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Committee Continues Work on Entrepreneurship Bills

On May 6, the House Small Business Committee held a hearing, “Legislation to Reauthorize and Modernize SBA’s Entrepreneurial Development Programs,” which examined several measures, including the Women’s Business Centers Improvements Act (H.R. 1838). TheHouse Small Business Rural Development, Entrepreneurship and Trade Subcommittee held a similar hearing on April 2 (see The Source, 4/3/09), and approved H.R. 1838 on April 30 (see The Source, 5/1/09).

Connie Evans, president and chief executive officer of the Association for Enterprise Opportunity (AEO), explained why federal investment in the Small Business Administration’s (SBA) microloan and entrepreneurship development programs is critical to women- and minority-owned businesses: “First, the International Labor Organization estimates that the return on investment in microenterprise development (through programs such as PRIME [Program for Investment in Microenterpreneurs] and the Women’s Business Centers) ranges from $2.06 to $2.72 for every dollar invested. Second, the SBA microloan program as compared to other SBA lending programs reaches women, African American, Hispanic, and rural business owners in significantly greater percentages. For example, 48 percent of women are served by the SBA microloan program as compared to 18 percent by 7(a) [the most basic of the SBA loan programs that provides loans through participant lenders]. Third, these programs (WBCs [Women’s Business Centers] and microenterprise development) serve low-income clients at least 67 percent of the time. These facts demonstrate that investment in microenterprise is both cost-effective and market effective, serving the communities and entrepreneurs most in need.”

Speaking specifically about WBC’s, Ms. Evans said, “The country’s Women’s Business Centers…are hubs of activity in urban and rural communities. The WBCs provide a unique service to women entrepreneurs with critical business education and access to market and capital resources. These inputs lead to business retention while creating and retaining thousands of jobs per year. In these unprecedented times, the WBCs are an important economic development tool for many communities. It is the investment in Women’s Business Centers and microenterprise development that allow nonprofit organizations to weave together an important base for business development and job creation…The Women’s Business Centers serve a unique purpose. They are charged with providing access to capital, technical assistance in the form of financial literacy, business acumen, and market place awareness specifically, but not exclusively, to women entrepreneurs. The centers work with other SBA agencies to address the needs of their clients, partnering with SCORE [Service Corps of Retired Executives] to provide high-level business coaching and mentorship, and in parallel with the SBDCs [Small Business Development Centers] to ensure all members of the community have access to business plan development and assessment. AEO is in full support of H.R. 1838 and its intent to strengthen the Women’s Business Centers, providing additional support, and improving communication.”

“We are the SBA’s most diverse resource partner,” said W. Kenneth Yancey, Jr., chief executive officer of SCORE, a nonprofit association of working and retired business owners and executives that donate time and expertise to counsel small business owners. He continued, “SCORE includes 25 percent women and minority volunteers, achieving the goal set by us, the SBA, and the House Small Business Committee. The SCORE Board includes 50 percent women and minority directors. SCORE continues to focus on increasing our level of counselor diversity, which will assist us in our efforts to serve the increasing diversity of our client base.”

In describing SCORE’s outreach to women-owned businesses, Mr. Yancey said, “Last year, SCORE launched the Women’s Success Blog, the first blog from SCORE at the national level. Women SCORE experts offer their insights and advice on issues facing women entrepreneurs. The blog won the prestigious 2009 Interactive Media Award (IMA) for Outstanding Achievement with high marks for design, content, functionality, and usability…Almost half of SCORE clients are women. A key SCORE focus is helping women grow their business from a sole proprietor to an employer firm by hiring workers. Last year, SCORE launched a new web site for women at www.score.org/women. The web site provides interactive tools, mentoring, workshops, and articles that can help women entrepreneurs achieve their business dreams.” He added, “At the Eighth Annual eWomen Network International Conference and Business Expo in July 2008, 14 women SCORE volunteers provided counseling and advice in a round table setting to more than 200 attendees on a wide range of topics, including SBA-backed loans, time management, Internet marketing, and franchising. Based on our success in 2008, SCORE has been invited to fill a bigger role in the 2009 meeting scheduled for August 6-9.”

Margot Dorfman, chief executive officer of the U.S. Women’s Chamber of Commerce, said, “We support the continued efforts of this committee to assure the Women’s Business Centers become self-sustaining and serve socially and economically disadvantaged women. However, we caution that the funding model for the Women’s Business Centers makes them very vulnerable to corporate sponsorship that leverages our taxpayer-supported structures as a way to reach women with their marketing messages. We continue to believe that women business owners would be best served through folding Women’s Business Centers into SBDCs and simply establishing women’s outreach and support specialists. We applaud the emphasis you have placed on outcome-based performance measurements including job creation.”

Ms. Dorfman also explained the Chamber’s support for the provisions of H.R. 1838 relating to the National Women’s Business Council and offered suggestions for the bill, saying, “We applaud your specific requests for two studies from the National Women’s Business Council and suggest the focus of these studies be more specific. For example, the impact of the 2008-2009 financial markets crisis on women-owned businesses should include recommendations for how the SBA could be of greater assistance to women-owned firms during challenging economic times. And, the use of SBA’s programs by women-owned firms should include observations of comparative outcomes between programs. We strongly urge you to focus the activities of this council through your requirements for needed studies that will inform future actions by the Congress to support the growth and success of women-owned firms.”

Scott Hauge, first vice chair of the National Small Business Association, and Justin Brown, legislative associate of the National Legislative Service of the Veterans of Foreign Wars, also testified.

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