Equity in small business investment vital to COVID recovery

Ensuring that the smallest of small businesses receive access to capital, entrepreneurial development opportunities and government contracting has been the cornerstone of President Joe Biden and the SBA under Administrator Isabella Casillas Guzman. Since the start of the COVID pandemic, entrepreneurs in New York, New Jersey, Puerto Rico and the U.S. Virgin Islands have received $145 billion in federal aid through SBA loans, grants and payments. Now, our continued economic recovery depends on ensuring that all American small businesses, from every socio-economic community, have the same ability to tap into our federal support and procurement programs.

In 2021, the Biden White House and SBA took a giant step toward equity by allowing self-employed and microbusinesses to be eligible for the Paycheck Protection Program. Nearly two-thirds of 2021 PPP loans went to small businesses, providing almost 4 million of the smallest businesses – 35 percent in Low- and Middle-Income communities – with $60 billion in forgivable loans. This administration tripled the amount of funding from the roughly $20 billion that went to small businesses from the previous administration.

The SBA is committed to helping small businesses build back better from the COVID-19 pandemic. With increased vaccinations, businesses are safely reopening, and workers are returning to their offices. As a result, we need to ensure equal access to its funding, entrepreneurial development, government contracting and disaster recovery programs.

Access to capital is the lifeblood of every business. It is needed to purchase supplies, pay workers, and connect with customers. The SBA helps mitigate risk to insure lenders have confidence to lend to new businesses, especially those in underserved communities, owned by women, veterans and communities of color. The SBA makes that happen by putting the full-faith and credit of the federal government behind each SBA loan. In other words, we have the back of small businesses.

Within weeks of being inaugurated, the Biden Administration announced a number of policy changes to target the PPP to the smallest businesses and companies that were financially ignored by our predecessors. Non-partisan reports by the independent Government Accountability Office and academics reported that the Biden-Harris reforms result in the increase of substantially more loans going to small businesses in underserved communities, including communities of color. Six million businesses with less than 20 employees, or 95% of all 2021 PPP loans received forgivable loans, a 2.5 million increase from the prior administration.

Given that success, the Biden Administration and SBA continue to reduce access barriers to all federal programs that can help small businesses grow. That’s why the SBA is expanding its resource partner footprint through increased funding and our Community Navigator initiative funded by President Biden’s American Rescue Plan Act. We now have more Women’s Business Centers operating in the nation than ever before, including several new ones in the Region - in Rochester, NY, San Juan, PR and Bayamon, PR. I was at the ribbon cutting and opening of the latter two and saw with my own eyes how this federal investment in women entrepreneurs will open doors for continued learning, growth and success in areas that until now were extremely underserved.

As you can imagine, the United States government is the world’s largest purchaser of goods and services, buying $25 billion worth in 2021 alone. By law, 23% of prime federal contracting dollars must go to small businesses. President Biden’s Bipartisan Infrastructure Law includes a historic procurement effort designed to help small businesses access more than $37 billion in federal contracts to rebuild America’s roads and bridges.

Our nation’s women, veterans and minority owned businesses are finally being invited to the table to rebuild our communities, deploying broadband, and install thousands of miles of new and resilient transmission lines. As a nation of opportunity we all understood that if we work hard enough and are given the opportunity to fairly compete, we will earn the prosperity we want and need for our families and nation. This administration clearly understands that to move America forward from the COVID-19 pandemic, we needed to ensure that America’s small businesses, the ones that provide jobs to the majority of our communities and fuel our economic engine not be left behind.

Through equitable financial relief and the delivery of focused programs, we will not only boost our economy for a new American era, but we will also be offering up sustainable long-term growth for our nation. I am very excited about our future.

ABOUT THE U.S. SMALL BUSINESS ADMINISTRATION

The U.S. Small Business Administration helps power the American dream of business ownership. As the only go-to resource and voice for small businesses backed by the strength of the federal government, the SBA empowers entrepreneurs and small business owners with the resources and support they need to start, grow or expand their businesses, or recover from a declared disaster. It delivers services through an extensive network of SBA field offices and partnerships with public and private organizations. To learn more, visit www.sba.gov