Saturday, May 12, 2007

Kerry Calls for Investigation Into Women’s Business Center Funding Delays

On Wednesday [May 9], Sen. John Kerry [D-Mass.] asked the Inspector General of the Small Business Administration to conduct a thorough investigation into the agency’s onerous grant disbursal process to Women’s Business Centers [WBCs] nationwide.

“I want to know why Women’s Business Centers are receiving federal grants months and even years late,” said Kerry, chairman of the U.S. Senate Committee on Small Business and Entrepreneurship.

“Each year, WBCs -- such as the Center for Women & Enterprise in Boston, Worcester and Providence -- help tens of thousands of women, minority and veteran entrepreneurs turn dreams into reality by providing critical business development assistance," Kerry noted. "These centers should be allowed to focus on providing these services, instead of worrying about how to get their funding from Washington.”

Leaders from WBCs around the country have charged that the application process for grants is arduous, with circuitous procedures that result in delayed grant disbursals for qualified centers.

Last year, WBCs assisted more than 197,000 businesses nationwide. In Massachusetts, WBCs served almost 2,500 women in 2006. Since 1995, the Center for Women and Enterprise, which serves Massachusetts and Rhode Island, has trained more than 13,000 entrepreneurs and helped them secure nearly $30 million in business loans, generating more than 15,000 jobs and $430 million in wages.

Following, is the text of Kerry’s letter to SBA Inspector General Eric M. Thorson:

May 9, 2007

Dear Mr. Thorson:

I have repeatedly heard from the leaders of Women’s Business Centers [WBCs] around the country that they are experiencing problems receiving their grants from the Small Business Administration [SBA], and I request that you immediately undertake an investigation into this matter.

For a number of years, the Committee on Small Business and Entrepreneurship has received complaints from WBCs about the process of applying and receiving grants from the SBA’s Office of Women’s Business Ownership. According to their stories, the process is unnecessarily lengthy and arduous. Information is repeatedly requested from WBCs and then lost. There have been cases where the same information is requested 10 or even 12 times. In addition, the process lacks clear guidelines and transparency. A WBC may believe that they supplied all necessary information, only to be told months later that they must supply additional documentation.

As a result of these and other shortcomings, the grants are often disbursed months or even years after the quarter in which the expenses were incurred. Since most WBCs rely on SBA funding as a major source of funding, this delayed reimbursement can be disastrous, especially for new or small WBCs.

It is simply unacceptable that WBCs continue to struggle to receive funding from the SBA. Therefore, I request that you undertake a full and complete investigation to determine the extent of any problems with the grant disbursal process and make recommendations on how to improve it.

If you have any questions or need additional information, please contact Karen Radermacher on my staff at 202-224-5175. Thank you for your attention to these matters.


John Kerry

GoodBiz113's take: We're very pleased that Sen. Kerry is holding SBA's Office of Inspector General accountable for achieving its stated mission, "To improve SBA management and effectiveness, and to detect and deter fraud in the Agency's programs." Kerry's bold efforts are bound to have positive and far-reaching ripple effects on all small businesses and our myriad stakeholders.

Photo: Peace Corps Online

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