Thursday, July 17, 2008

Bids for Work Falsified, GAO Reports
The Washington Post
By ANITA HUSLIN

Over the past two years, at least 10 Washington area companies have won more than $100 million in prime government contracts set aside for small businesses in economically distressed areas by claiming they had residency in those communities.

A Government Accountability Office report released yesterday challenged those claims and said the agency plans to ask the Small Business Administration's inspector general to investigate.

(Click here to read the complete article)

(Click here to review information on the committee hearing)

Friday, June 27, 2008

Airline woes costing small businesses
The Cincinnati Enquirer
By MALIA RULON

The skyrocketing cost of airline tickets may be enough to keep would-be tourists close to home. But for Terry Segerberg - who operates her family's company in Cincinnati's East End, Los Angeles and Houston - travel isn't a perk, it's a necessity.

Segerberg told members of the House Small Business Committee on Thursday that as the cost of fuel jacks up airline ticket prices, small businesses like Mesa Industries, which makes equipment and other products for the petroleum industry, are being hit hard.

"We have been forced to reduce our intra-company travel," she said, explaining that the cost to fly from Cincinnati to Los Angeles has risen from $390 two years ago to $630.

"Multiply this increase by 20 to include all of our sales staff and key administrative staff, and the impact is in the thousands and thousands of dollars each month," she said.

(Click here to read the complete article)

Friday, June 27, 2008

Business air travelers facing ‘full-blown crisis’
Cox News Service
By MARILYN GEEWAX

Hearing witness Terry Segerberg, chief executive of Mesa Industries Inc. in Cincinnati, said business owners in southwestern Ohio already are struggling with rising fares and would suffer from any loss of competition in the region.

"The average cost in the last two years for me to fly from Cincinnati to Los Angeles and return has escalated from $390 to $630," she said. "Even with the advance purchase we now pay 62 percent more for a ticket" than two years ago.

Lawmakers said they share the business travelers' alarm at the prospect of more flights being eliminated as oil prices rise. Rep. Steve Chabot, R-Ohio, noted that airline fuel costs have increased from $16 billion in 2000 to about $61 billion in 2008.

Given such rising costs, "by this time next year, there could be as many as 20 percent fewer seats available" nationwide, he said.

(Click here to read the complete article)

Thursday, June 26, 2008

Oil Soaring, Airlines Nosediving
Talk Radio News Service
By STAFF

The airline industry’s impact on entrepreneurs and the US economy was discussed by the House Committee on Small Business. Rep. Nydia Velazquez (D-N.Y.) said that the United States is in an air travel crisis and that small business owners across the country will feel the impact of struggling airlines.

Paul Ruden, vice president of legal affairs for the American Society of Travel Agents, said demand for airspace and runways exceeds supply in the United States. Ruden stated that excess demand for seats, congestion in airports, the introduction of fees for services once included in the ticket price, and the increased cost of oil leave consumers alienated.

Rep. Steve Chabot (R-Ohio) said airline fuel costs have increased from $16 billion in 2000 to an estimated $61 billion in 2008. Chabot suggested increasing domestic oil production, citing a FOX News survey which says 76 percent of Americans support drilling offshore and in Alaska.

(Click here to read the complete article)

Tuesday, June 24, 2008

Soaring Fuel Costs Carry Risk of Airline Collapse
The Tampa Tribune
By TED JACKOVICS

The impact of skyrocketing aviation fuel prices could result in massive job losses, declining business activity and reduced tourism as early as the second half of 2008, the Business Travel Coalition, a Radnor, Pa.,-based business consumer group, warned Monday.

With airlines paying about twice as much for fuel this year as last year, fuel costs have increased to more than 40 percent of airlines' operating expenses, which could push air travel far beyond affordability for the majority of the traveling public, the coalition report stated.

"The impact ... goes far beyond charging $2 for a can of Coke or $15 for a checked bag - two consumer annoyances that will have little impact on the airlines' prospects for survival and should not distract anyone from the catastrophe that is looming on the near horizon," the report stated.

(Click here to read the complete article)

Friday, June 20, 2008

SEC OKs 1-year compliance extension for small firms
Forbes.com
From REUTERS

The U.S. Securities and Exchange Commission agreed to give small businesses one more year to meet certain auditing requirements of the Sarbanes- Oxley corporate reform law, the SEC said Friday.

That means small companies, those with a market capitalization below $75 million, will not have to comply with auditing part of the financial controls section of the law for one more year.

The so-called Section 404 requires companies to assess their internal controls over financial reporting. It also requires external auditors to report on management's assessment and on the controls itself.

(Click here to read the complete article)

Thursday, June 19, 2008

New S Corp Rules May Help Small Businesses Weather Economy
AllBusiness.com
By KEITH GIRARD

Small businesses are being squeezed by troubled credit markets, high energy prices, and sharply rising costs. In many cases, their ability to weather the economic downturn will hinge on cost cutting and maximizing cash flow.

Next to labor, taxes are the biggest expense facing small businesses, and that's unlikely to change anytime soon. But a movement is afoot in Congress to provide relief by modifying rules that govern S corporations. The changes could not only reduce taxes, but also help S corporations tap new sources of capital. According to the U.S. Chamber of Commerce, more than 55 percent of all corporations file taxes as S corporations; of those, about 3.5 million are considered small.

The debate is important because it marks the first significant examination of S corporation rules since that the tax code provision was enacted 50 years ago. The House Small Business Committee's Subcommittee on Finance and Tax held a hearing on the issue this week, and several bills are pending in Congress that would make important changes. "As everybody knows, the times are changing. What was right and proper 50 years ago doesn't always add up to what is right and proper today," said the subcommittee's ranking member, Rep. Vern Buchanan, R-Fla.

(Click here to read the complete article)

Thursday, June 12, 2008

Cincinnatian Testifies at Hearing
Cincinnati Enquirer
By MALIA RULON

Donald Boeding of Fifth Third Bank, based in Cincinnati, was in Washington today to testify before the Small Business Committee, of which Rep. Steve Chabot is the top Republican member.

Boeding is senior vice president and general manager of merchant services for the company and he had quite a lot to say about a new IRS proposal to require information tax reporting on all credit card receipts of small businesses. Basically, he said it could drive merchants to avoid electronic payment systems and instead use cash - and certain withholding provisions would substantially reduce their cash flow.

"The enactment would come at a very difficult time in the economy and would require significant IT investment," he said.

Chabot, R-Westwood, also opposes the proposed change, which he said is the wrong way for the government to go after an estimated $290 billion in delinquent tax payments. Chabot says the government should instead simplify the tax system and cut spending.

(Click here to read the complete piece)

Thursday, June 5, 2008

How the Real Estate Crisis Hurts Small Business
AllBusiness.com
By KEITH GIRARD

John Puffer, chairman and president of Pilot Bank, a community bank in Tampa, Fla., has had a ringside seat to the real estate crisis. Florida is one of the states hardest hit by the market crash, and Puffer has witnessed the economic devastation that foreclosures and declining prices have caused on businesses in his community.

"The weak housing sector continues to have a ripple effect throughout the entire nation and is putting severe stress on households and small businesses nationwide," he told the House Small Business Committee this week. "Restoring confidence in the housing market is vital to restoring economic growth."

The most immediate impact on small businesses is in credit markets. They have been severely damaged by the sharp decline in housing prices and the decline in collateral that real estate represents, said Puffer. Some 45 percent of outstanding small business loans are collateralized by some type of real estate asset. Small business owners, in particular, often rely on the equity in their homes and widely use home equity loans and lines of credit.

Beyond tapping their homes for financing, small businesses are closely tied to the housing market, even if they aren't directly involved in the construction or sale of homes. "The housing sector's weakness affects not only home builders, realtors, mortgage brokers, and others directly involved in home sales," but also related small businesses that provide such services as landscaping and home improvements as well as products such as furniture and appliances, said Rep. Steve Chabot, R-Ohio, ranking member on the House Small Business Committee.

(Click here to read the complete article)

Wednesday, May 28, 2008

Gas Crunch Rattles Business
Upstate Today
By CARLOS GALARZA

It used to be that Americans would take solace in rising gasoline prices by pointing out that at least a gallon of gas was still cheaper than a gallon of milk.

That’s no longer the case in many areas.

The current crunch that escalating gasoline prices are having up and down the U.S. economy comes as no surprise to those who have taken time to read the tea leaves.

For example, here is a warning found in a U.S. House committee report:

“With no end in sight, public concerns have surged over the seemingly perpetual state of an energy crisis … If these conditions continue the economic climate will become increasingly harsh for this country’s small businesses and entrepreneurs.”

(Click here to read the complete article)

***Ranking Member Chabot recently discussed the energy crisis and methods to help bring costs down. You can read his comments here.

Thursday, May 01, 2008

Lakewood Ranch Jeweler Appeals to Congress
The Bradenton Herald
By LESLEY CLARK

Vanessa Baugh knows firsthand the obstacles facing small business owners. She once had three jewelry stores, but is now down to one, worried about rising insurance costs and Florida's slumping economy.

"I'm in a holding pattern, where I'm sitting back waiting to see what's going to happen to the economy," the Lakewood Ranch businesswoman Wednesday told a House subcommittee looking into ways to help businesses like hers cope with a credit crunch that has made it increasingly difficult to secure loans to grow their businesses. "I'm sitting back, hoping to survive."

(Click here to read the complete article)

Tuesday, April 22, 2008

SBA Administrator Preston Answers Questions in a Washington Post Chat

Small Business Committee Ranking Member Steve Chabot appeared on Jim Blasingame’s Small Business Advocate Show this morning to talk about National Small Business Week and the current economy.

This week marks the 45th annual National Small Business Week and presents an opportunity to say thank you to the entrepreneurs that create the jobs that will keep our economy running in tough times.

(Click here to listen to the broadcast)

Sunday, April 20, 2008

The Small Business Booster: As incubator and SBA lender, group has helped the smallest of small enterprises across region for 25 years
The Cincinnati Enquirer
By MIKE BOYER

When Mark and Jerry Becker wanted a construction loan in 1988 to expand their family's 50-year-old fitness equipment business, their banker laughed at them.

"He said we were in no position to take on the $750,000 loan," Mark Becker said.

Undaunted, their Exercise & Leisure Equipment Co. in Columbia Township went for help from the Hamilton County Development Co. and the Small Business Administration's 504 loan program it administers. Since then, the company has expanded twice in the last 20 years, increasing employment from five to 26 and its revenues more than 20 times.

"They were a godsend," said Mark Becker of HCDC, the county's nonprofit development company, which is marking its 25th anniversary at a black-tie dinner Thursday night at the Cincinnati Club downtown with Ohio Lt. Gov. Lee Fischer as keynote speaker.

Quietly over the last quarter-century, the Norwood-based HCDC has grown from a one-man operation created to support the SBA loan program into a full-service economic development agency helping create 30,000 jobs and more than $2.6 billion in business investment.

(Click here to read the complete article)

Monday, April 14, 2008

SBA Administrator Preston Answers Questions in a Washington Post Chat
The Washington Post
By STEVE PRESTON

Steve Preston, Administrator of the U.S. Small Business Administration, was online for a chat with washingtonpost.com’s small business blog readers to talk about issues ranging from the economy, lending assistance, federal contracting and much more.

(To read a transcript of the chat, click here.)

Friday, April 4, 2008

Restrictive Bank Terms Fuel SMB Credit Crunch
AllBusiness.com
By KEITH GIRARD

Although the growing use of credit cards has gotten a lot of the blame for the rising cost of small business credit, local banks are also a big part of the problem. Wayne M. Gatewood, Jr., president and chief executive of Quality Support in Landover, Md., is a case study of the hurdles small business owners face, and why so many owners are turning to credit cards to finance their businesses.

Gatewood appeared before the House Small Business Committee this week as part of its continuing examination of the role of credit cards in small business financing. “Cash management is an absolutely critical matter for small companies. Careful management of cash and credit may mean the difference between whether a business expands or doesn’t, and whether it succeeds or fails,” said Rep. Steven Chabot, R-Ohio, the committee’s ranking member.

