Today, Sen. John Kerry [D-Mass.], chairman of the Committee on Small Business and Entrepreneurship, sent letters to the Department of Defense, Department of Veterans Affairs, and Small Business Administration, calling on the agencies to work together to reach out to veterans and reservists to inform them about available small-business programs.
Kerry also released the following statement in reaction to the Small Business Administration’s announcement of a pilot loan program targeted to serve veterans, reservists and their spouses:
“This program is a good first step by Administrator [Steven] Preston to address the growing needs of America’s veterans and reservists who work for, or want to start, a small business. I will work with Administrator Preston to lower the interest rate and reduce loan fees for this program and, hopefully, make it a success.
“As the Administration develops a plan to reach out to veterans and reservists about this new program, it must be aggressive, comprehensive and coordinated, so our military service members and their families are aware of all the resources available to them. The Administration must provide information about the Military Reservist Economic Injury Disaster Loan [MREIDL] program as part of this outreach, and work with Congress to make important fixes to it.
“The SBA needs the full weight of the White House behind them to put the money and resources necessary into this program to make it a success. However, there is more we can do -- including improving existing loan programs, creating grant programs, implementing tax incentives for small businesses that employ reservists, and enforcing the government’s federally mandated contracting goal with service-disabled, veteran-owned firms.”
Under the SBA’s new program, today a veteran or reservist would pay 10.5 to 13 percent in interest on a loan. While this is a few percentage points less than other express loans, the rate is far higher than on loans made through MREIDL, which are capped at four percent.
Kerry created the MREIDL program in 1999 for small businesses that have experienced economic hardship, due to the deployment of an owner or key employee. Unfortunately, most reservists do not know about this program, due to a lack of information provided by the Administration and lack of coordination among the relevant federal agencies.
Today, there are more than 25 million veterans in America, including more than 1.1 million men and women who have left military service since 2001. Over the last five years, more than 500,000 reservists have been called to active duty -- and they are often staying longer or serving multiple deployments.
These numbers demonstrate the need for a comprehensive, coordinated effort by the Administration to reach out to these men and women, to make sure they know about small-business loans and counseling available to: 1] Help them preserve their business while they are deployed; or 2] To start a business after their service is completed.
Senator Kerry has been a leader in the Senate to expand economic opportunities for veterans and reservists after they have served their country, and is the author of several proposals to achieve these goals.
Last Congress, Kerry introduced the Military Families Bill of Rights, a bill that provided comprehensive and direct assistance for military members and their families -- including loans, grants and tax credits for Guard and Reserve members who own their own small businesses or work for one.
This year, Kerry has taken many steps to address the concerns of veteran and reservist small-business owners and employees; e.g.:
* In January, Kerry held a hearing to examine federal small-business assistance programs for veterans and reservists.
* In January, Kerry introduced the Active Duty Military Tax Relief Act to create new tax credits that bolster small businesses and their employees.
* In March, Kerry released a report on the State of Veteran and Reservist Entrepreneurship, which outlined the challenges veterans and reservists face in starting or expanding a small business, and detailed some solutions.
* In March, Kerry introduced bipartisan legislation to strengthen and improve the Military Reservist Economic Injury Disaster Loan program, expand resources for the SBA’s Office of Veterans Business Development, and create a new veteran loan program.
* In May, Kerry wrote to Defense Secretary Robert Gates, seeking increased accountability in the agency’s contracting goals with service-disabled veteran owned firms.
* This year, Kerry also worked to expand the definition of disabled veterans eligible for the Work Opportunity Tax Credit [WOTC]. This expansion was included in the small-business tax breaks that passed as part of the emergency supplemental appropriations bill. This law extended the WOTC through August 2011.
On Thursday, June 21, 2007, Sen. Kerry's committee will hold a roundtable on "SBA Reauthorization: Small Business Venture Capital Programs." The event begins at 10 a.m. Eastern Time.
Sources: Peace Corps Online [photo], U.S. Department of Labor, U.S. Senate Committee on Small Business and Entrepreneurship, U.S. Small Business Administration, WashingtonWatch.com, WhiteHouse.gov
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