[House Hearing, 106 Congress] [From the U.S. Government Publishing Office] WOMEN IN BUSINESS ======================================================================= HEARING BEFORE THE SUBCOMMITTEE ON GOVERNMENT PROGRAMS AND OVERSIGHT OF THE COMMITTEE ON SMALL BUSINESS HOUSE OF REPRESENTATIVES ONE HUNDRED SIXTH CONGRESS SECOND SESSION __________ WASHINGTON, DC __________ JUNE 8, 2000 __________ Serial No. 106-62 __________ Printed for the use of the Committee on Small Business U.S. GOVERNMENT PRINTING OFFICE 66-167 WASHINGTON : 2000 COMMITTEE ON SMALL BUSINESS JAMES M. TALENT, Missouri, Chairman LARRY COMBEST, Texas NYDIA M. VELAZQUEZ, New York JOEL HEFLEY, Colorado JUANITA MILLENDER-McDONALD, DONALD A. MANZULLO, Illinois California ROSCOE G. BARTLETT, Maryland DANNY K. DAVIS, Illinois FRANK A. LoBIONDO, New Jersey CAROLYN McCARTHY, New York SUE W. KELLY, New York BILL PASCRELL, New Jersey STEVEN J. CHABOT, Ohio RUBEN HINOJOSA, Texas PHIL ENGLISH, Pennsylvania DONNA M. CHRISTIAN-CHRISTENSEN, DAVID M. McINTOSH, Indiana Virgin Islands RICK HILL, Montana ROBERT A. BRADY, Pennsylvania JOSEPH R. PITTS, Pennsylvania TOM UDALL, New Mexico JOHN E. SWEENEY, New York DENNIS MOORE, Kansas PATRICK J. TOOMEY, Pennsylvania STEPHANIE TUBBS JONES, Ohio JIM DeMINT, South Carolina CHARLES A. GONZALEZ, Texas EDWARD PEASE, Indiana DAVID D. PHELPS, Illinois JOHN THUNE, South Dakota GRACE F. NAPOLITANO, California MARY BONO, California BRIAN BAIRD, Washington MARK UDALL, Colorado SHELLEY BERKLEY, Nevada Harry Katrichis, Chief Counsel Michael Day, Minority Staff Director ------ SUBCOMMITTEE ON GOVERNMENT PROGRAMS AND OVERSIGHT ROSCOE G. BARTLETT, Maryland, Chairman MARY BONO, California DANNY K. DAVIS, Illinois PATRICK J. TOOMEY, Pennsylvania RUBEN HINOJOSA, Texas RICK HILL, Montana CHARLES A. GONZALEZ, Texas Nelson Crowther, Counsel C O N T E N T S ---------- WITNESSES Page Hearing held on June 8, 2000..................................... 1 Henderson, Laura, President, Prospect Associates............. 3 Parker, Suzane W., President & CEO, Ward Global Enterprises.. 6 Keenan, Linda M., Director of Association Marketing, Lucent Technologies............................................... 10 Neese, S. Terry, CEO & Founder, Terry Neese Personnel Services................................................... 12 Wirth, Diane M., Representative, Women's Business Institute.. 15 Mayer, Glen, United Parcel Service........................... 17 APPENDIX Opening statements: Bartlett, Hon. Roscoe G...................................... 32 Prepared statements: Henderson, Laura............................................. 34 Parker, Suzane W............................................. 40 Keenan, Linda M.............................................. 46 Neese, S. Terry.............................................. 53 Wirth, Diane M............................................... 57 Mayer, Glen.................................................. 63 FOCUS ON WOMEN'S BUSINESS ENTERPRISES ---------- THURSDAY, JUNE 8, 2000 House of Representatives, Subcommittee on Government Programs and Oversight, Committee on Small Business, Washington, DC. The Subcommittee met, pursuant to call, at 10:40 a.m., in Room 2360, Rayburn House Office Building, Hon. Roscoe G. Bartlett (chairman of the Subcommittee) presiding. Chairman Bartlett. Our subcommittee will be in order. Would the witnesses please take their seats at the table. Good morning and welcome to this hearing of the Subcommittee on the Government Programs and Oversight of the Committee on Small Business. A special welcome to those who have come some distance to participate and to attend this meeting. On October 8, 1997 and March 25 in 1999, the Subcommittee on Government Programs and Oversight held hearings to showcase women's business enterprises on a national level and to examine issues of concern to women entrepreneurs such as the availability of capital. These were the first hearings in almost a decade devoted to women in business. Why this commitment to help women start new businesses or grow existing enterprises? Because it is the right thing to do, and because women entrepreneurs are a key dynamic in this Nation's present prosperity. The following statistics which are from the Small Business Administration, speak for themselves: The number of women-owned businesses increased 89 percent over the last decade to an estimated 8.5 million. Second, women- owned businesses generated $3.1 trillion in revenue, an increase of 209 percent between 1987 and 1997. Third, more than 1.4 million women-owned businesses with employees generated $2.8 trillion in revenue. The number of women-owned businesses with employees grew 46 percent from 1987 to 1997. And fourth, revenue of women-owned businesses with employees grew 221 percent from 1987 to 1997. This hearing is a continuing commitment to spotlight the vital nature of women's business enterprises to the economy of this Nation as a whole and to the communities in which we live. This hearing provides, as did the previous ones, a forum for learning how the private sector is succeeding or failing to meet the needs of women in business and to focus attention on those deficiencies that may exist. The hearing also provides an opportunity for women business owners to express their views as to the effectiveness of Federal Government programs designed to help small business owners and those who aspire to go into business for themselves. Congress needs to know whether these programs are succeeding or failing. Lastly, this hearing provides a vantage point for identifying problems that women business owners encounter as the result of overregulation and burdensome government paperwork. Is the Federal Government a friend or a foe? In recent years Congress has increasingly supported legislation aimed at helping women start and grow businesses. The Committee on Small Business has supported the National Women's Business Council, Women's Business Centers, and the Microloan Program. Proposed changes in the 7(a) loan program will help make loans more readily available to women entrepreneurs. It is hoped in the near future that the SBA will be totally out of the business of approving loan applications. This is the case, presently, with respect to more than half of the dollar amount of loans presently being made. The hometown banker will be the decision-maker, not some bureaucrat in a remote location who does not know the lender. [Mr. Bartlett's statement may be found in appendix.] Chairman Bartlett. Again, good morning and welcome to this hearing of the Subcommittee on Government Programs and Oversight of the Committee on Small Business. Thank you very much for coming to the hearing. Let me now introduce our witnesses. Ms. Laura Henderson, President and CEO, Prospect Associates. She is a member of the National Women's Business Council. Ms. Suzane Ward Parker, President and CEO Ward Global Enterprises, board member, National Black Chamber of Commerce. Ms. Linda Keenan, director of association marketing, Lucent Technologies. Ms. Terry Neese, President and CEO, Terry Neese Personnel Services, Incorporated, cofounder, Grassroots Impact Incorporated. Ms. Diane Wirth, President, The Solution Works, Incorporated, board secretary, Women's Business Institute. Mr. Glen Mayer, corporate supplier, diversity coordinator, United Parcel Service. Thank you all very much for being here at the hearing, and we will begin with the testimony. Oh, Danny Davis has joined us. Mr. Davis, thank you very much for joining us and any comments you would like to make before our witnesses testify? Mr. Davis. Well, thank you very much, Mr. Chairman, and let me thank you for calling this hearing. I think it is a very important one and especially one that we need to pay a great deal of attention to. Women entrepreneurs are an increasingly significant part of the United States economy. Women, of course, own more than 8 million businesses that account for approximately one third of all U.S. businesses and are starting businesses at twice the rate of men. Surrounding by these stirring statistics, it is the fact that women still encounter numerous obstacles trying to start, maintain or expand the business; obstacles which must be eliminated if we are ever to realize the full potential of this dynamic sector of our economy. Consequently, the programs offered by the Small Business Administration and women centers provide the healthy social and economic environment necessary to cultivate a fledgling business. In spite of all these programs and all of these efforts, and in spite of the fact that we have come a long way towards the development of creating a fair and equitable playing field, we realize that there is still some distance to go, so a hearing like this one should indeed help us along the way, and so I thank you, Mr. Chairman, and look forward to the discussion. Chairman Bartlett. Thank you for your remarks. I frequently tell audiences that women-owned small businesses are growing, as you indicate in your remarks, at twice the rate of male- owned small businesses. I remind the bankers they have a lower bankruptcy failure rate. I also note that they are better employers. Women are different than men. Our military has trouble figuring that out, but they are different. Women are more empathetic, they are more compassionate, and I am not surprised that they are better employers. For those same reasons,they are better corporate citizens. In spite of all these things, women still have many impediments in going into business, and we are focusing primarily on availability of capital and whether our government programs are helping to make capital more available to our women-owned small businesses. So we will begin with the testimony of Ms. Laura Henderson. STATEMENT OF LAURA HENDERSON, PRESIDENT AND CEO, PROSPECT ASSOCIATES, AND MEMBER, NATIONAL WOMEN'S BUSINESS COUNSEL Ms. Henderson. Good morning Mr. Chairman, Mr. Davis. Thank you for giving me the opportunity to testify today. I am testifying today in my role as an appointee to the National Women's Business Council, which is a bipartisan Federal panel that provides advice and counsel to the President and to Congress on matters of importance to women business owners. The Council has played a vital role in leading policy discussions, developing effective strategies which have been fundamental to the expansion and recognition of women business owners as an integral force in our economy. And I would like to submit, for the record, the 1998 annual report of the National Women's Business Council. Chairman Bartlett. Without objection, and let me say that all of your written testimony will be made a part of the record, so feel free to summarize it. It will all be a part of the permanent record. Thank you. Ms. Henderson. Thank you. The Council is being considered for reauthorization this year, and I believe you will agree with me that the work that the Council does is vital, and that we have done very much to create a solid infrastructure that has benefited one of the fastest growing segments of our economy. Twelve years ago in 1988, I testified before the House Committee on Small Business in a hearing to explore the barriers women business owners face and to identify actions that could be taken to enable women business owners to reach their potential and contributing to our economy. The subject of these hearings was the passage of legislation that took three very decisive actions that have had a very major impact on businesses run by women. The legislation established the National Women's Business Council, and established the Women's Business Development Center programs. Perhaps as important of any action taken in the history of women business ownership was the decision to direct the U.S. Census Bureau to expand the collection of business data to include the largest women-owned businesses, C corporation. The committee should take great pride in the accomplishments of the Council and of the other programs that resulted from this landmark legislation. The legislation truly changed the landscape for women business owners. When we came to the hearing in 1988, those of us who were women business owners knew that the data that existed did not reflect the reality of women business owners. At that time, the data said that women-owned businesses had revenues of less than $10,000 and had no employees. Today, the data that we have documents the potent economic force of women business owners. The Census Bureau data