On May 16, the House Small Business Committee held a hearing on proposals to reauthorize the Small Business Administration’s (SBA) entrepreneurial development programs. The hearing focused on the Women’s Business Centers program, Native American- and veteran-owned small businesses, and energy efficient small businesses.
Chair Nydia Velázquez (D-NY) said, “As part of its mandate to ensure small business owners operate competitive enterprises in the marketplace, the SBA administers a portfolio of entrepreneurial development programs. These include Small Business Development Centers, Women’s Business Centers, SCORE [Service Corps of Retired Executives], Native American and Veterans Business Outreach programs, as well as the Women’s Business Council. They support business development by providing counseling, technical assistance, research, and mentorship to entrepreneurs throughout the country.” Rep. Velázquez added, “A key aspect of the programs’ modernization is to ensure they reflect the fact that a greater portion of the population operates small businesses. There has been an explosion of women entrepreneurs, as their growth has increased at twice the rate of their counterparts…[T]he bills before us today provide SBA’s entrepreneurial development programs with the capacity to develop training, technology, and informational resources to ensure small businesses can address the specific issues they face in domestic as well as global markets.”
Ranking Member Steve Chabot (R-OH) said, “The SBA’s Entrepreneurial Development programs can play an important role in helping small business owners succeed. These programs range from narrowly targeted programs to very broad programs that take advantage of the resources of America’s higher education system and retired business executives. The programs that we’ll be considering today SCORE, Small Business Development Centers, and Women’s Business Centers have not been reviewed by this committee since 2003. It is important to ensure that these programs are doing what they are intended to do: help small businessmen and women.”
Wilma Goldstein, acting associate administrator for the Office of Entrepreneurial Development at the Small Business Administration, stated: “Women’s Business Centers [WBCs]…provide long-term, in-depth training and counseling to their clients, as well as target socially- and economically-disadvantaged women. The centers are usually located in the heart of the communities that they serve, often on public transportation routes. They offer classes at convenient hours, such as weekends and evenings, because their clients often have to balance other responsibilities both at work and at home. Some centers also provide child care services.”
Ms. Goldstein went on to discuss the sustainability of the WBCs, saying, “The WBC program is designed for the Centers to be self-sustaining after an initial SBA assistance period. The Administration recognizes the contributions of WBCs, particularly those targeting underserved groups, but we remain opposed to open-ended funding…The original purpose of the WBC program was to develop and expand the WBC network by supporting WBCs for up to five years while they gradually increased their matching funds requirement and created a fundraising network to achieve self-sufficiency. The agency believes the program will be most effective if it continues to serve as a program that provides seed capital to non-profit organizations increasing their ability to serve the small business community and expanding our reach into new, underserved communities.” She added, “The Women’s Business Centers can best meet the goal of self-sufficiency by making sure they are strategically located and equipped to train and counsel potential clients in each of the fifty states and all of the U.S. territories. Self-sufficiency will lead to more new centers, which will offer the greatest number of opportunities to the greatest number of potential clients.”
Barbara Wrigley, executive director of the Women’s Business Center of Northern Virginia, said, “The Women’s Business Centers program has been an important part of the SBA’s entrepreneurial development assistance efforts since its establishment in 1989, after the passage of the Women’s Business Ownership Act of 1988 [P.L. 100-533]. The program has grown from four ‘demonstration sites’ in its first year to 99 SBA-funded [WBCs] in FY2007, with an additional 11 Centers currently operating outside the formal program.”
Ms. Wrigley shared with the committee three areas of concern regarding the WBC program: “Women’s business centers are past the point of ‘demonstration’ and should be evaluated and funded on an ongoing basis on par with other SBA business assistance programs”; “funding allocations between new and existing centers should recognize the value of the longitudinal approach WBCs take to client service, and should not vary from year to year”; and “program grant disbursements should be made in a timely manner to ensure that client services are not interrupted.” In bolstering her points, Ms. Wrigley said, “Between 2001 and 2003 alone, the number of women entrepreneurs served nearly doubled (a 91 percent increase) and the number of new firms created by WBCs increased by 376 percent. Program-wide, the number of clients served has increased from 106,000 in 2003, to 144,000 in 2006: a 36 percent increase. In 2003 alone, the WBCs generated $407 million in gross receipts, helped launch 3,578 new businesses, and fueled the created of 6,493 new jobs…Studies of microenterprise programs, in general, including WBCs, have shown that two dollars in value to society is returned for every dollar invested over a one- to five-year period. Funding for the Women’s Business Centers is thus an investment in the country’s small business economy.”
C. Edward Rowe, associate administrator for Congressional Legislative Affairs at the Small Business Administration; Gregory Higgins, Jr., state director of the Pennsylvania Small Business Development Centers at the Wharton School of the University of Pennsylvania; David John, former Navajo Nation tribal council representative; and Scott Sklar, president of the Stella Group, Ltd., also testified.
