The Small Business Administration's venture capital program provided more than $2 billion in financing to 1,331 small businesses in fiscal 2010.

That's a 10 percent increase for Small Business Investment Companies, compared with the previous year. SBICs are privately owned and managed venture capital firms that are licensed by the SBA. They raise their own money but also leverage financing provided by the SBA. They invest in small businesses, filling gaps for smaller VC investments, and in industries and geographic areas often neglected by other venture capital firms.

They've hit some home runs over their 52-year history: Federal Express, Outback Steakhouse and Callaway Golf received SBIC investments in their early years.

But SBICs also struck out a lot, especially when the tech bubble burst. Large losses to the federal government from SBIC equity investments led the SBA to begin winding down one SBIC program, participating security investments, in 2004. As a result, these equity investments have been dropping dramatically every year.

Now, however, the other part of the SBIC program - debentures, or long-term loans to small businesses - is beginning to take off. This program provided a record $1.6 billion in financing to small businesses in fiscal 2010. That's up 23 percent from fiscal 2009.

For more information, see www.sba.gov.

Wells Fargo leading lender in SBA program

Wells Fargo was the nation's top lender in the Small Business Administration's flagship 7(a) program in fiscal 2010, making more than $805 million of these government-guaranteed loans.

That was twice as much as No. 2, JPMorgan Chase, which made $400 million in 7(a) loans. JPMorgan Chase, however, beat Wells Fargo in the number of 7(a) loans it made: 3,084 to Wells Fargo's 2,275.

The No. 3 SBA lender, Live Oak Bancshares, made only 338 7(a) loans, but they totaled $344 million, an average of more than $1 million per loan.

Other lenders on SBA's top 10 list for 7(a) loans were U.S. Bank, Compass Bancshares, Huntington Bancshares, Excel National Bank, First Financial Banc, Wilshire Bancorp and Central Bancorp.

For more information, see www.sba.gov.

Feds file antitrust suit vs. Michigan Blue Cross

The Justice Department filed an antitrust lawsuit against Blue Cross Blue Shield of Michigan, alleging its agreements with hospitals lead to higher prices for health-care services and prevent other insurers from entering the market.

Small-business groups have long complained that Blue Cross plans dominate the small-group market in many states, leading to few choices when it comes to health insurance coverage.

The lawsuit challenges Blue Cross Blue Shield of Michigan's contractual clauses with 70 of the state's 131 general acute-care hospitals, which essentially guarantee that no other plan can obtain a better rate for their services.

These clauses cause hospitals to increase their prices for other insurers, the lawsuit alleges.

The intent is to "reduce competition for the sale of health insurance," said Christine Varney, assistant attorney general for the Justice Department's antitrust division.

"American consumers deserve affordable health care at competitive prices, and the antitrust division will vigorously pursue anticompetitive actions that stand in the way of achieving that goal."

A spokesman for Blue Cross Blue Shield of Michigan said the lawsuit was "without merit."

"We will vigorously defend our ability to negotiate the deepest possible discounts for our members and customers with Michigan hospitals," said Andrew Hetzel, the insurer's vice president for corporate communications.

See www.justice.gov.

Kent Hoover is Washington bureau chief for American City Business Journals.