Good news and Albany. It wasn”™t an oxymoron pairing for once.
Women and minorities who own businesses in the state came out winners in a legislative package passed by both houses of the Legislature.
The three bills addressed findings in a study released in the spring titled “The State of Minority and Women-Owned Business Enterprises: Evidence from New York.”
The so-called “disparity study” found that the state procurement process has been exclusionary to the detriment of minority and women-owned businesses. The report used a tougher word, albeit couched in legally written phrasing, saying these business owners “continue to experience statistically significant disparities in their access to private and public sector contracts and to those factors necessary for business success, leading to the inference that discrimination is a significant cause of those disparities.”
Discrimination is a tough allegation to ignore, even for our lawmakers.
The state has one of the largest databases of certified minority and women-owned firms in the nation with 6,899 as of December 2007, the latest figure available. Of that number, 3,627 were women owned, 2,578 were minority owned and 694 had dual certification.
The lawmakers agreed they wanted to end any appearance of past discrimination by state agencies and authorities. The thrust of their legislation is to ensure fairness, create more transparency and enact tougher reporting requirements for agencies and prime contractors.
The bottom line of the package is to, as Assembly Speaker Sheldon Silver of Manhattan and state Sen. Antoine M. Thompson of western New York said, “level the playing field.”
State Sen. Ruth Hassell-Thompson, who has a piece of Mount Vernon in her district, said: “New York has many professional firms that are owned by talented individuals of diverse backgrounds and it is incumbent upon the state”™s fiduciary-controlled entities, public authorities and agencies to develop and codify a strategy aimed at inclusion and meaningful participation by MWBEs across New York state.”
Now to really help out these and other small-business owners is to “unbundle” large contracts.
The size and complexity of state contracts are considered “a major impediment” to minority and women-owned businesses as well as other small firms in obtaining work as prime contractors. That”™s what the disparity study found.
The study points out that “in conjunction with reduced insurance and bonding requirements, smaller contracts should permit firms to move from quoting solely as subcontractors to bidding as prime contractors.”
It did offer a bit of caution, saying the process must be conducted “within the constraints of the need to ensure efficiency and limit costs to taxpayers.”
As if that has been a problem in the past.
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A tub of guacamole and a loan to go
Another aspect of the legislative package above is expanding access to credit from the Small Business Revolving Loan Fund.
But even that isn”™t a guarantee for struggling businesses.
So, who do you turn to after the banks had said no?
How about Sam”™s Club?
The big-box discount store last week began testing a program to offer qualified members small-business loans ranging from $5,000 to $25,000.
The service would be offered online through a partnership with Superior Financial Group, a federally licensed Small Business Administration lender.
Sam”™s Club had found in a November 2009 small-business survey that nearly 15 percent of its business members reported being denied a loan to run their operation, up from 12 percent in April 2009.
“Access to capital is a major pain point for our members and the small business Main Street community. We believe this pilot program is a step in the right direction to help fuel small-business growth and create jobs to stimulate our economy,” said Catherine Corley, vice president of membership at Sam”™s Club.
During the pilot program, business members who apply for a 10-year loan will receive a $100 off the application fee and a 7.5 APR.
Whether its community minded or a move to get clients to spend more in its stores, Sam”™s Club is doing the right thing by offering a helping hand to small businesses.
Walmart Stores, which owns Sam”™s, in May reported record first-quarter sales and earnings for fiscal year 2011 of $99.1 billion, an increase of 6 percent from $93.5 billion in the first quarter last year. Of that amount, Sam”™s contributed $11.7 billion.
Maybe the retailer might want to do the lending itself.
