[House Hearing, 107 Congress]
[From the U.S. Government Publishing Office]
CRITICAL SMALL BUSINESS ISSUES AFFECTING LONG ISLAND
=======================================================================
FIELD HEARING
before the
COMMITTEE ON SMALL BUSINESS
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTH CONGRESS
FIRST SESSION
__________
RIVERHEAD, NY, AUGUST 30, 2001
__________
Serial No. 107-27
__________
Printed for the use of the Committee on Small Business
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COMMITTEE ON SMALL BUSINESS
DONALD MANZULLO, Illinois, Chairman
LARRY COMBEST, Texas NYDIA M. VELAZQUEZ, New York
JOEL HEFLEY, Colorado JUANITA MILLENDER-McDONALD,
ROSCOE G. BARTLETT, Maryland California
FRANK A. LoBIONDO, New Jersey DANNY K. DAVIS, Illinois
SUE W. KELLY, New York BILL PASCRELL, Jr., New Jersey
STEVE CHABOT, Ohio DONNA M. CHRISTENSEN, Virgin
PATRICK J. TOOMEY, Pennsylvania Islands
JIM DeMINT, South Carolina ROBERT A. BRADY, Pennsylvania
JOHN R. THUNE, South Dakota TOM UDALL, New Mexico
MICHAEL PENCE, Indiana STEPHANIE TUBBS JONES, Ohio
MIKE FERGUSON, New Jersey CHARLES A. GONZALEZ, Texas
DARRELL E. ISSA, California DAVID D. PHELPS, Illinois
SAM GRAVES, Missouri GRACE F. NAPOLITANO, California
EDWARD L. SCHROCK, Virginia BRIAN BAIRD, Washington
FELIX J. GRUCCI, Jr., New York MARK UDALL, Colorado
TODD W. AKIN, Missouri JAMES R. LANGEVIN, Rhode Island
SHELLEY MOORE CAPITO, West Virginia MIKE ROSS, Arkansas
BILL SHUSTER, Pennsylvania BRAD CARSON, Oklahoma
ANIBAL ACEVEDO-VILA, Puerto Rico
Doug Thomas, Staff Director
Phil Eskeland, Deputy Staff Director
Michael Day, Minority Staff Director
C O N T E N T S
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Page
Hearing held on August 30, 2001.................................. 1
Witnesses
Rogers, Aubrey, New York District Director, U.S. Small Business
Administration................................................. 2
King, James, State Director, New York State Small Business
Development Center............................................. 4
McEvoy, Judith, Director, New York State Small Business
Development Center at State University of New York............. 6
Kozakiewicz, Robert, Supervisor, Town of Riverhead............... 8
Aloisio, Anthony, Director of Economic Development, Town of
Brookhaven..................................................... 9
Cohn, Marion, Assistant Director of Government Affairs, Long
Island Association............................................. 11
Goldmacher, Roslyn, President/CEO, Long Island Development
Corporation.................................................... 13
Shivak, Judith, Executive Director, Greater Smithtown Chamber of
Commerce....................................................... 14
Freierman, Sima, General Manager, Montauk Inlet Seafood Inc...... 16
Appendix
Opening statements: Grucci, Hon. Felix........................... 32
Prepared statements:
Rogers, Aubrey............................................... 34
King, James.................................................. 40
McEvoy, Judith............................................... 46
Kozakiewicz, Robert.......................................... 71
Aloisio, Anthony............................................. 87
Cohn, Marion................................................. 89
Goldmacher, Roslyn........................................... 92
Shivak, Judith............................................... 99
Freierman, Sima.............................................. 101
Grimm, William............................................... 105
CRITICAL SMALL BUSINESS ISSUES AFFECTING LONG ISLAND
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THURSDAY, AUGUST 30, 2001
House of Representatives,
Committee on Small Business,
Washington, DC.
The Committee met, pursuant to call, at 2:00 p.m., at the
Government Center, 200 Howell Avenue, Riverhead, New York, Hon.
Felix Grucci presiding.
Chairman Grucci. I would like to thank everyone for joining
us and I would like to thank our hosts here this afternoon, the
great town of Riverhead and Supervisor Kozakiewicz and the
entire Town Board for allowing us to use this facility to
conduct this hearing which makes it easier for everyone to
access the federal government in this hearing today.
Good afternoon and welcome to this field hearing of the
Committee on Small Business. The hearing will now come to
order. On behalf of Congresswoman Sue Kelly and myself, I
welcome all witnesses and thank you for your participation in
this hearing.
I would also like to particularly thank Ms. Kelly for
taking the time to travel to my district from hers, which is in
Westchester County. It has been a long and tiring ordeal on the
Long Island Expressway on the weekend of Labor Day, but it just
shows you her commitment to the small business community and
how we can collectively be helpful to the small businesses who
have elected to be with us today.
Today's hearing will examine key problems facing Long
Island's small businesses and potential assistance or solutions
involving the Federal Government. Within the first
Congressional district alone small business men and women work
in a truly diverse environment, from historic Montauk Point to
the beautiful elusive Hamptons, to the scenic intellectual
giant of Brookhaven National Laboratory, the educational center
at Stony Brook University and the Main Street businesses of
Smithtown. With this great diversity comes unique problems for
Long Island's small businesses. Our small businesses must
balance the effects of seasonal tourism, the significant impact
of storms on our coastal businesses, and the high cost of
property, along with many other problems. In these slow
economic times, small employers need all the help they can get
to keep their companies afloat and their employees working. The
Federal Government needs to foster the growth of small
businesses, not hamper it.
Today we will discuss the local impact and operations of
the Small Business Administration programs, such as the Small
Business Development Center, the SBDC, and the SBA's partners,
such as the Service Core of Retired Executives or SCORE,
S.C.O.R.E. I look forward to a lively and informative
discussion of the issues presented. Again, welcome to this
hearing.
Before we get underway, I will turn to my colleague and ask
Sue Kelly if she has anything she would like to add.
Mrs. Kelly. I am very happy to be here on Long Island.
Actually it is a wonderful place and we had a lot of fun
driving out here. We made a lot of Long Island jokes, but it is
very interesting to me to be able to be here and be with you.
I am the former Vice Chairman of the Committee. I am also,
was for many years, the Chairman of the Regulatory Reform and
Paperwork Reduction Subcommittee, and I sit on the Banking
Committee as well. I have the chairmanship of the Oversight
Committee of Financial Services for the House of
Representatives. So the business of being in business is not
only of interest to me from that standpoint, but I am the only
florist that was ever elected to Congress. I am a small
business woman, and my husband and my children are small
business, independent business people.
This is a topic very close to my heart and I am delighted
that you are all able to be here and join us and I look forward
to your testimony and I thank Mr. Grucci for inviting me here
today.
Chairman Grucci. Thank you, Sue.
Before we start taking our testimony, let me just introduce
the panel of distinguished people that are with us here today.
We have Aubrey Rogers, the New York State District Director
and Acting Regional Administrator, United States Small Business
Administration from New York.
James King, New York State Director of Small Business
Development Center, United States Small Business
Administration, from Albany.
Judith McEvoy, Director of New York State Small Business
Development Center at SUNY, Stony Brook and Supervisor
Kozakiewicz here from the Town of Riverhead.
Anthony Aloisio, the Director of Economic Development, the
Town of Brookhaven.
Marion Cohn, the Assistant Director of Government Affairs
for the Long Island Association.
Roslyn Goldmacher, President and Founder of the Long Island
Development Corporation, Plainview, New York.
Judith Shivak, Executive Director of the Greater Smithtown
Chamber of Commerce in Smithtown.
Sima Frierman, General Manager, Montauk Inlet Seafood,
Montauk, New York.
We will get underway with Aubrey Rogers.
STATEMENT OF AUBREY ROGERS, NEW YORK STATE DISTRICT DIRECTOR/
ACTING REGIONAL ADMINISTRATOR, U.S. SMALL BUSINESS
ADMINISTRATION, NEW YORK, NY
Mr. Rogers. Members of the committee, my name is Aubrey
Rogers and I am the Director the SBA's New York District
Office. I am responsible for managing SBA's activities in
downstate New York for all 14 counties in the State.
Thank you for inviting me to testify about the assistance
that SBA provides for small businesses on Long Island.
SBA is beginning a new era with a new administration in the
White House and a new Administrator at the SBA, and his name is
Hector Barreto. Administrator Barreto grew up in a small family
business and, in fact, ran a business of his own. He
understands the problems and the issues that concern small
business owners.
The SBA is tasked with helping entrepreneurs start, run and
grow small businesses. It does so through a large organization
of employees and resource partners who administer several
lending and management programs. These programs include
financial assistance, counseling and training and access to
Federal contracts. SBA's capital access programs are designed
to provide financial assistance to a variety of small business
types, and to deliver them the agency partners with banks, non-
bank lenders, certified development companies, the Long Island
Development Corporation and small business investment
companies, as well as microloans for intermediate years. The
programs include:
Microloans for very small, start-up businesses with loans
up to $35,000.
