[Senate Hearing 113-385]
[From the U.S. Government Publishing Office]
S. Hrg. 113-385
NOMINATION OF MARIA CONTRERAS-SWEET
TO BE ADMINISTRATOR, U.S. SMALL BUSINESS ADMINISTRATION
=======================================================================
HEARING
BEFORE THE
COMMITTEE ON SMALL BUSINESS
AND ENTREPRENEURSHIP
UNITED STATES SENATE
ONE HUNDRED THIRTEENTH CONGRESS
SECOND SESSION
__________
FEBRUARY 12, 2014
__________
Printed for the Committee on Small Business and Entrepreneurship
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COMMITTEE ON SMALL BUSINESS AND ENTREPRENEURSHIP
ONE HUNDRED THIRTEENTH CONGRESS
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MARY L. LANDRIEU, Louisiana, Chair
JAMES E. RISCH, Idaho, Ranking Member
CARL LEVIN, Michigan DAVID VITTER, Louisiana
MARIA CANTWELL, Washington MARCO RUBIO, Florida
MARK L. PRYOR, Arkansas RAND PAUL, Kentucky
BENJAMIN L. CARDIN, Maryland TIM SCOTT, South Carolina
JEANNE SHAHEEN, New Hampshire DEB FISCHER, Nebraska
KAY R. HAGAN, North Carolina MICHAEL B. ENZI, Wyoming
HEIDI HEITKAMP, North Dakota RON JOHNSON, Wisconsin
EDWARD J. MARKEY, Massachusetts
CORY A. BOOKER, New Jersey
Jane Campbell, Democratic Staff Director
Skiffington Holderness, Republican Staff Director
C O N T E N T S
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Opening Statements
Page
Landrieu, Hon. Mary L., Chair, and a U.S. Senator from Louisiana. 1
Feinstein, Hon. Dianne, a U.S. Senator from California........... 1
Risch, Hon. James E., Ranking Member, a U.S. Senator from Idaho.. 3
Witnesses
Contreras-Sweet, Maria, Nominee to be Administrator of The Small
Business Administration, Washington, DC........................ 3
Alphabetical Listing and Appendix Material Submitted
Boxer, Hon. Barbara
Prepared statement........................................... 30
Cantwell, Hon. Maria
Questions for the record..................................... 32
Contreras-Sweet, Maria
Opening statement............................................ 3
Prepared statement........................................... 6
Endorsements and Letters of Support of the Nominee............... 52
Feinstein, Hon. Dianne
Opening statement............................................ 1
Landrieu, Hon. Mary L.
Opening statement............................................ 1, 23
Palomarez, Javier
Prepared statement........................................... 83
Risch, Hon. James E.
Opening statement............................................ 3
Questions for the record..................................... 38
Shaheen, Hon. Jeanne
Prepared statement........................................... 28
Questions for the record..................................... 47
Small Business Majority
Prepared statement........................................... 85
NOMINATION OF MARIA CONTRERAS-SWEET TO BE ADMINISTRATOR, U.S. SMALL
BUSINESS ADMINISTRATION
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WEDNESDAY, FEBRUARY 12, 2014
United States Senate,
Committee on Small Business
and Entrepreneurship,
Washington, DC.
The Committee met, pursuant to notice, at 10:38 a.m., in
Room 428A, Russell Senate Office Building, Hon. Mary Landrieu,
Chairman of the Committee, presiding.
Present: Senators Landrieu, Levin, Cantwell, Cardin,
Booker, Risch, and Fischer.
HON. MARY L. LANDRIEU, CHAIR, AND A U.S. SENATOR FROM LOUISIANA
Chair Landrieu. Good morning everyone, and welcome to our
confirmation hearing on Mrs. Maria Contreras-Sweet. We are so
happy to have Senator Dianne Feinstein joining us this
morning--welcome, Senator--for the introduction of our nominee.
Because of the difficulty of scheduling with our ranking
member, Senator Feinstein, and other members, we are going to
go in a little different order. I am going to save my remarks
until the end to accommodate the schedules of other members
that are here. But let me just say it is an honor to have
served as the Chair of this Committee, and I am leaving it in
excellent hands to Senator Maria Cantwell, who will be joining
us, I believe, shortly.
It has been a pleasure to work with my partner, Senator
Risch, for several years passing major pieces of legislation
and conducting really important roundtables on issues that
have, I think, strengthened the entrepreneurial spirit of the
United States.
Let me turn it over now to the Honorable Dianne Feinstein
to introduce our nominee, and then I am going to ask the
ranking member for his remarks, if you do not mind, and then we
will hear from our nominee and try to proceed that way to
accommodate everyone's schedule.
Senator Feinstein.
STATEMENT OF HON. DIANNE FEINSTEIN, A U.S. SENATOR FROM THE
STATE OF CALIFORNIA
Senator Feinstein. Thank you very much, Madam Chairman,
Senator Risch--I see you on Tuesday and Thursday afternoon in
Intelligence. It is nice to see you here this morning--and
members on both sides.
It is my great pleasure to introduce to this Committee,
Maria Contreras-Sweet, President Obama's nominee to head the
Small Business Administration, and she comes with my strongest
and highest positive recommendation.
Let me begin by telling you a little bit about Maria's
inspiring personal story. She was born in Guadalajara, Mexico.
She immigrated to my home state of California when she was only
five years old. Her mother worked at a chicken packaging plant
to support and provide for Maria and her five siblings.
She went on to study at Cal State Los Angeles. She worked
hard. She built a distinguished career, including serving as
the secretary of the Business, Transportation and Housing
Agency, a big agency in California. In addition to Maria's
outstanding track record of public service, she possesses a
keen intellect and considerable private sector experience, both
of which will serve her well.
But most important to me, you know, the longer we are here,
it is easier to look at people as problem makers and problem
solvers. This woman is a problem solver.
So let me talk briefly about the private sector. This
nomination comes at an important time for the small business
community of our economy, and Maria knows firsthand what it
takes to run and grow a small business. She is the founder of
ProAmerica Bank, the first Latino-owned business bank in more
than 30 years. Before that, she was the president and co-
founder of a private equity fund that specialized in helping
small businesses access capital.
As you know, increasingly, those at the very top of the
income scale have easy access to capital, but many Americans
who earn more moderate incomes have trouble getting approval
for a loan. This is the kind of support that is essential to
grow a small business, something that Maria knows very well. In
fact, she has dedicated a considerable portion of her career to
help small businesses access capital, to grow, and to employ
more people. She has earned respect from community and business
leaders alike.
The Los Angeles Chamber of Commerce CEO Gary Toebben, who
worked closely with Maria over the years, has this to say: ``In
her business as chair of ProAmerica Bank, she was in contact
with numerous small businesses every day, businesses that have
financial needs and need other kinds of advice. That gives her
a really hands-on understanding of the small business community
and the challenges and opportunities that they face.''