(Click here to read the full article)

Thursday, March 27, 2008

Finding Health Insurance if You Are Self-Employed
The New York Times
By MARCI ALBOHER

If there is one thing that separates the self-employed from those employed by others, it is their preoccupation with health insurance.

I was reminded of this on Feb. 14, when I wrote a post on the Shifting Careers blog asking small-business owners and would-be entrepreneurs what they were doing about health insurance. Within hours, scores of people posted comments about their own experiences and, if they had managed to find good resources, shared those. I have been reading e-mail messages and trying to make sense of the subject ever since. In short, it is not pretty out there.

A 43-year-old woman wrote about going without insurance in the first year of her business. “I lived in terror of needing a doctor visit or worse yet, lab tests or something more,” she said. She then moved to an H.M.O. for sole proprietors through a local chamber of commerce. The cost of that plan, which she said was $171 a month in 2001, has now risen to $500 a month. At the same time, she wrote, co-payments have increased and services have been cut.

That woman’s experience reflected the exasperated tone of several of the other writers. Many entrepreneurs seem to find health insurance after doing a lot of research, though they generally pay more than they think they should. Some who are in good health bet on remaining that way and forgo health insurance or get policies with low premiums and high deductibles, choosing to insure themselves for mostly catastrophic illness. Some are lucky enough to have a well-insured partner.

(Click here to read the complete article)

Monday, March 10, 2008

2008 Small Business Outlook: Where is the U.S. Economy Going?
Forbes.com
By PAUL MAIDMENT

You can forgive entrepreneurs their pessimism about the economy, though it may well be misplaced.

While the rest of 2008 looks a bit rough, and the fire sale of Bear Stearns to JPMorgan Chase has the doomsters swapping the "R-word" for the "D-word," the darkest clouds may be lifting on the horizon, even if flat growth--or worse--is already here. Better still, Congress is giving small-business owners an investment tax break on top of the $168 billion stimulus package it is preparing for consumers.

How much will those two measures stimulate spending and investment? The answers differ by region and industry. For instance, as conditions soften in New England (thanks to cutbacks at big banks stung by the credit crisis), economies in the West South Central region (buoyed by energy companies) are still chugging along.

(Click here to read the full article)

Also worth a look: Maureen Farrell’s piece, They Call This Intellectual Property? Learn how new regulations may drive up costs for patent filers. The culprit? Too many goofy proposals.

Happening Now

Thursday, March 6, 2008

Federal Law Fails to Stem SMB Red Tape
AllBusiness.com
By KEITH GIRARD

There's nothing new about government red tape. Charles Dickens wrote about it in 1869, when petty clerk David Copperfield dryly observed that Britain was "bound hand and foot" by it. Not much has changed. Government red tape is still a huge obstacle facing small businesses.

The Small Business Administration (SBA) has created such programs as the Business Gateway Initiative to give businesses a single access point to federal forms and other tools to help comply with federal regulations. But like most government snafus, the problem goes deeper than that. Congress tried to do its part when it passed the Paperwork Reduction Act (PRA) in 1980, specifically to cut red tape. The result? Government paperwork has increased by 400 percent since then. That's no laughing matter to the countless small business owners who must wade through mounds of government forms to run their businesses.

Take, for example, Drew Greenblatt, president and owner of Marlin Steel Wire in Baltimore. He's in a tough business, competing with foreign manufacturers in a global economy. His firm, which employs 27 people, has managed to grow 33 percent in the last two years and has tripled over the past decade. That's no small achievement, especially since Greenblatt must comply with regulatory requirements from more than six federal agencies, from the IRS, EPA, and OSHA to the Department of Commerce and the State Department, not to mention state and local governments.

"I compiled all the forms my business fills out in a single year, and when piled on top of each other, they are more than six feet tall," he told the House Small Business Committee. The committee hasn't revisited the PRA since 1995, and its hearing this week is the first step in a comprehensive review of the measure.

(Click to read the complete article)

Wednesday, March 5, 2008

What can self-employed workers deduct?
Fortune Small Business
By JULIE FREESE

Dear FSB: My husband is a self-employed construction worker. How can I determine what tax deductions we can take off? Our tax preparer mentioned work clothes and supplies? Can we use our medical receipts as a business deduction or can we only deduct insurance premiums?

- Tiffany, Holcomb, Mo.

Dear Tiffany: You are asking the right questions - determining what work expenses are deductible for the self-employed isn't easy and you should not just rely on a tax preparer. Do your own research as well.

There are several IRS publications that can help make filing your taxes easier. Thomas D. Klein, CPA and Professor of Accounting and Taxation at the University of Arizona, Eller College of Management, suggests you read Form 1518, "IRS Tax Calendar for Small Businesses and Self-Employed" and Form 535 "Business Expenses". Both documents are available at IRS.gov and are written in layman's terms.

Mark Nash, Partner, Private Company Services for PriceWaterHouseCoopers agrees that the IRS resources are a helpful, and suggests the next step is going to your tax professional with specific questions.

(Click to read the complete article)

Thursday, February 14, 2008

Small Businesses Protest Backdoor State “Activity” Taxes
AllBusiness.com
By KEITH GIRARD

When Barry Godwin, the comptroller of a South Carolina pleasure boat company, received a call from a New Jersey revenue agent last July, he could hardly believe his ears. A truckload of boats bound for Massachusetts had been stopped at a weigh station, and the agent was demanding $46,200 in "back taxes."

Goodwin's 240-employee company, Stingray Boats, has never had a physical presence in New Jersey. But the revenue agent had determined through a conversation with the driver that Stingray had a "business nexus" with the state because it supplied boats to an independent New Jersey dealer. Therefore, it owed state taxes. It was either pay up or the boats would be impounded, he was told. The company had little choice; it paid.

"The manner in which the State of New Jersey acted is commonly defined as extortion," Goodwin told the House Small Business Committee this week. The hearing was called to examine a trend that is alarming small businesses across the country. A growing number of states are imposing so-called "business activity" taxes on companies that have a connection, or "nexus," with the state. A nexus can exist, even though a business has no employees or physical presence in the state.

Rep Steve Chabot, R-Ohio, the committee's ranking member, said the hearing revealed that the definition of what constitutes "economic activity" left too much room for small businesses' comfort. "These new avenues of commerce have become frequent and favorite targets of overeager tax assessors," he said.

(Click here to read the complete article)

Friday, February 08, 2008

Locals shed light on health crisis
The Cincinnati Business Courier
Opinion Page

In the midst of a presidential primary election, a Cincinnati doctor helped the U.S. House committee on small business dip its toe into a debate about which both its Democratic leadership and its Republican leader - Congressman Steve Chabot - can easily agree.

At a hearing last month before the House Small Business Committee, physician R. Stephen Eby spoke about how the nation's health care crisis is affecting his practice. In each of the last five years, the cost of a health insurance policy has increased an average of 16 percent…

…Chabot said the testimony of Eby and five other small-business owners were solicited to make the point to Congress that action on health care legislation for small groups is needed even before a major fix is readied by the next administration.

"What is most troublesome about these stories is that they are not exceptional," Chabot said. "Millions of small-business owners live on the fringe of providing or suspending care."

(Click here to read the complete article – subscription required)

Thursday, January 24, 2008

Putting a human face on the health care crisis
The Washington Post and AllBusiness.com
By KEITH GIRARD

For the past 18 years, Cathey Sandman has owned her own small business, catering to as many as 18 children a day in her home-based child care center in Lockport, N.Y. To the 13 families who rely on her, she provides a critically needed service. Without the center, she knows many would be hard-pressed to find care elsewhere.

It's one of the reasons she keeps working even though two years ago she joined the ranks of 27 million other people who own or work for a small business, yet have no health insurance. "Five years ago my husband joined my business as my assistant and business partner," she told lawmakers at a congressional hearing this week. "We had to purchase our own health insurance and found it expensive but affordable."

But after consecutive annual premium increases (up 100 percent in six years), they made the painful decision to give up their coverage. "It was not an easy choice, but after the last few premium increases the monthly cost for our health insurance was the same as the cost of our monthly mortgage payment," she says.

(Click here to read the complete article)

Thursday, January 24, 2008

Doctor Testifies about High Health Premiums
The Cincinnati Enquirer
By MALIA RULON

A Cincinnati doctor told members of the House Small Business Committee on Wednesday that the cost of getting health insurance through his practice is so high that he and his wife can't even manage to pay for it.

"The premiums are unaffordable," said Dr. Stephen Eby, a primary care physician at Western Family Physicians.

Eby said that his wife, a registered nurse, had to take a second job with a large hospital system so they could have access to affordable health insurance.

"The inability of medical doctors to offer adequate health insurance benefits to their employees, or in some cases even themselves, is more proof that a health insurance crisis exists today in this country," Eby told lawmakers.

Several small business owners, including Eby, testified at Wednesday's hearing about their plight in trying to provide health care insurance to employees.

(Click here to read the complete article)

Tuesday, January 15, 2008

How to help women-owned small businesses
The Hill
By STEVEN PRESTON, Guest columnist and SBA Administrator

In 1994, Congress set a government-wide target that 5 percent of all federal contracts should go to women-owned small businesses (WOSBs). More recently, legislation was signed into law creating a set-aside for such businesses but requiring that the Small Business Administration study the issue to determine in which — if any — of the government’s 313 contracting categories, many of which are defense-related, WOSBs were underrepresented.

Since then there has been an SBA study, a National Academy of Sciences review, a court case, and an external, independent study by the respected RAND Corporation on the issue. The RAND study concluded that WOSBs were underrepresented in four contracting categories, based on a review of dollars going to such firms.

Two weeks ago, based upon the RAND study, statutory law and constitutional precedent, SBA issued a proposed set-aside rule for women-owned small businesses. Our responsibility was to implement the statute in a constitutional manner, and that is what we’ve done.

(Click here to read the complete article)

Tuesday, January 08, 2008

Business.gov Unveils New State and Local Features
Courtesy of the SBA Press Office

Business.gov, the official business link to the U.S. government, has launched a new Google-based custom search and expanded content that make it easier for small business owners to find essential information needed to run their operations, including forms, licenses, permits and regulatory information from federal, state and local governments.

The new search capabilities have been tailored to meet the needs of the nation’s small businesses using the Google Custom Search Engine service. The new search engine filters the Google.com index for results business owners can trust.

Business.gov has also expanded the scope of its content. Business owners now have access to over 8,000 state, territory, county, and city government web sites providing information on starting and managing a business while complying with regulations from all levels of government.

(Click here to access the site’s small business guides and other information)

Thursday, January 3, 2008

Can’t Live Without Credit Cards? Here’s How to Live with Them
AllBusiness.com
By KEITH GIRARD

Small businesses are hooked on plastic. Credit cards are now the No. 1 source of small business financing, but on the downside, more than 70 percent of business owners carry a month-to-month balance. For many, it's a love-hate relationship. But lately it's grown to become more of the latter and less of the former.

A majority of small business owners (53 percent) say their credit card terms have grown worse over the past five years, according to a recent survey by the National Small Business Association (NSBA). The Washington, D.C., group has become a leading advocate for credit card reform on Capitol Hill, where bills are pending to change some controversial industry practices.

(Click here to read the complete article)

Thursday, December 20, 2007

SBA Unveils its 2007 Year in Review Report
The U.S. Small Business Administration
NEWS RELEASE

Washington - The U.S. Small Business Administration today released a 10- page report marking the agency’s accomplishments during calendar year 2007.

The agency’s accomplishments during the year enabled it to more effectively foster small business ownership and help people quickly get back on their feet after natural disasters.

Looking back on the year, it is clear the SBA has made substantial progress. Internal operations are more effective and efficient, with every SBA department taking on new challenges, goals and initiatives launched by Administrator Steve Preston, who took the reins at the agency in July 2006.

Looking forward, the SBA has much to do in 2008 to achieve Administrator Preston’s reforms, but 2007 was a turning point indicating positive results to come.

