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STRATEGY

Women's Business Centers Fight for Funding

Women decry SBA budget maneuvers.
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"A powerful resource" is how Small Business Administration chief Hector V. Barreto described the Women's Business Center program (WBC) when he announced the opening of 11 new centers last December. Lately, however, some of his budget decisions have upset supporters of the 16-year-old program.

The brouhaha began when the SBA announced that it would, for the first time, cease funding centers that have been open for five or more years; the money would instead flow to start-up centers. Women's business groups were outraged. Without that funding, they claim, 53 of 91 centers would face budget deficits and could close starting in September. "It's a mystery to me," says Ellen Golden, of the Association of Women's Business Centers. "People in the SBA have called them the jewel in the crown. The President called them a key component in helping small business."

Critics add that funding new centers at the expense of established ones is silly. "It's like a client," says Mary MacRae, past president of the National Association of Women Business Owners. "It's more cost-effective to retain the one you've got than to recruit a new one." SBA spokesman S. Kevin Washington responds that the program was never intended to provide more than seed funding, and that WBCs have known that from the beginning. "We don't have endless pools of money," he says. That may be, women's groups concede, but state and local funding has dried up in recent years, and the SBA has always funded existing centers.

In May, WBC allies in both houses of Congress introduced bills to restore the funding. Maria Welch, a former homeless person who now runs a business that grosses $1.4 million per year thanks to counseling she received from a WBC in Baltimore, testified before a House committee that she "would not be here if it weren't for them."

The feel-good campaign seems to be succeeding. At presstime, two WBC advocates told Inc. that a compromise to maintain funding was in the works. The SBA's Kevin Washington would not confirm the deal, however. If it falls through, a program that once enjoyed bipartisan support could be in jeopardy.

Last updated: Aug 1, 2004




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