So as you can see, Maria is uniquely positioned to make a
very positive impact at the Small Business Administration, and
that agency, I think, is one of the best things our government
does. I deeply believe she can play a critical role in helping
this country's entrepreneurs and small businesses thrive and
succeed.
Finally, and on a personal note, I have known her for many
years and I have observed her as a person who has dedicated her
life to helping people and improving the economy of Los Angeles
and California, and I have seen her in action. She is eager to
help. She is constructive. She is a problem solver.
So across California, from the public to the private
sector, in economically thriving and underserved communities,
Maria Contreras-Sweet is universally respected and admired. She
has my strongest recommendation to this Committee. And I thank
you Madam Chair.
Chair Landrieu. Thank you, Senator Feinstein, for that
beautiful introduction. Let me turn it now to my ranking
member, and then we will hear from our nominee.
OPENING STATEMENT OF HON. JAMES E. RISCH, RANKING MEMBER, A
U.S. SENATOR FROM IDAHO
Senator Risch. Well, thank you very much, and Senator
Feinstein, thanks so much for coming. It is always good to see
you on Tuesdays and Thursdays and other times too.
And I want to thank you, Ms. Contreras-Sweet. You
telephoned me the day that you were nominated, and I
appreciated that, and then took the time to come see me, and I
thank you for that. You have an absolutely stunning background
and qualifications for this job, and I am glad to see that the
president has appointed someone of your caliber to do this. We
have had a short period of time to talk about what your vision
is, and I am impressed to this point.
On a personal note, we have a mutual friend, Jovita
Carranza, who you know, and I value her judgment greatly. I
have known her for some time, and she gives you the highest
recommend, so that is a real plus for you.
So with that, Madam Chairman, thank you very much for the
opportunity, and we look forward to hearing from the nominee.
Chair Landrieu. Thank you very much. And Senator Feinstein,
if you have to slip out, you may.
Senator Feinstein. I do.
Chair Landrieu. Okay. Go right ahead. Thank you. And Ms.
Sweet, if you would stand, and we are going to take the oath.
Do you solemnly swear to tell the truth, the whole truth
and nothing but the truth, so help you God?
Ms. Contreras-Sweet. I do.
Chair Landrieu. Are you willing to appear and testify
before any duly constituted committee of Congress when
requested to do so?
Ms. Contreras-Sweet. I do. I am.
Chair Landrieu. Are you willing to provide such information
as is requested by such committee?
Ms. Contreras-Sweet. I am.
Chair Landrieu. Please be seated. Thank you very much, and
please proceed with your opening statement.
STATEMENT OF MARIA CONTRERAS-SWEET, NOMINEE TO BE ADMINISTRATOR
OF THE SMALL BUSINESS ADMINISTRATION
Ms. Contreras-Sweet. Thank you. Thank you, Chair Landrieu,
Ranking Member Risch, Senator Cantwell, members of the
Committee. I am deeply honored to appear before you today as
President Obama's nominee for the position of Administrator of
the U.S. Small Business Administration. Let me thank you and
your staff for putting together this hearing so quickly and the
kindness you and your teams have shown me in this confirmation
process.
I want to extend my sincere appreciation to Senator
Feinstein for her warm introduction. I am grateful for the
support of both my home state senators. I also want to express
my sincere appreciation to my husband, Ray; my children,
Antonio, Francesca and Rafael; and my extended family that is
represented here today. They are the bedrock and motivation for
everything I do.
President Obama has made small business a priority since
the day he stepped into office. He elevated the role of SBA
Administrator to cabinet level. He understands small
businesses. The work of Administrator Karen Mills, Deputy
Administrator Marie Johns, as well as the stewardship of Acting
Administrator Jeanne Hulit, has all resulted in a stronger,
more effective agency.
SBA's record levels of lending helped pull us out of one of
the nation's worst economic periods, and the agency has
streamlined and simplified many processes, reduced paperwork,
and become more customer oriented than ever before. If
confirmed, I will strive to build on that record.
I have, as was stated, over 25 years of management and
executive experience in both the public and the private
sectors. I will bring to this post--I will bring these
experiences to the post if confirmed. My background and
experience as an entrepreneur and as a government official and
as a corporate executive give me a unique perspective into
lessons learned that I can put to good use helping small
business owners create new products and expand their
businesses.
Let me just say, I am a small business owner whose small
business helps small businesses every day. ProAmerica is a
Latino-owned business bank in California. It started like so
many other small businesses do, from the ground up. With
support from the community, my friends and my family, we remain
a strong, vital bank in our community. We ensure that
entrepreneurs can access financing and all their needs to
contribute to the economy, create jobs and provide for their
families.
Earlier, when I started my first business, I experienced
the same challenges entrepreneurs face today. I wore many hats
and I poured my heart and soul into that business. Later, as
California's cabinet secretary over Business, Transportation
and Housing, I made sure small businesses were integrated and
involved in the state's procurement process, and we made
progress on those goals every year.
I enjoy bringing people together, building bridges, finding
ways to solve problems, and creating opportunities. I am
honored that so many small business advocates, community
organizations and friends from my past are here today, and I
look forward to working with them and others on the public/
private partnerships to help America's entrepreneurs if I am so
confirmed.
When I moved to California from Mexico as a child, I saw my
mother work long, hard hours to support my brothers and
sisters. I experienced firsthand the challenges that working
families face every day, the challenges that recent immigrants
are facing today. My record of fighting for women and families
stems from these experiences, and if confirmed, I will continue
to do that work.
We have a saying at the bank, ``construyendo patrimonoes.''
Translated in English, it means building family legacies. That
is what small businesses are. They are family legacies. It is
about family pride, supporting their community. It is what the
American dream is all about after all.
I am a very proud American, and proud of all that America
means to her citizens and to the world. If confirmed, I will
work closely with you, with your colleagues in the House and
the Senate, and President Obama for sure, to make sure that the
Small Business Administration is an even more significant force
in expanding the opportunities for all Americans, ensuring the
economic strength of our country and the global economy.
Once again, thank you again for this hearing. Thank you for
your leadership, Chair Landrieu, and if confirmed, I look
forward to working with you, with Senator Cantwell, Ranking
Member Risch, and I am happy to take your questions. Thank you
very much.
[The prepared statement of Ms. Contreras-Sweet follows:]
[GRAPHIC(S) NOT AVAILALBE IN TIFF FORMAT]
Chair Landrieu. Thank you very much. As I stated, because
of the time, I am going to submit my statement at the end. Are
there any other members of the Committee that would like to
make a brief one-minute opening statement, and if not, we will
go right into questions.
Okay. Let me begin. There are so many, but we have just a
short time. Let me begin with a priority that we were not able
to finish up in this last Congress that I feel very strongly
about. The U.S. Congress enacted a Small Business Investment
Act in 1958--which I am sure you are familiar with--because
Congress identified a gap in the ability of small businesses
throughout our country to access long-term credit. The economic
situation has changed for the better quite a bit since 1958,
but I think, and as you can tell from your position currently,
there are challenges to small businesses getting access to
capital and to credit to expand their businesses and to build
out that family opportunity and entrepreneurship.