504 loans for the purchase of real estate and equipment, as
well as 7(a) general business loans that are used for working
capital and general business purposes.
Finally, small business investment company deals where SBIC
has invested in small businesses during their growth stages.
Just recently the SBA introduced a new program that's
called the New Markets Venture Capital Program that is designed
to bring venture capital to low income rural and urban areas.
In the first round of applications, seven companies were
approved to deliver this program, and in the spring of 2002
another request for proposals will be made.
With respect to counseling and training, SBA delivers this
program, again through partners, one of them, the Service Core
of Retired Executives. Here on Long Island we have 78
volunteers that deliver that program for Long Island residents,
and through the Small Business Development Centers, two of them
here on Long Island and one of them is represented here at this
panel today.
The Government, the Federal Government buys approximately
200 billion dollars worth of goods and services annually, and
SBA is tasked with the responsibility of securing some of those
contracts for small businesses. It does so through a Government
contracting program where prime and subcontracts are identified
for small businesses. It does so as well through the 8(a)
business development program, where socially and economically
disadvantaged small businessses receive management technical
assistance and Government contracts through this program. On
Long Island there are 41 certified 8(a) firms.
We also have a small disadvantaged business certification
program where companies are certified as ``small
disadvantaged,'' in order to make them eligible for special
bidding benefits.
Finally there is a program introduced just two years ago,
called the HUBZone Empowerment Contracting Certification
Program, developed to bring economic development and employment
growth in distressed areas. This is a race neutral and gender
neutral program. To date we have two small businesses on Long
Island certified in this program and they are reaching out to
expand the outreach. Combined, these programs have had a
massive economic impact on the Long Island economy, creating
jobs and expanding the local tax base.
With respect to regulations, SBA is also charged with
oversight regulatory compliance and, therefore, we have created
the office of the National Ombudsman to do that. And a new
Administrator of that division has just been named.
Let me close with a word about SBA's award winning Web
site, www.sba.gov. This site brings information about SBA into
the homes and offices of Long Island businesses, and at the
touch of the keyboard, 24 hours a day. It receives about 1.6
million hits per week and is a key component of our outreach
efforts.
I want to thank you for inviting me and as both of your
offices know, Congressman Grucci and Congresswoman Kelly, we
are delighted with the strong support that you have for small
businesses in New York State and for your support of the Small
Business Administration.
I will be pleased to answer questions.
Chairman Grucci. Thank you. As the format is generally
conducted, the questions will be asked at the conclusion of the
panel's testimony and we will certainly have available some
time, I see we have some guests in the audience, if they have
any questions as well.
[Mr. Rogers' statement may be found in appendix.]
Chairman Grucci. I would just like to take a moment: We
will hear from him momentarily,but I would like to acknowledge
the presence of Supervisor Kozakiewicz who just joined us at the panel.
Thank you once again, personally, for lending us this meeting room.
Thank you for letting me sit in your seat and allowing us to conduct
this meeting.
Mr. Kozakiewicz. You are welcome.
Chairman Grucci. Mr. King.
STATEMENT OF JAMES KING, NEW YORK STATE DIRECTOR, SMALL
BUSINESS DEVELOPMENT CENTERS, U.S. SMALL BUSINESS
ADMINISTRATION, ALBANY, NY
Mr. King. Thank you, Mr. Grucci and Ms. Kelly. First, I
feel like an interloper coming down here to the Island, but I
am very pleased with the invitation. Just so you don't feel
left out, Ms. Kelly, I was in your district on Tuesday and
working with the folks out of Ulster Center.
I would like to point out, it is kind of significant but
this might be the first hearing I have ever attended where we
had two small business owner families heading up the hearing,
and I could also add that only two small business persons would
come in from a day like today, off the beach or whatever else
was calling, and sit here and pay attention to the issues of
small business.
One other thing, before I really get started, I have rather
lengthy testimony and I will provide that for the record, but
one thing I would like to point out is that last year, I would
like to seriously thank the Committee for your efforts in
making sure that the SBDC primary core service of business
advisement was not forced to implement fees for our
constituents and clients. From my perspective, that would have
been a disaster. It would have taken money out of the equity
base that many of our smaller clients use to get their
businesses started and leveraged with the financial community,
and it would have just been the wrong thing to do. So I do want
to thank you for your initiatives in stepping forward on that
critical issue.
Today we are talking about the issues that confront the
Long Island small businesses, and I guess I can go back a few
years to--I was around regretfully, well, happy I was around--
that many years ago when the soothsayers were pronouncing Long
Island's economy dead. We were looking at Grumman and several
other large firms leaving the area. The foreign raiders were
coming in from other states trying to recruit our businesses
away as fast as possible. Thankfully, that did not happen and I
think the reason that did not happen was the strength and
vitality of the entreprenuerial community here on Long Island
and elsewhere in New York.
The change, I think, that is underscored here on the
Island, when I looked at the statistics, over 40 percent of
Long Island's employment is now provided by firms or in
occupations that did not exist ten years ago. Some folks would
say that that could be as high as 60 percent. I think that
really underscores what I think is the major issue that small
businesses are confronting and that is change. The change is
increasing ever faster and we try and provide a sector analysis
focus on each one of the small business areas. The primary one
for us has been manufacturing. Where our manufacturers--in 1998
we had a turnaround for the first time in ten years, that
manufacturing employment did not decline in New York State, we
actually had an increase. I think that increase is based upon
our manufacturers being much more highly sensitive to costs,
they're much more productive and they're getting much more
investment out into their businesses.
That investment or access to capital and at reasonable
rates and terms is often a concern where many small business
people fall short, and that's where we spend a lot of time
within the SBDC, making sure that small business owners do have
proper access to the capital that they need. In that context, I
am a very avid supporter of SBA, of the guaranteed programs and
some of the programs that have been launched recently, but I
really think that we should look to concentrate on even
expanding those programs and making them more widely available.
There are always many individuals that have good, successful
ideas, that cannot get them implemented on a timely basis with
the proper amount of capital, because we are confronting some
of those loan guarantee limitations, and I don't believe those
programs cost the Federal Government; I think they are an
investment and they get returned many times over.
One other area of change that I would like to touch upon,
and that's an area that, again, the Committee has taken action,
and that is with HR203, that's a compliance assistance
initiative. Small business people do not have the wherewithal
to respond to all the regulatory compliance agencies that are
in existence. They don't have experts in OSHA. They don't have
experts dealing with the IRS and some of the intricate rules
and regulations there, and definitely they don't have experts
that know every chemical and compound that could be declared
hazardous today that wasn't declared hazardous yesterday.
My own office, I went out of the way to find someone--we
had a person coming in to review my office. We still had some
of that liquid whiteout around and I was surprised to hear that
that was declared a hazardous material which should no longer
be kept in the office.
So we constantly go out in the field. We meet with
individuals and I was up in Watertown the other day, met with a
small bakery, family owned bakery operation. We worked with
them to set up a new facility, expanded to about a 12,000
square foot operation; it's employing about 45 people. OSHA
came in and fined him $8,000 because he didn't have his plug
outlets covered in an area of the factory that wasn't yet
completed. There was no one working there. It was an area that,
you know, he had moved in early and he was working on it and he
got hit with a fine like that, which was just unbelievable,
from the viewpoint that he just moved into a new facility, he
was tight on working capital and he received a fine of that
nature.
I guess I will wrap up by just saying, I would almost say
that the major issue is that small business often times is not
a major issue and should be. Maybe that's a reflection of the
fact that within the Beltway, SBA is not a major agency, and it
should be. We looked at some of the Federal agencies and what
we are talking about and often times SBA's budget might be
equated to a statistical discrepancy. If we look at how
important small business is to the Nation and to Long Island, I
think it deserves a lot more.
Chairman Grucci. Thank you, I tend to agree with you.
[Mr. King's statement may be found in appendix.]
Mr. Szymanski. Excuse me everyone. We usually have timing
lights, green, yellow, red. I will just wave my hand when you
have a minute left and help you track your time.
Chairman Grucci. We are trying to keep the opening comments
to about five minutes so that we can get to the questions and
open up a dialogue because I am sure that people may have
questions that they would like to bring forward.
At this time we will go to Ms. McEvoy. It's good to see you
again.
STATEMENT OF JUDITH McEVOY, DIRECTOR OF THE NEW YORK STATE
SMALL BUSINESS DEVELOPMENT CENTER, SUNY AT STONY BROOK
Ms. McEvoy. My name is Judith McEvoy. I am Director of the
New York State Small Business Development Center at the State
University of New York at Stony Brook. I think I would like to
describe the SBDC to a small extent, but what is very
interesting about the SBDC is that we are all located in
centers for higher learning and I believe that we are a true
partnership of the public, private and both Federal and State
Government in servicing small business.
An essential part of the Small Business Development Centers
is that we are located in all 50 states. We can talk to each
other and offer to our clients at least 23 locations in New
York State. Again, access to the educational community is a
very big part of what we do.
We also, because of our affiliation with and administered
by the SBA, can help service and retail businesses. There are
other economic development agencies; they are looking for
value-added business. We are the ones that service the small
mom and pop stores and service the retail sector.
