09/11/08 Business Start-up Hurdles in Underserved Communities: Access to Venture Capital and Entrepreneurship Training Hearing
09/09/08 Opportunities and Challenges for Women Entrepreneurs on the 20th Anniversary of the Women's Business Ownership Act Roundtable
07/30/08 S.3362, A bill to reauthorize and improve the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs Markup
06/25/08 Examining Solutions to Cope with the Rise in Home Heating Oil Prices Hearing
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Press Room: Statements
February 24, 2000
Kerry Hearing Statement on the President's FY 2001 Budget Request for the SBA
Mr. KERRY. Good morning. Mr. Chairman, I thank you for holding such an ambitious markup. I think it is unfortunate that we will not be taking up the Community Development and Venture Capital Act today, but I am pleased that you have agreed to hold a separate markup on that bill May 16th.
Let me say a few words about each of the bills we will markup today. Overall, I agree with the program levels in the three-year reauthorization bill. Though I agreed to lower levels for the microloan program than the Administration requested, I believe it is important to expand the program so that it is available everywhere. I will be monitoring technical assistance usage, and reserve the right to revisit the issue before the three-year reauthorization period is up. Mr. Chairman, I think we both agree that the SBDC program funding formula must be corrected for FY 2001. This is an important program for all of our states and we want no confusion about its funding. I understand that the agency and the Association of Small Business Development Companies are working on acceptable bill language and it is my hope than we can include it in the manager's amendment when this bill goes to the floor.
As I said last month during our hearing on SBA's budget, I believe the program levels are realistic and appropriate based on the growing demand for the programs and the prosperity of the country. I also think they are adequate should the economy slow down and lenders have less cash to invest. Consistent with SBA's mission, in good times or bad, we need to make sure that small businesses have access to credit and capital so that our economy benefits from the services, products and jobs they provide. We don't want good ideas dying in the parking lot of banks. We also want a safety net when our states are hit hard by a natural disaster. There are many members of this Committee, and their constituents, who know all too well the value of disaster loans after floods, fires and tornadoes.
Switching to reauthorization of the SBIR program, I thank the Chairman, Senator Levin, Senators Burns, Enzi and Snowe, for their months of hard work on this bill. We were all committed to increasing nationwide participation in the program, though we had different ideas about how to go about doing it. I am relieved that we preserved the strength of this program -- making awards based on merit -- and that we will test the effectiveness of volunteer mentoring and outreach through coordinated efforts in the states. While I understand why we made mentoring a component of Senator Bond's outreach program, called the FAST program, I have some concerns about mentoring getting lost in the states' initiatives. I ask that the SBA, the program managers of participating SBIR agencies and FAST entities promote this cost-effective tool. Let SBIR companies know that mentoring is voluntary and that they would be reimbursed for relevant out-of-pocket expenses. It gives them another stake in this program. And, SBA and SBIR agencies should let prospective or struggling SBIR companies know that veteran SBIR companies are out there to help them understand the world of federal procurement.
Before moving on, I want to mention the Administration's proposal for Phase III matching grants to help SBIR companies attract venture capital. We all agree that such companies need venture capital. Though we did not have time to fully consider this proposal in time for this markup, I appreciate the Chairman's willingness to work on the proposal so that an agreement can be reached in time to pass it as an amendment with this bill when it comes to the Senate floor.
A few quick words about the 504 bill we are passing. The changes are uncontroversial and make common sense. I am particularly glad that it includes a provision to give women-owned businesses access to the higher debentures. I introduced it in 1998, and it passed this Committee and the full Senate by unanimous consent. I hope the CDCs will make good use of it. I thank the Chairman for moving 504 as a separate bill, and I support Senator Wellstone's amendment to authorize spending levels for this program, making it a complete package. Better to act now on a bill that already has the House's blessing than to wait for the comprehensive reauthorization bill to make its way to the President's desk. Taking this action now will enable the CDCs to plan for the year ahead.
Title II of this bill incorporates an improved version of S. 1111, the Chairman's "National Conference on Small Business Act" and renames it the "Quadrennial Small Business Summit." I congratulate the Chairman for taking the lead on this important issue. It is helpful to Congress and the President to hear from small businesses about their concerns. I am pleased that we have been able to work together to incorporate comments that were expressed during a Committee forum on this topic last year. Those who participated in the forum agreed that these changes should be made to strengthen the bill, and I believe they do.
Title III of this bill is the Chairman's "Small Business Advocacy Review Panel Technical Amendments Act of 2000. I was a cosponsor of this legislation, and it has been approved by our Committee, and passed the Senate last year by unanimous consent. It is my hope that this important piece of legislation would become law, as it is critical that we closely examine the effects of government legislation on small firms.
Title IV incorporates the Chairman's "Independent Office of Advocacy Act," which I also cosponsored. This legislation passed the Senate by unanimous consent last year as well. This Committee has been an ardent supporter of the Office of Advocacy, and I am glad to be part of the bipartisan effort to ensure that this office has the staff and funding to continue to do an outstanding job as our Nation's advocate for small businesses. This year, I asked the Appropriations Committee to provide a separate account for this office and fund it at $9.4 million dollars, of which $2.5 million would be earmarked for economic research. It is my hope that our colleagues on the House side would see to it that this bill becomes law, and I have full faith and confidence that they will. I know they are supporters of this office as well.
The Historically Underutilized Business Zone, or "HUBZone" program, which passed this Committee in 1997, has tremendous potential to create economic prosperity and development in those areas of our Nation that have not seen great rewards, even in this time of unprecedented economic health and stability. This program is similar to my New Markets legislation in that it creates an incentive to hire from, and perform work in, areas of this country, that need assistance the most. This bill would authorize the HUBZone program at $7.5 million for the next 3 years, which is $2.5 million over the Administration's request.
I am glad that this bill seeks to include those areas which were inadvertently missed when this legislation was crafted - namely, Indian tribal lands. It is my understanding that our staff is currently working with the Committee on Indian Affairs in order to create HUBZone opportunities in the state of Alaska and in other Indian tribal lands. It is my hope that we can get all of the remaining HUBZone issues worked out to be included in a manager's amendment when the bill is considered on the Senate floor.
Lastly, we don't want to forget microloans. We have heard from intermediaries and economic development activists around the country that with some administrative and legislative changes, this program could have a greater impact. This bill takes some important steps in the right direction. Right now we have 140 microlending intermediaries. This bill will permit the program to grow to 250 in FY 2001; to 300 in FY 2002, and to 350 in FY 2003. It also increases loan levels and technical assistance levels over three years. With more technical assistance, we will be able to increase the number of intermediaries, and therefore reach more borrowers in rural areas or large states. It also makes sense to raise the cap on microloans from $25,000 to $35,000, making it adequate to help micro-entrepreneurs in states and urban areas where operating costs are more expensive. I understand that Senator Snowe may have an amendment to authorize $1 million for peer-to-peer training for microlenders. I strongly support this concept and her amendment. It will help the program grow while maintaining its high quality and low loss rates.
All or our states benefit from the success and abundance of small businesses. This bill makes their jobs a little easier. Thank you, Mr. Chairman for holding this hearing today.