I introduced with several of my colleagues the EXCEL Act,
which was filed in both this Congress and last. It has broad
bipartisan support. It basically would raise the family of fund
limits for small business investment companies, SBICs, from 225
to 350.
One of the leaders of one of our SBICs from Triangle
Capital in North Carolina, one of our most successful--you
might have heard of them--said, ``If our legislation had
passed,''--which it did not, but despite broad bipartisanship
support, it was held up by literally a handful of members--``If
the proposed legislation is passed, we believe over the next 12
to 24 months we would be able to directly help another 30 to 40
companies create up to 2,000 jobs.''
That is just from one SBIC that has been successful. This
is the leveraging partnership where private sector puts up $2.
The Federal Government puts up $1. We lend out to companies
that can grow.
Could you comment on your experience with SBICs, and would
you be willing to lead the fight to get this authorized as soon
as we can?
Ms. Contreras-Sweet. Thank you for that very important
question, Senator. As I have experienced in our bank in Los
Angeles, what we find is that clients come in and they have so
much that they can secure for collateral to underwrite a loan,
to buy debt. Then on top of that, they put up whatever cash
they have, whatever their savings, to make up a little more.
And oftentimes, there is that gap, that mezzanine portion
that the small businesses need, and that is why I think the
SBIC has been the most effective in trying to provide that
funding to make that gap, to make sure that they can actually
realize their dream and build that business.
So I am familiar with the product. I support the product,
and to the extent possible, I would like to learn more about
the specifics of your proposal. But I am aware of the gap and
understand the role that, along with private equity, can play
in layering with debt. So it makes a lot of sense to me. And
thank you for your leadership in that regard, and I would look
forward, if confirmed, to working with you on that product.
Chair Landrieu. Thank you. My second question is our
Committee was very active, both Republicans and Democrats, in
trying to expand by encouraging many of our community banks.
There are about 7,000 in the country. When I took over as chair
five years ago, only 1,300 were participating in the small
business programs. Now I am proud to say that there are 2,400
SBA lenders--you being one of them--around the country.
So what could you share with us about what some of your
ideas might be to even expand that number to more community
banks that could be partners with the SBA? What do you think we
could do better, the Federal Government, to either minimize
unnecessary regulations or paperwork that would encourage banks
to really become partners with us, because they are the ones
that know the customers. They are the ones that are in the
communities. How do you see community banks particularly being
a partner with you in your new role?
Ms. Contreras-Sweet. Thank you, Senator, again, for your
overall leadership in this regard. Specifically, let me just
share with you what I have been experiencing. What I see is
that large and small financial centers have been addressing the
area of small business loans to families and to entrepreneurs
across America. But indeed, it is the small local community
banks that really benefit from this product the most.
And for some of us--and again, I am just sharing my
personal experience--unless you have a specialized officer in
the bank that really understands the covenants, the warrants,
the underwriting, the standards that SBA promulgates, it is
somewhat daunting and a little overwhelming, and you want to
make sure that when you are pursuing an SBA loan and there is a
guarantee element, you want to make sure that you are not
sacrificing that, whether it is a 50 percent, 75 or 90 percent
guarantee, depending on the product.
And so what I have really been pleased with is that already
SBA's made some progress on that, the introduction of SBA One,
for example, the way that they are clearing up the paperwork,
streamlining, delegating authority to so many banks. For
example, ours is a preferred lender bank, so we get the benefit
of delegated authority. And so I already see great improvement,
but to the extent that we can get the word out, there is also
push and pull marketing, as I like to call it.
There is where we can also get the public to be more
informed. When I approach some prospective client or a client
about an SBA product, they are not fully aware, and so we take
a lot of time to consult them, to walk them through and explain
to them this alternative.
So to the extent I think that the SBA can even market the
products more, get out--and if you will, I use this
vernacular--we can brand the SBA a little more so that people
are comfortable with it, understand that this is not your
grandfather's SBA, I think it will go a long way in encouraging
local communities, local community banks, to do more of that
work.
And if I may just add one more thing. I think throughout
our 68 field offices, the SBA now has great reach into every
community through their regional offices, as well as through
the SBDCs, through the women business centers, through all the
myriad of programs. So to the extent that we can continue to
work with those strategic partners throughout the country and
get the word out about the benefits, about the upgrades, about
the simplified streamlining that is taking place today, I think
that too will go a long way.
Thank you again, for the good question, Senator.
Chair Landrieu. Thank you.
Senator Risch.
Senator Risch. Thank you, Madam Chairman.
Ms. Contreras-Sweet, you recall when you and I met, I told
you about one of my favorite agencies over there in the agency,
and that is the Office of Advocacy. And I'm assuming since that
conversation you have had time to think about it and perhaps
even have a look at what they actually do over there.
To me, that's one of the real important things that the
agency does. When I meet with people, whether they are from big
business, medium business, but particularly small businesses,
they are just really miserable over the crush of regulation
that the Federal Government is putting on them. And the Office
of Advocacy is designed to go in there and get them
figuratively by the collar and say, ``Look, you cannot do
this.'' The law of unintended consequences is going to come
around and bite these people and put them out of business.
The Office of Advocacy really needs its independence to do
that, not being getting a call from the White House saying,
``Hey, back off on your advocacy for small businesses.'' They
really need to make life less comfortable for the bureaucracy
than what it is when they are in their rulemaking and
regulating mode.
So have you had some time to think about that? And I would
like to get your thoughts on the Office of Advocacy.
Ms. Contreras-Sweet. Thank you, Senator, for speaking to a
couple of important points, and I take pleasure in having an
opportunity to address you on this.
First, let me just speak to the office and the structure. I
mentioned to you also in that conversation that I had the good
fortune of being able to create California's Department of
Managed Healthcare. And I went to great lengths to assure that
there was an independent voice for the patient community, the
Office of Patient Advocate. And I made sure that it reported
directly to me, as did the director of the department.
And so I liked the role, that it was important to me to
have that sense of independence. What I appreciated here is
that here too the Office of Advocacy is also an independent
voice and should--we need to maintain the integrity of that
office to make sure that it stands alone and of its own prowess
to be able to provide an ardent voice for the small business
community.
The small business community represents half of America's
workforce, and it represents two-thirds--two out of every three
jobs being created come from the small business community. We
need to make sure that we're creating a level playing field for
this community. So that is number one.
Number two, to the extent of the actual regulation to which
you spoke, it is a primary goal to assure the small business
community has a level playing field. We want a level playing
field. It is already difficult to start a business. You make
huge sacrifices and yet, this is a community where we harness
great innovation, where we create jobs, as I just outlined.
And so to the extent that we can reduce regulation,
streamline opportunities for them, I think it should be a
priority. From personal experience, I have endured regulation,
if you can imagine, having been California's Secretary of
Transportation. Just in that department alone I had 14
departments. But just in Caltrans, I was responsible for about
22,000 employees and a $10 billion budget.
