(Washington, DC) —Senate Committee on Small Business & Entrepreneurship Chair Ben Cardin (D-Md.) today joined Color of Change President Rashad Robinson, U.S. Black Chambers, Inc. President & CEO Ron Busby,1863 Ventures Founder Melissa Bradley, National Urban League President Marc Morial, and NBA Hall of Famer and Chairman & CEO of ISIAH International Isiah Thomas, and Black entrepreneurs for a webinar to celebrate the contributions of Black-owned small businesses hosted by Reimagine Main Street. Click here to watch a video of the webinar.
“Gaps in wealth and access to capital have limited the growth of Black-owned businesses. My priority for the Small Business Committee this Congress will be increasing federal capacity to bridge those gaps,” Cardin said. “While I am Chair, I intend to examine, fine-tune, and at times shake up, programs at SBA to make them more equitable so Black entrepreneurs have access to the technical training and capital they need to grow successful businesses and create jobs.”
Cardin has been a lead negotiator of each of the COVID-19 relief bills that have been passed by Congress during the pandemic, securing more than $1 trillion in aid for small businesses.
Cardin has also led efforts to ensure that funds are distributed equitably. He and Senator Jeanne Shaheen (D-N.H.) drafted a provision in the CARES Act that required the Small Business Administration (SBA) to issue guidance to financial institutions participating in the Paycheck Protection Program (PPP) to prioritize loans for underserved small businesses. In April of last year, Cardin secured a $60 billion set-aside in PPP for smaller lending institutions, such as credit unions, community banks, Community Development Financial Institutions, and Minority Depository Institutions that can better reach Black-owned businesses. Cardin also secured a $15 billion set-aside for loans issued by mission-lenders, including CDFIs, MDIs, and SBA 504 and Microlenders, as well as another $15 billion set-aside for certain smaller depository institutions, such as credit unions and farm credit institutions in the $900 billion bipartisan COVID-19 relief bill passed in December.
The COVID-19 pandemic has highlighted the pre-existing disparities that minority entrepreneurs face in access to capital, mentorship 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 2019, an estimated 41 percent of Black-owned businesses, 32 percent of Latino-owned businesses, and 26 percent of Asian-owned businesses closed while 17 percent of white-owned businesses closed.
Historically, access to capital has been an especially uneven playing field for minorities, who are two to three times more likely to be denied credit; more likely to avoid applying for loans, based on the belief that they will be turned down; and more likely to receive smaller loans and pay higher interest rates on the loans that they do receive. Due partially to these trends and other historical roadblocks, minorities own only 29 percent of small businesses despite representing 39 percent of the overall population. These challenges are felt most acutely by Black business owners.
Maryland boasts the highest concentration of minority-owned businesses in the country—the majority of which are Black-owned—and Cardin has made increasing federal support for Black entrepreneurs his top priority on the Small Business Committee.
Last month, Cardin and Senator Mazie K. Hirono (D-Hawaii) reintroduced the UPLIFT Act to create an Innovation Centers Program within SBA to award competitive cooperative agreements worth as much as $400,000 annually to institutions that support underserved and low-income communities. On the same day, Cardin, Hirono, and Senator Tammy Duckworth (D-Ill) reintroduced the Unlocking Opportunities in Emerging Markets Act to establish an Office of Emerging Markets (OEM) within SBA’s Office of Capital Access to ensure that SBA’s access to capital initiatives address the specific needs of entrepreneurs in underserved communities in a coordinated way.
In July 2020, Cardin and Senators Maria Cantwell (D-Wash.), Chuck Schumer (D-N.Y.), Cory Booker (D-N.J.), Catherine Cortez Masto (D-Nev.), and Kamala D. Harris (D-Calif.) introduced the Minority Business Resiliency Act to make the Minority Business Development Agency (MBDA) permanent 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.In December 2020, a Cardin amendment to extend the current 9-year limit on a small business’s participation in the SBA’s 8(a) Business Development Program to 10 years was included in the FY2020 National Defense Authorization Act. The 8(a) program is a business assistance program for small disadvantaged businesses to procure with the federal government.