NEWS: Democrats Highlight Success of SBA’s Entrepreneurial Development Programs
Warn Against Budget Cuts
At a hearing today before the Committee on Small Business Subcommittee on Contracting and Workforce, Democrats stressed the importance of the Small Business Administration’s (SBA) Entrepreneurial Development (ED) Programs and warned against budget cuts that would undermine the initiatives’ effectiveness.
ED programs exist to support entrepreneurs by providing the necessary tools to effectively start a small business. With a range of counseling services and technical assistance, ED initiatives specifically target small business owners from a variety of backgrounds such as veterans and women. The programs reach Americans all across the country with hundreds of locations spanning all fifty states, Guam, Puerto Rico, American Samoa, and the US Virgin Islands.
Despite bipartisan support and a history of success, the Trump Administration has proposed a five percent decrease in funding for the SBA, which could potentially hamper these already underfunded programs.
“Cutting support for entrepreneurial development programs is counterintuitive. It would stifle innovation and job creation – slowing economic growth and shrinking revenue that would help reduce our deficit,” said Ranking Member Stephanie Murphy (FL-07). “These programs have a proven track record of creating jobs and growing small businesses throughout America.”
The SBA’s Entrepreneurial Development programs have a proven return on investment. In a single year, these programs helped to create 73,000 new jobs contributing $7.2 billion to the U.S. economy. Additionally, there is a nearly three dollar return to the U.S. Treasury for every dollar put into Small Business Development Centers, the most popular form of Entrepreneurial Development programs..
“The SBA’s ED programs help small businesses navigate tough obstacles so they can grow and thrive. Whether it is creating a business plan, advice for navigating the procurement process, help marketing a new product, assistance with international trade or any other myriad topics, these resources are key to the survival of countless entrepreneurs and small businesses,” said Congresswoman Murphy.
The hearing focused on four specific SBA programs; Small Business Development Centers (SBDC), Service Corps of Retired Executives (SCORE) mentorship program, Women’s Business Centers (WBCs), and Veteran’s Business Outreach Centers (VBOC). All of the listed programs are dedicated to providing assistance to traditionally underrepresented groups in the business sector.
In just one year, SBDCs have helped 13,400 entrepreneurs launch new businesses, provided training sessions for over 260,000 attendees, advised 192,000 clients, and helped clients obtain $4.6 billion in financing for their businesses. Furthermore, the SCORE program enlists volunteers to help with in-person and online mentioning services, and includes over 11,000 professionals at over 320 chapters nationwide.
“Even though we’re seeing more women entrepreneurs, there are significant gaps between men and women-owned businesses. As more women turn to entrepreneurship as a career path, it is critical this initiative remain in place to close these gaps,” said Murphy on the importance of WBCs. In 2015, over 100 WBCs assisted in helping to form 700 new businesses and reached 130,000 clients.
“Just as small business is the backbone of the economy, veterans are the foundation of America. Thus, providing veterans with every small business resource and opportunity is not only integral to our economy, but also vital to our country,” said Joseph Sharpe, Director of the National Veterans Employment & Education Commission of The American Legion. Mr. Sharpe called for an increase in funding for VBOC programs, “The American Legion believes that if the VBOCs were funded to the maximum capacity or were juggling less number of states within their region, they would be able to meet the veteran entrepreneurial demand for services.”
“With all of these programs, it is vital that taxpayer resources are being used wisely – with maximum effect. That is why this Committee has long pushed for clearer metrics and accountability, especially among many of the newer, pilot programs being formulated at SBA,” noted Congresswoman Murphy.
During the hearing, Democrats made clear their intention to push back against potential cuts and press for additional resources for entrepreneurial development programs.