So trying to work with each dedicated fund, if I was trying
to fill a pothole but I only had extra capital--in the Carl
Moyer Program, for example, you could not move things over. So
the discretion, the flexibility that the regulation prohibited
me to exploit was difficult. And now, if anybody is going to
start a business, the most complicated businesses to begin, to
start from the ground up, would be a bank. It is highly
regulated.
So having talked to the point about how we want a level
playing field, we want to make sure that we can have a
streamlined program in place, but the other side of it is also
in balance to make sure that the proper consumer protections
are in place.
Thank you, Mr. Senator.
Senator Risch. Well, thank you very much, and I know you
and I talked about, and I know you share my concern, that these
regulations that are put in effect many times can be easily
absorbed by a large corporation that has an army of lawyers and
compliance officers. But for the guy that is fixing lawn mowers
with a couple of employees, it can put them out of business. So
I appreciate your understanding in that regard and look forward
to working with you on that.
Madam Chairman, I have got to excuse myself because I have
another meeting, but since this will be our last foray
together, thanks so much for working with you and the many
courtesies you have shown, and I look forward to working with
the new chairman of this Committee.
The bad news is we will only be a few seats apart over on
the Energy Committee, so look forward to working with you.
Chair Landrieu. We will continue our strong partnership
there.
Senator Risch. Thank you.
Chair Landrieu. Thank you, Senator.
Senator Risch. Appreciate it. Thank you much.
Chair Landrieu. Thank you.
[Applause.]
Senator Cardin and then Senator Fischer, Booker and
Cantwell.
Senator Cardin. Well, first, Madam Chair, I want to just
join in recognizing your extraordinary leadership as the chair
of this Committee. I have had the honor of serving on this
Committee since I was elected to the United States Senate, and
working with Senator Snowe and Senator Risch, your leadership
has been extraordinary, and we have gotten a lot of things
done. You should be very proud of that.
The first and foremost was to get funding for the SBA. It
was not easy. President Obama was a strong supporter, but we
had to get those funds in the Congress, and through your
leadership, we were able to get the Budget Committee to make
the necessary adjustments. So the resources are there. We made
it a lot easier on the SBA loans, making major changes.
The reauthorization, the SBIR program, that didn't come
easy. And there is not unanimity among the research community
about the SBIR program, and you did a great job in bringing
together a workable way that we could get that done. I
particularly appreciate your help in getting a permanent
increase on the surety bonds that help small construction
companies and the work to be done on government procurement. We
made major progress.
I also acknowledge the work we have done in a fairer SBA,
dealing with minority businesses and women-owned businesses,
all under the watchful eye of this Committee. So you have a
great record, and I thank you for the leadership, and it has
been an honor to serve under your chairmanship.
I know that Senator Cantwell will provide great leadership
to this Committee. I look forward to working with her, because
this Committee is very important. I asked to serve on this
Committee. Small business is the engine of job growth in
America and innovation, so therefore, we need a champion.
So let me, if I might, raise a couple questions as to our
nominee's commitment on certain areas. Let me talk government
procurement for one moment. Agencies that are hard pressed for
dollars--and that is what is happening today--will sometimes
try to take the easy way on procurement, bundle small contracts
together so that the only entity that can really qualify for
the prime contracts are large business. We want to see more
prime contracts with small companies.
Can you share with us your vision as to how you will be an
advocate within the Obama Administration so that the government
procurement goals are truly met not just by subs but by primes
and how you will provide leadership to provide that opportunity
for small businesses.
Ms. Contreras-Sweet. Thank you, Senator. Thank you very
much for addressing an important part of what is going to be a
key element of what we do. Clearly, we all know that the SBA is
responsible for access to capital, but right behind there is
the contracting component, and of course, the counseling and
the disaster relief. So I understand that it is an underpinning
of the Administration, of the Small Business Administration.
But if I may just also speak to what you just referenced
earlier, and that is the importance of the SBIR, the STTR, all
those programs. What I see from the public, being a banker and
small business person, I really admire the work of this
Committee. Let me just say the leader, Chair Landrieu, and how
thoughtful these programs are, how thoughtfully they fit
together, you know, to be able to have research dollars, to be
able to partner up with the university through the STTR
program, and then to be able to roll it out and through
counseling to be able to get the capital and to take it to
market, to patent it and to take it to market. I intend to use
the cabinet-level status to make sure that I am working
collegially with the Secretary of Commerce to make sure that we
are using that Patent Office efficiently and effectively.
Senator Cardin. And I agree with that. I just would focus
on the fact that there are some departments that are great on
small business. There are others that are not.
Ms. Contreras-Sweet. Right.
Senator Cardin. And I just hoped you would be very visible
with those agencies that are not meeting the goal and certainly
not complying with the spirit, that we want prime contracts for
small businesses just not subcontracts.
I want to raise one other issue. I have limited time. We
have talked about capital a lot. And I must tell you, I have
been disappointed by the results on loans being made to small
businesses. I think we provided a great deal more tools here in
Congress. There was fundamental disagreement, I think, between
some of us on the Committee and the Administration as to
whether there should be direct loans or just guaranteed loans.
The Administration prevailed on the prime tool being
guarantees.
There are too many banks that are still very difficult,
particularly if you are a minority small business or a non-
conventional. Some of the faith-related enterprises, small
business, it is very difficult to get loans.
What game plan did you have to make sure that we achieve
this objective of capital being available?
Ms. Contreras-Sweet. Thank you. Again, if you will indulge
me and allow me to answer your first question, because I am not
sure that I satisfied you. And so let me just say that I have
extensive experience in contracting, and I want to share with
you that to the extent that I was working to reach goals that I
established for our agency, what I found is that first the
public was not generally aware of the opportunities with
government. They knew that they could go down the street and
try to get a local restaurant to buy some things from them, but
they were not aware about how to approach government.
And so first it was just to counsel them, to help them
understand what the procedure was. Once I got them to be aware
of it, then they would say, ``You take too long to pay. I
cannot carry the EBITDA. I cannot carry the cash flow.''
So we put a prompt program in place, a prompt payment
program. I was delighted to see that the president here put in
QuickPay. That mirrors some of the things that we were doing
there. At the next level, it just generally was, you just aptly
pointed out, and that is that in bundling, you know, you go the
counter-cyclical way. So I did what would probably be
counterintuitive, and that is to debundle, to make sure that to
the extent possible we can kind of break these down to make
sure that smaller and smaller and smaller businesses could
capture some of those opportunities. And to that extent, also
we were able to create more local opportunities, and I think
those are important facets.
So I just wanted to underscore the importance of what you
said and share with you that if confirmed, I would be delighted
to engage in this project. It is very important to me, and I
have personal experience, some strategies that we can deploy to
make that even more effective. So thank you for that.