The SBDC provides assistance in financial, marketing, and
technical matters. What we do is direct one-on-one business
advisement. Every client has their own personal business
adviser. There is no cost. Again, I thank the Small Business
Committee for making sure that fees were not imposed for
services. The number of clients who have thanked us for our
services, who could not afford, at this point in their
establishment, to pay high consulting fees, are hoping that we
get them to grow, that we get them to become larger businesses.
Small business on Long Island is 92 percent of all
businesses and 75 percent of all the jobs are in the small
business sector. It is essential that the no cost services of
the SBDC be maintained and available to keep the Island
thriving.
The Small Business Development Centers routinely see the
types of business that cannot afford the higher priced
consultant. Working with our partners, we hope to make these
businesses grow.
One of the things that I am proud of, and I am stressing
this, is the fact that we are located in centers for higher
learning. I have the privilege of being located at the State
University at Stony Brook. I tell people many times, in talks
that I give, that we see the sublime to the ridiculous coming
through. That is absolutely the case; we see the smallest,
single entrepreneur to the high tech incubator companies that
are being incubated at the State University at Stony Brook. We
are a port of entry, if you will, to not only services but
those of the strategic partnership for industrial resurgence,
and the Long Island Forum For Technology. We utilize every
single economic development agency on Long Island if it
benefits that client. All of our business advisors know where
to send the individual to get the technical services that are
available for small businesses.
I am also very proud of the fact that we are located in
Southampton, that enables us to service the east end, and of
significant interest to this Committee, is the Small Business
Development Center located at Brookhaven National Laboratory,
the first in the Nation. It is a joint effort of the United
States Department of Energy and SBDC. I support the--I will
list them very quickly, HR203, which is the National Small
Business Regulatory Assistance Act, which is geared for our
high tech incubator clients. I also support HR2538, which is
the Native American Small Business Act, because Southampton
services the Shinnecock Indians. You have another bill, the
Vocational and Technical Entrepreneurship Development Act which
is important, but more than that, the University utilizes the
Small Business Technical Transfer Program which utilizes
students, companies incubating on a campus faculty and their
association with private businesses.
My other concern from the perspective of what we see, that
as banks are merging and becoming bigger and bigger, they are
losing the personal touch with our clients. I cannot tell you
how many personnel shifts there have been as each of these
banks merge, and I just want to request as banks merge, that
small businesses are paid attention to, and that their needs
are takeninto consideration.
Thank you very much.
Chairman Grucci. Thank you, Judy. It looks like I am not
paying attention, but I'm trying to do a number of things, so
please forgive me if it looked as though I wasn't, but you know
me long enough to know that I always pay attention to you.
Ms. McEvoy. Yes, you do.
Mrs. Kelly. We can hear and read, and we won't talk on our
cell phones.
Chairman Grucci. That I promise.
[Ms. McEvoy's statement may be found in appendix.]
Chairman Grucci. At this time I'd love to hear from our
host, Supervisor Bob Kozakiewicz.
STATEMENT OF ROBERT KOZAKIEWICZ, SUPERVISOR, TOWN OF RIVERHEAD,
NY
Mr. Kozakiewicz. Thank you. Good afternoon, Congressman
Grucci and Congresswoman Kelly. I certainly want to first and
foremost once again welcome you to the Town of Riverhead, thank
you for bringing Washington to Riverhead. We are honored to
have members of the House Committee on Small Business here
today to visit our town, and I hope that you have a chance to
visit some of the small businesses that make this town the
great community it is.
We are a small community. We have our roots founded in
agriculture and agricultural businesses. We have large shopping
districts in three prominent downtown areas, Riverhead, Wading
River and Jamesport. The majority of these businesses in the
downtown areas throughout our 78 square miles are predominantly
small businesses. These businesses are owned by individuals.
These businesses are businesses handed down from parent to
child.
We are experiencing a growing spirit that will only be
enhanced by additional small businessses. To ensure this, we
have a very active industrial development agency. We have
established or are working to establish, we passed a resolution
to establish the East End Office, which will be the home for
the Long Island Development Corporation, as well as the Empire
State Agency at the former Grumman site in Calverton. In
addition to that, I am looking to establish a Riverhead Office
of Economic Development to further promote and enhance the
opportunities for small businesses to locate within the
boundaries of our rural town.
The Town of Riverhead is also collaborating with Stony
Brook University and the State of New York to establish an
agricultural business incubator at the former Grumman site, to
further encourage small businessses to start to grow; this
means that the town residents have invested in the future of
small businesses. I say this because it is extremely necessary
that these agencies have the appropriate funding needed to
sustain the individuals who are willing to take these risks to
start new businesses and expand existing small businesses.
Without your support and without the support of your Committee,
the State of New York is limited in what it can do, as is the
County of Suffolk and the Town of Riverhead. Whether we are in
an economy that is peaking, stalled or reaching the depths of
despair, small businesses have been the life line of American
commerce. Your support, continued support for the funding of
small business agencies and programs is paramount to the
survival of these small businesses into the community here, as
well as communities of this great nation.
In closing, as I start to wind down, I do have to take this
opportunity to reach out to you and to express to you my
sincerest concern that you can address damage that is being
incurred in our small business community as we speak, damage
that is being sustained because of the skeleton frame, that eye
sore, that albatross on West Main Street, which was to be the
new and improved United States Postal Office. We in the Town of
Riverhead understand that there has been a difference of
opinion between the contractor and the Postal Service. We
understand the issues surrounding the contractor not meeting
schedules and providing an expected quality of work. What we do
not understand, and have a difficult time accepting, is the
fact that the Postal Service began such an enormous project and
abandoned it to the point of causing us serious damage to the
beautiful vistas that we have here in the Town of Riverhead and
the damage that it has caused, what we are trying to do for our
small businesses along West Main Street and our community at
large. It is one of our main gateways to the heart of Riverhead
Town and it is such an eyesore. It has been forced on the Town
of Riverhead and its residents, and I am asking you to do
whatever it is in your measures, to take whatever necessary
steps you can to help us, to help the Town of Riverhead, to
help its residents remediate this problem. I am asking you to
please help us with that.
I close, thank you.
[Mr. Kozakiewicz's statement may be found in appendix.]
Chairman Grucci. Thank you, Supervisor. You have brought
that issue to my attention day one when I became Congressman
and I applaud you for your efforts in trying to resolve that
issue. We will talk about that more as we get into the question
and answer session.
Mr. Kozakiewicz. I do have one additional thing: I have had
some photographs that are being developed with a digital
camera. May I ask permission that they be made part of the
record? I don't have them available at this point, but before
we close today.
Chairman Grucci. Without objection, they will be made part
of the record.
At this time we will turn to my former Director of Economic
Development. As most of you here know, I used to be the
supervisor of the Town of Brookhaven and Tony Aloisio was the
Director of Economic Development, so let's hear from Tony.
STATEMENT OF ANTHONY ALOISIO, DIRECTOR OF ECONOMIC DEVELOPMENT,
TOWN OF BROOKHAVEN, NY
Mr. Aloisio. Thank you, Congressman Grucci and
Congresswoman Kelly. It's nice to have the opportunity to speak
to you this morning and to act as an advocate for some of our
small businesses in Brookhaven. I am sure our concerns are
similar to what you might experience in other areas of the
country.
What I would like to briefly do is highlight a few areas
where I think we might have some congressional attention in
order to alleviate some of the issues that we are dealing with.
The first point I would like to bring up is, you may not think
of the dollar figure that I'm going to use usually associated
with small business, but Roz, you can correct me, small
businesses are usually those with 500 or under employees with
the Federal Government.
Often I also act and run an industrial development agency
which issues tax exempt bonds, small caps, on behalf of small
manufacturers. All of these employees generally fall into what
we consider the small business category, 200 or less employees.
They really are not large enough to access the corporate bond
market, and they are really too large in many cases for
traditional bank loans, so industrial revenue bonds are very
typically the way they want to go for building 100,000 square
foot, 150,000 square foot factories, with building and
machinery expenses that will usually be in excess of $10
million, but they very much still fit the small business
category.
Since 1979 a cap was put on the amount of individual
projects at $10 million per project, and since that date, that
number has not been adjusted. So as inflation has occurred over
time, we have not been able to assist deals which will have the
capital expenditure requirement of over $10 million for a
particular new project. So for those larger small businesses--
that's the way I like to talk about them--that is really a
major issue, and I really speak probably on behalf of most
IDA's that that is something that there can be some attention
to in the future.
Again, just having some discussions with some of the small
businesses in the town recently, a number of issues have come
up, and they really come up repeatedly. I know it was just
mentioned earlier, some of the regulatory problems as with
respect to OSHA and the IRS. You know, I certainly can second
those thoughts. A lot of the complaints that I hear will, for
example, relate to the IRS's discussion or definition, I guess,
of who can be contractors and how they are able to use them
effectively. The rules are still somewhat confusing to some of
our small businesses and it really does need some attention so
that they can be effective in the use of those type of
technical skills that an independent contractor can bring.