continues to serve as the basis for both public and private sector research initiatives, and the data that we have from The National Foundation for Women Business Owners tells us that, in 1999, there were 9.1 million women- owned businesses in the U.S., employing 27.5 million workers, and that means that one out of every four employees worked for a business owned and run by a woman, and these businesses are generating $3.6 trillion in sales. Even more impressive than the expansion is the change in employment and revenues of women-owned businesses. Between 1987 and 1999, employment in women-owned businesses is up 320 percent and revenues are up 436 percent. This means that not only are there more women-owned businesses, but those businesses are larger, more substantial. Chairman Bartlett. Excuse me, the bell simply means that we are now going back into session. They went out of session, they recessed briefly after taking a picture of the 106th Congress, and so they recessed the House briefly for reasons that I don't understand. But now they are back in session. Thanks. Ms. Henderson. And these businesses are providing increasingly more job creation and making a greater contribution to the economy. One of the studies that was done in the last couple of years that I found most interesting was to look at women-owned businesses owned by women of color, and we know that one out of eight women-owned businesses is owned by a woman of color, and in fact, women of color are the fastest growing segment of the women-owned businesses. The impact of this data cannot be overstated, not only in documenting the power of the women entrepreneurial movement, but in the significance of the research in developing effective strategies for removing barriers facing women-owned businesses. We see that this data has had a phenomenal impact on banks, financial institution's and policy-makers. The National Women's Business Council has contributed greatly to the base of knowledge on women business owners through its support of research, and one of the things I find best about the Council is that the Council's strategies and approaches have been based on research findings. So they are not merely just ideas, but they are the results of research that sets a solid foundation to the actions the Council takes. I would like to tell you of a few of the activities that the Council is doing. The first is in the area of Federal procurement. Over its life, the Council has focused on increasing women-owned businesses participation and Federal procurement. We have been concerned that this marketplace has been closed to women. We are concerned that the Federal agencies have not received the full benefit from the capabilities and talents of businesses owned by women; but we remain seriously concerned that in spite of many efforts by many people, women-owned businesses still receive only 2 percent of Federal prime contracts, about the same percentage that we have received over the past 5 years. If the 5 percent goals set by Congress were reached, women would be receiving contracts worth $10 billion, a $6 billion increase over what we are now receiving. I would like to discuss specific activities that the Council is sponsoring or endorsing. I would like to submit for the record, a Best Practices Guide on contracting with women, which emphasizes that the most effective tool for increasing procurement with women is the commitment at the top of agencies to do business with women. We are also commissioning a study of the characteristics of women-owned firms who have been successful in winning more than $5 million in government contracts. This study will identify the characteristics and the opportunities which have enabled these women-owned firms to be successful in this market, and these findings will serve as the basis for developing policy and programmatic recommendations to assist other women entrepreneurs in gaining access to this market. The Council also supports and urges the expansion of the DOD Mentor Protege Program to include women-owned businesses. One of the exciting activities that the Council has had in the procurement area is to assist in the development of a Web site, www.WomenBiz.gov, that willprovide a single point of entry to Internet information on doing business with the Federal Government, and will simplify access to information and contracting opportunities. Another area that the Council has been very involved in is that of access to credit. We have been watching women business owners' access to banking and have now moved actively into researching the next financial frontier for women business owners, access to the equity market. Women-led technology companies are the newest on the scene, and their access to investment capital will make the difference between success and failure. The Council has taken the lead in establishing initiatives to ensure access to the equity markets for women entrepreneurs. One of the initiatives is to create a Best Practice Guide on women's access to credit. The Council and the Milken Institute will issue a report this summer that identifies financial strategies that have been successful in increasing access to credit for women launching and growing their businesses, and which deserve replication. The Council is also hosting a series of very exciting venture capital forums around the country, showcasing women-led businesses before, private corporate, and venture capital investors. This series of forums is called Springboard2000. The first forum in Silicon Valley presented 26 companies that, as a result of their involvement in the forum, have raised $140 million in capital. A very exciting outcome. We are having these forums around the country, and I would like to invite all of you to the next forum, which will be held in Dulles, Virginia, at AOL's headquarters on July 11th and 12th. In addition, the Council has hosted, in 1996 and 1998, national economic summits to examine the critical issues facing women business owners and to develop a consensus agenda. Summit '98 resulted in the development of a Master Plan of Action, those serving to foster the growth and development of women-led businesses and the economy as a whole. One of the critical consensus issues from that summit is the need for development of women business owners as leaders and advisors on national, State, and local levels. The Council has made it a priority to work with women leaders in each of the 50 States to support their involvement in local decision-making. Women entrepreneurs have much expertise to offer in policy development, and we are assisting them in assuming their seat at the table. Further, we are focusing many of our programs on the local and regional basis. For example, Springboard2000. We believe that the success we have achieved focusing on a national agenda must be moved to a more local strategy. In conclusion, the Council has been extraordinarily effective in fulfilling its role as advisor to Congress and the President. Even more important, the Council has been active in defining what actions are imperative to ensure that our Nation will benefit from the full potential of the fast-growing, dynamic, vibrant part of our economy. The Council has accomplished an enormous amount, and women-owned businesses and our economy have benefited. The Council has been a catalyst for making our dreams come true. And I believe that the Council is fundamental in achieving our goals for the future. As a member of the Council, I know that none of these accomplishments would have been possible without the support of this Committee. I thank you for your support over the past 12 years and seek your support in the Council's reauthorization. Through this reauthorization, you support the growth and success of women who are starting, leading and growing over one third of our Nation's businesses. Thank you. Chairman Bartlett. Thank you very much. [Ms. Henderson's statement may be found in appendix.] Chairman Bartlett. And now the testimony of Suzane Ward Parker. STATEMENT OF SUZANE WARD PARKER, PRESIDENT AND CEO, WARD GLOBAL ENTERPRISES, AND BOARD MEMBER, NATIONAL BLACK CHAMBER OF COMMERCE Ms. Parker. Thank you. Chairman Bartlett, Ranking Minority Member Davis, committee members, thank you for allowing me, Suzane Ward Parker, President and CEO of Ward Global Enterprises, and a member of the board of directors of the National Black Chamber of Commerce, the opportunity to present to the committee on the issues of women business enterprises and the availability of capital. Let me first give you a little bit of background and explain that Ward Global Enterprises is a global company with two retail stores selling beauty supply products here in the United States in Washington D.C. And Peoria, Illinois. With the ultimate growth strategy of eventually franchising the operation nationwide, thereby offering opportunity to other African American entrepreneurs through the creation of jobs, purchasing of goods and services and providing community participation through scholarships and mentoring. Since our entry into this business, we have been able to provide scholarships for minority students in Illinois and have recently started a scholarship fund for the Howard University Business School. Additionally, our global reach extends to West Africa to the country of Ghana, where we have established an import business as distributors of hair care products for Soft Sheen International, a division of Loreal. Finally, the company will be launching a Web site within the next few weeks, CEOSISTER.COM, that is designed to offer women of color entrepreneurs information, networking and learning opportunities that will help enhance and promote their businesses. I welcome the opportunity to come before this distinguished panel to discuss my experience as an African American woman and entrepreneur, and to share with you the perspective of many other women of color who have had similar experiences. As you know, women have joined the entrepreneurial ranks at an astonishing rate, and you have heard some of the statistics already. And we are projected by 2005 to increase ownership by 77 percent and to generate close to $4 trillion in revenue. This is in spite of the fact that we have not had the same access and availability to capital and contracts as majority males. Businesses that should be up and running and mature are still at the starting gate because of this critical issue. I continually hear from minority women with fantastic ideas for businesses that, at the same time, relate tales of woe regarding inability to secure capital. These businesses range from technology, trucking, manufacturing, consulting services, wholesale trade, and the list goes on and on. These are very talented individuals, many who have held executive positions in our country's finest corporations and business schools; these are well-trained, experienced and technologically competent people but lacking one thing, capital. Let me first address the issue of capital. Obviously access to capital is a key ingredient to the success of every business. However, it is the case, the rare case, when a woman, and especially a minority woman, has been able to secure financing prior to opening a business. I have yet to meet one businesswoman, minority or majority, who has been able to secure initial financing for a business venture, therefore tremendous talent is wasted and delay experienced as a result of having to find nontraditional sources of funding, which can be expensive and risky. The greater loss here, however, is the contribution and impact that we know minority women entrepreneurs can make to a community and to the labor market through the creation of jobs andimprovement to economically challenged areas. In 1999, women business ownership increased 103 percent. The economic impact of those businesses resulted in an increase in employment of 320 percent, and a growth rate in sales of 436 percent. These are impressive figures, considering the rate of traditional funding for those businesses is not consistent with the rate of growth. Clearly, the disparity of funding and the impact of those decisions will have an immediate effect and long-term impact to our economy. Many women are discouraged from even considering loans due to a number of factors; one is fear of rejection. The reception one gets when approaching a bank is less than welcoming. The typical response from a bank officer is to hand you a stack of brochures and send you on