AUBURN – Eager to hear how federal efforts to revive the flagging economy are being received on the ground, Maine Republican Sen. Olympia Snowe gathered with local business and banking leaders at an informal roundtable at Auburn City Hall on Friday.

Snowe said she wanted to hear how effectively stimulus money was being distributed and how easily small businesses are able to access loans.

“I don’t believe Congress has truly recognized the value of small businesses in our overall national economy,” said Snowe, who serves as the top Republican on the Senate Small Business and Entrepreneurship Committee. “It’s small businesses that are on the front lines day in and day out, and they are creating all of the new jobs in our economy now.”

Diane McManus of Camden National Bank in Lewiston said she is seeing how critical the Small Business Association has been in the banking community.

“With the SBA reducing their fees, I’m seeing a lot more activity utilizing SBA programs because all of a sudden it is affordable,” she said.

The SBA is charged with protecting the interests of small business by guaranteeing loans and providing additional assistance to businesses recovering from natural disasters. Snowe said she successfully worked to increase the percentage of loans the SBA would guarantee and temporarily suspend some of the normal fees associated with enrolling in SBA programs during negotiations for the massive federal stimulus package passed in February.

McManus said her bank has maintained its usual lending practices, even while large banks have tightened theirs.

“We’re not declining deals because of the economy, the deal has to make sense,” she said.

Ford Reiche, president of Safe Handling in Auburn, told Snowe his company has spent more than $100,000 on lawyers and consultants to help them navigate the federal stimulus package.

“We’re in good shape, I have no complaints about the process; it’s just very complicated,” he said, noting that Safe Handling will be able to take advantage of certain tax credits as a result. “It’s a gamble we’ve never taken before, and I’m not sure everyone could do that or would take that risk. But I also feel like others that are more politically savvy are way ahead of us.”

Other business leaders used the nearly two-hour-long session to air a grab bag of concerns to Snowe.

Peter Geiger of Geiger in Lewiston said he has been frustrated by federal legislation being filed based on “knee-jerk” reactions to political pressure.

“If I am selling an order of pens to the Montello school, it can’t be done because the pen has lead in it; if I sell it to the (Parent Teacher Organization), it’s to adults, so it’s OK,” he said of legislation concerning product safety born out of controversy surrounding imported toys. “It’s all well-intentioned, but it’s a knee-jerk reaction. No one has died from eating the end of a ball-point pen.”

Kathie Leonard of Auburn Manufacturing Inc. said she feels like the federal government has abandoned American manufacturers.

“We have been left for roadkill,” she said. “I’m not asking for a handout, but helping people after they are laid off is too late. I’m trying to grow.”

Maurice Dube, Maine’s SBA district director, said he will follow up on the issues discussed.

Snowe said she would also relay the local concerns to Karen Gordon Mills, the newly appointed SBA administrator.