H.R. 2352: Job Creation through Entrepreneurship Act of 2009

H.R. 2352

Job Creation through Entrepreneurship Act of 2009

Date
May 20, 2009 (111th Congress, 1st Session)

Staff Contact
Communications

Floor Situation

H.R. 2352 will likely be considered under a structured rule. The legislation was introduced by Rep. Heath Shuler (D-NC) on May 12, 2009.

Bill Summary

This bill reauthorizes the Small Business Administration's (SBA) entrepreneurial development programs, creates a new small business assistance program for veterans, and authorizes the SBA to establish a distance learning program and online networking forum for existing and potential entrepreneurs. 

Veterans Business Center Program:  H.R. 2352 authorizes $10 million in Fiscal Year 2011 and $12 million in Fiscal Year 2012 for the SBA to create a Veterans Business Center program.  These centers would provide veterans and their surviving spouses with entrepreneurial training and counseling.  These Veterans Business Centers would receive initial grants of $150,000 annually for five years, after which time the centers could apply for three more years of funding.  Additionally, the bill authorizes $1.5 million for the SBA to provide centers with $75,000 for capital grants, procurement assessment grants, and grants tailored to service-disabled veterans.

Educating Entrepreneurs:  The bill authorizes $2 million in each of the Fiscal Years 2010 and 2011 for the SBA to contract with vendors for entrepreneurial training materials and a communications platform that can be used for broadcast distant learning.

Enhancing Native American Entrepreneurship:  H.R. 2352 authorizes $2 million in each of Fiscal Years 2010 and 2011 for the SBA's Office of Native American Affairs.  The bill also authorizes $15 million in Fiscal Year 2010 and $17 million in Fiscal Year 2011 for grants of up to $300,000 for tribal business information centers.  These centers assist Native Americans to start and expand small businesses.  Finally, H.R. 2352 authorizes $7 million in each of Fiscal Years 2009 and 2010 for grants of up to $300,000 for SBDCs in States with populations made up of over 1 percent Indian tribe members.

Some Members may be concerned that the bill provides funding to Native Hawaiians, a racial group which is not a tribe.  Such financial assistance on the basis of race would likely be subject to "strict scrutiny" in federal courts and presumptively unconstitutional.

Women's Business Centers Program:  This legislation authorizes $20 million in Fiscal Year 2010 and $22 million in Fiscal Year 2011 for women's business centers, 40 percent of which must be spent on new centers.  These cost-share funds would be available to centers only if certain non-federal dollar requirements are met.  H.R. 2352 establishes performance standards for these women's business centers and each center must submit an annual financial and strategic plan to the SBA.

SCORE Program Improvements:  "SCORE Counselors to America's Small Business" is an SBA non-profit partner which educates entrepreneurs.  SCORE maintains 370 chapters nationwide.  This bill authorizes $7 million in each of Fiscal Years 2010 and 2011 for SCORE.  The legislation directs SCORE to establish benchmarks for the success of assisted entrepreneurs which would be reviewed by SBA.  SCORE would also create a mentoring program and a networking program for small businesses. 

Expanding Entrepreneurship:  The bill requires the SBA to develop a plan for creating jobs through its entrepreneurial development programs.  The SBA would also have to implement a consistent data collection process for all of its ED programs.  The SBA Administrator would establish a web-based portal with comprehensive information on all of the agency's ED resources.

Small Business Development Center Program:  The bill authorizes $150 million in Fiscal Year 2010 and $160 million in Fiscal Year 2011 for the Small Business Development Center (SBDC) program.  Only fully accredited higher education institutions may receive new grants through the program.

H.R. 2352 authorizes $2.5 million in each of the Fiscal Years 2010 and 2011 for a new grant program for SBDCs to develop programs which help local small firms in securing capital and repairing damaged credit.  These grants would be for $300,000 each.

The bill authorizes $2.5 million in each of the Fiscal Years 2010 and 2011 to establish a procurement training program by which SBDCs work with local agencies to find contracts for local small businesses.  The bill also authorizes $2.5 million in each of the Fiscal Years 2010 and 2011 for a new "green entrepreneurial development program" to educate businesses on energy efficiency, green technology, and clean technology. 

Finally, the bill authorizes $2.5 million in each of the Fiscal Years 2010 and 2011 for a statewide small business helpline in every State and territory to provide information to small business and dislocated workers interested in starting a business.

Background

This legislation was reported out of the Committee on Small Business by voice vote on May 13, 2009. H.R. 2352 is a compilation of seven individual bills, five of which were sponsored by Republicans. These bills were all approved by the Subcommittee on Rural Development, Entrepreneurship and Trade on April 30, 2009.

Entrepreneurial development programs, facilitated by the SBA, have been developed over the past several decades and provide services such as counseling, educational training, and workshops for small businesses. Small Business Development Centers (SBDCs) provide existing small businesses and potential startups with assistance such as marketing advice and financial planning. Additionally, the SBA administers 96 Women's Business Centers, which help women entrepreneurs, five Veteran Business Outreach Centers, and an Office of Native American Affairs.

The Small Business Administration (SBA) has been reauthorized through several short-term extensions. The latest was signed into law on March 20, 2009. Under that law, the authorization for SBA programs is scheduled to expire on July 31, 2009. The agency received $786 million in emergency appropriations in Fiscal Year 2008, and $569 million in regular appropriations. The Omnibus spending bill for Fiscal Year 2009 also provided the SBA with $612 million.

 

Cost

The Congressional Budget Office (CBO) estimates that implementing H.R. 2352 would cost $189 million in 2010 and $531 million over a five year period, assuming appropriation of the necessary amounts.