BOSTON – Today Senator John Kerry testified before the Joint Committee on Community Development and Small Business outlining his agenda in Washington that will benefit Massachusetts entrepreneurs and detailing areas where federal and state legislators can work together.



Kerry, Chairman of the Committee on Small Business and Entrepreneurship, is working to pass legislation to help small businesses in Massachusetts and around the country. His priorities for small businesses include expanding their access to financing and training, promoting innovation, assisting them after a disaster, improving their ability to do business with the federal government, helping them become energy efficient, and reducing health care costs. Below are his remarks, as prepared for delivery:


Statement of U.S. Senator John Kerry
Before the Joint Committee on Community Development & Small Business
The 185th General Court of the Commonwealth of Massachusetts

July 16, 2007


Chair Chandler, members of the Committee, thank you for inviting me to testify about the important issues of small business growth and job creation. Here in Massachusetts, we have nearly 640,000 small businesses employing 1.5 million people and pumping $24 billion into the economy. They’re driving innovation, creating jobs and keeping our state and our nation competitive in a global marketplace.



As the Chairman of the U.S. Senate Committee on Small Business and Entrepreneurship, I’m working to pass legislation in Washington that will help entrepreneurs get financing and training, help small businesses survive disaster, protect their access to federal contracts, improve energy efficiency, and reduce health care costs.



These are my priorities in Washington, but the reality is small businesses don’t care whether it comes from federal and state programs—they just want help. We have a real opportunity here for our Committees to work together to foster entrepreneurship and create an environment where even more small businesses can succeed.



Access to Capital

One essential component of that success is access to capital. Last year, small businesses in Massachusetts received more than $500 million in government-backed financing. In the Senate, we’re working to improve and expand the SBA loan programs, with a special focus on underserved minority and women entrepreneurs. These federally backed loans helped create or retain nearly 23,000 jobs in the Commonwealth in 2006 -- but we must do more to ensure that economic development spurred by these loans reaches every sector in our society.



Our Committees should work together to identify communities that are not benefiting from those lending programs designed to use entrepreneurship to close the wealth gap. We should combine local knowledge with the resources of the federal government—we should be working with community leaders on an aggressive outreach campaign to market federal and state financing programs and help small firms navigate what can be an intimidating maze of paperwork. Together we can expand the reach of these key programs to reach more and more entrepreneurs across Massachusetts.



Improve Business Training Programs

Another promising area of cooperation between our Committees is technical assistance and business counseling for small businesses. Small Business Development Centers and Women’s Business Centers receive federal funding, but they must also obtain matching funds from non-federal sources. The result is often a partnership between federal, state and local governments, universities and colleges and private resources. The eight SBDCs in Massachusetts and their 48 outreach sites served more than 8,500 clients last year.



The Center for Women and Enterprise is another example of a successful federal, state and private partnership. Since 1995, they’ve helped over 12,000 entrepreneurs generate more than 15,000 jobs and $430 million in wages. The SCORE program, with nine chapters across the state, brings the expertise of business executives to small businesses.



These critical programs deserve our continued support to protect and expand all of their funding sources. And as we strengthen these programs, we should include veterans as well—we should be fighting to create jobs and economic opportunity for the men and women who bravely fought for us.



Promote Innovation

Another priority is the Small Business Innovation Research Program, which is up for reauthorization next year. We can all be proud that Massachusetts ranks second in the nation in SBIR contracts, with $242 million worth in 2005. Over the last 10 years, more than 7,000 small firms in Massachusetts got SBIR awards worth nearly $2 billion. Without this program, they may not have received the funds they needed to develop their innovative ideas. Later this month I will hold SBIR roundtables in Washington and here in Massachusetts to look at increasing the percentage of government funding, making the program permanent, protecting intellectual property, and helping companies survive the so-called “valley of death” before commercialization.



Provide Assistance After a Disaster

We’re also concerned about how to protect small businesses after natural disasters. In the wake of Hurricane Katrina, we found major problems with the federal government’s low-interest disaster loan program. Over the last few years, small business owners and homeowners right here in Massachusetts have used the program to bounce back from floods, fires, drought, and even the red tide outbreak on the North Shore.



Earlier this year, my Committee passed bipartisan, comprehensive legislation to overhaul the Disaster Loan Program and I’m working to pass this bill by the full Senate, now that we’re in the middle of Hurricane Season, over the objections of a few Republicans. But we need your help, because this critical assistance often only comes when states ask for it following a disaster.



Level the Contracting Playing Field

On Wednesday, I’ll be holding a hearing focused on finding new ways to create opportunities for small businesses to contract with the federal government. Massachusetts firms currently do about $9.5 billion in business with the federal government each year. I believe we can do better.



In January, I hosted my second annual procurement conference at Northeastern University to help reduce the red tape small businesses face as they try to gain access to federal contracts. But this isn’t just about the federal level. I was proud to have support from Governor Patrick and Mayor Menino to bring together all of the resources at the federal, state and city levels to make Massachusetts a place where small firms can and want to do business. We can do more to bring small businesses face to face with procurement officials and prime contractors..



Help Small Firms Become Energy Efficient

Last month, the Senate passed an energy bill that takes major steps to wean our nation off of our dependence on foreign oil. I worked to include provisions that help small firms become more energy efficient. In particular, we provided grants to Small Business Development Centers for energy efficiency counseling. One SBDC in Pennsylvania has already started a successful energy audit program, and I believe that SBDCs across the Bay State are in a similar position to help small businesses reduce their energy costs. Small businesses can find tremendous profits in developing the technologies that will help us fight global warming.



Health Care

On a final note, I want to touch on health care. Across Massachusetts, I hear again and again that health care is the number one issue confronting small business owners. John Kingsdale, head of the state’s Connector Authority, testified at a hearing I held in February focusing on solutions for making health care affordable for small employers. While the Commonwealth is implementing a first-in-the-nation approach to expanding health care coverage for everyone, states cannot do this alone. I have introduced a bill to create a refundable tax credit for small businesses to purchase health insurance for employees. I’ve also introduced a bill that will establish the federal government as a partner in helping businesses with the heavy financial burden of catastrophic cases through a reinsurance trust fund. This plan will reduce premiums for everyone by up to 10 percent.



In closing, I would like to again thank you Chair Chandler and all the members of the Committee for having me here today to talk about these important issues for our small businesses. I look forward to working together to push forward an agenda that’s good for Massachusetts small businesses, their employees, their families and our economy. Thank you.