Declining budget or no, Hector Barreto hopes to make the agency more responsive to the small-business community it serves.
Hector V. Barreto's confirmation as administrator of the U.S. Small Business Administration (SBA) earlier this year was a mixed blessing of sorts. On one hand, the Senate's vote of confidence meant that Mr. Barreto, a Southern California businessman, would become the nation's most influential advocate for small business. Under President Bush's proposed budget, however, annual SBA funding would be slashed from $860 million to $540 million – a decrease of 37 percent.
"We were very excited he was nominated for the position, but we also were concerned that he would be coming into a situation that would restrict his ability to do the best job he could," says Elizabeth Lisboa-Farrow, chairwoman of the U.S. Hispanic Chamber of Commerce (USHCC).
Ms. Lisboa-Farrow and others worried that Mr. Barreto, a former USHCC vice-chairman, would shoulder blame for the inevitable cutbacks. And some feared Mr. Barreto, despite having learned the political ropes from his father, USHCC cofounder Hector Barreto Sr., would be unable to deflect the criticism.
The president's proposal to cut the SBA's budget and impose $141 million in higher loan fees elicited protests from small businesses, minority groups, and members of Congress.
Rep. Nydia M. Velázquez (NY), ranking Democrat on the House Small Business Committee, questioned the president's commitment to small business in an opinion piece published in HISPANIC BUSINESS ("Pro-Business or Big Business," Second Opinion, June 2001).
"I can tell you that this is the worst budget that I have seen in my nine years as a congresswoman and my four years as ranking member on the Small Business Committee," she said in a subsequent telephone interview. "I guess Mr. Barreto's first order of business will be to restore some of these cuts and work hard with the administration to make sure next year's budget doesn't look as bad, because then it will be on his shoulders."
Congress, however, wasn't willing to wait that long. At press time, budget bills in both the House and the Senate sought to restore much of the SBA's funding. The House bill proposes $728 million in SBA funding, while the Senate bill would provide $778 million, according to Mike Stamler, an SBA spokesman.
Click here to view the SBA budget breakdown.
Neither bill contains the new fees proposed by the president, and only the House bill lacks funding for the newly created BusinessLINC Program, which would be eliminated under the president's budget.
In a telephone interview with HISPANIC BUSINESS, Mr. Barreto warned against reading too much into the president's initial SBA budget. "The president has told me on more than one occasion that this agency is a vital part of his administration and that he wants to see small businesses prosper and grow," said Mr. Barreto, who co-chaired the Bush/Cheney 2000 campaign in California and was a delegate and featured speaker at last year's Republican National Convention in Philadelphia.
He says the SBA, with 2,800 employees and a loan portfolio in excess of $10 billion, will work with whatever budget it receives without eliminating offices, cutting programs, or diminishing its ability to serve the small-business community. "We're talking about doing a lot more outreach and leveraging our resources in a better way than has been done in the past," he said. "We need to look at the agency from top to bottom, making sure it operates as efficiently and effectively as possible."
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