your way. There is no attempt to set up a consultation with a bank official to help guide you through the process or answer questions. Unless you are persistent and a bit pushy, you will not be able to get in front of a decision-maker. The level of paperwork. Many women, after approaching a bank and then being told the loan must be SBA secured, are turned off by the ensuing lengthy process and the burdensome paperwork. Let me also add that there are banks that use the SBA loan guarantee as a way to discourage women from applying. Too often, the banks, without a full picture, will very quickly require the SBA guarantee before completely reviewing the applicant's file. The level of consideration and receptivity toward reviewing and writing the loan of a minority woman generally must be tied to the SBA. The banking industry appears to want no risk whatsoever as it relates to minority women. The end effect of those decisions is that it does lengthen the process and provides greater documentation burden on the business owner. Divorced women have the additional burden of having to not only account for themselves, but must also explain financial decisions that a former spouse may have made both positive and negative that now effect that financial standing. As a global entrepreneur, finding finance options to start up or enhance a foreign operation is next to impossible. With the exception of letters of credit, my experience of researching alternatives for manufacturing operations overseas have led to continued frustration and dead ends. The appetite of U.S. banks to consider financing of a non-U.S. venture is not there. One particularly frustrating experience I had occurred after attending a conference on business in Africa and listening to a bank representative express the bank's position and positive desire to accommodate those types of investments. Upon contacting the same individual, I was told that the bank would not even consider loans to that part of the world. He would not even, as a courtesy, look at my business plan. When I inquired why he held negative opinions, I discovered that these opinions indicated his level of knowledge of the region was outdated and out of touch. Unfortunately I found that attitude to be more the rule rather than the exception. However, these individuals are the decision-makers that make it difficult or impossible to obtain financing. The other area that needs critical examination is in the area of procurement and contracts. Measured in both the number and dollar value of Federal contracts, the participation of women business owners falls woefully short. Again, although women comprise almost 40 percent of small businesses, of which 12\1/2\ percent are minority women, we only receive 1.7 percent of Federal prime contract dollars and 3\1/2\ percent of subcontract dollars. Additionally, in 1999, the SBIC only awarded one percent of the venture capital program to women. Now as we sit here before Congress, I am very encouraged that this panel is asking the right questions regarding problems and issues. However, I am continually amazed that the issue of contract disparity continues to exist, especially given the approved governmental structure and funding designed to eradicate discrimination in the assignment of contracts with the government. The problem is even more acute with women of color. Ladies and gentlemen, there are qualified women and minorities available with the goods and the service, so I ask why can't we receive our fair share. As the United States is experiencing one of the greatest periods of business expansion, does it make sense that a significant percentage of the business world is being left out or granted less than their fair share of the total opportunity? What is needed for minority women entrepreneurs to be successful is equal access and fairness to financial institutions and government programs that have unfortunately had a history of discrimination. The American dream should not be so far out of reach as to be inaccessible, especially given the framework that is already there. To address these inequities and begin to see real progress, Congress needs to critically examine why the disparity in lending exists and put the appropriate measures in place to remedy the situation. Many of us would also welcome alternatives to traditional sources that take into consideration that we do not have the luxury of friends and family with financial resources to help us get started. Far too many of us without trust funds are forced to use our credit cards and mortgage everything to the hilt. It is a statistical fact that 60 percent of women-owned businesses utilize credit cards and finance companies to get started, which indicates that perhaps we are facing barriers in accessing traditional credit and clearly paying more for that credit. If the well-established banks are unwilling to lend to us, then we need venture capital firms as well as minority-owned banks, and institutions that will see our diversity and experience as an asset and give fair consideration for the unique challenges we face. The government could take the lead in this area by designating part of SBIC funds for exclusive use of women- and minority-owned businesses. Serious consideration also needs to be given toward reducing the paperwork required as well as expediting the process. There should be an option to electronically submit an SBA application and have the capability to query the status on- line as well. Too much time and resource is spent chasing the bank contact who will typically blame the delay or lack of information on the SBA. Finally, a proactive approach to access government contract information and bidding needs to be addressed. It is truly shameful as we discuss disparate treatment that the government procurement and contracts process has such a deficient report card. The level of contracts awarded to minority women and women in general must improve. As all women, and especially minority women, continue to pursue their own businesses and help strengthen our economy, create jobs and opportunity, it is incumbent upon our national leaders to help erase any and all barriers to not only their success, but our country's success. Again, thank you for the opportunity to address this distinguished panel. [Ms. Parker's statement may be found in appendix.] Chairman Bartlett. Thank you very much for your testimony, and now Ms. Linda Keenan. STATEMENT OF LINDA KEENAN, DIRECTOR, ASSOCIATION MARKETING, LUCENT TECHNOLOGIES Ms. Keenan. Good morning, Mr. Chairman, Mr. Davis, and other members of the subcommittee, and thank you for the opportunity to appear before you today on behalf of Lucent Technologies. Women business owners have been and continue to be an important market segment for Lucent. Lucent Technologies designs and delivers the systems software silicon and services for next generation communications networks for service providers and enterprises. And of course, we are backed by the research and development of Bell Labs. Today I am going to address two key areas that Lucent has provided support for women business owners, procurement and marketing. Lucent Technologies has proudly supported Minority and Women Business Enterprises, and we refer to that as MWBE, programs for over 32 years, first as AT&T, and then as Lucent when we were formed, after separating from AT&T on October 1st, 1996. In addition to our procurement focus of our MWBE programs, Lucent has formed strategic partnerships with associations representing business owners, some of these associations include the National Association of Women Business Owners, the National Foundation for Women Business Owners, and the National Women's Business Owners Corporation, and recognizing the opportunities and power of this high growth segment, Lucent has created programs to assist women business owners to be more successful, more informed, and more effective in growing their businesses. Now Lucent recognizes that MWBE utilization is not only an extension of a social or legislative obligation, but rather a strategic asset that offers real benefit to our bottom line of profitability. Last year with women-owned businesses, we were able to serve our customers more effectively and realize a savings of over $47 million. Lucent Technologies spent over $1 billion with minority and women-owned businesses representing about 9.5 percent of our total procurement. Of that $1 billion, $461 million was spent on white female-owned businesses, and the other 634 million dollar was spent on the remaining minority business enterprises. By developing ongoing relationships with women business owners, Lucent has benefited from a supplier base that is experienced, technologically savvy and strategically located, and we have a policy of ensuring that qualified women business owners have the maximum opportunity to provide us with goods and services. From a marketing perspective, Lucent has been a premier corporate partner of the National Association of Women Business Owners since 1997. The relationship with NAWBO has been extremely beneficial for Lucent to gain visibility, increase brand awareness and loyalty and become better positioned with women business owners. Through some of our dynamic marketing programs, Lucent has provided tools to NAWBO to help grow its membership and educate its members. We have been very successful in taking what started as a sponsorship and building it into more of a partnership, a real win-win situation. I would like to share a few of the marketing initiatives we have implemented in conjunction and collaboration with NAWBO. As you may know, NAWBO has very aggressive goals to grow its membership. As part of our negotiated sponsorship agreement, we developed and produced a recruitment video for NAWBO to use nationally at the local chapters. It was called, ``NAWBO, It's Happening.'' It has been shown throughout the United States and has been extremely successful in assisting the local chapters to increase their memberships. The video demonstrates the power of NAWBO through real-life success stories, interviews and examples of the diversity of the NAWBO membership, and I am pleased to let you know, too, that ``NAWBO, It's Happening'' did win two prestigious industry awards for its quality, message, impact and the difference it made in helping NAWBO, and the awards were the Aurora Platinum Best of Show Award as well as the Communicator Award. As we all know in this room, public policy is an important focus for NAWBO and last year we produced a multimedia program called 20/20 Vision to help NAWBO members learn about the economic impact of women business owners and the importance of their participation in public policy issues. The 20/20 Vision program was training that was developed to inform, educate and update NAWBO members on key public policy issues and to engage more of the members, get them more involved, hear more voices up on Capitol Hill, and get them to participate in transforming public policy. The program consisted of a series of seven videos, which really highlighted the key issues that NAWBO is focusing on with its members, a public policy handbook, and then we also do provide each of the members with a customized Congressional Directory, so they know who they should be in touch with and how to get in touch with them. We also sponsor a ``government watch'' section on the NAWBO Web site so that all the NAWBO members can be kept current of everything happening up here on Capitol Hill. Now NAWBO is celebrating their 25th anniversary. Next week is their conference, and we are producing another video; again, a tool for NAWBO to help grow its membership, and we also have another Web-based marketing tool that we developed to help NAWBO and Lucent keep an open line of communication so that we can continue to build on our partnership and understand the needs of NAWBO who are representing the needs of women business owners. In addition to specific sponsorship of associations, Lucent has also been very supportive of providing opportunities for women business owners just starting out. We recognize that there are a lot of obstacles, and Lucent, in conjunction with Working Woman Magazine, sponsored a ``Partners for the Future'' grant to honor women entrepreneur start-ups. Two grants were awarded to women entrepreneurs who demonstrated creativity, business knowledge and the ability to meet unique market needs. And each of these honorees received a $5,000 grant, a Lucent