To the extent that you just mentioned, again, about access
to capital, it is the underpinning of everything. So indeed, we
have to make sure that we market well, that we use our
counseling centers well, and that I, as you aptly pointed out,
that I work collegially with my colleagues. The ones with whom
I have met already have been very receptive, and that 23
percent goal is something on my mind. And if you give me an
opportunity and I have your support and I am confirmed, I would
be delighted to work.
I am counting the days, Mr. Senator, 365 days in a year.
And so I am counting the days, and I can assure you that even
though I am coming in a little late with weekends and evenings,
we can make up some time and to actually capture some of those
goals. Thank you.
Senator Cardin. I like your enthusiasm.
Ms. Contreras-Sweet. Thank you, Senator.
Chair Landrieu. Wonderful. Senator Fischer.
Senator Fischer. Thank you, Madam Chair. And I too would
like to thank you for your leadership and your service on this
Committee. I also asked to be on this Committee, so it has been
such a pleasure to serve with you. Thank you. I wish you well
in your new chairmanship on Energy.
Ms. Contreras-Sweet, earlier this year, the SBA implemented
a policy that would increase costs for some 7(a) loans. The
rule will require that lenders for special-purpose properties,
such as hotels or convenience stores, obtain two appraisals.
One is for the real estate portion and the other is for the
operations.
The cost of obtaining those two appraisals, I know you
understand that that is going to be passed on to the consumer.
I think it is also going to slow down the sale of the business.
It is going to slow down the obtaining of the loan that these
businesses are trying to get.
As you know, a number of real estate agents have been
trained where they can do both appraisals, but that is not
allowed under this rule. Would you be willing to reconsider the
rule if you are confirmed as the administrator?
Ms. Contreras-Sweet. Thank you, Senator, for that important
question, again. It is tough out in the community, I can share
with you, and so I am delighted that you raised that issue,
because we usually ask for that appraisal cost upfront, and so
they have to put that out and then you process them, and then
hopefully succeed through the process.
I can share with you that it is something of which I am
quite familiar, and I commit to you to engage in that from that
experience point of view, to learn more about, again, the
rubrics, the bowels of the organization, what is possible, and
so I would not want to commit prematurely. But if confirmed, I
would be delighted to take a delve, to dive in and work with
you on that program. I have an interest in wanting to pursue it
some more.
Thank you for the question.
Senator Fischer. Thank you. I appreciate your commitment on
that. I can tell you in rural areas of any state there is a
limited number of professionals who are able to do those
appraisals, and small businesses struggle in rural areas. So
any time you have to find two appraisers, that adds additional
costs to a business that is trying to expand, that is trying to
grow, that is trying to serve the customers they have. So I do
look forward to working with you on that.
Also, what is your expectation as to when you believe the
Administration might be nominating someone for the deputy
position that has been vacant, I believe, since June? And
hopefully the Administration is going to move forward on that.
Have you heard anything about that?
Ms. Contreras-Sweet. Thank you for asking me a very
important question, as you can imagine. I can tell you that I
think the Administration was really focused on filling the top
job so that if confirmed that person would be able to engage in
the process and be a part of the selection committee.
So I am looking forward to your support. And again, I would
be delighted to engage in that process to make sure that to the
extent that there is a, if you want to call it, a complimentary
role, I think it is important in making sure that we are
working collegially, collaboratively to assure that America's
small businesses have a loud voice and an active engagement in
the community of job creation.
Thank you.
Senator Fischer. I would assume that would just be one of
the number of items on your agenda as you move forward if you
are confirmed as the administrator. Can you tell me what you
see as some of your priorities? If you are confirmed, how do
you want to hit the ground?
Ms. Contreras-Sweet. Yes. As an administrator, whether you
are in public or private sector, I think you have to first
explore the fundamentals. You have to assure that the controls
are in place. You have to, what I call, you know, deploy an
ERM, an Enterprise Risk Management, system. You have to make
sure that all the controls are in place.
So I do not like to launch off into anything until I make
sure that the fundamentals of business, of government, are all
in place. So I would first do that. I would just make sure that
I am briefed about where the vulnerabilities are. How do we
tighten those things down?
And then after that, again, just to understand the full
complement of programs and to understand if there are any gaps
there. From my vantage point, from my prism at this point, I do
not see that there is that.
And then third, I still think that it is very important to
get the word out about the products, again, making sure that we
understand the limitations of our role. The SBA is not here to
supplant the private sector role. The private sector, the
credit markets, must be first, but where they freeze, or where
there is a gap, that is where I think SBA has an appropriate
role.
So we must make sure that we understand the proper role of
government, the proper role of the SBA. But where we belong and
where we must be, we must be there effectively, efficiently.
Particularly in an instance of disaster, for example, you want
to make sure that the right layers are in place at the right
time to be responsive to whatever that family may be enduring.
I had a personal example, a personal instance where my
mother-in-law was victim to the Northridge earthquake, and I
saw what SBA's role was. I saw what FEMA did, and the way in
which it was unveiled. And I think it is important for us to be
efficient and to be effective, particularly in those times.
I will just make one more comment about that. I was on duty
during 9/11 and as Secretary of Transportation, some folks do
not know, I also had responsibility for the California Highway
Patrol, and the Highway Patrol protects our state buildings,
our courts, some of our state prisons, and so it was important
to make sure that those safety mechanisms were in place, and I
am very familiar with that.
I can tell you that we did not know what was taking place,
as the world did not know exactly what was taking place. But we
knew that those planes were bound for California, and I had to
make sure that the integrity was in place: of our bridges, of
our highways, and our entire transportation network. Readiness
around disaster would be fundamental, to answer your question.
That would be one of the areas that I would want to make sure
that we have buttoned down everything that needs to be down,
because that is when the people need us most.
Thank you for that question.
Senator Fischer. And thank you for your response. I
appreciate it.
Chair Landrieu. Senator Booker.
Senator Booker. I just want to add my chorus of
congratulations and gratitude to you. You have been an
extraordinary leader for me on a very personal level, coming
new to the Senate. You helped me with my orientation. This
Committee I was thrilled to be on, but even more thrilled by
the leadership and guidance you have given me. So thanks for
being a north star in my early days, and I just hope the people
of Louisiana, every single one of them, knows how lucky they
are to have such an extraordinary leader, a leader amongst
leaders here in the United States Senate. So thank you.
Chair Landrieu. Now, if my children could hear this, we
would be making progress. Thank you. Thank you, Senator Booker.
Senator Booker. But I would be remiss. I have had the
pleasure of knowing Senator Cantwell long before I was a
Senator, and it is extraordinary now to have her leadership
here. She is somebody that comes with private sector
experience, with experience in the technology sector, which is
really important to me in an area where small business growth
is critical, and I am just really looking forward to having you
now as the chairperson of this Committee, and congratulate you
as well.
