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Ms. CANTWELL. Mr. President, today I am joining with my colleagues to introduce legislation to empower women entrepreneurs and to help address the persistent challenges women face when trying to start and grow a business.
It was just 26 years ago that Congress enacted landmark legislation, the Women's Business Ownership Act of 1988 that eliminated requirements that women obtain the signature of their husband or other man to secure a business loan.
Between 1997 and 2013, the number of women-owned businesses in the United States grew by 59 percent, but significant barriers for women still exist and there is still much more work to do.
Last week, the Small Business Committee released a report entitled ``21st Century Barriers to Women's Entrepreneurship'' that assesses the current challenges faced by women-owned businesses. The report also makes policy recommendations to increase economic opportunity for women and help to put them on a level playing field with other business owners.
Our committee report makes four critical findings and includes policy recommendations to help remedy the business climate for women entrepreneurs.
First, women business owners face challenges in getting access to capital. The report highlights a study by the Urban Institute finding that only 4 percent of the total value of all conventional small business loans goes to women entrepreneurs. That means only $1 of every $23 is being loaned to a women-owned business. The report also notes that women are forced to rely on personal savings, loans from family or friends, or high interest credit because they cannot get traditional small business lending from banks.
Second, the report finds that women business owners still face challenges in getting access to loans of the right size. Women-owned businesses have been very successful with the SBA's Microloan program, under which they can obtain loans of up to $50,000 through intermediaries that also provide assistance in the development of business plans. However, this program has not been updated since 1991.
The report highlights the importance of reauthorizing the Intermediary Lending Program that expired in 2013 and provided capital for women business owners who were ready to take out loans that exceeded the $50,000 provided by the SBA's Microloan Program, but were not yet able to take advantage of the SBA's 7(a) lending program.
Third, the report finds that women entrepreneurs face challenges obtaining relevant business training and counseling. Women's Business Centers provide specialized counseling and training designed to address the unique challenges women face in starting a small business. The report shows that the Women's Business Center program has not been re-authorized since the 1990s and is in need of a 21st century modernization.
Last, the committee report finds that women business owners face challenges getting access to Federal contracts. Despite the growing number of businesses owned by women, the Federal Government has never met its goal of awarding 5 percent of its contracts to women-owned small businesses. Our report notes that if the government met this goal, women-owned small businesses would have access to additional market opportunity worth up to $4 billion a year.
That is why we are introducing the Women's Small Business Ownership Act. This legislation follows the policy recommendations made in the committee report and helps to address the glass ceiling many women entrepreneurs still encounter in the 21st century. While women-owned businesses as a whole continue to grow and succeed, to do so many women must overcome barriers men do not face.
The Women's Small Business Ownership Act increases the flow of capital to women business owners by modernizing the SBA's Microloan program and reauthorizing the Intermediary Lending Program. Women have been particularly successful in using microloans, which are loans of under $50,000, and receive about half of all SBA Microloans.
The Microloan program would be modernized by increasing the total amount lenders can loan, as well as allowing lenders to provide flexible terms and improved technical assistance to better suit the needs of borrowers.
The Intermediary Lending Program is also an important program, which this legislation reauthorizes to address a gap in lending options for small businesses, including women-owned small businesses that are unable to obtain financing from traditional lenders. The Intermediary Lending Program offers low-interest loans of between $50,000 and $200,000 and closes the gap that can exist for small businesses that have outgrown the SBA's Microloan program, but are not yet able to take advantage of SBA's other lending guarantee programs.
This legislation removes barriers to the federal contracting marketplace by allowing sole source contracts to be awarded to women-owned small businesses. Every other small business in a unique socioeconomic category, including HUB Zone firms, service-disabled veteran-owned small businesses, and small disadvantaged businesses, can receive a non-competitive or sole source contract, but women's small businesses cannot. Women-owned companies deserve parity with other programs and a fair shot to grow their businesses.
The Women's Small Business Ownership Act ensures that the SBA's Women's Business Centers are adequately and effectively meeting the needs of women entrepreneurs in the 21st century. It provides the resources for Women's Business Centers to provide the technical support and counseling tailored to the unique challenges for women-owned businesses.
Women make up 51 percent of the population and have tremendous potential as business owners and job-creators. We need to empower women to break through the glass ceiling so it will be easier for even more women to succeed in the 21st century, grow the U.S. economy and create more U.S. jobs.
When women have equal opportunity to access capital, obtain the right business counseling, and compete for federal contracts, the economy grows and the country moves forward.
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