partner communications system, and, of course, a membership in the National Association of Women Business Owners. The business owners we have supported have been very receptive to our support. I am pleased and honored to let you know we did receive the National Corporate Partner of the Year from NAWBO and several local NAWBO chapters, and I think more important of what I am saying today is really a quote that came from one of the letters from NAWBO, and I will share that with you. ``Each year we look at our corporate supporters and choose one whose partnership stands out, a partner that has provided not only financial support, but also advice, counsel and superlative service to women business owners. Lucent more than meets these standards, and we are proud to present you with this award.'' In conclusion, this has been a very successful working partnership from both a marketing and procurement area. We have been able to support women business owners by increasing our procurement objectives year after year, and we will continue to do that, and in addition, our marketing sponsorship and partnership has enabled us to become more visible in providing the information and tools to enable women business owners to be successful. So I appreciate the time to be here today and I look forward to our continued partnership. Chairman Bartlett. Thank you for your testimony, and I wish the Federal Government was doing as well as Lucent is doing. Thank you very much. [Ms. Keenan's statement may be found in appendix.] Chairman Bartlett. And we will next hear from Ms. Terry Neese. Thank you for joining us again. STATEMENT OF TERRY NEESE, PRESIDENT AND CEO, TERRY NEESE PERSONNEL SERVICES, INC., AND COFOUNDER, GRASSROOTS IMPACT, INC. Ms. Neese. Thank you. Good morning, Mr. Chairman and members of the committee. Ihave to, right on the heels of what Linda Keenan said, I have to thank Lucent Technologies for all that they have done for women business owners as a whole around this country and the partnership between Lucent and women business owners is one that should be the envy of many. My name is Terry Neese. I am the CEO and founder of Terry Neese Personnel Services in Oklahoma and co-founder of Grassroots Impact with offices in Oklahoma City and Washington D.C. I am past president of the National Association of Women Business Owners and their corporate and public policy advisor. Grassroots Impact represents several small business associations on Capitol Hill, including NAWBO and the National Business Association. I offer this testimony today on behalf of my companies, Grassroots Impact and Terry Neese Personnel Services. First, just returning from the National Women's Small Business Summit chaired by Senator Bond held in Kansas City Missouri this past Monday, I highly recommend that the committee obtain the issue recommendations from that summit and focus on moving those recommendations through the legislative process. To that end, I also recommend that the committee establish a task force of small business owners to review the recommendations, establish some priorities and work with the committee to ensure success. That conference was chaired by Senator Bond, Senator Diane Feinstein, Senator John Kerry, and it was a bipartisan summit focused on issues that affect women business owners. Now the technology that was used at that conference to vote on the issues that are important to small business was a wireless keypad. So we had instant feedback on the top priorities for women business owners, but I understand all of it will be on their Web site today or tomorrow. So we will have the issues very soon. The bottom line from what I could view from the answers that were coming over from the wireless keypads was access, access to capital, access to procurement, access to education and training. Let me first address procurement. For the past 3 years, I and numerous NAWBO colleagues have presented testimony on behalf of the National Association of Women Business Owners, NAWBO, before this committee previously and many others regarding procurement. That testimony called on the Congress to hold the administration accountable for the 5 percent procurement goal enacted by the 1994 Federal Acquisition Streamlining Act. In fiscal year 1999, the departments and agencies of the Federal Government awarded prime contracts totaling 2.4 percent of the total dollar value of all prime contracts to women-owned businesses. As you have heard this morning, the National Foundation for Women Business Owners recent study shows 9.1 million women business owners employing 27.5 million workers and generating $3.6 trillion, and they are receiving 2.4 percent of government contracts. They make up 38 percent of all businesses in the United States and they are getting 2.4 percent of all contracts. Is there something wrong with this picture? On Tuesday, May 23rd, the President issued an executive order to strengthen the executive branch's commitment to increased opportunities for women-owned small businesses. In addition, that same day, Senate resolution 311 passed the Senate unanimously. The resolution authored by Senator Bond and cosponsored by Senator Kerry, Senator Landrieu, Senators Bingaman, Lieberman and Harkin, urged the President to adopt a policy in support of the 5 percent procurement goal for women- owned small businesses and to encourage the heads of the Federal Departments and agencies to undertake a concerted effort to meet the 5 percent goal before the end of fiscal year 2000. I encourage and challenge the House of Representatives to issue a similar resolution showing your support of this issue. While I am encouraged by this show of support for more business opportunities for women business owners, the House of Representatives must make sure the U.S. Small Business Administration acts immediately to implement the President's executive order. Congresswoman Sue Kelly's resolution is bottled up in committee, and I urge you to either move on that resolution or author another resolution, and then we will have the administration, the Senate and the House standing shoulder to shoulder in support of women business owners' procurement opportunities. Now on to death tax. One of the most pressing issues facing women business owners today is the death tax. Many have suggested that the estate, gift and generation-skipping tax, the death tax, does not affect enough Americans, but many families sell out early and pay a 20 percent capital gains tax on the appreciation instead of a 55 percent tax rate on the fair market value of all their assets. This means that businesses are sold and jobs are lost in the community because many sell out to larger companies that consolidate and are not subject to the estate tax. As an example, in the city of Williamsport, Pennsylvania, seven family businesses have been sold to large companies resulting in the elimination of thousands of jobs in that town. As a result of the estate tax, the livelihood of the family members who worked in those businesses was eliminated. Bottom line, the death tax elimination is all about saving jobs for families and their communities. The estate gift and generation-skipping tax must be eliminated. And I urge this Congress to pass legislation aimed at early phase-out or total elimination now. Finally, installment sales and cash versus accrual basis. The cash versus accrual issue is a day-to-day pervasive issue for small businesses, and certainly the membership of the National Association of Women Business Owners. The installment sales issue only applies when the business is sold. I believe the only way to explain both of these issues and really bring the message home on a personal basis is to focus on cash in and cash out for any individual. For example, how would a Federal employee cope with this issue if they were told that since their income for the year would be $60,000, that they would have to pay their taxes up front on the $60,000 before they receive their income? Does that sound pretty ludicrous? That is what has happened with both of these issues. It is inexcusable for Treasury to issue regulations similar to the above example and circumvent the Regulatory Flexibility Act, SBREFA, and frankly, the legislative process. The Treasury employees are not elected by the people of the United States. So why are they acting and issuing regulations like they are in Congress? Installment sales repeal for accrual basis taxpayers must be reversed. Forcing small businesses to pay lump sum capital gains taxes on the sale of their businesses is wrong. I strongly support the Herger-Sweeney bill, H.R. 3594, to repeal last year's modification. I also support the cash versus accrual legislation, H.R. 2273, and Senate bill 2246, to protect small business. Mandatory implementation of the accrual basis accounting would be devastating, taxwise, the first year and would necessitate the hiring of a full-time accountant for every small business owner. Thank you for allowing me the opportunity to voice problems and concerns facing women-owned businesses, and your support is greatly appreciated in resolving these issues. Chairman Bartlett. Thank you very much, and during the question and answer period we will have an opportunity to explore more of these problems. Thank you very much for your testimony. [Ms. Neese's statement may be found in appendix.] Chairman Bartlett. Now I am very pleased to welcome Diane Wirth, who is a constituent and has testified before us before, and I see her out in the District because she is a very active member of the Women's Business Institute, and contributes a lot of her time in helping women entrepreneurs get started on that first rung up the business ladder. Diane, thank you very much for joining us again. STATEMENT OF DIANE WIRTH, PRESIDENT, THE SOLUTION WORKS, INC., AND BOARD SECRETARY, WOMEN'S BUSINESS INSTITUTE Ms. Wirth. Thank you and good morning, Mr. Chairman, Mr. Davis and members of the subcommittee, for allowing me to appear before you today to testify on women's business ownership issues. As Congressman Bartlett said, I am Diane Wirth, president of The Solution Works, which is a technology training company, and also the board secretary for the Women's Business Institute. My goal during this hearing is to provide you some insight as far as the issues surrounding women's business ownership, and also to provide you solutions or suggest solutions as a purpose of that. There are three areas that I am going to focus on this morning. The first one is access to resources followed by education and training, which someone else alluded to, and also how these items then tie into access to capital. The Women's Business Institute is dedicated to empowering women to start or expand their businesses, and that is through education and training, networking and business counseling. Although the Women's Business Institute has been in existence for a 5-year period, it wasn't until July 1, 1999 that we were awarded a grant by the Small Business Administration Office of Women's Business Ownership in order to expand the businesses in the rural areas. We also received additional funding through the Appalachian Regional Commission to continue this work, and the success of winning the SBA grant was due in part to the efforts and support of Congressman Roscoe Bartlett. As Women's Business Institute's Technology Representative, I provide one-on-one business counseling as well as e-mail and telephone counseling to women entrepreneurs. It is from this experience that I share this testimony. Access to resources. We receive many calls from women entrepreneurs from Annapolis to Cumberland. Many need assistance in some of the basic factual items in starting a business from where do I obtain license and permit as well as how to take an idea and convert it to a business concept. At the same time, we are asked to assist them in developing their business plans and reviewing and understanding cash flow statements. However, many of the entrepreneurs that we work with and meet with do not know how to use the Internet, and if they do, they are not familiar with or comfortable with searching for information. The resources available today is a lot more than it was 13 years ago when I started my technology business, and at that time, we only had access to one book in the library on business planning. So what I demonstrate to the entrepreneurs are different Web sites where they can access resource information. This can include information from