You are extraordinary, and I am so thrilled to have the
opportunity to work with you. And this country is lucky that
someone with your experience, background, expertise and skill
would want to volunteer to serve in government yet again. You
are making a personal sacrifice doing so. You are making a
family sacrifice doing so. And, you know, I was taught as a
young person that you should never judge someone by their
personal accomplishments but by their willingness to do for
others. And under that measure, you are truly a great American,
and I am grateful to have this moment to talk with you.
You and I both know I have been in the grassroots trenches
like you have, trying to figure out how, especially in
underserved populations and especially in urban areas, how do
you get businesses going. And my team and I understood that the
three biggest things, when we pulled together folks, is
technical expertise--because many people have vision--but
everything from learning how to make payroll, and all the
things that help you to really make businesses run, function;
access to capital, which is something that has to be a major
part of your mission, and I know it is, and I have heard that
already expressed; understanding that government is one of the
biggest opportunities for small businesses. We found that many
of them did not know how to--everything from bonding
requirements to even getting in the game to be considered.
So I am grateful for all those things, and I am actually
really confident that you are the right leader to tackle those
three areas. I look forward, as we have talked a little bit
before this meeting, about the creative ways now to get capital
into the communities. I am looking forward to discussing with
you some of our ideas about using online platforms--which we
think is going to really help New Jersey--is a new movement, a
democratizing force in terms of access to capital for the
country.
A few quick things that I just want to hit you with in the
remaining moments that I have, and I will just say them both at
once and allow you to speak to them. There is a lot of
dissatisfaction in New Jersey about the SBA's speed at which
they dealt in post-Sandy recovery. And I am hoping that you pay
particular attention to this, because these 100-year storms
seem to be coming, at least to my area of the country, with
great regularity, becoming almost a yearly or every other year
engagement.
And getting small businesses up and running again is so
important and is so critical. And I hope you understand that
part of your duty--I pray not, but should be--is going to be
responding to crisis and businesses in crisis, and the SBA has
not lived up to the expectations people have for it.
And then the second thing, there is so much attention on
cyber security for the big businesses, Target and the like, but
I have increasing concerns, especially as many small businesses
do deal with personal information, do deal with valuable
exchanges that add up to large amounts of money, is what we are
doing from a small business perspective to prepare our
businesses in America to do the things they should be doing to
protect themselves from cyber attack?
Thank you.
Ms. Contreras-Sweet. May I first say that you are an
American hero in every sense, and so as we say, I would like to
just sort of shout it back at you.
Senator Booker. I do not have kids, but can we record that
for the record? Yes. Just so I can pull that out.
Ms. Contreras-Sweet. So your reputation precedes you, so
thank you for the generosity of those compliments.
Let me just make a couple of comments in response. First
and foremost, when we had the Los Angeles riots, a highly
underserved community, I was delighted that here I was sitting
at, if I may plug, 7-Up at the time. I was delighted that I was
called by the Mayor and Peter Ueberroth, the chairman of
Rebuild Los Angeles, to come and serve at that board to make
sure that we could respond to those riots and that we could
restore those communities immediately.
And I learned something in that process, Mr. Senator, and
that is that oftentimes we think we have the answer, and people
said, ``You have to put in this and''--and when I went in and I
actually went into the community, walked those streets, talked
to those families, and what they said is, ``Yes, we need jobs
and we need a bank and we need''--``for sure, but please do not
forget a laundromat. I can't even interview until I get my
clothes washed.''
The fundamentals of understanding, to connect with the
folks, ask them what they need. It is important that we engage
in the community. So first, I must say it is important to
understand what the needs are before we begin to respond.
Secondly, with respect to your cyberspace question, I had
the good or--I am not sure if I want to say good fortune, but I
was in the position of cabinet secretary over our business
regulation, and as part of that, I had to help the state ready
for Y2K. Now, I know in retrospect, you know, we have perfect
vision, right? Hindsight is 20/20. But in advance of that, we
had no idea what was in store for the world, let alone our own
state.
And so I was responsible for one-third of the California
data systems, the tiered data center. And so I learned a little
bit about how to manage technology, as well as in the way we
executed our driver's licenses. You have to stay ahead of, you
know, those who will counterfeit your products. And so we were
continually upgrading and changing our driver's licenses.
So in different ways, whether it was through the banking--
you may know that I oversaw the Department of Financial
Institutions for the state, and so I regulated in-state
banking. And there too, we had to make sure that there was
redundancy, that there was a proper separation of duties to
make sure that somebody was watching what the other person was
doing. So I have a little insight into this community, and I
would be prepared to, if confirmed, to bring some of those
ideas that I was able to glean from those experiences to this
process to make sure that we are being responsive in making
sure that we are protecting Americans, particularly the small
business community that desperately needs a level playing
field.
But just one more thing about that, and that is that we
have to make sure that we avoid fraud, waste, and abuse as
well. We have to make sure that we respect our public
employees. Our public employees are largely hard-working people
across America; that is what I see. But you have to also convey
a message of zero tolerance if anybody is going to try to game
the system, try to do something that is inappropriate. So I
would bring my past experience to those areas that you just
outlined.
Thank you for the question, Senator.
Chair Landrieu. Thank you. We have two more senators,
Senator Cantwell and Senator Levin, and then I am going to
finish up with a few questions. And I think we will close out
in about 10 to 15 minutes, because votes will be called at
11:30.
Senator Cantwell.
Senator Cantwell. Well, thank you, Madam Chair, and I too
want to thank you for your tremendous leadership here at the
Small Business Committee. Not only do I consider you a personal
friend, but a giant advocate for small business. And when our
country had one of our biggest economic downturns, there was a
lot of discussion about how to help the big banks. In fact, in
my opinion, we kind of gave them access to the keys to the
Treasury, something I did not quite appreciate how that was
done.
But you were steadfast in the Small Business Jobs Act of
2010 in advocating for small businesses and trying to come up
with ways to help protect them as they were getting hammered by
new regulations and this economic downturn, when performing
lines of credit were pulled right out from under people.
So I just could not have been more proud of your leadership
in this Committee. People did not realize what an advocate Mary
Landrieu was when she took over this Committee, and I actually
feel like she put the small business activities in that battle
of 2010. You know, we had to work with Senator Voinovich and
Senator Lemieux to finally get a bill that tried to protect
small business, but it was the cry in our country at that time
that small businesses were just getting hammered on this
downturn and really, in some ways almost being a scapegoat for
what had happened. I do not think a lot of these small banks,
or even the businesses that they were serving, were involved in
derivative activity, but yet they were the ones who took it
right in the chin.
So I am just very proud of your leadership on that and very
proud of your leadership on this Committee. And I know you are
not going far. In fact, we both serve on the Energy Committee
and this Committee will certainly be looking for ways to work
together. So thank you for that.
Ms. Contreras-Sweet, thank you so much for your willingness
to serve. You have shown today you have a command of these
policy issues that we are going to be looking forward to your
activities and I personally like that you are a good marketer.
Anybody that knows push and pull technology marketing is okay
by me, because to me a lot of the Small Business Administration
is both push and pull. I mean, part of it is getting people to
understand what programs we have and what they can take
advantage of, and obviously, getting them to work with us on
those that need to be improved.