I might remind you that there was the Small Business
Regulatory Enforcement Fairness Act that went into effect a few
years ago that essentially was supposed to have the top to
bottom review of all agencies that impact small business, and I
would just hope that there could be a real commitment to
following through on what that law set in practice, and really,
because of changes that have occurred in the small business
environment, really upgrade or update some of the existing
laws.
The other issue that I was little surprised to hear and I
actually went into a little bit more research as a result of
it, was the interest of our small business community in global
trade. One of the statistics that I have become aware of
recently, and I think it is up to 67 percent of our businesses
with 20 or more employees are now involved in global trade.
That's up eight or nine percent from 1992.
It is really interesting the way some of our companies are
really aggressively trying to get into those market areas, but,
again there are risks, there is some confusion really working
in areas where we do not have any type of trade agreements. I
am not only necessarily talking about costs, but issues related
to even having the appropriate credit or, in some instances,
letters of credit are required for purchases. That really
creates a real problem for some small companies, and I guess if
there could be some progress in trade agreements between our
country and those where there are, it really does benefit the
small businesses.
The last point that comes up a lot with some of my
companies is, again, transportation and infrastructure issues.
A company this morning was just telling me about their concern
that the Port of New York has to be dredged because they get a
lot of their goods and services through that particular port.
Roads, infrastructure connections, trucking to that is very
important and there is a concern that we are falling behind in
infrastructure, and that, of course, is really the lifeblood of
feeding the east end of Long Island for goods and services.
I will just close with that.
[Mr. Aloisio's statement may be found in appendix.]
Chairman Grucci. Thank you, Tony. Your information is right
on the money and very current in the things that are happening
and we will talk about TPA trading, the promotion authority in
a moment, but I think that will hit on a lot of issues that you
just talked about.
At this time we will hear from Marion Cohn.
STATEMENT OF MARION COHN, ASSISTANT DIRECTOR OF GOVERNMENT
AFFAIRS, LONG ISLAND ASSOCIATION, COMMACK, NY
Ms. Cohn. For the record, the Long Island Association is
not a recipient of any Government grants.
Good afternoon. My name is Marion Cohn and I am the
Assistant Director of Government Affairs for Long Island
Association. I am here substituting today for Mitchell Pally,
the Vice President of Government Affairs at the LIA, who is
taking his second daughter to college today.
The Long Island Association is the region's largest
business and civic organization with over 5,500 members, over
5,000 of which could be considered small businessses. We are
very pleased and honored to be able to testify here today
regarding the needs of Long Island small business community.
Many of the other speakers on today's hearing list will
discuss specific aspects of the needs of small businesses,
including financing and capital needs. The ability of our small
businesses to move an idea or a product from inception to the
marketplace is one of the most important areas where the
Federal Government can effect change. From our Small Business
Development Centers to our Small Business Administration
regional offices, these agencies attempt to provide small
businesses with the financing necessary to make their ideas a
success and reality. I will defer to the other witnesses here
today to discuss the specifics of these entities and how we can
make them better for our companies.
In addition to these small business issues, these companies
are faced with many of the same needs as our larger companies
on Long Island, namely, the need for highly skilled workers.
The need for such educated workers cuts across all segments of
the Long Island economy, from our service sector to our
expanding high technology sector. This need is all the more
important, given the issues which evolve from it, including the
ability of Long Island to provide affordable housing for our
young people just coming out of college, young people who have
just the skills necessary for our Long Island companies. If
Long Island cannot provide such affordable housing to this
segment of the population, these young people will not stay
here, nor will they come back here, regardless of the desires
of their families. Not every mom or dad wants their grown-up
son or daughter living in the basement, and not every son or
daughter wants to live in mom and dad's basement.
It is essential for Long Island to provide appropriate
housing opportunities for this segment of the population. It is
for this reason that the Long Island Association has attempted
to work with our municipalities to fashion a program to build
affordable rental housing for our young people. Long Island has
fewer rental units than any other comparable region in the
United States. This is the type of housing that our young
people want and this is the type of housing which is in such
short supply on Long Island.
The Long Island Association is working with the towns of
Brookhaven and Islip and Suffolk County to find sites on which
such housing can be built. In fact, they are attempting to find
just such a site in a downtown area where density can be
increased, so that we can attempt to find two solutions: One
for such housing and one for the redevelopment of the downtown
area. Funding from the Federal and State housing agencies is
going to be necessary for this to work, because these rents
must be kept below market rates to be affordable for our young
college graduates. If we can keep these college graduates here
on Long Island, then the expansion of our small businesses can
be possible, but without these prospective workers, it is going
to be very difficult for our small businesses to expand.
In summation, the Long Island Association remains committed
to working with our elected officials at all levels to assure
that the atmosphere of success is available on Long Island to
allow small businesses to succeed. We remain committed to
providing affordable housing for our young people, reasonable
energy costs for us all, finding the highly trained workers
necessary, providing the financing for the development of new
ideas, and providing affordable and accessible health insurance
for all. We thank you very much for this opportunity.
Chairman Grucci. Thank you. We appreciate your comments.
[Ms. Cohn's statement may be found in appendix.]
Chairman Grucci. Roz how have you been? Good to see you
again. The last time I think we were together we were doing a
radio show.
Please, the floor is yours.
STATEMENT OF ROSLYN GOLDMACHER, PRESIDENT/FOUNDER, LONG ISLAND
DEVELOPMENT CORPORATION, PLAINVIEW, NY
Ms. Goldmacher. Good afternoon. I am Roslyn Goldmacher, the
President and CEO and Founder of the Long Island Development
Corporation, which is a 20-year-old regional economic
development organization here on Long Island, serving the small
business community. Our membership represents the economic
development community of Long Island, including banks,
businesses and Government. We provide 15 different financing
and technical assistance programs for small businessses in
Nassau and Suffolk Counties. Over the years, Long Island
Development Corporation has made some $450 million in loans to
small Long Island companies and helped small Long Island
business obtain and perform on $426 million in Government
contracts.
We operate the SBA's 504 Certified Development Company
program for Long Island, as well as the Department of Defense
Procurement Technical Assistance Center for Long Island.
We also operate a targeted industry loan fund aiding
defense dependent manufacturers, commercial fishermen and
targeted industries under a program of the Economic Development
Administration.
There are two issues I would like to address today: One of
them is access to capital for small businessses, particularly
for minority and women-owned businesses and businesses located
in blighted areas. Lack of adequate access to such capital on
affordable terms was an issue when LIDC was founded 20 years
ago, and it is still an issue today.
The solutions that I would like to propose are policies
which will increase such capital for small businesses. For
example, increased reliance on Government guarantee programs,
such as the SBA 504 program, rather than direct loan programs.
It is quite clear from the historical numbers that Government
guarantee programs are less costly to the Government than
direct programs.
Federal agencies, such as the Small Business
Administration, should increase their reliance on private
sector, community based partners, such as the certified
development companies like LIDC; such as the Small Business
Development Centers, et cetera, to deliver financing products.
It is less costly to the Government, more efficient, in terms
of delivery, and less reliance on limited Government resources,
including declining agency staffs. There is also a better
knowledge of community needs by the local community partners.
Another way to increase capital for small businesses is to
ask that agencies, such as the Small Business Administration,
monitor regulations regarding the lending programs, to make
sure that they encourage lending rather than discourage it, and
that they have enough risk tolerance to permit lending to these
targeted communities, particularly during times of recession.
Increasing incentives for lenders is another way that the
Federal Government can help increase access to capital for
small business. Both bank and non-bank institutions do better
when they are provided with incentives rather than mandates.
Incentives to make such loans, such as tax credits, giving the
lending institution the ability to expand in exchange for a
good record of such lending, these are the ways to get these
lenders to get more money out into the small business
community.
In addition to access to capital, an issue of importance to
Long Island small businesses is high tech. Our economy out here
does revolve around high technology. These type industries
which Long Island has and continues to foster in the wake of
the defense downsizing. Such industries as biotech,
pharmaceutical, high-end electronics, software development,
biomedical instrumentation. Increasingly such companies are
proliferating here on Long Island and we need to support the
development of these industries because they provide high
paying sustainable wages, they do not negatively impact on
fragile physical environment, and they can co-exist with our
high land costs, high utility costs and labor costs.
It is requested that the Small Business Committee continue
to monitor Federal legislation, regulation and funding to
encourage high tech businesses with direct funding for research
and development, funding and technical support for those
industries whose technology can be used by the Federal
Government as well as the commercial sector, and by monitoring
Federal regulations to make sure that they encourage the growth
of such companies, not restrict them with over burdensome
reporting and other requirements, particularly in early stages
of growth. Finally, that the Federal Government create a tax
structure which encourages investment in these types of
companies, their capital assets and their growth.
The Long Island Development Corporation is proud to serve
the small businesses of Long Island, our affiliate, LISBAC, the
Long Island Small Business Assistance Corp., makes mini micro
loans to women-owned businesses and we were the first, and to
my knowledge still the only community development financial
institution in the nation certified by the U.S. Treasury to
provide services to women-owned businesses. Together we hope to
continue serving the small business community of Long Island
with your support.
