(Washington, DC) — Senate Committee on Small Business & Entrepreneurship Ranking Member Ben Cardin (D-Md.) today introduced the NEW START Act—legislation to create a reentry program within the U.S. Small Business Administration (SBA) to award grants to organizations, or partnerships between organizations, to provide business counseling and entrepreneurial development training to returning citizens.
Cardin is a leader in the fight in Congress to create a more fair and equitable criminal justice system—cosponsoring the bipartisan FIRST STEP Act last Congress, which was enacted in December 2018, and will reduce sentences for certain low-level nonviolent offenders and use evidence-based programs to help returning citizens rejoin their communities. The NEW START Act is the first of two bills Ranking Member Cardin will introduce today to build on the success of the FIRST STEP Act as Americans mark Second Chance Month. This afternoon, Cardin will also introduce the Democracy Restoration Act, which would strengthen American communities by restoring voting rights for returning citizens.
“In December, Congress took bold action to make our criminal justice system more fair and more equal, but the hundreds of thousands of Americans who return home from prison every year still struggle to secure a job, find a place to live and reenter society. I remain proud of the passage of the FIRST STEP Act, but it was just that: a first step. Congress must now find solutions to the many barriers that formerly incarcerated individuals face when they leave prison,” said Senator Ben Cardin. “This bill will use the power of entrepreneurship to help returning citizens rebuild their lives and reenter their communities by giving them the training and capital they need to start businesses. It will give returning citizens one more tool in their reentry toolkit.”
“Part of reversing mass incarceration is helping people return home and build new lives after release from prison,” said Brennan Center for Justice at NYU School of Law Senior Counsel Ames C. Grawert. “This bill would take an important step in that direction, and encourage people in need of new opportunities to seek them.”
“The NEW START Act is one of the most impactful pieces of legislation that addresses recidivism head on. As the voice of the Black business community, we commend Senator Cardin's efforts to reduce recidivism through entrepreneurial development. We firmly believe entrepreneurial development programs are a viable solution to empower and reactivate returning citizens,” said U.S. Black Chambers of Commerce President Ron Busby.
“We're pleased Senator Cardin has introduced the NEW START Act to make it easier for returning citizens to launch their own businesses and pursue the American dream,” said Small Business Majority Founder & CEO John Arensmeyer. “Supporting entrepreneurial development programs for formerly incarcerated individuals will help more people, especially those who are often shut out of the labor market, create their own jobs by starting small businesses, which will benefit our economy overall.”
“Entrepreneurship—from micro-enterprises to high-growth businesses—supports financial well-being and economic mobility, which are fundamental to reducing the lasting harm caused by incarceration,” said Laurin Leonard, Executive Director of Baltimore-based Mission: Launch. “The NEW START Act is an exciting opportunity to continue to invest in entrepreneurs who have demonstrated their commitment to positively contributing to their families and communities as well as their local economies.”
“JustLeadershipUSA enthusiastically supports the NEW START Act. The business counseling and entrepreneurial development training and resources made available to people after returning home from incarceration affirms the rights of directly impacted people to use their talents to provide for themselves and their families, and create opportunities for others in their communities,” said JustLeadershipUSA President and CEO DeAnna R. Hoskins. “People impacted by prison, probation, and parole face thousands of barriers to employment, housing, and many basic needs—barriers that JLUSA advocates to remove through our #WORKINGfuture campaign. As we work to challenge and end stigma and barriers to employment, small-business ownership is a vital pathway for thousands of people with records, who have the creativity and courage, to start a business. The NEW START Act increases the number of people who will be able to take advantage of entrepreneurial opportunities.”
“In my experience, people coming home from prison are eager to contribute to society, support their families, and strengthen their communities,” said #cut50 Co-founder and National Director Jessica Jackson. “We need to build more ladders to success that help them in that process. The NEW START Act recognizes the entrepreneurial capacities of returning citizens and invests in their future by providing critical resources to direct-service organizations that help ease the transition from prison to entrepreneurship. #cut50 stands firmly behind Senator Cardin's NEW START Act, which will help us all build safer and more prosperous communities.”
Every year, more than 600,000 people are released from prisons, and an additional 11 million cycle through local jails. An estimated 64.6 million Americans—25 percent of the adult-age population—have a criminal record of some kind. The Department of Justice has found high rates of recidivism among returning citizens, with half of all returning citizens recidivating within 3 years and 60 percent recidivating within 5 years.
One of the primary drivers of high recidivism rates is the inability for returning citizens to find a job: up to 60 percent of ex-offenders remain unemployed one year after their release. A 2015 Manhattan Institute study revealed that employment, especially within the first six months of release, drastically lowers the likelihood of recidivism for nonviolent offenders.
The Cardin bill would build on the successes of programs across the country that have successfully deployed entrepreneurial development to reduce recidivism by helping returning citizens secure employment and start businesses. In Texas, the Prison Entrepreneurship Program—which has graduated more than 2,300 returning citizens—has helped 100 percent of its participants secure employment within 90 days and has helped its participants start more than 360 businesses. In Oregon, the state Department of Corrections found that participants in the Lifelong Information for Entrepreneurship Program were 41 percent less likely to recidivate. Defy Ventures, which operates in New York, California, Connecticut, Colorado, Washington, and Illinois, reports an 82 percent employment rate and a less than 5 percent recidivism rate for its released graduates.
Under the NEW START Act, organizations seeking grants from SBA must demonstrate ties to the business and returning citizen communities. Additionally, the organizations must partner with lenders in the existing SBA Microloan Program to provide microloans of up to $50,000 to help qualifying program participants start and build their businesses. Click here to download a one-pager on the bill.