One of the things about the Small Business Jobs Act of 2010
was the 504 refinancing program, and that refinancing expired
in September of 2012, so I wanted to have your thoughts on
whether you support reauthorizing that section of the bill.
Ms. Contreras-Sweet. Thank you for speaking to 504. It is
an important product, and to the extent that you were able to
offer up the refi program, let me just tell you from my
personal experience it was very well received. At the onset, at
the very beginning, I must say that we were trying to work our
way through and tried to understand it a little bit.
But once we got it down is about when it sunset, and so we
were a little disappointed about that. As I understand it now,
the president is supportive. I, from the community, understand
the importance of the product and if I am confirmed, I would be
delighted to work with you and explore ways in which we can
continue to fill that important gap.
Senator Cantwell. So you would support reauthorization of
that?
Ms. Contreras-Sweet. If given the opportunity, I support
the product. I think it is an important tool for Americans
today.
Senator Cantwell. Thank you. Another program, and again, I
appreciate your perspective on small businesses and small
business exports.
My colleague from New Jersey mentioned technology and the
State Trade and Export Promotion program, the STEP program. Are
you familiar with that program within----
Ms. Contreras-Sweet. I am. The partnership with the states?
Senator Cantwell. Yes. And I am a huge believer in where we
are right now in the context of an information age and a lot of
products and services, but you have to add capital. And the
U.S. has a lot of these, and so the STEP program in my state
has been beneficial from many technology aspects. It helped a
program in my state grow to nearly a hundred new people on some
swipe technology that right at the critical moment they got
access to the Asian market, and, just recently, some aviation
companies have used the program. Silicon Forest Electronics, a
company in Southwest Washington, got access to some aviation
sales because of the STEP program. A small company, Slingshot
Sports in Stevenson, Washington, a very small company, got
access to help grow their business.
So for me, I want to get your thoughts on the STEP program
and whether you support continuing that or growing that effort.
Because we have huge opportunities with the Asian market and
the Pacific Northwest, and we certainly want to see us use
these promotions to help meet the agenda that the
administration has on doubling the number of exports out of the
United States, and certainly, small businesses can play a very
big role in that.
Ms. Contreras-Sweet. If you will indulge me, Senator.
First, I just wanted to thank the State of Washington. When
California was going through its energy crisis, the State of
Washington really came forward and helped us through, and I
will never forget that. So thank you to all of the good people
of the State of Washington for all that they did for
Californians in that very difficult period.
Next, let me just speak to STEP. What I like about STEP is
that it has three important components, in my view, again, just
from personal experience. I really appreciate that somebody can
come in and get some counseling through a university, the
partnerships with the universities, that it is state-sponsored
so that there is a relationship and a partnership with the
state government.
In many instances, this is where many small businesses are
a little more comfortable. So I appreciate that. I appreciate
that it provides for introductions, in many instances
internationally. And so there are so many good components
around STEP, and in a globalized economy, we have to find ways
to make sure that small businesses too can compete in that.
There is currently, in my view, with technology and all the
other tools that are available to us, the lowest barrier to
entry for a small business opportunity, and so to the extent
that we can have programs like STEP, helping them, partner with
them, and providing them the right tools, I think that we can
strengthen our ability to compete globally.
Again, this is where the innovations are taking place, and
so why not let the small businesses also have a piece of that
pie, a bite of that apple, to make sure that they are also
partaking of the international globalized opportunities that
are presenting themselves in an increasing way every year. So I
believe in the program. I think it is an important program, and
the tools in it support small business expansion in the
international economies.
Senator Cantwell. Great. Thank you. Thank you, Madam Chair.
Chair Landrieu. Thank you, Senator Cantwell. Senator Levin.
Senator Levin. Thank you so much, Chairman Landrieu. And
welcome to you, Ms. Contreras-Sweet. Congratulations to you.
Your wonderful experience and talent is going to be put to
great use with the SBA program and it is matched only by the
enthusiasm which you show for the job at hand. We are delighted
with your appointment and look forward to your confirmation.
I want to thank our chairman. Mary Landrieu has been an
absolutely superb chairman of the Small Business Committee.
There are not too many people who are able to get legislation
passed these days. I will not go into any more detail on that
as to why. But she is one, because she knows how to work across
the aisle. Her energy is legendary. She will bring that energy
to the Energy Committee now. It will be called the Energy
Energy Committee after Mary Landrieu is there.
And we are also delighted with our new chair. We have known
Senator Cantwell a long time, and her background is going to be
useful from before she was a senator. The respect in which she
is held by all members of the Senate will be a major gift to
this Committee. So you will be working with a wonderful new
chairman as we say goodbye but not farewell to our current
chairman.
You have a couple more hours here, I believe. Have you been
formally----
Senator Cantwell. Not until Thursday.
Senator Levin. Not until Thursday, if we are here.
There are a number of small business programs I have been
involved with. I have been on this Committee actually since I
got to the Senate and one of the programs I have been involved
with--and this is a recent addition to the panoply of programs
in the Small Business Administration--is the Intermediary
Lending Pilot Program. It is currently a pilot program where we
have non-profits that are, on a competitive basis, given awards
to re-loan to small businesses, filling in a gap between the
smallest program, the Microloan Program, and the 7(a) program.
And so this intermediary program fills that gap.
It is a pilot program which has been in place only for
three years now and it is up for reauthorization. And I am
wondering if you are familiar with the program. The SBA itself
has said it has had great success with it. That is our
experience in Michigan. But I am wondering if you are familiar
with this program and whether or not you would support its
permanent reauthorization.
Ms. Contreras-Sweet. Thank you, Senator. And in preparing
for this, I heard from my good friend George Mitchell, Senator
George Mitchell, who said to say hello.
Senator Levin. Well, thank you.
Ms. Contreras-Sweet. And so I do extend his regards here.
Senator Levin. Thank you.
Ms. Contreras-Sweet. But thank you for asking a really
important question and oftentimes an overlooked part of our
economy, and that is that so many of us think about loans and
banks, but in the microlending program--and I was delighted to
see that that was an offering in the SBA, that they do have a
microlending program. And so thank you for your leadership and
your ardent support for that sector.
Clearly, it is always difficult to start your first loan,
and until you build credit, it is difficult to get a 200,000, a
3, 4, $500,000 loan. So to the extent that we can issue some of
those microloans, $50,000 loans to get people started, it spurs
innovation. So I am familiar with the program. I think it is an
important tool in the tool chest and I am very much in support
of microlending programs.
And through our intermediaries now as a banker, to the
CDFIs, through programs like CAMEO in San Francisco--a program
I am familiar with--different disseminators of microloan
programs have been really good stewards of making sure that
particularly underserved communities--and as I said, folks that
are reentering the workforce--that they are providing for that
first line of credit that will build eventually to the next and
the next.
