Congress Considers Proposals to Help Immigrants Start Small Businesses

November 11, 2019 by Tom Ramstack
Businesses in the commercial district of Princeton, New Jersey. (Photo by Dan McCue)

Business leaders in California appealed to Congress Friday to expand financial assistance to immigrants trying to start their own businesses.

They said small government investments can create big payoffs when immigrants start successful businesses that pay taxes and employ other persons.

The U.S. Small Business Administration loans offer “an opportunity for small businesses to take that next transformative step and eventually transition into conventional loan clients,” said Rachelle Arizmendi, chief operating officer at the Pacific Asian Consortium in Employment, a nonprofit community development organization in California.

Arizmendi and other business leaders testified at a House Small Business subcommittee on investigations, oversight and regulations field hearing in Rosemead, Calif. They want Congress to raise the cap on Small Business Administration loans and make them available to more applicants.

“Anecdotally, we know these programs work and I am confident that statistically, you will find the same results,” said Arizmendi, who also is a Sierra Madre, Calif., city council member.

Much of testimony during the hearing focused on the Small Business Administration’s Community Advantage Loan program. It is designed for new and existing businesses that need loans as high as $250,000.

The Small Business Administration designates lenders throughout the United States to offer the Community Advantage loans. The agency then guarantees repayment for as much as 85 percent of the loan amount if the business owner defaults.

Default rates are running between 4 percent and 5 percent.

Arizmendi advocates increasing the loan cap to $350,000. She also said it should be offered more widely to women-owned and minority-owned businesses. She said the eligibility also should include more businesses owned by military reservists, spouses of veterans or members of the armed forces.

“We know first-hand the possibilities and opportunities that SBA products offer small business owners,” Arizmendi said. “Yet, there are improvements to these products that can be made.”

The United States is home to nearly 45 million immigrants, according to a recent congressional report. More than 3.1 million have started small businesses.

They employ an estimated eight million people, generate over $1.3 trillion in sales and pay more than $4 billion in taxes.

The Small Business subcommittee is considering legislation to close the gap on immigrants who lack equal access to business loans and development opportunities.

The Kauffman Indicators for Entrepreneurship, which reports on U.S. entrepreneurial trends, found that the 2018 rate of new entrepreneurs among immigrants was close to double the rate for native-born entrepreneurs.

Among ethnic and racial groups, Asians and Latinos experienced a significant increase in the share of new entrepreneurs between 1996-2018, while African Americans’ share of new entrepreneurs increased only slightly, the Kauffman Indicators showed. Immigrants make up nearly 30 percent of all new entrepreneurs, a significant increase from 13.3 percent in 1996.

The congressional field hearing was held in California because about 27 percent of its population, or 11 million residents, are foreign-born. California has more immigrants than any other state.

Don Loewel, director of the Small Business Development Center at Pasadena City College, said many immigrants lack awareness of business and financing opportunities.

The Small Business Administration partners with Small Business Development Centers nationwide for outreach to local businesses. The centers offer counseling and training to small business owners and entrepreneurs.

Loewel said during the hearing that “awareness is the number one opportunity we have to make greater impacts on small business success. Putting aside the owner’s nationality, it is difficult to serve the small business population if they are not aware of who we are and how we can help.”

He spoke in favor of legislation that would authorize Small Business Development Centers to use federal funds to market their services directly to small businesses.

Business

New Mexico Governor Declares Space Her State's Next Frontier In The News
New Mexico Governor Declares Space Her State's Next Frontier
January 13, 2020
by Dan McCue

New Mexico Gov. Michelle Lujan Grisham last week declared the burgeoning space industry is one of her nine economic growth sectors for the state. “New Mexico is truly breaking barriers in the space industry,” the governor said as she opened New Mexico’s first Space Valley Summit... Read More

Boeing CEO Dennis Muilenburg to Step Down Immediately Aviation
Boeing CEO Dennis Muilenburg to Step Down Immediately

Boeing's CEO is resigning amid ongoing problems at the company over the troubled Max 737 aircraft. The Chicago manufacturer said Monday that Dennis Muilenburg is stepping down immediately. The board's current chairman David Calhoun will officially take over on January 13. The board said a change... Read More

Revised North American Trade Deal Overwhelmingly Passes House Trade
Revised North American Trade Deal Overwhelmingly Passes House
December 20, 2019
by Dan McCue

WASHINGTON - In a strong show of bipartisan cooperation just hours after they were at each other's throats over the impeachment of President Donald Trump, Democrats and Republicans threw their support behind a new trade agreement with Canada and Mexico. The 385-41 vote in the House... Read More

No Date Set for U.S.-China ‘Phase Two’ Talks, Lighthizer Says Trade
No Date Set for U.S.-China ‘Phase Two’ Talks, Lighthizer Says

WASHINGTON — No date has been set so far for the U.S. and China to kick off “phase two” trade talks, said U.S. Trade Representative Robert Lighthizer, contradicting a suggestion by President Donald Trump that negotiations would start right away. For now, the two sides are... Read More

House Committee Calls for Action to Prevent Airline Mishandling of Wheelchairs Travel
House Committee Calls for Action to Prevent Airline Mishandling of Wheelchairs

U.S. House committee leaders this week called for airlines to do more to prevent mishandling of wheelchairs and scooters of passengers with disabilities, and sought more information on airlines’ policies and procedures. In a letter to industry group Airlines for America CEO Nicholas Calio, Delta Air... Read More

Trump Considers Disposing of D.C. Hotel to End Legal and Political Disputes In The News
Trump Considers Disposing of D.C. Hotel to End Legal and Political Disputes
October 30, 2019
by Tom Ramstack

WASHINGTON - The Trump organization is considering selling its lease on the downtown Washington Trump International Hotel to resolve legal and political disputes over its ownership and profits. Controversy surrounding the hotel is part of an ongoing tide of criticism against the Donald Trump as he... Read More

Straight From The Well
scroll top