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Pappas raises alarm on plan to cut SBDC funding, questions SBA administrator about Biden budget proposal

By Staff | Mar 25, 2023

Democrat Chris Pappas celebrates winning the New Hampshire U.S. House District One Congressional race at an election party in Manchester, N.H. Tuesday, Nov. 6, 2018. (AP Photo/ Cheryl Senter)

WASHINGTON – U.S. Rep. Chris Pappas (NH-01), a member of the House Small Business Committee, questioned Small Business Administrator Isabella Guzman about a Biden Administration proposal to reduce funding for Small Business Development Centers (SBDC) by $19 million for FY 2024.

Following the COVID-19 pandemic, New Hampshire SBDC saw an approximate 68% increase in its annual direct advising client count. In 2022, New Hampshire SBDC supported 3,375 businesses in 219 communities, helping them to access $44.1 million in new capital, increase sales by $17.4 million, and create and retain 760 jobs. New Hampshire SBDC’s overall economic impact in 2022 was $207.3 million.

Pappas: “You said, ‘we hope the proposed budget gets approved.’ But I have a concern. Included in this budget is a 14% cut to the Small Business Development Center. Other members have mentioned this, but I want to stress how important SBDC is to our frontline businesses in New Hampshire. SBDC is the boots on the ground. They have increased and expanded their mission, since the pandemic, they’ve gone from seeing roughly 862 businesses to about 1500 businesses a year… But the concern is that they’re going to lose about $105,000 of the roughly $778,000 that they receive in a federal allocation. That means they’d have to cut full-time advisors. So that would have a direct impact on the ground in terms of the support that is out there for a critical resource partner. And I just want to give you another opportunity to respond to this, why are we cutting a successful program that provides such important assistance to our small businesses at a time where they need it more than ever?”

Guzman: “And again, what I would re-emphasize is that we’re trying to diversify our entrepreneurial ecosystem to be inclusive of all types of providers, you know, the SBDCs do a remarkable job, as does our SCORE partner, as does the Women’s Business Centers. And we want to make sure that we are able to incentivize support for these great institutions across the board. And so, we do need additional types of support, to be more inclusive and make sure nobody’s left on the sidelines. And, you know, ideally, we have enough resources to continue to support all of our great resource partners at scale, but there has to be some change to reach out to more of these micro small businesses around the country and serve them effectively.”

Pappas: “…One of the important functions of SBDC is disaster assistance, wouldn’t cutting SBDC jeopardize that critical function and other things that we rely on them to do?”

Guzman: “The SBA actually has a full field operation for disaster assistance, which we scale in the event of disasters. And so, you know, clearly, we need to work on the ground with partners, those are chambers, those are local economic development agencies, our SBDCs are great partners on the ground as well. And, you know, we hope to continue to support a strong field outreach within our disaster programs and expect to continue to partner on the ground with great organizations like America’s SBDC.”

During the FY 2023 appropriations process, Pappas worked to ensure the package would invest in New Hampshire’s economy and workforce by providing funding for job training, apprenticeship programs, Community College Training Grants, Small Business Development Centers, and Manufacturing Extension Partnerships; as well as providing $1.2 billion for SBA, $320 million for Entrepreneurial Development Programs, and $40 million in funding for the Northern Border Regional Commission.


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