Senator Levin. Okay. Well, the next step then is this
intermediary program. It is the next step up from the microloan
program. It is a pilot program, and I hope when you get to the
SBA, not if but when you get to the SBA, that you will check
this out, because we need to reauthorize the next step-up
program from the microloans, which are these more intermediate-
sized loans. And it is an important program, so if you can get
back to us as to what you find when you get there about this
pilot program and whether you are going to be able to strongly
support it.
Finally, we have been very much involved in the SBIR
program. As chairman of the Armed Services Committee, the
Defense Department is the largest contributor to the SBIR
program. As a matter of fact, under the leadership of our
current chairman for another day, we were able to get the SBIR
program reauthorized in the Defense Authorization Bill.
Chair Landrieu. Thank you.
Senator Levin. We cannot use the Defense Authorization
bills for everything, but we were in this case able to actually
use this bill when we were having trouble getting bills passed
because of the creativity of Chairman Landrieu coming to me,
basically saying, ``Can we get this done in the DoD
authorization bill?'' The argument was, ``Yes, the Pentagon is
the biggest contributor of funds to the SBIR program.'' That
gave us the quote, ``hook''--not probably politically correct
word--but the hook to include this in that bill.
So it is an extremely successful program. We hope that it
will have your full support.
Ms. Contreras-Sweet. First, may I thank you on behalf of
America's small businesses, if I may be so presumptive, because
it allows the small business community to again have a more
level playing field. The large corporations have extensive
research dollars and R&D centers, and so to the extent that we
can provide innovation and research resources for the small
business community, I think it is an important tool again, once
again. So thank you for your leadership.
As I understand, it is a very well received program out in
the community, and I think it should be supported. And I would
be delighted to, if confirmed, if from your lips to God's ears,
my prayers are answered and I am confirmed, I would be
delighted to engage more deeply in that program and work with
you closely on it. But thank you for your leadership. It is an
important tool.
Senator Levin. Thank you. And again, congratulations and
thanks to our current chair and our future chair.
Chair Landrieu. Thank you so much. If the members would
just give me a five-minute personal privilege to close out this
meeting and give my remarks.
OPENING STATEMENT OF CHAIR LANDRIEU
Chair Landrieu. First, to begin, you will have my strong
and unequivocal support for your nomination.
Secondly, I have been on this Committee now almost 10
years. I think you may be the most extraordinary nominee that
we have ever had. Your command of the details of the programs,
your own personal experience that you bring, is going to be
just a tremendous asset. I could not be happier to hand over
the leadership to two extraordinary entrepreneurs in your own
rights maybe for the first time in the history of this
Committee, two women who have built businesses, run businesses,
marketed businesses, and understand the challenges. So I think
this Committee is going to be well served.
First, Senator Levin, you have been such a mentor to me in
my time here. To have the chair of the Armed Services Committee
hardly miss a Small Business meeting is just a testimony to his
heartfelt belief that he may be running and authorizing some of
the largest businesses in the world, which he does, but has
never lost his passion for the people of Michigan, the people
of Detroit, all the places in Michigan, where he knows that
small business is the heart and soul of his state.
Senator Booker, your experience as mayor and coming as a
new member of this Committee, you are just going to be
extraordinary on it. I want to particularly thank Senator
Cantwell. People do not realize this, but she was my rock
behind the scenes in so many places where I could not figure
out where to go and what to do, and her technical knowledge is
so spectacular. And she helped me to put this Jobs Act together
when we really couldn't find a lot of support to do it. And the
two of us just kind of made up our mind.
And I want to thank Senator Merkley, Senator Boxer, Senator
Levin, Senator Schumer, Senator Durbin, Begich and Cardin, who
were the original co-sponsors of it, and the two Republican
members that stepped up against great pressure, Senator
Voinovich and Senator LeMieux, that helped us to pass that.
In closing, in three minutes, I just want to leave you and
the Committee with three or four big issues. First, your
command of the need for small business in a disaster, I really
want to just cry, but I am not going to let myself. Because I
know what happened in Katrina and the Gulf Coast. You know what
happened in the earthquake. You know how desperate small
businesses are. And they have nowhere to go, nowhere, because
no one wants to lend them any money. It does not matter how
long they have been in business. It does not matter how
profitable they have been. People just want to shut them out
and say, ``Come back when the situation is better.''
The problem is the situation cannot get better, Senators,
unless the small businesses are helping to make it better, like
the gas stations, the laundromats, the restaurants that cook
food for the first responders so they actually have a place to
eat. This woman understands this, and we have done some good
work on that, but God bless you for taking it to the next
level.
Secondly, I want to talk about--30-seconds--rural
businesses. President Obama made a great effort to try to bring
high-speed internet to rural communities. Technology has
changed. People in rural areas need help. They are smart, they
are hardworking, and they do have community banks in rural
areas that know them. But they have to have high-speed
internet. Please continue to focus on that.
On the entrepreneurship underemployment, the president
spoke about this in his State of the Union. We have millions of
Americans--you know them well. You can see their faces--that
have either flunked out, stepped out or been kicked out of the
mainstream. They are not going to be able to finish high school
or college. They are of an age but if given a chance, they
might be able to start their own business, employ themselves,
their family, their community. I do not think we are doing
enough to reach them.
The president has called us to come up with special
initiatives. I really hope the Small Business Administration
will be first to the line to say, ``This is what we can do.''
And finally, the STEP program. Maria Cantwell is correct.
Carl Levin was particularly focused on helping us. 1 percent of
small businesses in this country export, 1 percent. In the old
days, their markets were their neighborhood. These days, their
markets are the world, but they cannot reach the world because
they are so little. They are profitable. They are powerful, but
they are small. They need our help to either help them
cooperatively get together or give them some help to get their
products to the world, and I think we can do a better job.
I personally saved the--how much money in the STEP
program--$8 million, which was going to be zeroed out. We need
a lot more than $8 million. That is all we have to help these
28 million small businesses reach the world. There are billions
of dollars out there to help every big business. You know, they
have embassies that will show up for conferences to help one
big business and all we have is $8 million in our budget, and
that would have been zeroed out had I not tracked it and kept
it in the budget.
So finally, I just want to say the 504 reauthorization, the
STEP program. And Senator Cantwell will bring an outreach to
Native Americans, who are also left out, forgotten. She is a
fabulous advocate. And again, there is some tremendous
entrepreneurship opportunities.
So it has been a joy, pleasure for me to serve as chair. I
am really looking forward to giving this gavel to you on
Thursday. I cannot give it until then. If we are not snowed
out, we will make that change on Thursday. God bless you all.
Thank you, and thank the staff. Would all of my staff please
stand, and the Republican staff too.
[Applause.]
Chair Landrieu. Thank you all. Jane Campbell, Don Cravins,
thank you all for an extraordinary job well done. I will submit
all their names to the record, and the meeting is adjourned.
[Whereupon, at 11:47 a.m., the Committee was adjourned.]
APPENDIX MATERIAL SUBMITTED
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