(Click here to read the report)

Wednesday, December 12, 2007

Small Businesses Can Cope With Illnesses
The New York Times
By FLOYD NORRIS

The Securities and Exchange Commission plans to delay for another year the requirement that small companies report on the state of their internal financial controls, the agency’s chairman, Christopher Cox, is expected to tell lawmakers on Wednesday.

In testimony prepared for a hearing of the House Small Business Committee, Mr. Cox said that he would propose delaying the rules until 2009 and that the decision on whether to require compliance would then be based in part on a study of costs to be conducted by the commission’s economists.

"More than five years since the Sarbanes-Oxley Act was signed into law, there are roughly 5,000 firms in the smaller public companies category that still aren’t required to provide an auditor’s report on their internal controls, as required by Section 404(b)," Mr. Cox said, according to a copy of his prepared testimony provided by a Congressional staff member.

(Click here to read the complete article)

Thursday, December 06, 2007

How I just said no to low-cost offshoring
Fortune Small Business
By LUCIE VOVES

I love a challenge. But I was discouraged by the reaction one of my sales reps got when she asked a university bookshop in Boulder to carry our custom diploma frames. The manager told us she could barely get students to buy low-end metal models. "How do you expect me to sell a $99 product if I can move only 30 frames a year at $34.95?" she asked. I knew from the prices she was charging that she had chosen a brand that was mass-produced overseas. The encounter was a harsh reminder of how much work I had to do to keep my firm alive.

Competition from the Far East was the last thing on my mind when I started Church Hill Classics in the basement of my house in Newtown, Conn. As a former corporate marketing executive, I had noticed that few university bookstores sold top-quality frames that incorporated their school logos. I decided to fill this niche. Starting with my alma mater, Dartmouth College, I built my company into a one-stop source. Today nearly 700 campus bookstores carry our products. We expect to bring in $6 million in sales this year and are profitable.

(Click here to read the complete article)

Thursday, December 06, 2007

Small Businesses Can Cope With Illnesses
The New York Times
By THE ASSOCIATED PRESS

The winter can be a hard time for staffing at small businesses -- it's not just the holidays that thin employee ranks, it's also colds and the flu. Owners can cope by making it easier for staffers to telecommute and by having a pool of workers who can fill in.

In short, planning ahead will make it far easier for a small company to get through a spate of employee absences.

"You always have to have a contingency plan," said Jeff Evans, general manager of Lake Naomi Club, a country club community in Pocono Pines, Pa. "People are going to come to the facility regardless of the fact that a lot of people have been hit with the flu."

(Click here to read the complete article)

Thursday, November 22, 2007

The Business of Thanksgiving
Small Business and Entrepreneurship Council
By RAYMOND J. KEATING

The Pilgrims celebrated the first Thanksgiving in 1621. But it wasn't until 1863 when President Abraham Lincoln declared it a national holiday.

It's a day for families across the nation to gather together and give thanks for the considerable blessings we have in the United States.  That appreciation and celebration, of course, are expressed in part around the dinner table during a Thanksgiving meal. 

It turns out that small businesses play a major role in making the Thanksgiving dinner a reality.  The SBA defines small businesses as firms with fewer than 500 employees.  That's fine, but some might debate if a company with 300 or 400 workers is small or mid-sized.  But most would agree that firms with less than 20 employees certainly are small. 

(Click here to read more about what small businesses are bringing to the table this Thanksgiving)

Monday, November 19, 2007

House helps minority contractors, hurts HUBZones
Washington Business Journal
By KENT HOOVER

Minority-owned businesses could benefit at the expense of businesses located in low-income areas if the Senate goes along with legislation passed by the House.

The Small Business Contracting Improvements Act, which passed the House by a 334-80 vote Oct. 30, would increase the net-worth limit for owners of small businesses entering the 8(a) program from $250,000 to $550,000.

Companies in the 8(a) program, which is open to socially and economically disadvantaged businesses, are eligible for contract set-asides and other procurement preferences. Racial minorities are presumed to be socially and economically disadvantaged.

(Click here to read the complete article)

Note: Ranking Member Chabot voted against the legislation.  The article goes on to discuss Chabot’s view on the bill:

Rep. Steve Chabot, R-Ohio, said the House bill would hurt the Hubzone program's ability to promote economic development in low-income areas.

"Rather than growing opportunities for all small businesses," the legislation "pits all of these deserving groups against one another," said Chabot, the ranking Republican on the House Small Business Committee.

Tuesday, November 14, 2007

U.S. angels see heavenly returns
Fortune Small Business
By MALIKA WORRALL

Angel investors operating in organized groups are seeing average returns on investment similar to those enjoyed by venture capitalists, according to a new study.

Angel financing has long been a first-stop source of capital for startup businesses. But angel returns on investment have mostly been a matter of speculation for investors and entrepreneurs alike.

Released Monday by the Ewing Marion Kauffman Foundation and the Angel Capital Education Foundation, the "Returns of Angel Investors in Groups" study claims to be the largest of its kind. The study shows that organized angel investor groups in North America have seen average returns of as much as 2.6 times their initial investment over three and a half years from investment to exit.

(Click here to read the complete article)

Thursday, November 8, 2007

What Economic Slowdown? Small Businesses Grow Stronger
The New York Times
By BRENT BOWERS

EVEN as oil prices surge, the housing market contracts, Wall Street reels and multibillion-dollar deals falter, small businesses are flourishing and, in fact, are helping to buoy the economy, experts say.

Last week, for example, a monthly report released jointly by Automatic Data Processing Inc., the nation’s largest provider of payroll services, and Macroeconomic Advisers, a St. Louis consulting firm, showed an increase in private sector employment in October of 106,000. That included a surge of 63,000 at businesses with fewer than 50 employees, a gain of 50,000 at businesses with 50 to 499 employees — and a loss of 7,000 at companies with more than 500 employees.

“I travel a lot and speak to a lot of small business groups,” said Joel Prakken, chairman of Macroeconomic Advisers. “What I hear is much more upbeat than what you read in the financial press. Small business owners know about the worries hanging over Wall Street. But they are doing well. Interest rates are low, the stock market is high. They can raise money. The global economy is very strong. They can expand their global reach, and they are doing it.”

The latest numbers marked an acceleration in job growth from an average of 43,000 over the previous three months, Mr. Prakken said. During that time, small businesses were also the main engine of job creation, he added.

(Click here to read the complete article)

Note: On Wednesday, November 7, Governor Frederic Mishkin of the Federal Reserve Board, appeared before the Committee to discuss the state of the small business economy.  Mishkin said that though “credit conditions have no doubt tightened,” the Fed has seen U.S. “small businesses seem generally to have been able to retain access to credit.”  He delivered his strictest warning on the subject of fiscal sustainability.  Acknowledging the “current level of uncertainty about the future is unusually high,” Mishkin said he was concerned about not only spending today, but about the government meeting its future obligations, namely Social Security and Medicare. 

Wednesday, November 7, 2007 

Tax bill has small businesses seeing red
Market Watch
By ROBERT SCHROEDER

The House's top tax-writer claims that small business owners would enjoy "overwhelming" relief under a major reform bill he recently introduced. So why are small business advocates underwhelmed -- and in many cases downright worried?

The answer: despite a proposed elimination of the alternative minimum tax and an extension of expensing rules, the so-called "mother of all tax reforms" also contains a potentially punishing hike in rates small businesses would have to pay, as well as a repeal of a deduction for making things in the United States.

Add all that up, and the big tax reform bill is off to a bad start with the "little guy" -- just in time for election season.

"We're very concerned about the Rangel tax bill," says Ron Bullock, chairman and chief executive of Bison Gear and Engineering Corp., a St. Charles, Ill.-based motor manufacturer that employs 250 people and does sales of about $50 million a year. "It's enough to make me plum upset."

(Click here to read the complete article)

Note: The House Ways and Means Republicans issued a warning that small businesses would face a “triple whammy” under the Rangel tax plan:

Millions of Americans who own small businesses and who pay taxes on that income on their individual tax returns are going to face a triple-whammy.  First, they will be hit with the 4% surtax on some of their income.  Second, many of them will lose the Section 199 manufacturing deduction that lowers taxes on their business income.  And third, this is happening at the same time as incorporated businesses get an across-the-board rate cut, making it even tougher for these small business engines of job-creation to compete. 

Monday, November 05, 2007

Tax plan could hurt more firms than it helps
The Washington Business Journal
By KENT HOOVER

Corporate tax rates would be reduced under the tax reform plan proposed by a powerful House Democrat, but many small business owners who pay individual income taxes on their company's profits could face higher taxes.

Rep. Charles Rangel's plan is significant because of who he is: chairman of the House Ways and Means Committee, which handles tax legislation. It's also significant because of what it represents: a preview of tax reforms that eventually may be passed by Congress.

The bill won't even be voted on until next year, but Rangel plans action this fall on a one-year fix of the alternative minimum tax and one-year extensions of popular tax breaks, such as the research and development credit.

(Click here to read the complete article)

Friday, November 02, 2007

Exec favors free-trade deal
The Cincinnati Enquirer
By MALIA RULON

The president of a Harrison-based plastics company that makes the material used on the bottom of high-end snowboards told lawmakers Thursday that free-trade deals benefit his business.

"It makes it less costly for me, and there's a lot less red tape," said Gary R. Ellerhorst, president and CEO of Crown Plastics.

Ellerhorst was one of several small entrepreneurs who testified at a House Small Business Committee hearing on four trade agreements - with Peru, Panama, Colombia and South Korea - that are now pending before Congress.

U.S. Rep. Steve Chabot of Westwood, the top Republican on the committee, said free-trade agreements help U.S. workers, farmers, ranchers and small businesses.

(Click here to read the complete article)

Friday, November 2, 2007

Payrolls Grow by Strong 166,000 in October
The Associated Press
By JEANNINE AVERSA

Employers boosted payrolls by a surprisingly strong 166,000 in October, the most in five months, an encouraging sign that the nation's employment climate is holding up relatively well against the strains of a housing collapse and credit crunch.

The Labor Department's report, released Friday, also showed that the unemployment rate held steady at 4.7 percent for the second month in a row. It's a figure that is considered low by historical standards.

Job gains were logged for professional and business services, education and health care, leisure and hospitality, and for the government. Those employment increases more than offset jobs losses in manufacturing, construction and retail _ casualties of the problems plaguing the housing market.

(Click here to read the complete article)

Wednesday, October 31, 2007

Halloween: Powered by Small Business
The Washington Post
By Sharon McLoone

As you dutifully dole out Halloween treats today and enjoy your neighborhood costumes, peruse some of these statistics culled from 2004 U.S. Census Bureau data.

• Ninety-four percent of the 135 businesses in the nation that made chocolate and confections from cacao beans had fewer than 500 employees. Seventy-six percent of the total, or 103 firms, had fewer than 20 workers.
  
  
• About 1,038 entities were in the business of making confections from purchased chocolate and 78 percent of them, or 807, had fewer than 20 employees.
  
  
• There were 479 makers of non-chocolate candies across the nation and 95 percent of them, or 457, boasted fewer than 500 employees while 351 had fewer than 20 staffers.

(Click to read complete article)

Monday, October 22, 2007

House delays contractor withholding requirement
The Washington Business Journal
By KENT HOOVER

The House approved legislation that delays a requirement that local, state and federal governments withhold 3 percent of their payments to contractors.

The Tax Collection Responsibility Act moves back the effective date of the withholding requirement from 2011 to 2012. The requirement, which is aimed at making sure the federal government collects what it is owed in income taxes, originally was included in a tax bill enacted in 2006. Business groups and local and state officials have been pushing for its repeal ever since.

(Click here to read the complete article)

Note: The Committee held a hearing on the three percent withholding issue in March.  At the hearing, Ranking Member Chabot noted, “Some [government contractors] may be forced to pass some of the withholding amount down to subcontractors. This can be especially harmful to small businesses down the supply chain… We need to be looking at ways to foster growth and productivity in the small business sector, not penalize everybody for the actions of a few.” 

