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Witness Testimony of Mr. William D. Elmore, Office of Veterans Business Development, Associate Administrator, U.S. Small Business Administration

Chairwoman Herseth Sandlin, Ranking Member Boozman and distinguished members of the committee, thank you for the opportunity to appear before you today to share information on the activities of the U.S. Small Business Administration (SBA) regarding our efforts to assist and support federal procurement opportunities and success of veterans, including those who have incurred a service-connected disability.

I am William Elmore, the Associate Administrator for Veterans Business Development, and I am pleased to be here today representing Administrator Preston and other SBA employees who work every day to support the small business success of America's veterans, reservists, and family members. The mission of the Office of Veterans Business Development is to maximize the availability, applicability and usability of all Administration small business programs for Veterans, Service-Disabled Veterans, Reserve Component Members of the U.S. Military, and for their Dependents or Survivors.

It is important to note that SBA' s efforts to support veteran entrepreneurs go significantly beyond the activities of SBA's Office of VBD. Each program at SBA is tasked with expanding and improving their services specifically for veterans and service-disabled veterans. This includes our Capital Access (loan) programs, our business counseling and training programs, our procurement programs, our field offices and our Disaster Assistance program. Thus far, the results have been good; the number of new loans being made to veterans has increased significantly. The number of new loans to veterans has grown from 4,800 in FY 2000 to approximately 8,000 in FY 2006. Additionally, loans to start-up businesses owned by veterans continues to see considerable growth-nearly doubling the 1,300 7(a) loans in FY 2000 to almost 2,500 in FY 2006. SBA Business outreach, counseling and training services assist more than 100,000 veterans, reservists, active service members and spouses each year, including the growth of special outreach and coordination efforts through our district and Regional offices.

Federal procurement opportunity for veterans is an important issue to SBA, to the emerging veteran business community, and to the government's ability to secure the goods and services it needs, especially during this period of mobilization for the Global War on Terror. SBA understands the critical skills that military members and reservists bring to this international effort. In this context, I am pleased to be sharing with you some of the initiatives and accomplishments the SBA has made over the past six years.

As expressed in the January 24, 2007 Memorandum For Heads of Departments and Agencies jointly issued by Administrator Preston and Office of Federal Procurement Policy Administrator Dennet, the Administration is broadly committed to enhancing all of our entrepreneurial programs and services for veterans and reservists returning from duty in the Global War on Terror, and more specifically for those service members injured or disabled in service to America.

Prime contracts have a three percent government-wide Federal procurement goal established by Public Law (PL) 1Q6-50 for small businesses owned and controlled by service-disabled veterans. In addition, PL 106-50 established a "best efforts" clause for veterans in Federal procurement at the subcontracting level. Though the Federal government has yet to achieve the required three percent goal, it is making progress towards accomplishing it. As you know, in 2004, President Bush issued Executive Order 13360 to strengthen procurement opportunities in Federal contracting for service disabled veteran-owned small businesses (SDVOSBs). As mandated by E.O. 13360, the General Services Administration (GSA) established the Veterans Technology Services (VETS) Government-wide Acquisition Contract (GWAC). VETS is a IT contract designed to help Federal agencies meet their three percent goal by purchasing information technology solutions from SDVOSBs. GSA also offers opportunities for federal agencies to contract with SDVOSBs for other services and supplies through the use of multiple GSA Multiple Award Schedule program. Preliminary data shows that both SBA and the Department of Veteran Affairs (VA) exceeded our three percent goals for SDVO small businesses in FY 2006, with SBA achieving more than four percent. This example demonstrates leadership by example, and represents a significant improvement for both agencies over our achievement in FY 2005.

SBA is currently reviewing the final FY 2006 reports from the Federal Procurement Data System. The preliminary data suggests significant efforts toward an improvement in achieving the three percent goal. This improvement reflects the ongoing SBA efforts, and the efforts of most federal agencies. It also demonstrates the increasing ability of service disabled veteran-owned small businesses (SDVOSBs) in pursuing contracting opportunities and in securing contracts.

On July 9,2007, the number of small businesses owned by service disabled veterans (SDVs) expressing interest in federal procurement by registering in the Government's Central Contractor Registration (CCR) was 9,642 and the number of Veterans Owned Small Businesses was 37,282. While SBA is analyzing what agencies are buying and comparing that to what SDVOSBs are selling, we are also strengthening the full range of SBA programs for:  veterans, service-disabled veterans, reservists, discharging service members and the spouses and widows of service members. Improvements include strengthening our written agreements with our Small Business Development Centers, growing SCORE's online assistance for veterans and reservists, funding Veterans Business Outreach Centers, growing our District Office-Veterans Outreach initiative, targeting veterans and veteran reservists in our Community Express Loan program, establishing the new Patriot Express Loan, improving our Surety Bond program, developing a public/private Matchmaking program specifically for veterans, focusing more PCR/CMR activity on veterans, establishing the electronic Scorecard for Federal agencies and working to reconcile the differences between the SBA procurement rules for veterans and the Federal Acquisition Regulation procurement rules for veterans. We are also working with the Department of Defense (DoD), and the Department of Labor (DOL) to enhance our involvement in TURBO TAP (Transition Assistance Program), in efforts to improve small business opportunity and employment support for returning veterans and reservists, and assisting various components of DoD in various planning initiatives.

At the request of both SBA and the veterans' advocacy community, the U.S. Census Bureau included veteran and SDV status questions in their 2002 survey of small business owners. These questions mark the first time we have an accurate count of the number of veteran and SDV small business owners in the American small business marketplace. This Census survey found that approximately 0.7 percent of small businesses in America are owned by SDVs, and approximately 14% of all small businesses are owned by veterans.  The 2002 statistics released by the Census Bureau indicate that 2.6 percent of veteran owned firms sell to the Federal government, while only 2 percent of all firms take advantage of the Federal market place. These findings reinforce our efforts to strengthen the full breath of SBA programs and services specifically for SDV and all veteran business owners. SBA is strongly committed to working with all of our programs and with all of our Federal agency counterparts to reach out to and help create more veteran-owned small businesses, and to make use of their talents and services in federal procurement, in strengthening the American economy and in strengthening America's involvement in the International economy.

This concludes my comments, and I welcome any questions you might have.