Thank you very much.
Chairman Grucci. Thank you, Roz.
[Ms. Goldmacher's statement may be found in appendix.]
STATEMENT OF JUDITH SHIVAK, EXECUTIVE DIRECTOR, GREATER
SMITHTOWN CHAMBER OF COMMERCE, SMITHTOWN, NY
Ms. Shivak. Good afternoon, Congresswoman Kelly and
Congressman Grucci. I would like to thank you for inviting me
to be part of this panel.
I am the Executive Director of the Greater Smithtown
Chamber of Commerce, which as of this week had 310 members.
This week actually the Long Island Business News had a listing
of all the Chambers of Commerce in Nassau and Suffolk County by
order, and we are the sixth largest Chamber in Nassau and
Suffolk County.
I also speak as the Corresponding Secretary of the newly
created Suffolk Coalition of Chambers, which represents
chambers of commerce from Suffolk County, from Montauk
toHuntington. Chambers of Commerce are the front door to the business
community. We represent professional men, women, merchants, property
owners, wholesalers, servicemen, manufacturers and financial
institutions in the communities where we are located. In other words,
we represent businesses from as little as one person up to 500.
We act as the informational center for visitors and for
businesses seeking a new location, and we answer thousands of
inquiries by phone, by fax and even now by the Internet. We
represent, according to 1999 statistics, 38,000 of the 42,000
small businesses in Suffolk County, and the definition of that
was less than 20 people employed, and a good percentage of that
is even less than five.
The panel today is intended to focus on critical business
issues, and I am speaking as someone who represents, quote,
``mom and pop,'' the people on Main Street. One of the major
issues facing them and all levels of the small business
community is the continuing struggle to find competent and
skilled workers to fill their business needs. This goes across
all sectors, from the hourly wage earners to the highly skilled
employees.
I questioned a sampling of the local merchants in both my
town and several of the other Chambers on every retail level,
and the issue that was most often raised was the ongoing
shortage of qualified candidates for employment. Almost every
store in our town area has a ``Help Wanted'' sign in the
window. They are constantly asking Chambers how can we help
them.
The latest unemployment figure for Suffolk County was 3.8
percent as of the end of July, almost the same as last year at
this time. This is in comparison to the national unemployment
rate figure, the 4.5 percent for the rest of the country, 4.5
for New York State and 5.3 for New York City. In other words,
any resident of Suffolk County who wishes to find employment
has a 96.2 chance of finding the employment, if he can get
there.
What are the reasons for this continued lack of employees?
Can it be tied to the fact that Suffolk County has one of the
highest costs of living for the entire Nation? Does it have to
do with the lack of adequate public transportation to get those
willing to work to the places which have the jobs to offer,
especially if you are not just going east or west but north and
south. Is it the lack of affordable housing or is it a
combination of all three.
I would like to ask this Committee to work with the small
business community and other organizations which were alluded
to on this panel to find these answers.
The downtown area of Smithtown has a unique problem of its
own. Its main street is actually two main State roads which go
through it. The Department of Transportation wants you to go
from A to B as fast as you can. We want people to, quote,
``stop and shop.''
One of the problems that we have is the need for adequate
parking and traffic mediation. I am happy to say that under the
auspices of the last Congress, June of 1998 an IST grant, now
known as T-221, Smithtown did receive a grant of one million
dollars, which will be used now to mitigate traffic and provide
parking. This was passed in 1998, it is now almost September of
2001, and we hope--we are saying ``hope''--to have a shovel in
the ground maybe by October.
I think one of the problems has always been when a grant is
given, it takes so many years and so many different levels of
Government to get this augmented, and this makes long-range
planning very difficult. I would like to see a shortening of
the time of actually helping with this. In other words, I would
like help from this Congress to help the small businesses in
any way they can.
Thank you.
Chairman Grucci. Judy, thank you for your testimony.
[Ms. Shivak's statement may be found in appendix.]
Chairman Grucci. Our last panelist who will be speaking, I
have had the pleasure of visiting her operation out in Montauk.
I was quite impressed with what I saw. You always hear about
the east end fishing industry, how important it is, and we all
recognize that, but to actually see the process, it was very
impressive and I thank you for giving me the opportunity to do
that.
You expressed some concerns at that particular time and I
think it was important to bring you here so you can put it on
the record so that we can continue to try to help our fishing
industry, not just here but along the eastern seaboard, as you
pointed out.
STATEMENT OF SIMA FREIERMAN, GENERAL MANAGER, MONTAUK INLET
SEAFOOD, MONTAUK, NY
Ms. Freierman. Thank you, Congressman Grucci and
Congresswoman Kelly. It is really an honor in this company for
commercial fishing to have been chosen as the small businesses
to represent the front line of folks in the trenches, and it is
certainly appropriate to be recognized by the Small Business
Committee since the over 6,000 floating small businesses that
make up New York's commercial fishing industry are under the
direct auspices, by an act of Congress, of the Department of
Commerce.
I have a little sense of deja vu sitting here. About 15
years ago, in the County of Alachua, Florida, I sat on the
board of the Gainesville Area Innovation Network--the acronym,
of course, was GAIN. From my office in a glass building, I put
together a coalition of State, County, academic, City, venture
capital and small business entities to start up and support a
high tech business incubator at Florida Power's Innovation
Center. It was sexy and exciting and we added the 80 percent of
job creation, just like the Baker report said we would.
Now today, as the Congressman mentioned, my office sits at
the end of a long dock in Montauk, and when the big trawlers
come in with their catch, they bump it and my office sways a
little bit. For excitement this week I went in at 5 a.m. one
morning to show solidarity with my totally Hispanic crew,
because one of the trawlers wanted to squeeze in one more trip
before the market closed for the holiday weekend. If you want
sexy, you should see the baby bald eagle that hunts from dock
piling about 20 feet from my computer.
It is good to be back in the field of economic development,
only this time I am trying not to create jobs so much as I am
trying to save some jobs. The commercial fishing industry
contributed $150 million to New York State's economy in 1999
and $3.6 billion to the national economy. We helped feed 280
million people about 15 pounds of fresh, canned and cured
seafood each. The Long Island region employs over 10,000
individuals in commercial fishing and its support industries. I
am employed by six middle aged small businessmen who have had
the same job since they were teenagers. They have all been
relatively successful so far, but some of them will be out of
business within the next ten years. They will be out of
business like the Boston Harbor fleet. It used to number over
100 boats right there in Boston Harbor; after years of
increasingly restrictive regulations, about 75 percent of the
fleet sold out to a Government buy-back program in the '90s.
They will be out of business because there is now talk of
legalizing individual, transferable quotas that would be issued
based on historic catch, and some them, simply don't keep those
kind of records. I am not talking about tax evasion or altering
records of what was caught. I am talking about fishermen filing
scraps of paper and handwritten logs in the proper way over
many years. I am terribly sorry, but if I had to produce my
paycheck stubs from 1985 to 1995, I would also be out of
business. Those who did keep the records may eventually have to
sell out if too much quota goes to large corporate operations
who will make it financially difficult for small independents
to operate.
Some of my employers will be out of business because they
are losing heart. My most successful employer has his 22 year
old son on the boat. He doesn't want to be a lawyer. He doesn't
want to manage a dock. He doesn't want to be a congressman.
This boy wants to fish, and every third night the two of them
come in angry and depressed and talk about crimes against
nature because they had to throw over 4,000 pounds of fish to
land the 30 to 60 pounds they are allowed to keep. I am not
talking about juvenile fish, I am not talking about a rare
stock, I am talking about 14, 16, and 18 inch fish that had
spawned three times and are too thick to stay away from. We
have to throw them over because of poor science and
mismanagement of the fishery industry.
What small business woe would you like to add to the
picture? How about the impossibility of finding crews who can
afford to live on the east end of Long Island? How about
geographic power coalitions that form so that New Jersey
processors stop buying Shinnecock quahogs and that fleet
disappears or converts?
The same kind of political muscle results in opening season
trip limits--that's in January, when all the fish are in
southern waters, that are four times the trip limits allowed in
the winter when the fish are in New York waters.
I sit on the fishing committee for the Town of East
Hampton's comprehensive plan. We distributed a quick survey to
the commercial and recreational fishermen, and we asked them to
name the problem that most bothers them. Everyone said
``regulations.'' The very language of fisheries management is
stilted, and I am going to read quickly from the testimony of
Bill Grimm, a fisherman who couldn't be here because he is
taking his daughter to college.
The language of the Magnuson Stevens Fisheries and
Conservation Management Act and the Sustainable Fisheries Act
referred to any and all fishery stock depletion as overfished.
That is, if an oil spill results in a fish kill, if an
overabundant seal population eats most of the juveniles of a
particular stock, if development destroys the spawning habit of
a stock and causes it to decline, these stocks are called
overfished. The Sustainable Fisheries Act set standards for the
level of fish population that cannot be and have never been
attained in nature. Basically, it calls for all stocks to exist
at their maximum level all at once. That's like saying that
foxes and rabbits should exist at the highest level they have
ever achieved, all at the same time.