Friday, October 19, 2007 

Changing Internet tax setup would hurt small businesses
The Cincinnati Business Courier
By STEVE CHABOT

Uncle Sam might never have opened up a laptop to surf the Net, but logged on or not, he seems determined to get a piece of the action.

On Oct. 16, the House voted to extend the federal Internet tax moratorium another four years. However, by refusing to allow a vote on making the tax ban permanent, Democratic leadership has left the door open for needless government regulation and taxation. It is time to ensure that door is closed.

The evolution of the Internet has contributed directly to the growth of the U.S. economy and accelerated the pace of innovation. Taxing Internet access would negatively impact the lives of hundreds of millions of Americans, from old friends who use it to keep in touch, to soldiers overseas who use it to communicate with their families, to businesses that rely on e-commerce for a healthy bottom line.

Small businesses, in particular, would feel the sting of Internet taxation. The Internet has broken down barriers faced by Main Street, USA. A 2006 survey conducted by www.allbusiness.com found that 61 percent of small-business owners said that the Internet had helped open new markets for their businesses. It is not unprecedented to find a mom-and-pop auto shop that finds success selling rare parts to classic car enthusiasts scouring eBay for the perfect seat cushion, or a stay-at-home mom who uses the online marketplace to sell handmade jewelry to a customer 300 miles away.

(Click here to read the complete article – subscription required)

Tuesday, October 16, 2007

Should I raid my IRA to grow my business?
Think again, says FSB’s Anne Fisher
Fortune Small Business
By ANNE FISHER

Dear FSB: I'm thinking of withdrawing funds from my IRA early to invest in building the next phase of our guest ranch - Mongolian-style yurts - on the land we own. My partners and I expect the expansion to generate solid revenues. Should we consider using retirement savings as a source of capital?

- David Capocci, Co-Owner, Paca Pride Guest Ranch Granite Falls, Wash.

Dear David: According to Martin Robins, a lawyer in Buffalo Grove, Ill., who often advises entrepreneurs seeking to raise capital, you should only think of tapping into an IRA when you have several decades before you plan to retire - and even then, he dislikes the idea. "Taking money from an IRA will cost you 10% of the balance of the IRA in penalties, and the amount you withdraw will also be subject to state and federal income tax," says Robins. "Your withdrawal could even bump you into a higher tax bracket."

(Click here to read the complete article)

Note: Looking for capital to grow or expand your small business?  Visit our Resources section to get more information and learn about lending opportunities.

Monday, October 15, 2007

Female Ownership Matters
Business Week
By STACY PERMAN

Patricia Karter, Dancing Deer Bakery CEO, thinks a better gender balance in the business world could improve society as a whole

The Entrepreneur: Patricia Karter, 51

Background: An artist with an MBA, Patricia Karter is the co-founder and CEO of Dancing Deer Baking. Based in Roxbury, Mass., the little bakery with a strong social mission aims to grow into a $50 million business—without sacrificing its core values and practices: community philanthropy, employee development, and the use of only natural ingredients. Today, Karter, who has received a round of institutional capital, is pursuing another equity capital round—this time using women angel investors.

The Company: Launched in 1994, Dancing Deer Bakery has clung to a simple yet unconventional business philosophy: If bakers love what they do, it shows in the food. More than a decade later, that guiding principle has helped propel the all-natural baked goods outfit into a fast-growing business.

(Click here to read the complete article)

Monday, October 8, 2007

A Halloween Reminder to Avoid Tax Audit Hobgoblins
AllBusiness.com
By KEITH GIRARD

October is a witching month. Summer fades; leaves turn golden hues and divine beings and spirits return, if only for one night on Halloween, to haunt us for our past transgressions. At least that's according to old Celtic folklore.

But ghost and goblins aside, Halloween is good reminder for small business owners to get cracking on organizing tax records and making plans for any last-minute deductions to minimize your taxes. Deductions and such have to be taken before Dec. 31, in most cases, to qualify for the current tax year.

In its quest to close the so-called "tax gap" (the amount of tax collected versus the amount taxpayers really owe), the Internal Revenue Service this year will be stepping up audits and other enforcement actions, aimed principally at small businesses. The best way to avoid a dreaded audit is to make sure your records are organized and your returns are filed on time.

(Click here to read the complete article)

 

Monday, October 1, 2007

Small Firms Keep an Eye on High Court Cases
The Washington Post
By SHARON McLOONE

The Supreme Court term that opened today will see the justices weigh a handful of cases involving large corporations that could have big repercussions for small business.

Hall Street Associates v. Mattel concerns arbitration awards. The National Federation of Independent Businesses asked the judges in a friend-of-the-court brief to allow parties entering arbitration proceedings to ask for judicial review if one or both of the parties believes that the arbiter came to a decision erroneously.

The Federal Arbitration Act's "limited standard of judicial review exposes businesses to the risk of irrational or excessive arbitral awards that are unreviewable on the merits," the NFIB and the New England Legal Foundation co-wrote in a brief.

An NFIB research poll found that 21 percent of small businesses use arbitration to resolve disputes, according to Karen Harned, executive director of the association's legal foundation.

(Click here to read the complete article

Thursday, September 27, 2007

Small Business, Big Clients: Don't fear taking on giant corporations as clients and business partners. Everyone benefits when Goliath hires David.
Entrepreneur.com
By LAURA TIFFANY

Does size matter? It's a cheeky question, but also a valid one. As a small company, can you take on a large corporate client and serve them just as well as--if not better than--a big vendor can?

Michael Fallone can offer a resounding "yes" to that question. After all, he and his co-founder, Doug Bartow, 39, and just four employees developed the design and creative foundation and executed many of the elements for the Harry Potter & the Deathly Hollows U.S. marketing campaign.

A self-promotional mini-poster got Fallone's creative agency, id29, in the proverbial door at Harry Potter publisher Scholastic. Serendipitously, Scholastic's creative director plucked the poster from the mailroom where it was wallowing, as it was addressed to someone who no longer worked there.

(Click here to read the complete article)

Wednesday, September 26, 2007

Small Business on Capitol Hill
The Washington Post
By SHARON McLOONE

Lawmakers and others in the Capitol Hill community are in full swing this month addressing small business issues. Here are some highlights of recent action on the Hill…

… Access to Capital: The House Small Business Committee this week voted to adopt the Small Business Investment Improvements Act introduced by Rep. Jason Altmire (D-Pa.), chairman of the Subcommittee on Investigation and Oversight, to aid entrepreneurs in securing funding. H.R. 3567 would overhaul two Small Business Administration programs designed to aid small firms. It also would create the Angel Investment Program to offer seed capital. The panel is holding a hearing Thursday morning on the issue of small enterprises' access to money to grow their businesses. Meanwhile, a House Small Business subcommittee was scheduled to hold a hearing this morning on renewable energy tax incentive possibilities.

(Click here to read the complete article)

Monday, September 24, 2007

Avondale Project Nears Launch
The Cincinnati Enquirer
By LISA BERNARD-KUHN

Momentum is building on a nearly $100 million redevelopment effort that community and business leaders say is vital to the neighborhood's rejuvenation.

Today officials with the Uptown Consortium and community leaders in Avondale are slated to gather at 9 a.m. to mark the dedication of a mixed-use project that includes:

A 100,000-square-foot office building along Burnet Avenue and multilevel parking garage at Northern Avenue for Cincinnati Children's Hospital Medical Center estimated at $50 million

A neighboring $8 million, 45,000-square-foot office building for the Cincinnati Herald, which will include street-level retail.

An estimated $10 million townhouse development along Harvey Avenue, between Erkenbrecker and Northern avenues.

(Click here to read the complete article)

Note: Earlier this year, the Committee held a field hearing in the Avondale neighborhood of Cincinnati, Ohio to explore community revitalization through the New Markets Tax Credit program and SBA loan programs.

Thursday, September 20, 2007 

Forbes: Secrets of the Self Made 2007
Forbes Magazine
By LISA LaMOTTA

As kids, America's richest entrepreneurs dreamt of curing patients, flying jets, writing plays and bagging base hits for the Chicago Cubs. Instead, they started hundreds of companies, employed hundreds of thousands of people and bagged $1.06 trillion.

In the accompanying slide shows, 21 self-made members of the 2007 Forbes 400 list offer an exclusive, introspective and often playful peek into their best days, worst qualities and hardest lessons.

We also coaxed them into sharing their thoughts on how to invest $100,000 right now (a few said put it with them); luck's contribution to their success (95%, says Kenny Troutt, founder of Excel Communications); and the pitfalls of leaving too much to the kids (money man Richard Rainwater says $50 million is too much, while $1 billion each works for supermarket and oil titan John Catsimatidis).

They even told us with whom they would most want to share a cocktail--two said "me."

(Click here to explore the feature)

 

Monday, September 17, 2007

Women’s Business Centers in the Spotlight
The Washington Post
By SHARON McLOONE

Lawmakers on Capitol Hill are turning their sights to women's business issues with an eye on Women's Business Centers, a program partly funded by the Small Business Administration.

The Senate Small Business and Entrepreneurship Committee has scheduled a Sept. 20 hearing on the future of women's small business programs that is expected to be lively. The House Small Business Committee plans a hearing on SBA contracting issues, including women's programs, on Wednesday.

(Click here to read the complete article)

 

Monday, September 17, 2007

Women’s Business Centers in the Spotlight
The Washington Post
By SHARON McLOONE

Lawmakers on Capitol Hill are turning their sights to women's business issues with an eye on Women's Business Centers, a program partly funded by the Small Business Administration.

The Senate Small Business and Entrepreneurship Committee has scheduled a Sept. 20 hearing on the future of women's small business programs that is expected to be lively. The House Small Business Committee plans a hearing on SBA contracting issues, including women's programs, on Wednesday.

(Click here to read the complete article)

 

Friday, September 14, 2007

Contentious Debate Looms Over Small Business Venture Capital
The New York Times
By KEITH F. GIRARD

In the parlance of venture capitalists, it's known as the "valley of death," a place that small technology companies fear. No matter how good their science, the valley awaits if they can't bridge the financial gap between the lab and their first commercial product.

In many cases, however, nascent tech firms can bridge the valley by tapping the government's small business programs, which provide everything from loan guarantees and grants to fee waivers for government services. But therein lies the rub. Can a small business still be considered small if it's substantially owned by a venture capital firm with hundreds, if not thousands, of employees?

The question is at the heart of a brewing debate on Capitol Hill that could become one of the most contentious facing small businesses in recent memory. Right now, the correct answer is "no." But a legislative proposal would amend the landmark Small Business Act to make it possible for venture-backed companies to be considered small businesses.

While the measure would be a boon to the venture capital industry, a recent hearing on Capitol Hill previewed just how heated the issue will be. Rep. Steve Chabot, R-Ohio, the ranking minority member on the House Small Business Committee, called the proposal "eviscerating." It would, he said, "drastically change the long-held standard [under the act] that a small business is one that is 'independently owned and operated.'"

(Click here to read the complete article)

 

Wednesday, September 12, 2007

Ranking Member Chabot on Jim Blasingame’s Small Business Advocate Show

Congressman Chabot joined Small Business Advocate host Jim Blasingame to talk about microlending and other issues of the day.

Asserting that the microloan program’s “payback has been tremendous” and that it is ideal for many businesses looking to start up or expand, Congressman Chabot offered advice to prospective entrepreneurs, “What I would suggest is if there are some small business folks that are interested in either starting up a business or expanding an existing business but don’t have the resources, have them contact their local member of Congress, they can contact my office, and we can put them in touch with the right people.”

Discussing the value of the program for our economy and our future generations, Chabot said, “These small businesses that are being started are tomorrow’s mid-size and large corporations. These are the folks that will be hiring your kids and my kids and our grandkids in the future.  Who would’ve thought where Microsoft was going… they all started out small and we need to make sure they have the access to capital that’s necessary to get started and to grow.”

