NEW YORK (AP) - The head of the U.S. Small Business Administration says she doesn't expect operations at the agency to be dramatically affected by automatic federal budget cuts scheduled to begin March 1.

Administrator Karen Mills says the SBA won't need to furlough employees because it already cut staffers through early retirements. She expects little impact on the amount of loans the SBA guarantees because demand for some types of loans is likely to decline.

Mills says many small businesses have already felt the impact of the budget cuts that are known as sequestration. She noted that contracts at the Pentagon, the agency that has the biggest federal contracting budget, were down sharply in December.

Mills, who plans to leave her post later this year, made her comments in a meeting with reporters.

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