patent and trademark to where do I obtain business license and permits, also to demographic information such as from the Census Bureau. The on-line business resources can provide entrepreneurs with tons of market research, also directories and statistics as well as identify who their competition is. Many of the owners are not familiar with auction sites, so they are not accessing the on-line resources in order to obtain supplies or equipment for their business if they have an established business. There is also a lack of mentors as well as support for new and expanding businesses, but there is a surplus of proteges. Although many organizations offer mentor programs, by matching a mentor with a protege, the training on expectations and the continual commitment is often lacking. Oftentimes, the length of time of a request of a protege for a mentor is far too long. So the potential solutions that we offer are several. The resources are out there. But they are not reaching the consumer, and in this case, the entrepreneur. Like any business, the government needs to make a concerted effort to do the following: market the sites where they provide that information; make the information visibly available in public places, such as the library system or State and county economic development offices; you can also include information in the government mailers. We receive information from the IRS as well as the Department of Labor. Distribute information to civic and entrepreneurial organizations, whether it be the Chambers of Commerce or the home-based business associations, and also create a pool of readily available mentors with particular skills and specialties or offer the mentor some incentive for full participation in assisting a protege. In the area of education and training, it is necessary to have some access to basic affordable training for women. Many women-owned businesses fail because of lack of training and education. They need the ability to have the opportunity to practice their creativity, confidence, as well as sales and marketing, and topics such as human resource development, learn how to ask questions, how to maximize networking opportunities, and how to determine their fee structure also make a big difference to the success of their business. Web site--the development maintenance and marketing of a Web site to gain more business. Studies reveal that small businesses, with 500 or fewer employees, indicate that 30 percent of them believe that the Internet is important to achieving their business goals. However, these businesses also believe that the cost, the security and the difficulties in implementing and maintaining the sites need to be addressed. Although small businesses represent 98 percent of all small businesses in the U.S., only 31 percent of them with 100 or fewer employees have a Web presence. Many women are not comfortable in working with numbers. This is absolutely important when operating a business. They have difficulty calculating their start-up costs, their monthly expenses, their cash flow statements and forecasting sales. So what are the solutions? We can develop additional workshops making them affordable and accessible to women; you can also provide more forums like the Women's Business Institute's Entrepreneurial Workshops where successful entrepreneurs can share their women business ownership story and experiences with those interested in starting a business, and also to provide small grants for the purpose of establishing Web site presence for increased marketability of their Web sites, would greatly assist women entrepreneurs. In the area of access to capital, a recent study reported by the Small Business Administration Office of Advocacy found that after controlling for differences in creditworthiness and other factors, the Hispanic-owned businesses were not significantly more likely to be denied credit and African American-owned businesses were about as twice as likely to be denied credit. Interestingly, both of these groups were more likely to withhold a loan application for fear of denial. There are also many myths about grants. There are special programs for women as well as minorities, and many women who contact the Women's Business Institute feel that they should be privileged and be given a break, so they call us to obtain grants. They are always surprised to find that the grants are very focused as far as programs, that they require grant writers, and that the award of the grants oftentimes takes a lot longer in a time frame than entrepreneurs arewilling to wait; and also many of the businesses being started are not nonprofit organizations. So the solutions we offer are to dispel the myths about grants. If there are truly grants out there and not just the marketing of a book of where to obtain grants from, provide the sources, what areas, what are the qualifications. At the same time, it would be good to know when businesses should look at refinancing a business loan or a combination of solutions, to help them grow their business, continue special programs geared toward women entrepreneurs and make them readily accessible and also understandable. I hope these challenges described in this testimony can be addressed and that these solutions also be considered. Once again, if any of these ideas are implemented, the government needs to think of ways to increase the exposure of the solutions to its target audience, and in this case, the women entrepreneurs. Thank you for the opportunity to appear before the subcommittee today and I will be pleased to answer any questions that you have. [Ms. Wirth's statement may be found in appendix.] Chairman Bartlett. Thank you very much for your testimony, and now Mr. Mayer. STATEMENT OF GLEN MAYER, CORPORATE SUPPLIER, DIVERSITY COORDINATION, UNITED PARCEL SERVICE Mr. Mayer. Good morning. My name is Glen Mayer with United Parcel Service, and I am the coordinator of the Supplier Diversity Program and the testimony is actually inside the book that you have there. It is inserted inside the booklet. On behalf of the more than 340,000 men and women of UPS, I thank you for inviting UPS to participate in these proceedings. UPS has long been committed to promoting business opportunities among women-owned enterprises. In fact, one of our longest standing vendor relationships is with woman-owned LPS industries, a supplier of UPS packaging products. From 20 years ago, they did $10,000 a year with us to last year, they did $25 million a year. It is evident that women-owned businesses have made enormous strides in recent years. However, the potential for continued growth is great and can be attained through collaborative efforts between individual entrepreneurs and corporate and government partners. Through our association with such organizations as the Women's Business Enterprise National Council and the National Association for Women Business Owners, UPS has expanded its commitment to meet the growing needs of today's businesswoman. Our network of more than 100 women-owned suppliers continues to grow. This growth is fueled by more than 200 UPS supplier diversity advocates around the country who participate in women and minority business councils on a national and local level. As our involvement with these groups continues to increase, so does the success of our program. Taking an active role in programs developed by such organizations as WBENC, NAWBO, the National Minority Supplier Development Council, and the Native American Business Association allows us to remain visible to potential business partners. It also is an excellent vehicle for three critical components of a successful program, or any government program, you need accessibility, you need communication and you need outreach. The various trade shows conferences and events are a great way for suppliers to become familiar with our program. This year we will distribute nearly 10,000 applications at trade shows and conferences alone. And that application is going to be accompanied with a conversation about UPS, our program and what opportunities there may be to do business with us. That is 10,000 face-to-face contacts. Once again, it is extremely important whether you are a private business or the government to interact with your suppliers. Ease of entry also is critical to a successful program. At UPS the procedure for entry into the program is designed to be supplier-friendly and aims to address any questions at the beginning of the process. Only certified companies are allowed in our program and we do not self-certify. Once a supplier is in our network, we work to align them with the units of our company that would most likely be able to use the products and services they offer. We have also added another layer of convenience to the process by making our application available on-line at www.community.ups.com. Mentoring and development initiatives are also key components of a successful program. A commitment to helping suppliers grow their business is essential. Once suppliers have proven themselves, we work with them to become a better business and a stronger partner. Development assistance at UPS includes everything from mentoring to sponsoring our suppliers to attend top schools, such as Kellogg and Tuck School. On occasion, we have provided executives to assist business associations in the areas of technology, finance and record management. We have also introduced firms to other corporations that may need the services they provide. The UPS approach to supplier diversity will continue to focus on interaction and communication. And we will continue to aim to establish long- term successful business partnerships. We know that the continued success of women-owned businesses is vital to the American economy, and doing business with women-owned firms makes good business sense. We look forward to continuing our support of women business enterprises nationwide and applaud them on their many successes. Thank you for your time. [Mr. Mayer's statement may be found in appendix.] Chairman Bartlett. Thank you very much for your testimony. Mr. Davis, let me turn to you for your first questions and comments. Thank you. Mr. Davis. Well, thank you very much, Mr. Chairman, and let me just indicate that I really appreciate all of the testimony, and it seems to me that each one of the witnesses really have their fingers on what the problems are. Ms. Henderson, you mentioned that commitment at the top of agencies have proven to be, perhaps, the most effective way, or the most discernible impact that we have seen in terms of businesses actually contracting or working with smaller businesses or women-owned businesses. And at the same time, Ms. Ward, in your testimony, you talked about the difficulty of having some top agency or top CEOs or people really understand the lay of the land relative to doing business. How do either one of you, or both, think that we can change those attitudes and those practices? I mean, what do you think will best work to change those attitudes and practices which are humanistic? And it is not really something that you can push a button and get a response or get an action. It is not like the Internet. It is something a little different. What do you think we can do to change those attitudes? Ms. Parker. I will respond first to that. I think one of the observations they have made is that you do tend to see an awful lot of activity in terms of very high executive level individuals, both in the public and the private sector that do network and have access to women's organizations and minority organizations as well. Unfortunately, a lot of that activity is what I would consider to be ceremonial. And so what you have are very high profile activities where you know at the end of the event everyone feels very good about having had the discussion and having learned something. But what is really lacking is the follow-up. The one example that I gave you, which was very striking to me because it was indicative of what I have seen over and over again and that is, you have an official that is part of a panel, part of an event that is representing an organization or a company or whatever, and for the benefit of that particular event, there is a lot of goodwill that is discussed and so on. What tends to happen after that, a month, a couple of weeks, whenever, the follow-up is not there and in my case, things that I have seen are, people who, very aggressively at a conference, ask me to please follow up, please