Click here to listen to the broadcast online

Monday, September 10, 2007

Chabot Bill Passes House
The Cincinnati Enquirer
By MALIA RULON

The House returned to work last Tuesday after a break, and one of the first things it did was pass Rep. Steve Chabot's bill to boost the federal microlending program.

The bill, which would increase the average loan size and provide lenders with more flexibility to work with borrowers, passed 385-5 late Tuesday.

"This bill will help today's prospective entrepreneur become tomorrow's CEO," said Chabot, the top Republican on the House Small Business Committee.

Microloans are usually made to nontraditional clients. Under the federal program, nonprofit groups are given below-market rate loans they can then offer to private clients.

(Click here to view the article)

Wednesday, September 05, 2007

House Clears Two Small Business Bills
The Washington Post
By SHARON McLOONE

The House yesterday afternoon passed two small business bills -- one aiming to help small firms gain a larger voice in trade negotiations and the other reforming a loan program administered by the Small Business Administration.

The SBA Trade Programs Act (H.R. 2992) would require the agency's international trade office to develop policies and programs to better enable small businesses to conduct trade with foreign countries. It also would require the office to notify congressional small business committees of pending international alliances and to have a small business trade strategy…

… Meanwhile, the Microloan Amendments and Modernization Act would update a program administered by the SBA to provide loans to startup, newly established or growing small firms.

(Click here to read the complete article)

**Note: Ranking Member Chabot was the sponsor of the Microloan Amendments and Modernization Act; the bill passed the House by a vote of 385 to 5.

Tuesday, September 04, 2007

Ranking Member Chabot speaks on the House floor in support of his microloan legislation

“Mr. Speaker, I rise today in support of H.R. 3020, the Microloan Amendments and Modernization Act.  The Chairwoman and I have worked on a cooperative basis to bring this technical but important piece of legislation to the floor.  H.R. 3020 represents the first substantive change to the microloan program in more than six years.   

“According to Dr. Mohamed Yunus, the 2006 Nobel Laureate in Peace and founder of the Grameen Bank, ‘microcredit views each person as a potential entrepreneur and turn on the tiny economic engines of a rejected portion of society.’  Unlike Bangladesh or other countries that have emulated the Grameen Bank, microcredit in the United States is not aimed at a rejected portion of society but rather at those individuals who do not have access to commercial financial institutions and the technical resources to manage those funds.  Despite the different target audiences, microlending in the United States represents a variation of the concept developed by Dr. Yunus.”

(Click here to read the complete floor statement)

**Note: Ranking Member Chabot’s Microloan Amendments and Modernization Act passed the House by a vote of 385 to 5.  Chabot said the “bill will help today’s prospective entrepreneur become tomorrow’s CEO” and that by “improving borrowers’ access to capital, we are paving the way for business owners to establish and improve their ventures as well as to create jobs and enrich their community’s economy.”

Tuesday, September 04, 2007

Ranking Member Chabot speaks on the House floor in support of SBA international trade programs

“Mr. Speaker, I rise today in support of H.R. 2992, the SBA Trade Programs Act of 2007.  The Committee worked in a cooperative and bipartisan basis to bring these important changes in the SBA's operation of its programs to enhance small business participation in the global economy.   H.R. 2992 represents the Small Business Committee's continued commitment to promotion of international trade by America's small businesses.    

“The Small Business Administration has a number of general entrepreneurial assistance programs that provide technical advice to small business owners.  However, international trade is an area that is fraught with regulatory issues requiring specialized knowledge that may not be available from the SBA's entrepreneurial partners.”

(Click here to read the complete floor statement) 

Saturday, September 01, 2007

Reps. Davis, Shuler Host Hearing on Energy Costs
The Greenville Sun
By TOM YANCEY

The U.S. House of Representatives Committee on Small Business held a hearing Friday in Johnson City on “The Cost and Availability of Energy and the Effect on Small Business.”

Two freshman congressmen, U.S. Reps. David Davis, R-1st, of Johnson City, and Heath Shuler, a Democrat who represents North Carolina’s 11th district, chaired the two-hour hearing at the Johnson City Power Board building.

Participants were asked to provide their perspective on the availability of energy sources and the impact of rising energy costs on small companies.

(Click here to read the complete article) 

Friday, August 31, 2007

Will Small Biz Suffer from the Credit Crunch?
Forbes.com
By MAUREEN FARRELL

While the credit contagion rages on, small-business owners on the whole have been spared.

Chances are, though, capital-hungry entrepreneurs can expect to feel a pinch in the coming months, according to 10 bank executives and economists Forbes.com canvassed this week.

"Banks are going to be more careful about lending to small-business customers," says Bill Bradford, professor of finance at the University of Washington's business school, who has conducted research on small-business loans. "There's going to be tightening."

(Click here to read the complete article)

Monday, August 27, 2007

Feds fail to hit small business contracting goal
Business Journals
By KENT HOOVER

The federal government narrowly missed its goal of awarding 23 percent of its contracts to small businesses last year, according to the Small Business Administration.

Reaching that goal will be harder in the future because contracts awarded to small firms that were later acquired by large businesses will no longer be counted as small business contracts.

"It's going to be tougher for agencies to meet these numbers," said SBA Administrator Steven Preston. "The bar is slowly going up."

(Click here to read the complete article)

**Note: Ranking Member Steve Chabot was the lead Republican sponsor on the Small Business Fairness in Contracting Act, bipartisan legislation to reform the federal procurement process through expanded competition and transparency.  The bill overwhelmingly passed the House in May, but has yet to pass the Senate.

Thursday, August 2, 2007

Small Business Committee Hearing on YouTube
Business Week
By JOHN TOZZI

Segments of today's full committee hearing - Disaster Planning and Recovery: Are We Ready for Another Katrina? - are available to view on www.youtube.com. For more information on the hearing, visit our Committee Hearings page.

(Click here to view the hearing clips)

Monday, July 30, 2007

Ranking Member Chabot speaks on the House floor in support of extending SBA programs

"Mr. Speaker, I rise today in support of H.R. 3206. This bill is very simple. It extends the authorization of all programs authorized by the Small Business Act, the Small Business Investment Act, and any program operated by the Small Business Administration for which Congress has already appropriated funds. This extension will last until December 15, 2007.

"This extension is necessary because authorization for various programs operated by the SBA ceases on July 31, 2007. Working in a bipartisan effort with the Chairwoman, the Committee has ordered twelve bills to be reported out of which nine have passed the House of Representatives. While the pace has been furious, more needs to be done in the examination of programs within the Committee's jurisdiction. These include small business government contracting programs, investment programs for small businesses, and improving the management of the SBA. This work cannot be done in a deliberative, thoughtful, and bipartisan manner by midnight on July 31, 2007.

"Even if the Committee and the House finished its deliberations on all aspects of the SBA and its programs, we operate in bicameral legislative system. Time is needed for the legislative process in both bodies to function and, if necessary, for the two bodies to meet in a conference to iron out any disagreements concerning each bodies deliberations about how best to ensure that the SBA and its myriad of programs are best promoting the health of America's entrepreneurs.

"I urge all my colleagues to support H.R. 3206 and reserve the balance of my time."

Note: Introduced by Small Business Committee Chairwoman Nydia Velazquez and co-sponsored by Ranking Member Chabot, the extension was passed by a voice vote.

Wednesday, July 25, 2007

Minimum Wage Hike Means Tax Breaks
Business Week
By JOHN TOZZI

Workers earning the federal minimum wage enjoyed a boost from $5.15 to $5.85 an hour on July 24, the first of three annual hikes that will bring the rate to $7.25 in 2009. But along with the raise, Congress passed a package of $4.8 billion in tax breaks for small businesses that go into effect this year. While employers in 30 states and the District of Columbia won't be hit directly in the first year of the raise because state laws already mandate wages higher than the new federal rate, those businesses can still take advantage of the new tax breaks.

The biggest boon for most small-business owners is an expanded deduction for new purchases. Any firm making purchases of pretty much anything from livestock to software, real estate excluded, can take advantage of this so-called Section 179 deduction. The new law allows business owners to deduct $125,000 in purchases, up from $112,000. Only businesses that spend less than $500,000 on eligible equipment-a ceiling that was raised from $450,000-can qualify. Spend above $500,000 and the size of the deduction starts to shrink.

(Click here to read the complete article)

Monday, July 23, 2007

Identity Theft: The "Business Bust-Out"
Business Week
By JOHN TOZZI

A criminal rents space in the same building as your company. Then he applies for corporate credit cards using your firm's name. The application passes a credit check because the company name and address match, but the cards are delivered to the criminal's mailbox. He sells them on the street and vanishes before you discover your firm's credit is wrecked.

The so-called "business bust-out" scam is one way sophisticated criminals steal business identities across the country. Identity thieves increasingly target businesses instead of individuals, experts and law enforcement officials say, but federal law and many state statutes don't consider business identity theft a crime. That's because the raft of identity theft laws passed in the last decade apply mostly to individual consumers-not business entities.

(Click here to read the complete article)

Friday, July 20, 2007

Two Cheers for House Small Business Committee
Competitive Enterprise Institute's Open Market Blog
By JOHN BERLAU

As the 110th Congress has passed its six-month mark, there is one committee that has significantly improved. This is the House Small Business Committee, which has expanded its scope to look at not just the traditional issues of Small Business Administration loans and grants, but the crushing regulatory burden facing small business in particular. New Chairman Nydia Velazquez and Ranking Member Steve Chabot deserve credit for pursuing investigations of and exploring bipartisan solutions for problematic rules.

At first glance, as well as a glance at voting records, Chabot and Velazquez appear to have little in common policy-wise. Chabot is a conservative from Ohio, and Velazquez is a liberal from the Bronx. Yet both recognize that sometimes well-intentioned regulations can hurt the "little guy," and have used the committee as a bully pulpit to help rein in burdensome red tape.

(Click here to read the complete piece)

Thursday, July 12, 2007 

NKU, UC buildings go green New construction is planet-friendly
The Cincinnati Post
By HANA BIELIAUSKAS

It's getting easier to be green.

The University of Cincinnati is using environmentally friendly techniques in its new construction projects. Its student center and Varsity Village athletic facilities already are certified as "green" by the U.S. Green Building Council. The recreation center is undergoing the certification process. That means they are using environmentally friendly techniques and tactics.

"Embracing 'green construction' for our new buildings was the right thing to do for our campus community," Mary Beth McGrew, vice president of university planning and design at UC, said Wednesday at a House Small Business Committee hearing.

Rep. Steve Chabot, R-Cincinnati, ranking member of the committee, attended the hearing. It was held to examine the way small businesses can remain at the forefront of the "green revolution" in building.

(Click here to read the complete article)

Wednesday, July 11, 2007 

Senator criticizes GSA plans to cut office supply program
Government Executive
By DANIEL PULLIAM

The chairman of the Senate Small Business and Entrepreneurship Committee early this week urged the General Services Administration to hold off on eliminating part of a purchasing program that has high participation from small businesses. In a letter Monday to GSA Administrator Lurita Doan, Sen. John Kerry, D-Mass., asked the agency to postpone plans to drop office supplies from its Global Supply stock program, a one-stop source for buying everything from firefighting equipment to furniture. Nearly 80 percent of government purchases of office supplies through this program are directed to small businesses, the letter stated. A decision to end the program would prompt agencies to buy supplies from a handful of large companies, Kerry said. He added he is concerned about the impact the decision will have on emergency readiness capabilities and the government's ability to react quickly to major disasters.

(Click here to read the complete article)

Monday, July 09, 2007

Ease the pain of government regulations
How to minimize paperwork - and save your time and money.
Fortune Small Business
By ANNE FIELD and DIANA ROSENTHAL

It's no exaggeration to say that entrepreneurs are being crushed by regulatory costs. A 2005 report by the Small Business Administration found that small firms spend $2,400 more per employee, on average, than bigger counterparts to keep up with the demands of Uncle Sam.

The two most daunting burdens, according to the study, are environmental compliance and - you guessed it - taxes. Following rules set by the EPA and other agencies costs small businesses 364 percent more per worker than it does larger enterprises. Staying out of tax court takes 67 percent more out of their pockets per employee than it does in big corporations. Although most business owners don't want to break environmental or tax regulations, even the most well-intentioned can get confused by the fine print.

