Bills
| 3.23.22

Should the Women’s Business Centers Program be Reauthorized & Strengthened? (H.R. 4405)

Do you support or oppose this bill?

What is H.R. 4405?

(Updated October 28, 2019)

This bill — the Women's Business Centers Improvements Act of 2019 — would strengthen the Women’s Business Centers (WBC) program, which provides a full range of counseling and training services for small businesses primarily owned by women. It would reauthorize WBCs for four years and increase the authorization to $31.5 million. It would also increase the cap on individual center grants for the first since since the program began, increasing the maximum five-year funding levels for both initial and continuation grants to $300,000.

Additionally, this bill would establish an accreditation program, to be run by the Association of Small Business Development Centers, to ensure that all WBCs provide excellent service and counseling. This program would be modeled after the program run by the Association of Small Business Development Centers. 

This bill would also eliminate reporting requirements for funds that WBCs raise above their federal match. At present, WBCs are subject to the same reporting requirements for funds raised above the federal match and funds raised to meet the federal match.

Additionally, this bill would create a transparent, consultative process for the selection of new WBC locations. It would require the SBA to consult with the Association of Women’s Business Centers when establishing new locations. 

Finally, this bill would require an annual report on the WBC program’s effectiveness. This would be delivered to the Senate and House Committees on Small Business. 

Argument in favor

Women entrepreneurs face unique challenges in starting and growing their businesses. Women’s Business Centers (WBCs) play an important role in helping them overcome these challenges. As such, WBCs should be reauthorized, given more funding, and enhanced so they can serve more women entrepreneurs.

Argument opposed

While no one denies that women entrepreneurs are important and should receive support in their endeavors, the federal government’s appropriate role in supporting female entrepreneurs is debatable. The private sector could just as easily — and perhaps more effectively — support women entrepreneurs without spending taxpayer money.

Impact

Women entrepreneurs; SBA; Women’s Business Centers program; regulations and rules governing WBC grants and fundraising; Senate and House Committees on Small Business.

Cost of H.R. 4405

A CBO cost estimate is unavailable.

Additional Info

In-Depth: Rep. Sharice Davids (D-KS) introduced this bill to support women’s business centers and help female entrepreneurs start and grow businesses: 

“Women are the fastest growing sector of entrepreneurs, but many unique challenges still exist for women, particularly women of color, to start and grow a business. By strengthening Women’s Business Centers, we can increase access to vital counseling and technical training services for female entrepreneurs so they can succeed.”

Original cosponsor Rep. Jim Hagedorn (R-MN) adds: 

“Millions of women own small businesses in the United States. Entrepreneurship and the Women’s Business Center (WBC) program are essential for empowering women to become business owners. By increasing these services, we increase the ability to inspire and foster new generations of business leaders.”

After this bill unanimously passed the House Small Business Committee, Rep. Hagedorn said, “We are one step closer to more effectively promoting women entrepreneurship and empowering a new generation of business leaders to achieve the American Dream.”

The Association of Women’s Business Centers (AWBC) endorses this bill. Its CEO, Corinne Hodges, says: 

“This importan[t] piece of legislation comes at a crucial time for women entrepreneurs across the nation, as they’re starting businesses at four times the rate of men. By lifting the cap on individual center grants for this first time in the program’s 30 year history and raising authorization levels to $31.5 million, WBCs will be able to reach more entrepreneurs in need, particularly in rural areas, with the training, counseling, and access to capital they need to thrive. I want to thank Representative Davids and Representative Hagedorn for prioritizing women business owners and job creators and for their support of the WBC program.”

Sherry Turner, executive director of the Kansas City Women’s Business Center, expressed her support for this bill in a statement: 

“Not only will women entrepreneurs in Kansas City and our surrounding region benefit from this legislation, but women all over the country will have the opportunity to access more of the resources they need to start and grow their businesses. Women are exploring entrepreneurship as a pathway to financial self-sufficiency. Reauthorizing WBC funding is imperative to our consulting and training programs for women entrepreneurs serving more than 145,000 women entrepreneurs each year.”

This bill passed the House Committee on Small Business by voice vote with the support of 17 bipartisan cosponsors, including 14 Democrats and three Republicans.


Of Note: The Women’s Business Center program was established 30 years ago to help women entrepreneurs succeed. It was first created as a demonstration pilot program and enacted as part of the broader Women’s Business Ownership Act of 1988. Several years later, Congress reauthorized the demonstration projects through FY1997 under the Small Business Administration Reauthorization and Amendments Act of 1994. That Act also established the Office of Women’s Business Ownership within the Small Business Administration (SBA) to administer the program. 

The Small Business Reauthorization Act of 1997 made the WBC program permanent. Then, the Women's Business Centers Sustainability Act of 1999 reauthorized and restructured the program. Now, there are currently 150 WBC locations throughout the U.S. serving over 150,000 entrepreneurs each year. 

The WBC program’s mission is to “act as a catalyst for providing in-depth, substantive, outcome-oriented business services to women entrepreneurs, both nascent and established businesses, a representative number of which are socially and economically disadvantaged.” Through this program, nonprofits are funded in efforts to establish substantial economic impact in their communities through the creation of new businesses that support job creation, job retention, and increased company revenues.

WBCs seek to meet the counseling and training needs of the small business concerns owned and controlled by women, particularly socially or economically disadvantaged women. To this end, they provide:

  • Financial assistance, including training and counseling in how to apply for and secure business credit and investment capital, preparing and presenting financial statements, and managing cash flow and other financial operations of a small business concern;
  • Management assistance, including training and counseling in how to plan, organize, staff, direct, and control each major activity and function of a small business concern; and
  • Marketing assistance, including training and counseling in identifying and segmenting domestic and international market opportunities, preparing and executing marketing plans, developing pricing strategies, locating contract opportunities, negotiating contracts, and utilizing varying public relations and advertising techniques.

In a February 2019 interview with Fundbox, the Small Business Administration’s (SBA) Assistant Administrator Kathleen McShane, who oversees the SBA’s WBCs, discussed WBCs’ impact on women entrepreneurs’ confidence. She noted that in the WBC program’s annual study, 76% of women strongly agreed or agreed that going through women-centered services increased their confidence. Citing the fact that 91% of respondents in the same survey said they would recommend a WBC, McShane contended that WBCs offer an overwhelming positive experience for women entrepreneurs.


Media:

Summary by Lorelei Yang

(Photo Credit: iStockphoto.com / izusek)