call me, and they wouldn't even take my calls, and that happens a lot. It happens a lot. So I think there are event opportunities that are occurring, but I think what really needs to happen is for the follow-up to occur. The follow-up not just from the standpoint of I talk with you and you talk with me, but you hear very impressive statistics in this room, and these are public figures that all of us have talked about. I think we still need to keep hammering home the disparity, factual disparity of what is happening and put a human face on what is happening. It is very easy to hear these things, a lot of people don't associate them with; they are actually people's lives that are being impacted by these decisions or the lack of decisions, and you hear 40, almost 40 percent of the businesses are women- owned, and then you talk about 2 percent of contracts, you talk about less than 3 percent overall. Someone really needs to take a look at that and put a human face on what that means, how many people don't get jobs, how that equates to the people that have to have public assistance as a result. Put a human face on it so that it does hit home, and also make people accountable. I would ask the question of, if I spent almost 20 years in corporate America. If I had had those kinds of numbers in the programs that I measured, managed and was measured against, I wouldn't have had 20 years in corporate America. I would have had a very short career. And so how do we make people accountable for those kinds of things, I think it is follow-up, and it is constantly getting that message out that there is a down side to not doing the right thing, and our economy is impacted by it. It is not just Suzane Parker doesn't get a contract or Laura Henderson doesn't get a contract; it hurts the growth of our economy as well. How do we connect all of those so that people see what is really going on? Ms. Henderson. We have struggled with this, and certainly I have talked before Congress for over 20 years about this issue. I know we struggle with finding a solution. I think one of the things we have to do is educate the people at the top of organizations and have them make contracting with women-owned businesses a priority. We need to hold them accountable: there need to be consequences if they don't meet their goals: and we need to identify very specific actions. I think one of the exciting things of the study that the Council's doing with the National Foundation for Women Business Owners, looking at over 5,000 who actually have gotten government contracts. What can we learn from these companies? What was different with them from other firms? What specific actions can we take? I think one of my greatest disappointments being on the National Women's Business Council is the fact that when I go to the Interagency Council on Women Business Owners, we do not have agency heads. We have people very low in the organization who come to those meetings. And I think Congress should ask the agency heads why, if this is a priority they do not attend. I think the people at the head of organizations, and I think people in Congress, have a voice and an opportunity. They need to have vision about how to make change happen, but we need very specific doable, tangible actions that people can implement. Mr. Davis. And let me just say, because I think all of us have had essentially the same kind of experiences, no matter what it is that we testify to. What brought me to my question was just last evening I had dinner with two CEOs of major enterprises. One private, one semipublic and another person who was trying to talk about getting business, and he kept making reference, he says well, you know, Mr. So and so, who is the CEO of so and so corporation, told his people to let us in and they let me in and I am now doing $25 million worth of business with them a year. The guy on the public side, well, sir, he says now, and all I want you to do is tell your people, and the guy says wait a minute, I can't do that. And so my question is, are there any policies, because I think part of our problem is that we deal in contradictions all of the time. I mean, are there any policies and practices that you can think of from a governmental vantage point or position that is actually prohibiting or inhibiting the ability to move beyond this 2.4 percent that we are talking about as opposed to moving closer to the 5 percent, which is not that great in the first place? Chairman Bartlett. If the gentleman would yield for a moment, in a former life, I was competing for government grants and contracts, so I am very familiar with your problem. Let me ask a question and then make a brief point. Once a woman-owned business has gotten a contract, is it much easier to get that second contract and the third one? Ms. Henderson. My company does about, I would say, between $15 and $17 million of government contracts in a year, and the answer is yes. Chairman Bartlett. So breaking in was the problem. Ms. Henderson. I think breaking in is the problem, but it is not merely breaking in. You break into one part of one agency. Chairman Bartlett. That is true; you have got to fight that battle. Ms. Henderson. Exactly. I think another major issue we face is the issue of bundling, especially in DOD, because we all know that being a subcontractor brings you very little quite often, except a lot of work on the front end and no return on your investment. So the ability to get prime contracts is very important. I think the issue of the old boys' network, which is what maybe you were talking about last night, is an issue that we face, not that we can't get the information on an RFP, but getting the context in which to write our proposals, getting the information on the political environment, the issues that are very specific to, you know, a certain procurement is something that comes from relationships, not from writing. And so it is very difficult to get in. It is very difficult to move from the civilian agencies to the Department of Defense. It is just an enormous regulatory load. It is the most regulated business in the world, I think. And it also requires an enormous ability to wait. Many of the procurement opportunities that we have involve submitting a proposal and waiting up to 2 years for the award. How can a firm hold the staff, how can a firm start work the day after they award it? They award it, they have waited 2 years and they say now you are supposed to start working and you are supposed to have the resources in place. It is a very complicated process. Chairman Bartlett. May I make one point and return to Mr. Davis. I think that the problem is not so much discrimination, but just the nature of the beast. These contract people are very comfortable dealing with people that they have dealt with before, and I understand that because if they let a contract to a new company and there is not a good performance, then they get bad marks from their supervisors. So they are very likely to let contracts to people they have let contracts to before, because they have a comfortable relationship with them, they have a good track record with them. I had that difficulty because I did not get my degree at one of the universities, at the peoplewho were passing judgment on the grants and contracts that I was applying for, and these were all medical research kinds of things, got their degrees at these institutions and so I had, like you, to break in. I did that. But it wasn't easy. Once I had that first contract and that first grant, and-- but you are right, you must jump these hurdles in every agency you deal with. It is not that you have established a good track record over here that it is going to help you with this other agency. You have got to do it all over again. I don't know, Mr. Davis, what the answer to that problem is, but it is not just a problem for women. It's not just a problem of minority women or minority-owned businesses. It is a problem with everybody that is trying to break in because you are new, you are trying to break in. And there is hope that this will change. It is changing. I noticed that last year it was 1.8 percent. This year it is 2.4 percent. If you look at a percent increase that is not 5, but even if you go from 1.8 to 2.4, that is a pretty decent increase for a year. And so we are on our way. I don't know how to solve this problem, and I think it is just a systematic problem of the institution, not so much any act of discrimination. But whatever it is, we have got to solve the problem and that is why we are here. Mr. Davis. Ms. Henderson. Could I respond to that? In the early days of my company, I had to hire a male negotiator. So while I agree with you, I think it is more complex. When I tried to negotiate, and I am a tough negotiator, I was being accused of crying in negotiations, which I never did. I know when I cry. I have been accused of being pushy, unreasonable for trying to negotiate very reasonable things. When I would send in a male with exactly the same stands on issues, it was very different. So while I agree with you, there is another factor that is playing there, and all of us women who do government contracting know the importance of the facts. In fact, in our meetings, we often sit around and say, ``Is this a meeting we can send women to or is it one we have got to send men to?'' Chairman Bartlett. They are comfortable working with men. Ms. Henderson. Exactly. Chairman Bartlett. What we need are more women on the other side of the table, and I hope we are getting there, too, in the government. Ms. Neese. Can I respond to a couple of things? Laura is absolutely correct. At Terry Neese Personnel Services in Oklahoma, we have a little over $5 million contract with just one agency, and we don't even want to try to go out and break into other ones, because by the time you get the bid, and spend the time putting all the paperwork and everything together, you get the award. You have got to go work on it instantaneously. That means you probably have to hire more people to go and fulfill the award, and then, I am in the temporary business, I have to do payroll for all those workers every Thursday. So that payroll may be $200,000, $300,000 Thursday morning, and then I don't get paid on that contract for 90, 120 days or even longer. So the Prompt Pay Act, is there a Prompt Pay Act? Chairman Bartlett. There is a penalty for not paying promptly. If they are not doing it, let us know. Ms. Neese. And the other thing I would like to speak to is, I think it is all about leadership, and the President's executive order, I think, is a good executive order, and if you haven't read it, I encourage you to read it, and I think that you should move forward and make sure that it is implemented. When the president or the CEO of Lucent Technologies or UPS or the President of the United States of America says look, I am calling all my people in, we are going to reach this goal, or we are not going to have jobs, period. In my opinion, it is all about leadership. Mr. Davis. I agree, but I think, I guess it is a little different, and I was trying to compare the President of the United States with the president of UPS or Lucent, and I think there are a few more restrictions like 435 of them here, and another hundred over on the other side, and yet I understand and I agree that leadership is vitally important. The other question, Mr. Chairman, and I really appreciate your approach to this, because you, too, I don't think that you were a back-slapping, glad-handing kind of guy who got any contracts on the basis of that, and I think one of the reasons they appreciate this committee is because there is an effort to really thoroughly look at situations and try and determine whether or not something can happen beyond the quid pro quo. And this kind of business that we have all lived with so much and that has been such an integral part of life, and so I really appreciate your approach to it. Recently we marked up in our committee a whole group of small business initiatives, the President's New Markets, one bill that I am a primary sponsor of, the Business Links Program, and Ms. Wirth, I wanted to kind of ask you if you think this approach, what it does is exactly what you are talking about, it just gives the Small Business Administration some money to do it, to establish business-to-business relationships, smaller businesses with larger businesses, and the Mentorship Protege. How effective do you think that really