So what's the answer, short of lobbying government officials to reduce the burden of government regulations? Prevention, say attorneys who advise small businesses on these two areas. Here is their best advice on how to avoid costly penalties.

(Click here to read the complete article)

Saturday, July 07, 2007 

Not Music to Their Ears
National Journal
By ANDREW NOYES

High-tech policy-watchers are experiencing a bit of deja vu.

Back in 2002, the federal Copyright Arbitration Royalty Panel for the first time set rates that webcasters had to pay to musicians and record labels for streaming music over the Internet. Some thought those rates were too high and would smother a burgeoning industry. Protests ensued, legislation was introduced, and appeals were filed. The webcasters and the music industry eventually cut a deal.

Fast-forward five years. The panel is gone, and webcasting has not only survived but also thrived. Now the panel's congressionally created successor, the Copyright Royalty Board, wants to raise rates. Again, we have seen protests, legislation, and an appeal, but so far no deal has been cut. Meanwhile, a federal Appeals Court may freeze rates while the legal process plays out.

(Click here to read the complete article)

Saturday, June 30, 2007 

The Last Stand of Internet Radio
Time Magazine
By GILBERT CRUZ

This past Tuesday, thousands of Internet radio stations found the perfect way to make their point about a recent decision to raise the royalty rates they pay - they simply shut down as part of what they called the "Day of Silence" protest. If the new rules go into effect as planned on July 15, the webcasters claim, there will no longer be niche streams like "Screamin' and Hollerin,'" "Ninja Tunes" or "The Cole Porter Songbook"--just three of the 320 channels available to listeners of AccuRadio, which is itself one of a legion of large, small, and miniscule providers of free streaming music. Supporters of the increase want to see struggling artists receive the money they say they deserve, and argue that the rules that were set up for a fledgling industry five years ago are no longer appropriate in an era when at least some of the stations are now owned by large corporations such as Yahoo!, AOL or RealNetworks.

Both sides had their say at a Thursday morning House Small Business Committee hearing. "If we have to pay those fees, we'd be bankrupted the day we had to write the first check," AccuRadio CEO Kurt Hanson said. "And this is all very ironic because Internet radio is one of the best things that has happened to the music industry in the last decade... It's given voice to genres and artists that have never gotten airplay before." Indeed, most music released every year is never heard on terrestrial AM and FM radio, with most songs on corporate-owned stations coming from Top-40 and other similar blockbuster acts. As a result, over the past five years Internet radio listenership has grown to almost 30 million, said Ohio Rep. Steve Chabot, the ranking Republican member on the Small Business Committee.

(Click here to read the complete article)

Friday, June 29, 2007 

Rep Inslee: Game not over for 'Net radio, not now or on July 15
Ars Technica
By KEN FISHER

Net radio's woes made their way to the House of Representatives Committee on Small Business today, where the looming crisis that could kill diversity in Internet radio was met with a lack of ideas how to stop it.

There were clear signs of frustrations among legislators, however, and those frustrations stem from the fact that in the eyes of many, this issue should have long been settled.

"The recent decision by the Copyright Royalty Board to increase royalty fees may jeopardize the mutually beneficial relationship [between webcasters and copyright holders]," co-chairman Steve Chabot (R-OH) said.

"The decision and the outcry on both sides raises questions and concerns about what is needed to fairly and adequately compensate recording artists and labels" while making it tenable for net radio to stay on the air.

Chabot also noted that these two parties-net radio and the copyright holders-have been down this road before, in 2002. The fact that the settlement achieved at that time hasn't prevented the current situation is worrisome. "The parties to the conflict are best suited to devise a remedy that is workable and equitable," he noted, but he added that it is "somewhat troubling that we are here revisiting these issues just five years later." Chabot went as far as to wonder out loud if sections 112 and 114 of the Copyright Act are sufficient to promote and encourage creativity and the use of the most advanced delivery mechanisms, while still ensuring compensation for rights holders.

(Click here to read the complete article)

Chabot too "old school" for Internet radio
The Cincinnati Enquirer - Politics Blog
By MALIA RULON

Rep. Steve Chabot may have requested today's hearing in the House Small Business Committee on the plight of Internet radio (pictured at left with Cincinnati Public Radio president and general manager Richard Eiswerth) - but don't mistake his interest.

Although he pointed out in his opening statement that the number of Internet radio listeners has increased in the last five years from 20 million to 29 million - Chabot himself isn't among those jumping on the webcasting wagon.

Asked after today's hearing if he has personally ever listened to an Internet radio station, Chabot said he prefers to listen to the old-fashioned radio on his old-fashioned 1993 Buick.

"I'm pretty old school in my entertainment," the Westwood Republican said, flashing a sheepish smile.

The number of people listening to Internet radio stations is expected to double by 2010. By 2020, industry experts predict that more than 200 million people will listen to internet radio.

So . Chabot, a self-proclaimed Jethro Tull fan, still has time to catch on.

(Click here to go to the posting - second item from bottom)

Wednesday, June 27, 2007 

What is Steve Chabot up to?
The Cincinnati Enquirer
By CLIFF PEALE

Had coffee with Steve Chabot the other day. Actually neither of us drank coffee, but we had a talk over Dr Pepper for him, lemonade for me.

Anyway, the west-side Republican congressman is ranking Republican on the House's Small Business Committee and he went over a lot of the issues that committee is facing. Reforming the patent system, which hasn't been changed much in about 50 years, is among the top issues, as is a health-care bill that would allow smaller companies to form associations to buy coverage as a group. He also hopes to propose this fall that individuals and small companies be allowed to fully deduct health-care premiums as many big companies can do.

(Click here to read the complete article)

Thursday, June 28, 2007 

Is Internet radio doomed?
The Cincinnati Enquirer
By MALIA RULON

Two Cincinnati radio station managers told lawmakers Thursday that new increases in royalty rates set to go into effect July 15 would devastate the emerging webcasting industry.

"I fear that the future of Internet radio under the new performance royalty rates will look wildly different from thousands of small, vibrant, eclectic stations you see today," Bryan Miller, general manager of Cincinnati's WOXY.com, told members of the House Small Business Committee.

Under the new rules from the Copyright Royalty Board, Internet radio stations will have to pay higher rates per song streamed, with a minimum of $500 per station for a limited amount of content.

Richard Eiswerth, president and general manager of Cincinnati Public Radio, said the higher rates - and limits - run contrary to the mission of public radio.

"The more Americans who listen to our stations' music webstreams, the more we owe in royalties," he said.

A bill is pending in Congress to fix the problem, but Chairwoman Nydia Velazquez, D-N.Y., and Ohio Rep. Steve Chabot, who requested the hearing, urged artists and Internet radio station managers to find a solution that wouldn't require legislation.

"Our preference would be that the two parties come together and work things out without the government stepping in," said Chabot, a Westwood Republican.

(Click here to read the complete article)

Tuesday, June 26, 2007 

Battle Looms in US Over Royalty Fees for Internet Radio
Intellectual Property Watch
By DUGIE STANDEFORD

Webcasters across the United States fell silent on 26 June in an effort to influence the passage of legislation reversing royalty rate increases many say will kill radio delivered over the Internet. The "Internet Radio Equality Act," introduced in the Senate and the House of Representatives, responds to a ruling by the US Copyright Royalty Board (CRB) that webcasters claim will raise payments for digital public performances of sound recordings by 300 percent to 1200 percent.

The bill has attracted strong interest in the House, and is the subject of a 27 June hearing by the Small Business Committee.

(Click here to read the complete article)

Friday, June 22, 2007 

The Next War: Ex-Soldiers Try To Set Up Shop
Forbes
By MAUREEN FARRELL

Bob Corcoran spent 15 years flying jets in the Air Force. He would need all that banking and rolling experience for his next dogfight--dealing with the twisted maze of government agencies established to help ex-soldiers start their own businesses.

When Corcoran (pictured left) retired in 2004 with a severe foot infection, weeks before his second tour of duty in Iraq, the government wrote a severance check for $90,000. He planned to start a gym franchise, but after a free 13-week entrepreneurship class at Robert Morris University, paid for by the federally funded Veterans Business Outreach Center in Pittsburgh, he quickly found out the numbers didn't add up.

Disaster averted, Corcoran decided to parlay his aviation training into a new aerial photography company called Top Flight Photos in Beaver, Pa. Staff members at the local veterans' center chipped in with tutorials in Quickbooks accounting software and introduced him to a network of local entrepreneurs. "They've funneled me more information and contacts and practical help than all the other organizations put together," says Corcoran.

(Click here to read the complete article)

Tuesday, June 19, 2007 

Will Congress slam small inventors? A massive patent reform would be tough on entrepreneurs
Fortune Small Business Magazine
By ANN THERESE PALMER

Steve Wren is the kind of yeoman inventor that the drafters of the Constitution had in mind when they commanded Congress to write a patent law "to promote the Progress of Science and useful Arts." In exchange for publishing patents and sharing their knowledge, little guys like Wren got exclusive rights to the use of their ideas for 20 years. The system helped make the U.S. the innovation capital of the world.

But by the time Wren applied for his patent, he discovered that the Patent and Trademark Office had become a bureaucratic swamp. "It was hell," he says.

After eight years of playing Trivial Pursuit with patent examiners, Wren was awarded patent No. 6055514 for a computer-based marketing system. But his hopes of building a business are in tatters; he still awaits approval of three other patents, which he says he needs to proceed. "Over 100 funding sources have turned me down or told me to come back once I get my patents," he says.

(Click here to read the complete article)

Patent reform in the Small Business Committee:

"The relationship between innovation and small businesses cannot be overstated."

(Click here to read Ranking Member Chabot's opening statement at the March 2007 patent reform hearing)

Most small-business owners maintain optimism
Associated Press
By JOYCE M. ROSENBERG

Judging by the gyrations in stock and bond markets over the last week, investors are a pretty uneasy lot these days. That anxiety doesn't seem to be spreading among small-business owners.

Interviews with randomly picked company owners show they're fairly upbeat although the economy is slowing and interest rates show no signs of coming down.

Dennis O'Connor, owner of Paradigm Communications, a public relations firm in Natick, Mass., said his company went through a slow period last winter, but business has since picked up. That's a good sign not only for Paradigm, but for its clients as well -- publicity and marketing are often the first casualties when nervous companies start cutting back.

(Click here to read the complete article)

Friday, June 15, 2007

Ranking Member Chabot on The Small Business Advocate with Jim Blasingame

Small Business Committee Ranking Member Steve Chabot joined radio host and small business expert Jim Blasingame today to discuss immigration, liability reform and the Sarbanes-Oxley Act of 2002.

Blasingame praised Representative Chabot as a “great American and a steadfast friend of small business” and asked for his take on a number of small business issues facing Congress, ranging from the need to secure our borders to the absurd $54 million lawsuit brought against a Washington-based dry cleaner.

(Click here to listen to the interview)

Monday, June 11, 2007

SBA creates loan for veterans, military
Dayton Business Journal

The U.S. Small Business Administration has begun offering a new type of loan for military veterans, members and reservists and their families.

The Patriot Express Pilot Loan is for veterans, service-disabled veterans, active-duty service members participating in the military's Transition Assistance Program, reservists and National Guard members, current spouses of any type of service member or veteran and for the widowed spouse of a service member or veteran who died during service or of a service-connected disability.

(Click here to read the complete article)

SBA says it's ready for a Katrina this year
Business Courier
By KENT HOOVER

The Small Business Administration spent the first day of hurricane season putting the final touches on a comprehensive disaster response plan and delivering it to Congress.

"It will be up there by the end of the day," SBA Administrator Steven Preston said June 1.

Three weeks earlier, more than 30 SBA employees gathered together to work through a hypothetical disaster larger than Hurricane Katrina. The point of the exercise was to make sure the agency's revamped disaster loan processes could handle a major catastrophe -- even one that forced the agency to evacuate its own Washington, D.C. headquarters.