Mr. Grimm is one of my employers who owns two 90-foot
trawlers. Last spring I persuaded his most productive captain
to forego a high priced season and do side-by-side comparisons
with the Government's research vessel Albatross. I stress that
the purpose of this research was not to compete with the
Government. They have a multi-year time line and it is
important that they don't change their methodology, but the
fact is they were catching an average of two fish per tow of a
certain species, while the commercial vessel caught an average
of 110 fish per tow. And when I sat with the Government
scientists earlier this month, because they are finally ready
to release this data, they actually suggested that the fishing
vessel change its gear to reduce professional catchability so
that the figures would be more comparable. I am happy to report
that we were able to convince them that there might be value in
the data to be gained from the commercial boat.
One more example of regulatory language: Managers are
beginning to focus on what's being called ``essential fish
habitat.'' In reading the definition of that term, one comes to
realize that the whole ocean is, of course, essential fish
habitat. The next step, according to the National Marine
Fishery Service is to identify potential adverse effects and
potential habitat degradation.Fisherman have been interacting
with that habitat for hundreds of years. Whatever they are doing, it
hasn't prevented certain areas from being rich fishing grounds for
centuries and centuries. Could it be that they're really the original
conservationists? Is there some reason regulatory language doesn't try
to identify potential beneficial effects or habitat enhancement?
I will stand here with my education and do quite well
splitting semantic hairs with fishing management counselors,
but please don't ask the small business fisherman to do that.
When you are all at the beach this weekend, if you can see past
the charter boats, take a look at their world. When a fisherman
wants to go from Point A to Point B, he aims his boat and he
goes there. And on the back of my written testimony you will
find a chart on the fisheries management structure, and you
will see there is no Point A and there is no point B. Not only
do management and industry for commercial fisheries work for
different companies, sometimes they don't even agree on the
product.
Thank you, sir.
Chairman Grucci. I appreciate your testimony. As always,
you were very articulate about it.
[Ms. Freierman's statement may be found in appendix.]
[Mr. Grimm's statement may be found in appendix.]
Chairman Grucci. The process now is that we will ask a
series of questions and then we will open it up to see if
anyone else in the audience may have questions they would like
to ask of us or the panel.
Out of consideration and thanks to Congresswoman Kelly for
making this trip down today, I will turn the questioning over
to you.
Mrs. Kelly. Thank you very much.
Sima, I do not have a written copy of your testimony, I
would appreciate having that simply because I have an interest.
I have a boat and I am in the waters, I see the fishermen.
Thank you, very much. Is the map there too? Thank you.
I want to go to Aubrey Rogers. Mr. Rogers, you and I have
talked with each other over the course of a good many years; I
want to know what you have done recently to help Long Island
with the 7(a), 8(a) to help the 41 certified businesses get
Government contracts. Have you interacted recently with people
out there to get them contracts?
Mr. Rogers. The contracts that we are talking about are
Federal contracts with Federal agencies. They can come from
local Federal agencies or Federal agencies located outside of
the state.
Mrs. Kelly. I understand that, Mr. Rogers. I am asking what
you, as the head of the SBA in the New York State region have
done to try to help the businesses out here on Long Island? You
said in your testimony there are 41 certified 8(a) firms, for
instance.
Mr. Rogers. That is correct.
Mrs. Kelly. But if I read your testimony correctly, there
are only seven of those firms who actually have a contract.
It's a long process to get certified. It is a hard process to
get certified.
Mr. Rogers. That's true. We have a number of contractors,
8(a) contractors, that graduated from a program that indeed
received lots of money and lots of contracts from our program
over the years. In the past two years we have been trying to
replace those contractors with a new group of contractors, so
more than half of the 41 that are now in the program came into
the program in the last two years.
We have staff who reach out to Federal agencies to market
the skills and products of the companies that are now in the
program. They are also training the companies on how to
negotiate the Federal process so that they, in turn, will be
able to access the contracts on their own.
Mrs. Kelly. Two years, Mr. Rogers, for a small business
person is an eternity. A small business person needs to get in,
once they go through that process of being certified, they need
to get contracts or the process of certification is useless. I
would like to encourage you to do everything you can from your
position to try to help the small businesses.
I drove through town here in Riverhead and found a fair
number of empty store fronts. There are probably small
businesses who could use some guidance. You have a whole group
of people sitting at this table who have the ability to help
you. Having met them, I hope you will take their advice and I
hope you will work with them----
Mr. Rogers. Absolutely.
Mrs. Kelly [continuing]. And emerge from a mere seven.
Let's try to get all 41 some kind of a contract.
Mr. Rogers. Yes.
Mrs. Kelly. That takes me to you, Roz I understand that
part of what you said you did here was work with the Department
of Defense. Under the Federal Government guidelines, the
guidelines are that women and minority owned businesses should
have five percent of all the contracts that are let by the U.S.
Government; what have you done, is my question, to help the DOD
make that goal? Because I know they are currently not at that
goal.
Ms. Goldmacher. As a procurement technical assistance
center licensed by the DOD, we do have that five percent goal
within our mandate. I am proud to say that here on Long Island
we exceed that goal. That's not the case nationwide, however.
One of the specific suggestions I would have to help that
goal be achieved nationwide, as well as also help the 8(a)
certified companies is a closer working relationship between
the Department of Defense procurement centers and the SBA. Here
on Long Island we do work together. We work with Mr. Rogers'
local representatives. Any time there is a workshop regarding
Federal contracting, our procurement center is invited to
participate. We try to work with the 8(a) companies to search
for specific contracts, but nationwide there is no formal means
of communication linkage.
For example, in the recent past there was a whole system
set up for certification of small disadvantaged business by
private certifiers. That's now discontinued, but when that
first came up one of the first things I asked Congress to do is
let's let the PTAP nationwide do it. You have a whole system
out there that can do this and do it for free, instead of
charging fairly large sums to these small businesses, but there
was no mechanism set up to link the programs. That's something
that perhaps the Committee could work on, is to establish a
more formal means of communication between the PTAP Center
program and the SBA 8(a) program and procurement divisions so
that they can work together for the benefit of these companies.
Mrs. Kelly. Thank you very much.
I have a couple of other questions. We have a couple of
supervisors here. One of the things that I think several of you
brought up, Roz you did and both supervisors indicated
something about this. I don't know how many of you are aware
that I got through Congress a bill called the Truth in
Regulating Act. This is a bill that was signed into law.
Unfortunately I haven't been able to get the funding from the
Committee, this Committee or other committees or anybody else
in Congress, to get funding there. It sets up a separate office
in the General Accounting Office that would take a look at all
of the rules and regulations that affect small businesses. It
would look at them for redundancy, for overlap; it would also
look at them from a cost benefit analysis.
There is a great deal of need for this to happen, just as
you pointed out, because people don't talk to each other. Both
of our supervisors indicated that they felt that there were
things that could be, perhaps, I think could have been
addressed had this office been funded this year, since it was
signed into law last year. Since all of you have something to
do with small businesses and this has a direct impact on how
small businessses are really affected by what the Federal
Government does, it is something I hope that you will, perhaps,
talk to your representative and others to help me get some help
to get this thing funded.
I do think that according to some of the testimony that I
heard, we have an opportunity through this office to prevent
small businesses from having to file numerous pieces of paper.
Sima, you talked about your fishermen; if they were able to
file once or twice a year with a particular type of thing--I
know because I am in small business, my husband is in small
business, we are a family of entrepreneurial small business
people--we get the weirdest kind of questions from agencies
that we didn't think had any control over anything that we did.
They invade the privacy of people who work for us, some of them
do.
I think that there is a strong need for all of us to work
together to try to stop that kind of thing from happening so
that you can focus on making money, which is what small
business is all about.
I have a couple of other questions. I was writing notes as
we went along.
This is, Judy, you talked about the cost of living, the
lack of transportation, the lack of housing and the problem
with tax incentives. I would ask our supervisors what their
approach is, because a lot of this can be handled on a regional
level. Are the two of you working together to try to approach
some of this, and do you offer tax incentives to small
businesses to locate in your towns?
Mr. Kozakiewicz. We do have an Empire Zone created in the
Town of Riverhead which does provide tax incentives. We also
work closely with the Industrial Development Agency to provide
tax incentives for location to the Town of Riverhead. So, yes,
there are opportunities that are provided. This does not mean
that we should stop looking for other means and other
mechanisms to make it work and we will continue to do that.
Mrs. Kelly. Tony, do you want to speak as the
representative here?
Mr. Aloisio. We do have a couple of different programs: in
fact, one on a County basis called the Suffolk County Incentive
Program, where we have taken downtown areas, special industrial
areas, and offered real estate property exemptions to
geographic areas, mainly taking in small business.
Of course, our industrial development agencies were able to
offer property tax exemptions to small businesses that create
jobs. In fact, I would say, I don't know, Roz maybe we have
done 15 or 20 projects just in the Town of Brookhaven, which
used a combination of an SBA financing, subordinate financing,
and an IDA lease, in order to provide relief fund on real
estate taxes and sales tax exemptions. So there is a pretty
good network of those programs.