is? Ms. Wirth. I think it probably needs a little bit more time, and once again, the exposure to the entrepreneurs that it is there and how it works. I think that for small businesses, to be able to access that particular program and also, what Susan spoke about as far as follow-up, is important. Many of us have spent our days participating in different functions with procurement, Department of Treasury has a large one every year. They are excited when they meet us, you know, one-on-one, and then we call them as follow up and there is no return call. I think business links could work, but once again, its exposure to the entrepreneurs to let them know it is out there and what the benefits are. I would also like to say that as a prior 8(a) certified company under SBA, we are one of the 55 percent of 8(a) companies that never received a government contract at all, and the Baltimore Sun had cited that a couple of years ago, and I think that is really sad that the program is in existence, and it doesn't work. Mr. Davis. And finally, because my question is actually--go ahead. Mr. Mayer. I was just going to add that this is kind of a rehash of what I just went through with Georgia. The State of Georgia had the same problem and they had asked if UPS would sit, the governor asked us to help them run a supplier diversity program, in essence, in their government, and going through all the things that you just mentioned, you know, what are the problems at the top and everything, they talked through the whole process there, and it all came down to administration, setting the tone, holding them accountable, just all the things that have just been mentioned right here. But the end result of private industry or public you know our company's out there working with government; it really rests at the top, and then putting in the accountability guidelines. Just like at UPS, I have guidelines and goals that I have to reach. Some are set by the government because you have some contracts with us. Now if we don't reach those, then we near trouble. Well, this is the kind of the reverse that you need those accountability guidelines put in there, and I am anxious to see how this works out, because the Georgia governor intends, Governor Barnes intends on taking it to the other States and working with the same type of problems that you have here. Mr. Davis. The last point is just I followed Lucent and UPS for a long time, especiallyLucent, I used to live right across the road from the big Western Electric plant. Plus, I studied Lucent when I was studying psychology in terms of the Hawthorne studies, and all those things that increased productivity and satisfaction, and so I am not surprised. I mean, because Lucent does have a history of being a progressive company or corporation, and, of course, UPS, the involvement with the welfare to work, and Rodney Carroll on loan to help run that for the President. Plus, we have got an excellent program that we work with UPS out of Chicago, and so I appreciate both your companies in terms of what you have done in your own limited way to increase the diversification, but we have got a long way to go in terms of the Federal Government. Chairman Bartlett. Thank you very much. We have a few minutes before another single vote. This time it will be a much quicker vote because they are not taking a picture afterwards, and there are a number of things that I would like to get on the record, so we ask that you would stay for a very brief recess, then I will be back as soon as I can. That was just a 15-minute bell. It takes us about five minutes to get from here to there, so we have probably got another 7 or 8 minutes for questions. Ms. Henderson, you mentioned that one out of eight of the women-owned businesses were women of color. Did I remember that statistic correctly? Ms. Henderson. That is correct, yes. Chairman Bartlett. That is about their percentage in our population is it not? Ms. Henderson. I don't know. Chairman Bartlett. I think what we are about, what, 12 to 14 percent, so that is roughly the percentage in the population. Has that percentage come up dramatically recently? Are we doing better? Ms. Henderson. Actually, we see women of color starting companies faster than any of the segment of the women-owned businesses sector. Chairman Bartlett. So a couple of years ago it wouldn't have been one out of eight. Ms. Henderson. Exactly. We are just beginning to study that. In fact, the National Foundation for Women Business Institute did the first study on entrepreneurship among women of color, but it is something that we are looking at very carefully. I could get for you, if you would like to see it, a copy of the study the Foundation did, because not only did it look at women of color as a whole, but it broke down women of color by different minority groups, which you might find interesting. Chairman Bartlett. I notice Lucent did that. I was looking with interest at your breakdown. You have done a very good job. There were more of your contracts that went to women of color than to white women, correct? Ms. Keenan. Yes, that is correct. Chairman Bartlett. I was impressed with that. When I first saw Lucent, it was at this small business hearing, how did Lucent get here? Then I read your testimony and understood why you were here. Ms. Parker, you mentioned several problems that you personally had, and that you think that others have. One is the fear of rejection, it is just not nice to be turned down. I don't know how to get around that. I guess you just need to tell people that the answer is not always yes? Ms. Parker. Well, I think the whole idea of a rejection, no one likes to go through that, but one of the issues that you have is, when you have, as we were just talking a second ago about, the number of women of color that are entering the entrepreneurial ranks, I mean, there are discussions that are going on all the time about, where did you get your funding? What was the reception of the banks? And it is pretty well understood that you are going to get a cool reception, and we are not talking about, for the most part, individuals that you know are setting the bar low. We are talking about many of the people that I speak to that are entering the entrepreneurial ranks right out of corporate America. They have had very high executive level positions. They are very skilled individuals, but the experience is the same across the board, regardless of industry, regardless of interest or regardless of level, that they are coming into the business world. And so you are just not given consideration, you are not given a warm welcome whatsoever. You really do have to dig and scratch and be very tenacious to move forward. Chairman Bartlett. You know, in a former life, one of my jobs was, for 2 years, teaching medicine at Howard Medical School here in the city, and near the end of those 2 years, it finally dawned on me that I was no longer seeing people as black or white or Oriental, because we had a number of Orientals there. I was seeing them as bright or dull, friendly or unfriendly. I thought, isn't that where we need to get to? I hope that one day we can stop talking about persons of color, that we are all Americans, but I know we are not there yet, and to make sure we are not discriminating, we need to keep records. But I think the real goal is that we need, as Martin Luther King said, to be judged by the content of our character and not the color of our skin, and I don't know how we get there. I think we are making some progress, but there is still impediments, and we want to focus on those to make sure that they are removed as quickly as possible. Ms. Parker. Could I make a very quick comment about that? Chairman Bartlett. Yes, ma'am. Ms. Parker. The issue of the social righteousness of treating people fairly, I am not sure, unfortunately that we will ever get there. The impetus probably should be on enforcement, on accountability, because I think to assume or to wish that people are going to view everyone on an equal level, I mean, we have been struggling with this for many, many years, and I am not sure we are ever going to get there. Chairman Bartlett. I hope we get there, and on the way there, I know we have to do the kind of things we are doing today, but I genuinely hope we get there. There are a number of us already there, it is not everybody, but we need to keep working, and we need to keep records as we work to make sure that we are, in fact, getting there. I was impressed with the record of Lucent. You all are doing a great job. 9.5 percent of your contracts are with women-owned businesses? Ms. Keenan. No. Actually, let me clarify that. That is our minority and women-owned businesses. So it is a combination. I think a point of clarification for your past comment---- Chairman Bartlett. How many of those are women? Ms. Keenan. The women numbers, the only ones that we have broken out is the white women, and that is the 461 million, and it is about 5 percent. Now within the remainder, because the remaining is minority business enterprises which are men and women, we don't split that out. Chairman Bartlett. But for women alone, it is 5 percent, which is where the government would like to get, and they are about 40 percent of the way there, a bit less than halfway there. Ms. Keenan. Right. And the other statistic that I did not include in the testimony is that our procurement to women-owned businesses has increased since 1997, by 25 percent. So when you were talking about where your trending is, ours has increased by 25 percent since that time, and we are at 5 percent now, and then we will be continuing to have stretch objectives going forward. Chairman Bartlett. I was impressed both with what UPS is doing and what Lucent isdoing, and once again, I noted that almost everything that can be done in the private sector and the public sector is done better in the private sector. Both of you are doing a better job than the Federal Government is and we are trying. It is just that big bureaucracies have a problem. And so I am really pleased that the private sector is leading the way here, and hopefully government will catch up. If you will give us a few minutes, we will recess the committee and be back as quickly as we can. Mr. Davis. Mr. Chairman, let me just say if I don't get back, it will only be because I have to be on the floor for the appropriations activities that are going on there, but if I don't, that is the only reason, because I am really enjoying this discussion. I think it is very meaningful and Ms. Henderson, you did mention one of our big problems and that is contract bundling. Something that---- Chairman Bartlett. I will come back to that. Mr. Davis [continuing]. We have got to get real serious about doing something about. Chairman Bartlett. We have legislation. [Vote break.] Chairman Bartlett. I call our committee back into session. Just before the vote, we were talking about the bundling and the small business problems with bundling. This is an unintended consequence of downsizing some parts of government, particularly Department of Defense where we have had most of the problems. And since they had fewer people in procurement, they sought to have fewer procurements, and the way to do that was just to have one large contract rather than a lot of small ones. The first time we were introduced to that was with moving, and many moving companies are mom and pop shops, they may be affiliated with large moving companies, but the Department of Defense was going to contract with a single company to provide all of the moving for Department of Defense personnel country-wide. This obviously was going to eliminate most of the small companies. What had been done previously was they would have a competition and the low bidder would get it. So obviously no mover can move everybody in the military, but the winner got as much of the business as they could handle, and anybody else got the business at the same price of the winning bidder. So the government had the benefit of getting the lowest possible price, and also the benefit of having anybody come in, so lots of small businesses could participate in this program. We recently had a problem with the Navy and Marine Corps. They wanted to let a single contract for all of their communications and telephones that would have cut out lots and lots of small companies. We finally got an agreement with them that 10 percent of the price contract dollars would go directly to small