"We fared well," Preston said.

(Click here to read the complete article) 

Saturday, June 9, 2007 

Micro-loans benefit U.S. sector: Small capital infusion is just what they need
The Cincinnati Enquirer
By JENNIFER BROOKS

For years, Yadira Santana-Torres and her husband, Edgardo Martinez, worked for other people.

A master upholsterer, Martinez was working two jobs and dreaming of the day he could own his own shop.

They had a dream, and they had a business plan. What the Nashville, Tenn., family lacked was seed money and a bank willing to take a chance on them.

Instead of a bank, the community reached out to them with a "micro-loan" - $10,000 to rent a storefront, buy materials and meet payroll for the first rocky months when their shop, Green Hills Upholstery, was finding its feet.

"I don't have words to describe what it's been like," Santana-Torres said. "Everything changed for us."

(Click to read the complete article)

Thursday, June 7, 2007

A Voice for Small Business
The New York Times
By RON NIXON

Steven C. Preston, 46, a former executive vice president at ServiceMaster, became administrator of the Small Business Administration in July 2006. He sat down recently in his Washington office to discuss his efforts and those of Congress to overhaul the agency, which has been hit with budget and staff cuts. Following are excerpts:

Q. There have been some proposals in the Senate and House for reforming various programs at the agency. Do you think those are necessary?

A. I think it’s important to acknowledge that in the absence of progress, Congress is going to feel the need to take action. So I respect the fact that many people on the Hill are working hard to think about how to improve the performance of the S.B.A. On the other side, there are policies that we’re not a fan of. I am not in favor of subsidizing our loan programs. I think we should be focusing on expanding those programs by making them more effective in reaching small business. But frankly, for the amount of fee that they pay, I don’t think that that’s an inhibitor to our getting capital in their hands.

Q. You’ve said that you felt that the agency had the budget to actually fulfill its statutory requirements. And you stand by that?

A. The budget we have allows us to fulfill our mission, and within that budget we are going to be a much more effective and much more efficient agency at performing what we do. So I think we’re going to build capacity to perform our mission that exceeds our growth in the budget. So I think there’s a great opportunity for us to be a lot better at what we do, be much more responsive to customers, improve our turnaround times, improve the quality of what we do.

(Click to read the complete interview)

Wednesday, June 06, 2007

Sarbanes-Oxley: No more delays
With the SEC holding to its Dec. 15 deadline for compliance, companies will be scrambling
Los Angeles Times
By CYNDIA ZWAHLEN

Time's up!

That's the message for small public companies from the Securities and Exchange Commission, which met recently to give final approval to new guidelines and amendments to the Sarbanes-Oxley corporate reform law.

The five-member commission didn't include a hoped-for extension of the Dec. 15 deadline for small public companies to comply with provisions that critics say are too costly and time-consuming. That means small public companies will have to follow the complex Sarbanes-Oxley rules, which require an annual evaluation of the effectiveness of internal controls, for fiscal years that end after that date.

(Click to read complete article)

Tuesday, June 5, 2007

Committee Hearing on Sarbanes-Oxley Reveals Looming Deadline Will Hurt Small Businesses

The House Small Business Committee held a hearing to determine if the new Security and Exchange Commission and Public Company Accounting Oversight Board regulations will lower compliance costs for small businesses.  Nearly three hours of witness testimony and congressional questioning revealed that costs would be marginally lowered at best. 

“It is generally agreed that Sarbanes-Oxley has had a positive effect on investor protection and confidence,” Ranking Member Steve Chabot said at the hearing.  “But its burden on small business has not only affected their bottom line, but also their competitiveness in our global economy.” 

Witnesses from the SEC and PCAOB made up the first panel, testifying that, at present, they had no reason to expect the deadline for Section 404 compliance to be extended.  SEC Chairman and former Congressman Christopher Cox said, “We fully expect that, by the end of 2008, management’s familiarity with the 404 process, and its documentation of internal controls, will make it easier and less expensive to do an external audit than it would have been under the previous system.

The second panel of witnesses, made up of representatives from the small business community, universally agreed that the costs of Section 404 largely outweigh the benefits.  Cincinnati-based attorney and witness Richard Schmalzl disagreed with the first panel’s assessment that they were “at the finish line” with regard to Section 404.  “To the extent that the SEC and PCAOB have declared victory, I think that’s a mistake.”

“It is unclear, though not entirely likely, that these reforms will fully match the rhetoric surrounding their adoption,” said former Congressman and witness Don Greenwood.  “The evidence seems clear as to the consequences of allowing the process to stall here: innovation may be stifled and U.S. competitiveness compromised.  The stakes for getting this right could not be higher.”

National Venture Capital Association President Mark Heesen echoed Mr. Greenwood’s innovation concerns.  “Today the next Microsoft is waiting – but has yet to go public because SOX compliance has been too burdensome – and other alternatives are available.”

Monday, June 04, 2007

Q&A with SBA Administrator Steven Preston: Disaster Assistance
The Miami Herald
By JIM WYSS

The 2005 hurricane season trashed more than wide swaths of Florida and the Gulf Coast, it also left the Small Business Administration's Office of Disaster Assistance in tatters.

After hurricanes Katrina, Rita and Wilma, the SBA ultimately approved almost 18,000 emergency loans worth $894 million to businesses and homeowners -- but not before the agency's sluggish response came under attack in the press and on Capitol Hill. Amid the attack, SBA Administrator Hector Barreto resigned last year.

The man picked to fill his shoes was Steven Preston, the former chief executive of ServiceMaster, a multi-billion-dollar lawn care, housekeeping and pest control company.

Preston talked to The Miami Herald about what business owners can do to prepare themselves and what the SBA has done to avoid a repeat of the troubles of 2005.

(Click here to read complete interview)

Working for a small business may mean going without health insurance
The Chicago Tribune
By CAROLYN BIGDA

If you're considering taking a job with a small employer, health insurance may not be included.

A March study from the U.S. Government Accountability Office found that the number of employers offering coverage has declined, particularly among small businesses. In 2006, 60 percent of employers with between three and 199 workers provided insurance, down from 68 percent five years earlier.

It's not that small businesses are stingy. But because they have fewer employees to contribute premiums, the insurer takes on more risk, which drives up the cost for the business or workers (or both).

Then, if one employee becomes seriously ill, premiums skyrocket.

(Click here to read complete article)

Friday, June 01, 2007

Health Care Big Issue for Small Biz
Cincinnati Business Journal

Nearly 75 percent of small-business owners say cost is the most important problem facing the health-care system in the United States.

That's according to a survey conducted by the National Federation of Independent Business, which also found that 79 percent of its members think the quality of health care available to most Americans is "excellent" or "pretty good."

William Dennis, senior research fellow at the NFIB Research Foundation, noted that many members of Congress see expanding coverage to the uninsured as the nation's most pressing health-care need.

(Click here to read the complete article)

Thursday, May 31, 2007

Small Businesses Adding More Jobs
Inc.com

Businesses with fewer than 50 employees continue to outpace all larger businesses combined in creating new private-sector jobs, a new report shows.

Small businesses added 58,000 new jobs in May, with gains in service-sector jobs offset by slight losses in goods-producing sector, according to Automatic Data Processing reported, a Roseland, N.J.-based employment services firm. Overall, the increases are consistent with a three-month average of 56,000 jobs, the report said.

By contrast, larger businesses in May accounted for just 39,000 new jobs.

(Click here to read the complete article)

Monday, May 28, 2007

Liability Costs Rise But Tort Reform Unlikely
Cincinnati Business Journal
By KENT HOOVER

Lawsuits and the fear of getting sued cost small businesses $98 billion a year, according to a new study by the U.S. Chamber Institute for Legal Reform.

The study tracks damage awards, settlements, legal costs, liability insurance premiums and costs incurred by insurance companies on behalf of policy holders. The $98 billion figure, which is based on 2005 data, represents a 13 percent increase from 2002.

A separate chamber survey of small businesses found that nearly half have been threatened by a lawsuit and one-third have been sued in the past 10 years. More than half say their business decision-making has been altered by lawsuits or the threat of lawsuits.

(Click here to read the complete article)

Friday, May 25, 2007

Dear Mom and Pop: Don’t be Afraid to Ask for Help
Forbes.com
By MARC COMPEAU

If necessity is the mother of invention, collaboration is the fertility drug. Throw a bunch of smart folks in a room--say, a gaggle of Google programmers or a cadre of HBO writers--and watch the magic happen.

Mom and pops don't have that luxury. Theirs is a solitary slog through an onslaught of challenges, from serving customers to paying the electricity bills. And while small-business owners value their independence, they also forgo the benefits of teamwork and camaraderie enjoyed by big shops.

But you don't have to go it alone. There are plenty of friendly genies to lend a helping hand; you just need to know which bottle to rub.

(Click here to read the complete article)

Thursday, May 24, 2007

Committee Hearing on Potential Role of Health Reinsurance

The Small Business Committee held a hearing today to consider the health reinsurance market and its potential to promote competition and lower healthcare costs for small businesses.  Health insurance is one of small businesses’ most costly expenses.  According to The National Federation of Independent Business, health care is the “most severe problem for small business owners” – greater than taxes, cash flow or government regulations.  

Ensuring that health care is affordable for small businesses is one of the most important issues Congress can address.  Small groups usually pay more for similar or less coverage than large groups and, as a result, small businesses are less likely to offer health insurance than large firms.
 
“Our nation’s small businesses drive the economy, and we need to do all that we can to help them stay competitive and encourage their growth,” Ranking Member Steve Chabot (R-OH) said.  “I believe that tax relief is an important way to reduce the overall tax burden and to make healthcare more affordable for small businesses.  In previous Congresses, I sponsored the Health Care Affordability Act, which would allow every American to deduct 100 percent of the cost of their health insurance.  I plan to introduce a similar bill in the near future.”

(Click here to read Ranking Member Chabot’s complete opening statement)

Inside Entrepreneurship: Good Credit Scores are Essential
Seattle Post Intelligencer
By SUSAN SCHRETER

Last week I wrote about how an entrepreneur's personal credit score can influence the credit decisions of business vendors, lenders, leasing agents and investors. It seems that at every turn, startup entrepreneurs and small business owners face tougher standards for establishing business credit.

But here's a little daylight. A recent study by the Small Business Administration's Office of Advocacy demonstrated that banks were more inclined to lend to small businesses that had favorable business and personal credit scores, rather than just relying on personal credit histories and business plans to make new credit decisions.

This is important news especially to startup entrepreneurs who expect to apply for traditional bank loans in the next couple of years. Now entrepreneurs can take tactical action to maximize their borrowing power without a lot of hassle or expense.

(Click here to read complete article)

Small Business Backbone
San Francisco Chronicle
EDITORIAL

SAN FRANCISCO may be a city filled with global businesses, major department stores and sprawling malls. But it's also a town where shoppers are surprisingly loyal to the corner store.

That's the message of a study sponsored by a small business group. The San Francisco Locally Owned Merchant Alliance found that shops, restaurants, bookstores, toy and sporting goods businesses have an extensive fan base here.

But the alliance is interested in more than a look at the retail world. It believes that nurturing this small-business backbone can bring more economic rewards than attracting an outside chain, which often hires fewer people and spreads less money around the city. Small business may be the best kind in many ways.

(Click to read the complete article)

Wednesday, May 23, 2007

Committee Approves Five Entrepreneurial Development Bills

The Small Business Committee approved five bills to improve and expand programs to help small businesses.  The legislation addressed the Small Business Administration’s Entrepreneurial Development programs, including the Small Business Development Center and Women’s Business Center programs, as well as proposals to broaden prospects for veterans’ entrepreneurship and to enhance opportunities for small businesses to develop energy efficient technologies.  All bills were passed by a voice vote.

“The vast spectrum of small businesses requires a broad array of technical advice to help them prosper,” Ranking Member Steve Chabot (R-OH) said.  “But the majority of small businesses do not have the financial wherewithal to hire sophisticated management consultants to keep up with the rapid changes in the American economy.  The assistance programs addressed in these bills help small firms to respond to the evolving economic climate and remain a driving force in job creation.”   

