By Raymund Flandez
Wall Street Journal
April 2, 2009
The Senate Committee on Small Business and Entrepreneurship unanimously confirmed Karen Gordon Mills, a venture capitalist and Tootsie Roll heiress, as the administrator of the Small Business Administration last night. The full Senate is expected to swiftly confirm President Obama’s nominee for the SBA post, as soon as today.
“Karen Mills is the right person to lead the Small Business Administration during these tough economic times,” says Mary Landrieu, D-La., the Senate Small Business Committee Chair, in a statement before the confirmation vote. “After suffering enormous budget cuts and being relegated to obscurity during the previous administration, the SBA needs a strong leader who will fight for small businesses throughout the nation. Ms. Mills has an outstanding record both in growing new businesses and in her community.”
At her confirmation hearing, Ms. Mills revealed what her first priorities would be as SBA head and was asked several questions about the small-business initiatives President Obama wants accomplished this year. Highlights below:
– First question out of the gate came from Ms. Landrieu, who told Ms. Mills that she and her colleague Sen. Olympia Snowe, R-Maine, have already sent two letters to President Obama, strongly urging him to elevate the SBA administrator post to a Cabinet position within the first 100 days. Yesterday was Day 72, she says, “we have 28 days left.” Does Ms. Mills intend to talk to President Obama about it?
“It is the president’s decision about who he wants in his Cabinet,” Ms. Mills responded. “He has assured me that, as you know, I’ll be part of the NEC, the National Economic Council. I’d very much be a part of all these discussions, and small business will be a part of the agenda.”
Ms. Mills was later asked the same question by Sen. Evan Bayh, D-Ind., but also gave a similar non-answer.
– Ms. Mills was asked details about how she plans to unfreeze the secondary market, crucial to small-business lending. She said that the details have not been announced, but the Treasury is working with the SBA on the issue. But she did reveal that the SBA has already implemented key provisions to Obama’s Recovery Act plan, such as the 90% guarantee on SBA loans and reduced fees. Since March 16, the SBA has already made $1.4 billion in loans under the revised program, Ms. Mills says.
– Sen. Snowe urged Ms. Mills to set a more aggressive deadline in implementing small-business provisions in the Recovery Act, instead of delaying them a month or two after confirmation. Ms. Mills agreed.
– A key question in her hearing had to do with what her views were on whether venture-backed small businesses be allowed to receive SBA-backed money. Ms. Mills says that the most promising businesses should not be excluded, although she worries about crowding out other small businesses in the process. “I don’t have a fixed view” on what percentage should be allocated to venture-capital majority-owned businesses, she says.
– With health care becoming the No. 1 or No. 2 issue in most small-business surveys, Ms. Mills says the administration has taken a look at several suggestions that would benefit small-business owners, mainly the ability to pool money to buy health care and to receive tax relief for small businesses that do provide health-care benefits to their employees. “The president sees this as…an important priority,” she told the committee.
– In her testimony, Ms. Mills indicated three issues she plans to tackle first: implement the small-business provisions in the stimulus package and get capital flowing to core SBA loan programs; hire staff and buy technology that’ll help the agency; and be an active liaison among other agencies, such as Commerce, Labor and Energy, whose programs affect small business.
“I am a believer in American small business,” she told the committee. ” … If confirmed I pledge to pursue these tasks with the utmost energy, and to be your partner in giving small businesses the help they need to thrive, to grow and put Americans back to work.”
Small business groups are already strongly suggesting what Ms. Mills should focus on first.
“As a first order of business at the SBA, Karen Mills should immediately remove all Fortune 500 firms, large businesses and their subsidiaries from any and all government databases of firms claiming status as small businesses,” the American Small Business League said in a statement. “This would once and for all bring an end to the ‘miscoding’ that has plagued the SBA for the last eight years.”
What should the new SBA administrator do first? What do you expect to happen in her first 100 days?