Mrs. Kelly. Judy, you seem to want to add something?
Ms. Shivak. Because each town is separate and apart and you
have, what, five towns--ten towns in Suffolk County, and not
all of them are together. I'm not saying ``yes'' or ``no,'' but
everybody's town is independent and that's why we are looking
beyond the town level.
Mrs. Kelly. You are trying to look at the regional level.
Ms. Shivak. Regional.
Mrs. Kelly. I just want to ask one more question and that
is indicative of my concern, again, to start small businessses,
to get them moving, and that is: What is the availability of
access tocapital here on Long Island? It is not terribly good
in some areas of the country. What is it here? I am going to throw that
question out to anybody, anybody who wants to answer that.
Ms. Goldmacher. I will be happy to because I deal with that
all the time.
It is probably better here than it is in many areas of the
country simply because we have so many banks and non-bank
institutions. Also, over the last few years, many of the banks
have finally come to realize that the small businesses, truly
small businesses, are their only remaining area of profit; that
small business lending can be profitable and that small
businesses eventually become big, because there aren't that
many mega-businesses left, so they have to concentrate
somewhere. Since Long Island is mainly made up of small
business, we see many more small business products coming out
from the traditional lending institutions. But there still is a
lack of access.
When I say a lack of access, I am not talking about the
person who has a great idea and nothing else. If someone walks
into my office with a wonderful idea, the first thing I say to
them is: Do you have a business plan? Have you seen the Small
Business Development Center? And, do you have some equity to
put into this? And it really amazes me how often people will
say to me, ``Well, no, I have no money to put into this, I want
you to give me 100 percent or lend me 100 percent.'' Even if we
get past that and we can find some equity, then the next thing
is, ``Well, for the loan that I am going to make to you, how
can you scrutinize this loan? What kind of collateral can you
give me? Sometimes we may even have to look to the person's
house. ``Oh, no, I don't want to give my house for collateral
for a loan.'' My response to that is always, ``As a lender you
are asking me to put my dollars at risk, you are the one who is
going to benefit economically from this and you don't want to
put yourself at risk and you don't have enough faith in your
company?''
I think what that all points out to is we need more
technical assistance at the start-up level. LISBAC, for
example, Long Island Small Business Assistance Corporation,
which is a CDFI under Treasury, was formed specifically to meet
that need. We don't just make loans to small businesses, to
women-owned businesses. Very intensive, free technical
assistance is provided to each of those applicants, along with
the series of seminars.
Our targeted industry program, under the EDA, even though
those are slightly larger businesses, that also combines
technical assistance. I am very happy to say that Mr. Grimm was
one of our recipients under the Commercial Fisheries Program,
and there we said, ``Okay, you need a bigger chiller system for
your boat so that you can go out further, catch fish that needs
to be refrigerated, but we are not just going to make you a
loan.'' Cornell Cooperative Extension came in and provided the
technical assistance to go with it.
So that technical component is an important piece of the
access to capital. Just throwing money at people doesn't do any
good if the technical assistance and the support isn't there at
the start-up stages.
Mrs. Kelly. It sounds to me like we are lucky to have you
here.
Judy, again?
Ms. McEvoy. In the past year we have helped our clients,
that's over $21 million, and that is a result of the business
plan; if they are willing to do the work that we assign them
and work through the process, there is capital available to
them, but many times, as Roz said, we get the person who comes
in and they say, ``Does the money truck pull up at 3:00, I came
here just to get the money bag,'' and when we say, ``Well, you
have some work to do,'' those that absolutely do the work, they
have a very good shot.
Ms. Freierman. In further praise of Roz here, not only the
technical assistance, but something that they do that I find
very important, and the dock is also a client of the LIDC is,
they went, they showed up, they had a representative at the
fisherman's forum, where there were working people who never
have time to think about. They had a representative there. It
was that kind of outreach going on. They said, ``Here is who we
are and here is how we can help you.''
Mr. Rogers. We agree with Roz that indeed technical
assistance is necessary. SBA financial assistance programs,
have grown tremendously over the last few years. Indeed, as we
speak today, this is the only area in the entire district where
the lending will surpass last year's levels because lending has
dropped off in general.
Mrs. Kelly. I feel it in my district, Mr. Rogers.
Mr. Rogers. Just a little bit, I keep an eye on it.
The importance of the technical assistance cannot be over
stressed, because we know when borrowers see the Small Business
Development Center and other technical assistance providers
first, they will do much better with the lender and they'll do
much better when they get the loan.
I would also add that we recently introduced the microloan
program on Long Island, and the micro-lender here won the award
as being the top micro-lender in our district last year, as a
result of the work they are doing.
Ms. Shivak. I just wanted to say that that's what the roles
of the chambers of commerce are. We get many calls from start-
up companies, especially someone who is starting up in their
home, and we tell them to call Roz and Judy and the other
agencies. We are the front door. We give them that assistance,
whether it's from low-cost marketing or how to develop, where
do they go?
Ms. Goldmacher. I would like to just ask for one specific
issue of relief.
On the SBA 504 program, as you know, it receives zero
appropriations. The subsidy issues are addressed by fees to
borrowers and to the lenders, and the subsidy rate is
determined by a model that OMB manages. Currently OMB is
looking at the model, the subsidy model for the 504 program,
looking at providing for a shorter look-back period; doing that
would substantially reduce the fees to our borrowers and our
participating lenders, and it makes the capital more cost
effective and more available for more small businesses. So I
would urge the Committee to continue monitoring OMB and make
sure that they look closely at the subsidy models in the 504
program, as well as the 7(a), in order to reduce the fees,
particularly for our borrowers under the program.
Mrs. Kelly. Thank you very much.
Mr. King. In your question about the access to capital, I
think probably for a lot of years I was concerned because
money, as a commodity, was flowing out of New York in huge
bundles, financing development all across the country and world
wide, but I have been pleasantly surprised since about the late
1990s, a lot of our own financial institutions have come to the
recognition that there are some excellent solid investments
here locally. It is amazing to me for them to realize so late
in the game that they can make a profit lending to small
business. They had always approached it as the necessary evil
under CRA or something. I think they are awakening to that. Now
they are much more proactive with our own organization in going
out and asking us to work with them to improve the borrowers'
access to them.
Mrs. Kelly. Mr. King, are you helping people like Roz move
people from 7(a) to a 504 and then out on their own? Mr.
Rogers, are you two working with Mr. King in helping Roz do
this kind of thing so we can get these businesses up and out?
Mr. King. We are in the unusual position that our golden
rule is we do whatever is right for the client, and if the 504
program is charging a substantial fee and that fee is very
difficult for the client to handle up front, then it is not a
good buy for the client.
In terms of some of the guarantee fees, the committee, I
think, forced them down recently because they were making a
profit. I don't think that's what it should be doing. So that
we just look at what is the best financial decision for the
client, and if that means going outside of the guarantee,
that's probably a good thing, but I think they would improve
their term, they would improve their access, and possibly the
time line contract if some of these fees were not so
oppressive. I think they are oppressive.
Chairman Grucci. If I can just interject for a moment, we
are going to move on, because I did promise if there were any
questions from the audience, and I do want to get to them
before our time expires.
I would just like to ask a few questions myself, before
taking questions from those who came to visit us today.
Mr. Rogers, I would also like to ask you a few questions,
if I may: Obviously, as having a strong voice in Washington and
being a voice here in New York, you have a lot of influence
over this program, the SBA program. One of the things that I
find somewhat confusing, maybe you can help me understand it,
is the lack of attention that I believe Long Island has been
getting from the monies that are being sent from Washington to
New York. It is roughly $600 million that comes into the State
of New York for SBA programs. Long Island gets about $14
million of that, but we have about one-third of the population
of the State of New York. Simple math would say that we should
be looking at about $200 million worth of SBA involvement here
on Long Island, which might ease up a lot of the trauma of
trying to find access to capital.
Could you explain why Long Island doesn't see more of that
roughly $600 million that is coming here?
Mr. Rogers. I am not sure about the $600 million,
Congressman, but if the $14 million pertains to the SBIC
financing----
Chairman Grucci. The number of $600 million, it's actually
$592 million from your testimony, page 3 of your testimony.
Mr. Rogers. The Small Business Investment Company deals are
based on the applications of small businessses for that money,
so that, for example, in Manhattan, where there are close to, I
believe, 72 Small Business Investment Companies, they tend to
get many more applications than applications in other parts of
the district. For example, in the mid Hudson Valley, we get
very, very few applications for Small Business Investment
Company money, even though the programs are advertised across
the district equally. The $600 million is the figure for New
York State.
Chairman Grucci. That's correct. That's what I said. I said
the number for New York State is roughly $600 million that
comes in; we see here on Long Island about $14 million out of
that $600 million, yet we account for about one-third of the
population for the State of New York. It would just seem to me
that that number of 14 million should be considerably more.