Bills approved by the committee:

H.R. 2359, the SBA Entrepreneurial Development Programs Act of 2007, introduced by Committee Vice-Chairman Joe Sestak (D-PA), expands the role of Small Business Development Centers (SBDCs), targeting the most pressing economic challenges facing entrepreneurs today, from the rising costs of healthcare and energy, to coping with regulatory burdens.  It also expands the SCORE program to ensure services reach entrepreneurs across the country. 
H.R. 2397, the SBA Women’s Business Programs Act of 2007, introduced by Congressman Mary Fallin (R-OK), expands the Women Business Centers’ reach across the U.S., and increases services in underserved communities. The legislation dedicates resources to strengthen centers and ensure stability in the program.
H.R. 2366, the SBA Veterans’ Programs Act of 2007, introduced by Congressman Vern Buchanan (R-FL), creates additional Veterans Business Outreach Centers and offers business development services targeted to veterans.
H.R. 2284, the Native American Small Business Development Act of 2007, introduced by Congressman Tom Udall (D-NM), creates a customized program to provide educational and technical assistance to Native American entrepreneurs
H.R. 2389, the Small Energy Efficient Business Act of 2007, introduced by Congressman Heath Shuler (D-NC), provides flexible loans, education, and investment to small firms that are acquiring or developing energy efficient technologies.

Analysis: Cost worries Mom 'n Pop
United Press International
By ROSALIE WESTENSKOW

An overwhelming majority of small-business owners point to cost as their primary healthcare concern, but say they don't want the government running the show, according to a recent survey.

When asked the number one problem facing the healthcare system, 74 percent of those surveyed identified cost; another 20 percent placed cost second. Another 13 percent blamed government involvement for the problem, and only 9 percent chose covering more people as the most pressing issue -- even though that's the issue most emphasized in political arenas.

"Small businesses see the problem as cost (but) most elected officials see the problem as coverage," said William Dennis, senior research fellow at the National Federation of Independent Business, the small-business advocacy group that sponsored the survey.

(Click here to read the complete article)

Tuesday, May 22, 2007

Sink or Swim: Small business owners speak up about what it takes to succeed
Business Today
By A.J. BARKS

"Experience is a cruel teacher," says Bill Vickery. "Effective, but cruel."

As the director of the Small Business Development Center in Cape Girardeau, Vickery is well acquainted with the risk of opening a new business. According to the U.S. Small Business Administration, only about 44 percent make it through the first four years.

"The No. 1 business failure is from lack of planning prior to opening doors," Vickery says. "That would include making sure they have sufficient capital, pricing, profitability, cash flow. It's all part of the planning process."

(Click here to read complete article)

Monday, May 21, 2007

Northern Kentucky Lumberman Testifies Before Committee
The Cincinnati Enquirer
By MALIA RULON

The president of Kelly Brothers Lumber in Covington was in Washington last week to testify about the effect of product-liability costs on small businesses.

Steve Kelly, who is also chairman of the National Lumber and Building Materials Association, told the House Small Business Committee on Thursday that more and more construction dealers are being sued over products they sell but do not manufacture.

The cost of defending these lawsuits can run as high as $100,000, forcing many dealers to settle regardless of the merits of the case, he said.

(Click here to read the complete article)

Disaster planning a must
Cincinnati Post
By JOYCE ROSENBERG

The tornado that decimated Greensburg, Kan., this month and the upcoming official start of the hurricane season should serve as reminders to small business owners that they need to prepare their companies for the absolute worst - physical devastation of their premises and an indefinite interruption of operations if a catastrophe strikes.

One of the lessons of Hurricanes Katrina and Rita two years ago, though, is that traditional planning may not be enough. When New Orleans residents left the city before Katrina hit, no one could have envisioned it would take months for many companies to be up and running again, and that many others would have to relocate permanently or shut down.

Many business owners have learned that planning for a disaster needs to be increasingly sophisticated and detailed for a company to survive. For example, while disaster-preparation experts have long advised business owners to have a list of employee's phone numbers, that might not be enough. Now, the recommendation is that you also have contact numbers for relatives and friends for each staffer, and, if there's an evacuation, you should also know where your staffers will be staying.

(Click here to read complete article)

Sunday, May 20, 2007

House Increases Small Business Contracting Goals
MSNBC.com
By KENT HOOVER

Small businesses would get a bigger piece of the federal government's $400 billion-a-year procurement pie under legislation passed by the House.

The bill, which sailed through the House by a 409-13 margin May 10, increases the government's goal for small business contracting from 23 percent to 30 percent. It also raises the current 5 percent contracting goals for women-owned businesses and minority-owned businesses to 8 percent each, and creates a new 5 percent goal for environmentally friendly businesses.

(Click here to read complete article)

Tuesday, May 15, 2007

With a little innovation, who needs outsourcing?
Gentler scalpels? Floats that never fail? Delivered yesterday? No problem! That's why small U.S. manufacturers are on the rise.
Fortune Small Business
By PHAEDRA HISE

The shop floor at specialty blades smells like machine oil, but nary a drop of the greasy glop can be seen. The bright, airy room is so quiet that the few scattered workers chat between stations without raising their voices. The robotic cutting machines gleam, the racks on the metal shelves are neatly labeled, the floor is pristine. Since when does the gritty world of small manufacturing look like this?

In its factory nestled in the foothills of the Blue Ridge Mountains in Staunton, Va., Specialty (specialtyblades.com) manufactures millions of blades each year, ranging from scalpels to the serrated versions that cut gas-pump receipts. The profitable company, founded in 1985, expects to see sales of $20 million this year, up 16 percent over 2006. "We are very much a growth company," says CEO Peter Harris, 38.

Harris is not alone. True, Detroit is in a slump and the entire manufacturing sector generated just 12.1 percent of U.S. GDP in 2006, compared with 17.5 percent in 1986. On top of that, manufacturing employment dropped from 17.2 million in 1996 to just over 14 million as of last year.

(Click here to read the complete article)

Tuesday, April 24, 2007

NSBA Survey Shows Small Business Community Optimistic About Economy

The National Small Business Association’s 2007 survey of small and mid-sized businesses was released today with data on business outlook, employee benefits, technology use, and other benchmarks.  The study revealed small business owners are optimistic about the financial future of their firms, despite a concern for the nation’s economy as a whole.  It also showed a desire on the part of the small business community to begin tackling health care reform.

(Click here to view the complete NSBA Survey)

April 13, 2007

Forbes’ Head to Head Series: Federal Small Biz Contracts
Forbes.com
By MAUREEN FARRELL

Forbes.com: There's been a lot of hoopla over whether small businesses are getting their fair share of government contracts. Is there a problem?

Steve Chabot: I think most government agencies are not achieving their goals for contracting with small business. I have some concerns about the large amount of contract bundling that we see; that consolidation of contracts limits the ability of small businesses to compete. This ultimately hurts the taxpayer. If you're shutting out some in the small-business community, you are limiting the competition and therefore paying a higher price than otherwise is necessary.

We [also] need to take a look at the federal procurement database and the federal supply schedule to make sure that they're accurate. I've heard some indication that there's outdated information and improper classification of larger businesses as small businesses. We need to make sure we don't have businesses [in there] that have gotten very large and wouldn't classify as small business.

(Click here to read Ranking Member Chabot’s complete interview)

March 16, 2007

Warning: Lawsuits Hazardous to Financial Health
Forbes.com
By MAUREEN FARRELL

When Dawn Giugliano woke up from an hour-long nap on a beach in Puerto Rico last year, the 27-year-old Long Islander claims she got quite a surprise: The metal ring attaching the cups of her Victoria's Secret bikini top had seared a mark in her chest.

To seek compensation for her alleged burns, Giugliano earlier this month hit Limited Brands, Victoria Secret’s parent company, with a $2 million lawsuit in Manhattan District Court. Giugliano's case is an "isolated incident," and the company is "investigating the matter," wrote Limited Brands spokesperson Jennifer Ortiz in an e-mail.

With $10.6 billion in sales, Limited has deep pockets--the kind that make plaintiff lawyers salivate. But small businesses also can find themselves on the wrong end of a crushing liability suit, especially in an increasingly litigious environment.

(Click here to read the complete article)

Tuesday, February 23, 2007

Forbes’ Head to Head Series: SBA Funding
Forbes.com
By MAUREEN FARRELL

In his 2008 budget request to Congress two weeks ago, President Bush asked for $464 million to fund the U.S. Small Business Administration, a 5% increase over his 2006 request. (Congress never passed a 2007 budget for the SBA.)

But before you cheer, understand that most of this increase is slated for more staff and better pay at SBA headquarters--not for beefing up grass-roots programs to help entrepreneurs.

While the SBA's proposed budget is a mere .02% of the $2.9 trillion in overall government spending, members of the House of Representatives' Small Business Committee--from both sides of the aisle--are finding plenty to gripe about. To get a sense of how Congress will shape the debate in coming months, we grilled the committee's chairwoman, Nydia Velázquez, D-N.Y., and ranking committee member Steve Chabot, R-Ohio, both regulars in our "Head to Head" series.

(Click here to read Ranking Member Chabot’s Interview)

Thursday, February 1, 2007

Everyone wants to start a business
FORTUNE Small Business
By PHAEDRA HISE

Once upon a time, small business was seen solely as the domain of idiosyncratic, iconoclastic outsiders, willing to forgo the security of corporate life to venture out on their own. But today entrepreneurs are America's role models.

Almost everyone wants to own a business - from college students, who are signing up for entrepreneurial courses in record numbers; to those over age 65, who are forming more companies every year; to recent immigrants, who in 2005 started 25% more companies per capita than native-born citizens did.

We are in the midst of the largest entrepreneurial surge this country has ever seen. According to Small Business Administration projections, nearly 672,000 new companies with employees were created in 2005. That is the biggest business birthrate in U.S. history: 30,000 more startups than in 2004, and 12% more than at the height of dot-com hysteria in 1996.

And the trend shows no sign of abating. The Bureau of Labor Statistics found that more businesses were created in the first quarter of 2006 than during the same period the previous year. Not only are more Americans launching small businesses, but most others are dreaming about it: Sixty-six percent of respondents in a 2006 Yahoo Small Business and Harris Interactive survey said they wanted to start a company someday; 37% of those said they hoped to do so within the next five years.

(Click here to read the complete article)

January 19, 2007

Forbes’ Head to Head Series: Women and Small Biz
Forbes.com
By MAUREEN FARRELL

There's been a lot of talk about firsts in Washington: the first Democratic-controlled Congress in 13 years, the "first 100 hours" and the first female Speaker of the House, Nancy Pelosi (D-Calif). But what do these firsts mean for small businesses--and specifically the women who work for and run them?

No major "workplace flexibility" legislation has been signed since 1993, when President Bill Clinton passed the Family Medical Leave Act (FMLA), allowing up to 12 weeks of unpaid leave in the event of a pregnancy, medical emergency or a sick family member. And with all the trouble in Iraq, it is little surprise that such issues have taken a backseat.

(Click here to read the complete story and Ranking Member Chabot’s interview)

December 21, 2006

Forbes’ Head to Head Series: Congress’ Small Biz Agenda
Forbes.com
By MAUREEN FARRELL

Forbes.com: What's number one on your agenda in 2007?

Steve Chabot: To do everything in my power to continue to promote policies that encourage economic growth and that foster an environment where entrepreneurs and their employees can prosper. We need to focus on making health care more affordable to small-business owners and their employees. That would include supporting legislation to create Association Health Plans. That would be number one on my list.

Forbes.com: What piece of small-business legislation will actually get passed in the first 100 days?

Steve Chabot: Minimum wage will pass. Democrats have said it's one of their top priorities. [Beyond that], we're not in control, so it's hard to say. I commend Chairwoman Nydia Velasquez for reaching out.

(Click here to read Ranking Member Chabot’s complete interview)