STATEMENT
of the
Honorable Nydia Velázquez, Chair
Committee on Small Business
Hearing on Legislative Proposals on Energy, Veterans Entrepreneurship, and the SBA's
Entrepreneurial Development Programs
Wednesday, May 16, 2007

I am very pleased to call to order this morning’s hearing on proposals to reauthorize SBA’s Entrepreneurial Development Programs. 

Over 400,000 new businesses are created each month during an average year.  As Americans pursue self employment, most find it both a challenge, as well as a rewarding adventure.  Time and time again, entrepreneurs have found that strong, sustainable enterprises result from steady commitment to developing a well-formulated business plan.  The plans that are most likely to succeed are those that detail long-term strategies to obtain affordable capital, manage operational processes, and address human resource issues.

As part of its mandate to ensure small business owners can be competitive in the marketplace, the SBA administers a portfolio of entrepreneurial development programs.  These include Small Business Development Centers, Women’s Business Centers, SCORE, Native American and Veterans Business Outreach programs.  All of these initiatives support business development by providing counseling, technical assistance, research, and mentorship to entrepreneurs throughout the country. 

These programs have a proven track record of success. In fact, the  businesses that utilize these initiatives are twice as likely to succeed. 

Over the past few years, as more and more Americans have decided to make their dreams of business ownership a reality, we have seen an increased demand for these services.  Yet, despite the increasing need for entrepreneurial development initiatives, these programs have not been modernized in the past 6 years. 

Today’s hearing will provide us with an opportunity to examine 5 proposals that aim to enhance these programs.   The modifications would establish new initiatives and improve program operations to effectively fulfill the needs of small businesses.  Most importantly, the proposals enable SBA programs to assist the next generation of entrepreneurs. By tailoring proposals to the current economic demands facing small businesses – and the emerging sectors of entrepreneurs – these initiatives will promote business development in communities nationwide.

The face of small business is changing today.  Over the past two decades, women owned businesses have increased at twice the rate of all firms.  We are also seeing more minority entrepreneurs – in 2002, they owned 18 percent of all small firms. 

Veterans represent 14 percent of small business owners, and that number only continues to grow as more return from Iraq and Afghanistan. 

A key component to ensuring SBA’s entrepreneurial development programs are effectively assisting entrepreneurs is not only making sure the needs of these growing sectors are being met – but also that changing economic conditions are being accounted for. 

Today, entrepreneurs are being hit with a whole new set of challenges – different from the ones many struggled with even a decade ago.  To address these challenges, the proposals before us today create new sub programs within the SBDC program to help entrepreneurs deal with healthcare, energy, tax and regulatory costs. 

We are also expanding the number of veterans business centers, and restructuring the Women’s Business Centers to open additional spaces.  Part of the proposal also includes launching a new initiative to help senior citizens who are interested in becoming a small business owner to get those ventures off the ground.

The proposals 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 their specific challenges. 

This process to modernize SBA’s entrepreneurial development programs has evolved from lessons learned.  They will be revisited as we continue to look for ways to strengthen the entrepreneurial sector.   

To support business ownership in the 21st century, it is critical that we build upon an already strong foundation.  Making these changes is a first step toward ensuring our small business owners have what they need to keep this economy strong for generations to come.

I now recognize Ranking Member Chabot for his opening statement.