Cantwell, Colleagues Introduce Legislation to Support, Invest in Minority-Owned Businesses
Tacoma MBDA has helped secure tens of millions for Washington state businesses, create hundreds of jobs since 2016
WASHINGTON, D.C. – This week, U.S. Senator Maria Cantwell (D-WA), the Ranking Member of the U.S. Senate Committee on Commerce, Science, and Transportation and a senior member of the Senate Small Business Committee, joined Small Business Committee Ranking Member Ben Cardin (D-MD), Senate Democratic Leader Chuck Schumer (D-NY), and U.S. Senators Cory Booker (D-NJ), Catherine Cortez Masto (D-NV), and Kamala D. Harris (D-CA) in introducing the Minority Business Resiliency Act. The bill would codify the Minority Business Development Agency (MBDA), which currently operates under the authority of an Executive Order, into law and expand the reach of the agency by creating regional MBDA offices, strengthening its grant-making capacity and increasing its coordination with other federal agencies. The Tacoma MBDA reports that it has helped secure tens of millions in contracts and financial transactions for Washington state businesses and has helped create hundreds of jobs for Washington state.
“The Minority Business Development Agency helps entrepreneurs launch and grow their businesses,” Cantwell said. “This legislation would make this agency permanent and ensure that we are doing everything we can to support minority-owned companies during these times of unprecedented challenges due to the COVID-19 pandemic.”
This legislation would give the nationwide MBDA program certainty by codifying it into law and strengthening support for the MBDA Business Center in Tacoma, which works with nearly 200 clients throughout Washington state and the Pacific Northwest from the African, Asian, Hispanic American, American Indian and Alaskan Native communities. The Center offers a range of services including business consulting, financial management and planning, market research, and webinars during the COVID-19 crisis. In 2019, the Center received an “outstanding” rating from the Department of Commerce for helping secure millions of dollars in contracts and transactions for minority-owned Washington State businesses.
The COVID-19 pandemic has highlighted the pre-existing disparities faced by minority entrepreneurs in access to capital, business networks, and technical training. According to a National Bureau of Economic Research analysis of the impact of COVID-19 on small businesses, from February to April of this year, an estimated 41 percent of Black-owned businesses, 32 percent of Latino-owned businesses, and 26 percent of Asian-owned businesses closed compared to 17 percent of white-owned businesses.
Prior to the pandemic, minority business enterprises (MBEs) were key drivers of growth in new business formation in America in spite of the many barriers they face. MBEs are 2 to 3 times more likely to be denied loans than non-MBEs; on average, the annual gross receipts reported by MBEs is only one-third of the annual gross receipts reported by non-MBEs; and MBEs are half as likely as non-MBEs to have employees.
The Minority Business Resiliency Act would:
- address the disparate impact COVID-19 has had on minority businesses by increasing MBDA’s fiscal year 2020 budget to support MBEs through this crisis;
- provide certainty by placing the MBDA in statute and formally establishing processes for its largest program, the Minority Business Development Center (MBDC) Program;
- build a diverse pipeline of entrepreneurial talent by creating a new program to spur entrepreneurship at historically Black colleges and universities (HBCUs) and minority serving institutions (MSIs); and
- expand the geographic reach of the MBDA by authorizing the creation of regional and district MBDA offices.
Similar bipartisan legislation was introduced in the House last year by U.S. Representatives Jerry McNerney (D-CA) and Don Young (R-AK). The measure is endorsed by the Page 30 Coalition, which includes the U.S. Black Chambers, U.S. Hispanic Chamber of Commerce (USHCC), the National Asian American Chamber of Commerce, and the Association for Enterprise Opportunity; and the National Urban League, the U.S. Chamber of Commerce, the National Minority Supplier Diversity Council, and the Black Economic Alliance.
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