business. Ordinarily, small businesses are looking to work for a prime, and we have legislation that looks at getting the money to subcontractors first by direct payment to subcontractors. So you don't have to wait for the 90 days that the prime waits for his money, and then the prime lets you wait another 90 days for your money. And meanwhile, you are trying to meet a payroll every week, so we have legislation which will permit, require actually, direct payments to certain categories of subcontractors, so they don't have to wait for their payments. And a question was raised about whether or not there was a prompt payment law. Yes there is, and the government agencies, if they don't pay on time, they are supposed to pay a penalty. They have to pay at least interest like IRS, they ought to pay penalty and interest, shouldn't they? They do that to you if you are late, even if it is inadvertently late. Terry, you mentioned the death tax. We vote on that tomorrow. Ms. Neese. Good. Chairman Bartlett. It is not what I would like, which is to eliminate the whole thing now, but at least we are starting down the road where it will be eliminated. The problem with this is to construct a bill that is not perceived as a tax break for the rich because that is going to be vetoed, and the truth is that the really rich don't need it, but there are a whole lot of people who aren't rich who really need it, and somehow we need to craft legislation to get us over that hurdle, and I hope we are doing that. We will see whether we get there or not with this legislation. You also mentioned the cash versus the accrual basis for accounting. We had an IRS person at another hearing, and if your gross receipts are between 1 million and 5 million a year, the government has the option of either accepting whatever method you choose, or requiring you to use a different method. If you are over 5 million, you have got to use the accrual method, as I understand it. If you are less than a million, you can use whatever you want, and of course, most people use the cash method. In questioning, it became obvious that at the end of the day, the amount of tax collected would not be one cent different, whether you paid your taxes on a cash method or an accrual method, and our question to the IRS was why are you then harassing our small businesses? If at the end of the day, you know, when they finally--and I had the company for 10, 12 years, and when I retired, and I liquidated the company, and the taxes that I paid would have been exactly the same no matter what I had done it on an accrual basis or cash basis, and he agreed that was true. Why then is the government harassing our small businesses? We really need legislation, and there is legislation there, I don't know whether it will make it through committee and on the floor this year, but there really is a need to have legislation that prohibits the IRS from harassing our small businesses. If the taxpayer would get additional revenues by that, then you might see some justification for that, but not a dime different in the amount of money that is ultimately collected; why are they doing it? This is very difficult to understand why they are doing that. So we hope that we can solve that problem. The installment sales problem, another big unintended consequence, our fault we passed legislation. It just wasn't clear, and it permits the practice if you sell something, and most people can't pay for it all at once, that the tax collector says that you owe it, just as you owe the tax, just as if you got the money all at once, and so I hope that that will be corrected by appropriate legislation. I would have thought that IRS would have had the discretion to have interpreted the legislation another way, because none of our people saw this as an unintended consequence of the legislation, but the IRS certainly did. You mentioned paperwork. We are trying to add IRS to the SBREFA panel process. You know, the only two agencies involved in the SBREFA panel process are the EPA and OSHA, and the testimony the other day indicated to us that the average small business owner spends more of his time complying with regulations from IRS than either OSHA or EPA, and so we ought to be including the agency that is the biggest burden on our small businesses in the SBREFA panel process. What this process does is to require that in the promulgation of new regulations, that they consider the effect on small businesses. They have to do that and they have to have a hearing process. They have to have a comments process. They have to answer to the Congress, and we have a watchdog out there, the Office of Advocacy, and if you are not acquainted with Jerry Glover, who heads that office, he is a genuinely good guy. When he says ``us,'' he is talking about small business. When he says ``them,'' he is talking about the government. He is about theonly government guy I know that when he comes and says I am from the government, and I am here to help you, you don't start laughing. So we are trying to solve these problems. Is there specific legislation--you mentioned a resolution encouraging our government agencies to become aggressive in achieving the 5 percent goal. We will see where that resolution is and what can be done to get that out, because I can't imagine anybody opposed to that resolution. It is not binding. It is just a sense of the Congress that this is a good idea, and it has been a goal for a long while. Why don't you get with it. The Senate has already done it, I understand. Ms. Neese. Senate has already done it. It passed unanimously, and the resolution here authored by Congresswoman Sue Kelly has been languishing in committee now for about a year and a half, which is pretty unbelievable. Like you said, I would think that that piece of legislation would pass pretty quickly. I don't know why anybody would be opposed to it. So if they are going to bury it and not pass it on, then let us get another one authored and get it through committee and get it out to the floor so we can vote on it. Chairman Bartlett. After a year and a half, it is probably more than languishing, it is probably dead. Ms. Neese. That is what I figured. Chairman Bartlett. We will see what can be done to resurrect it. Ms. Neese. Good. Thank you very much. Chairman Bartlett. What is a certified company, Mr. Mayer? You don't self-certify. What is a certified company? Mr. Mayer. Certified is what the NMSDC, National Minority Supply Development Council, WBENC and NWBLC, they actually go and do a site certification. They actually go to the business to make sure it is not a storefront. We don't go to all the businesses that would come in. So instead, we only take certified companies because we do not want to deal with storefront companies, pass-through companies, which are just saying they are maybe women-owned or minority-owned and they really aren't a full-fledged company. Chairman Bartlett. You have 1,800 women-owned suppliers? Mr. Mayer. Yes. Chairman Bartlett. Out of how many? Mr. Mayer. Out of about 40,000, but of the 40,000, 25,000 are small businesses. I don't know in that how many are minority small businesses. I just know that we have 1,800 non- small business women-owned businesses. Chairman Bartlett. You don't know how many women-owned businesses are in the small business category? Mr. Mayer. Out of the 10,000, there is quite a few in there. Chairman Bartlett. Okay. You mentioned that UPS has a practice of, on occasion, sending consultants, some of your people, to work with the small business to help them solve some of their problems. Mr. Mayer. Right, right. We mentor with small businesses. For example, there is a package company in Atlanta that we had a purchasing executive actually work with them over 4 years and took them from--he was a second tier company. Because he was very small, he won a $2 million contract as first tier in about 4 years, but grew his business working with him. Chairman Bartlett. I just wanted to put on the record an example that is really not small business. I guess it was a small business before they started, but now it is not a small business. Garden State Tanning, which is a company in Williamsport in our district that makes leather for upscale Toyota cars, and they were having great difficulty in meeting their deadlines, and they were having to air freight the product to Japan. Whatever profit they might have made went to the company that was air freighting the product. And so Toyota sent several of their people over to help them reorganize their plant at no cost. The result of that was now that for at least the last 2 years, they have gotten two awards from Toyota. They have decreased costs and increased quality. Ordinarily, you can do one of those at the expense of the other, but they have both decreased cost and increased quality. So I was really impressed with how effective a bigger company could be in helping a smaller one when they saw what the problems were. They came over here clear from Japan, spent time in the factory and helped them reorganize. It wasn't any new equipment, by the way, it was just reorganization, just how to better organize, to do the work, and it didn't cost Garden State anything more than to be a very efficient company than it was costing them to be an inefficient company. It was just how to do it better, so I want to commend you on recognizing the value of working with these small businesses. Do any of you have any final comments you would like to have on the record? Yes. Ms. Henderson. A couple things. Related to the Prompt Pay Act, and this would be enormous to all small businesses, but especially women-owned businesses, the Prompt Pay Act does not cover cost reimbursement contracts. It only covers time and material and fixed price contracts. If the Prompt Pay Act could be extended to cost reimbursement contracts, it would make an enormous, enormous difference. The other thing in relation to Mr. Davis' comments about Mentoring Proteges, the National Women's Business Council did a survey across the country of business owners and learned that women business owners take advantage of Mentor Protege programs to a much greater extent than men do. So your focus on creating those kinds of programs also would be of great benefit to women. Chairman Bartlett. Thank you. Other comments for the record before we adjourn the meeting? Ms. Neese. I just want to be sure and urge you to look at the recommendations that come out of this National Small Business Women's Summit in Kansas City this last Monday, and I think there will be some great ideas focused around procurement. We had a very, very heated discussion with the DOD who was present, and on the premises for the meeting and there were a couple hundred women who spoke very passionately about procurement. So I feel there will be some excellent recommendations coming out of that summit. Chairman Bartlett. Were the procurement people from DOD men or women? Ms. Neese. Men. Chairman Bartlett. We need some women procurement people in DOD, don't we? Ms. Neese. Both men were taken to task for their lack of outreach, whether true or not. Chairman Bartlett. Well, if there are no other comments, thank you all very much for your testimony. The meeting is adjourned. [Whereupon, at 12:45 p.m., the subcommittee was adjourned.] [GRAPHIC] [TIFF OMITTED] T6167A.001 [GRAPHIC] [TIFF OMITTED] T6167A.002 [GRAPHIC] [TIFF OMITTED] T6167A.003 [GRAPHIC] [TIFF OMITTED] T6167A.004 [GRAPHIC] [TIFF OMITTED] T6167A.005 [GRAPHIC] [TIFF OMITTED] T6167A.006 [GRAPHIC] [TIFF OMITTED] T6167A.007 [GRAPHIC] [TIFF OMITTED] T6167A.008 [GRAPHIC] [TIFF OMITTED] T6167A.009 [GRAPHIC] [TIFF OMITTED] T6167A.010 [GRAPHIC] [TIFF OMITTED] T6167A.011 [GRAPHIC] [TIFF OMITTED] T6167A.012 [GRAPHIC] [TIFF OMITTED] T6167A.013 [GRAPHIC] [TIFF OMITTED] T6167A.014 [GRAPHIC] [TIFF OMITTED] T6167A.015 [GRAPHIC] [TIFF OMITTED] T6167A.016 [GRAPHIC] [TIFF OMITTED] T6167A.017 [GRAPHIC] [TIFF OMITTED] T6167A.018 [GRAPHIC] [TIFF OMITTED] T6167A.019 [GRAPHIC] [TIFF OMITTED] T6167A.020 [GRAPHIC] [TIFF OMITTED] T6167A.021 [GRAPHIC] [TIFF OMITTED] T6167A.022 [GRAPHIC] [TIFF OMITTED] T6167A.023 [GRAPHIC] [TIFF OMITTED] T6167A.024 [GRAPHIC] [TIFF OMITTED] T6167A.025 [GRAPHIC] [TIFF OMITTED] T6167A.026 [GRAPHIC] [TIFF OMITTED] T6167A.027 [GRAPHIC] [TIFF OMITTED] T6167A.028 [GRAPHIC] [TIFF OMITTED] T6167A.029 [GRAPHIC] [TIFF OMITTED] T6167A.030 [GRAPHIC] [TIFF OMITTED] T6167A.031 [GRAPHIC] [TIFF OMITTED] T6167A.032 [GRAPHIC] [TIFF OMITTED] T6167A.033