The administration’s Certified Development Company (504) lending program traditionally provides long-term, fixed-rate financing for assets like real estate, heavy machinery or other improvements. But as of last Wednesday, it now permanently allows small business owners to refinance such debt, as long as it is used for expansion purposes.

“This is one more piece of the Recovery Act that is going to have a direct impact and put more money in the hands of small business owners just when they need it most,” said Karen Gordon Mills, head of the Small Business Administration, in a statement.

But the timing of such changes is a bit off, according to experts and analysts of 504 lending programs. They say that few businesses can currently afford to expand, to leave such good intentions unused.

According to Scott Shane, professor of entrepreneurial studies at Case Western Reserve University, few small business owners may also feel up to the task. In May 2009, just 5 percent of business owners felt that the following three months would be “a good time to expand.”

This is a drop of 11 percent from nearly two years ago, according to data Shane cumulated from the National Federation of Independent Business. And while positive feelings unexpectedly spiked last September, overall trends speak volumes about the confidence level of such business owners.

“Small business owners’ views of the expansion-potential of the economy may have turned the corner, but we have a long way to go to get back to the point where a lot of small business owners think it’s a good time to expand,” Shane wrote Monday for the New York Times.

As president of Mercantile Capital Corporation – a conventional, for-profit 504 lender – Christopher Hern suggests fully lifting any restriction on refinancing, to really stimulate small business lending. Bob Coleman, publisher of Small Business Administration newsletter Coleman Report, agrees.

“This is another program stymied by too much regulation and will not deliver the intended stimulus desired by Congress and the Administration,” he commented to the New York Times.

Small business owners – will you take advantage of the new 504 lending program anytime soon? Why or why not?

What Snowe wants most is a Small Business Administration (SBA) seat back in the Cabinet – one that President George W. Bush did not elect, and one she and others have sorely missed. Furthermore, elevating the agency’s incoming administrator, she said, “will send a clear signal that small business will drive our nation out of this recession,” as she wrote in a letter addressed to Obama.

At the same time, Snowe has been pushing legislation in hopes of providing more immediate relief. Along with lost lending activity, her ten-step Main Street Economic Recovery Act seeks to recover Small Business Administration funding that has suffered great losses. Over the past eight years, the administration’s budget shrunk by 27 percent – the largest cut of any federal agency.

“When you consider that the SBA budget represents only about 2/100ths of a percent of the total federal budget – yet at the same time small businesses are creating about three-fourths of all new jobs – there is no question that adequately funding the Agency’s small business programs is an investment in America’s economic future,” she said to BusinessWeek.

Traditionally the Small Business Administration’s most popular loan program, 7(a), aims to be “as broad as possible” for start-ups and existing small businesses, according to its official Web site. But over the past year, lending through that program has dropped by 55 percent, as 75 percent of banks reported to the Federal Reserve that they tightened their lending practices.

To stimulate lending activity again, Snowe’s act aims to make Small Business Administration’s loaning processes more efficient. Among other actions, she wants to offer training programs for new lenders, temporarily reduce lending fees by $510 million, and increase the maximum financing that can be secured through one loan – from $2 million to $3 million, according to a press release.

And, with the credit crunch in mind, Snowe also wants to allow borrowers to refinance their 7(a) loans if more favorable terms from another lender are available. Lately, as the Wall Street Journal reported last month, banks and lenders have not been able to re-sell Small Business Administration loans, as their costs have been rising too high to appeal to buyers.

“During these challenging economic times, it is imperative that the SBA … is part of every conversation President-elect Obama has about restoring confidence in the economy,” she said in a statement.