Mr. Rogers. From these numbers it appears as though these
deals are much smaller deals. I would have to look at this much
closer to see why the number is so very small.
Chairman Grucci. I would certainly like to hear the
response to that.
Mr. Rogers. We will present that to you.
Chairman Grucci. Thank you.
Judy, we have been together for a long time on a lot of the
projects; working as a former supervisor of the town, I
recognize the hard work that you have done. Just to stay in
focus to what today was about, today was about to find out how
the Federal Government, through its SBA programs, could be
helpful to small businesses. Could you tell us what the single
mostcrucial issue is that you see that's a problem with our
programs and how our programs can be better tuned or revamped to help
the small businesses that you see coming through your front door?
Ms. McEvoy. I think one of the things is--I'm out there all
the time, as you know--we get so many people who say to us, ``I
didn't know about your program.'' One of the things that we try
and do is to connect them with some of the other Government
programs. I don't know why there is this lack of knowledge or
this lack of access to the things that we do, but I can't tell
you how many times people say to me, ``I wish I knew you were
here five years ago.'' ``I wish someone had told me that you
were here.''
So we are trying very hard, all of us here, to connect to
each other, to provide the services that we provide, but I
really think that the Government is really doing a lot. In my
shop alone I have the Deta Delta advisor who is the defense
diversification. We have worked with the New York State
Department of Labor to provide self-employment opportunities
for people who are getting unemployment. There is a tremendous
amount of programs out there, but the problem is that people
don't seem to be finding out about them. I laugh because I
say--someone just came in to me recently and said, ``I wish I
knew you had been here.'' I said, ``I can't be out any more
than I am.'' I don't know whether there should be an
advertising type of promotion, but that's what I get all the
time.
I want to add, I was asked specifically to provide some
individual stories. I have included about 14 success stories
here, so you can see the type of individual that comes in, but
I would say that the access to the information that we are out
there, that we have these programs, and that we are more than
willing to help.
Chairman Grucci. Anything that you might be able to provide
us as a means to be more helpful to making your programs
successful, making your endeavors successful through our
programs, we would welcome that on the Committee, because
that's what our function is. Our function is to help the small
businesses through the SBA programs and there's no better
person to tell us if we are succeeding or failing than those on
the front line.
Ms. McEvoy. I would be happy to.
Ms. Kelly, one of the things that I have found interesting,
in terms of your questioning about the 8(a)'s, I have a
business advisor on the grounds of the Brookhaven National
Labs, and one of the goals of that individual is to get more of
the minority businesses and women-owned businesses involved. We
just recently did a workshop within the last two weeks to
advise the purchasing agents there who now have credit cards
that they purchase, on how they can use the Internet to look
for some of these 8(a) companies, you know, the minority
companies, when they do their purchasing with credit cards, and
we will run that workshop again.
Mrs. Kelly. It's a Federal mandate that the Federal
Government should purchase at the level of 5 percent. Of
course, nationally they are not.
Ms. McEvoy. Right.
We need to get to those purchasing agents, which we have
started to do at Brookhaven National Labs. They have their own
credit cards that they can purchase with. They have to be
advised of the minority 8(a) companies, and we are in the
process of doing that; so there are programs where we are
working on that.
Chairman Grucci. Thank you, Judy.
Roz, let me ask you that same question: How can we better
help you? What is it that we can do?
Ms. Goldmacher. One specific example, you mentioned venture
capital before in terms of the small business investment
companies. I have to say that Aubrey and his representatives
were extremely helpful to us several years ago when a bunch of
us certified development companies, ten of us around the
country, got together and we saw a need for that next level of
capital for our 504 borrowers, where they got to that next
level and they needed equity or debt, but they weren't ready or
able to take advantage of the usual sources. We wanted to be
able to provide venture capital.
We put together a venture capital firm, which is licensed
by SBA to do debt and equity, it's an SBIC. It's a great
program, and Aubrey and his people were very helpful to us in
putting that together. Unfortunately, we have been stymied in
using that fund to help our 504 borrowers, because the SBA at
the central office level has instituted a policy prohibiting us
from doing so. They are saying that if a Certified Development
Company has an interest in an SBIC, then the same borrower
cannot receive 504 financing that came from that Certified
Development Company, as well as SBIC financing from the SBIC
because of an alleged potential conflict of interest.
Now keep in mind, for example, Long Island Development
Corporation invested $150,000 in this fund. We were the largest
investor, as far as certified development companies; this is a
$70 million fund. It is a very tiny percentage. We have no seat
on the board, we have no part in the loan management, et
cetera. Conflict of interest is something that can be always be
managed. If we could get that policy eliminated, then it would
open up nationally more venture capital for small businesses.
Those who are going from the 504 level up to that next level.
So that's one specific thing that I would like to see
addressed. We have not been able to get it addressed on the
agency level, and we are probably, at some point, going to be
coming to you with some specific proposals.
Mr. Rogers. If I may, I noted that in Roz's testimony and I
brought it to the attention of the 504 office in Washington,
and we will be happy to provide a response or an explanation to
the Committee.
Chairman Grucci. I would be very appreciative of that. I'm
eager to see it.
As you know and you are probably aware, but let me just
tell you from my perspective, our job here in Washington is to
help those on the front line, that's coming from small town
Government, and watching how the biggest relief, the biggest
help to our business communities have always come at the local
level, and the local level is the least equipped financially to
make those kinds of commitments.
You have heard the Town of Brookhaven, the Town of
Riverhead and every other town here in Suffolk County, as I am
sure every town across the State of New York has these programs
where they are struggling by giving up tax revenues that goes
to supporting the local Governments and supporting the fire
departments and the schools and the libraries and a variety of
other things, in order to entice businesses to come and locate
in their communities to make them grow. The most equipped level
of Government is the Federal Government to be able to help with
those programs, and if we are failing to do that, then we are
failing in our responsibilities.
I am hearing from the small businesses themselves, I am
hearing from people like this panel that we have some
difficulties, we have some problems, and this committee is very
eager to resolve those and to move those problems aside so that
we can continue this growth. I know I am preaching to the choir
here when I say that the job creation that has happened in this
country hasn't happened at the hands of the mega corporations.
While we need them as part of the mix, and we all encourage
them and we try to do all that we can to see that they succeed,
we can't do that on the backs of the small businesses, because
70 percent of the job growth, at least in this area if not the
State has been the direct result of small businesses. So I
welcome these testimonies here today because I think it is
going to help our committee to continue to do its job and do it
more efficiently, and we need your help and your assistance. I
would like to see more of that resource that is coming into
areas that have one-third of the population, that means there's
a lot of entrepreneurs out there that are sitting there
wondering, as Judy said, ``How do I get involved with this?''
Maybe what we need is a better advertising and ad campaign,
letting the people know what we have, what is available to us.
Mr. Rogers. I want you to know, sir, that we are anxious to
do that; our team is, and our new Administrator, just last week
in a meeting he talked about hearing issues such as this, and
listening to what small businesses have to say and responding
to these things. So you will see much more of this.
Chairman Grucci. Thank you.
I want to turn to Supervisor Kozakiewicz. I know that he
talked a moment ago about the Post Office, and that may not
seem like a small business issue for this panel, but I assure
you in the way that he has presented it and what I have seen
here, it most assuredly is because it is the entranceway to
their downtown communities, and it is an albatross hanging
around the neck of a vibrant community trying to revitalize
itself. I would like to ask the Supervisor to expand a little
bit more on the problems and what it is that this Committee and
we, in the Federal Government as a whole, can do as
representatives, to help you alleviate that problem.
Mr. Kozakiewicz. I have the photos by the way, now.
Although I travel by the site often, it is when I started to
look at the photographs that I got a little chuckle. It says
``United States Postal Service,'' and then, below it it says,
``A new facility.'' I will hand up to you 13 photographs which
show the condition of the site. It is not bad enough that the
work was stalled, but the site has not been maintained in any
way, shape or form as well. It's overgrown, it is weedy, it is
an eyesore. It goes beyond what I can do here at the local
level, and, therefore, it is incumbent for me to ask you for
your assistance.
I understand that you can do many things that we cannot do
at the local level or at the State level or at the County
level, such as a direct inquiry to the Postal Service,
gathering of records, convince them that it is time to get past
the impasse that they have been struggling with the contractor,
and that is how I come to you. I ask you to use your resources.
Perhaps this is not the proper forum, but I believe it can be
taken to the proper forum so that it can be done.
It is obvious that the visual impacts are great. If you go
past the site, as the photographs depict, it is in deplorable
condition, where we have seen a spreading of new businesses.
There is a new restaurant that opened not too long ago, which
now features some pretty good pizza. There has been the ice
cream store that's just a stone's throw away, and they're still
managing well and they're improving their site, and we had
another nice little business that opened up which features
Mexican food, and it's called Funcho's. I have been there. The
amazing thing is that people from far away from Riverhead are
discovering it, and as a matter of fact they told me that there
is one particular person who comes out every weekend on the way
to Sag Harbor and makes sure that they stop there before they
head out to Sag Harbor so that they can enjoy this food.
The problem is the businesses are trying to improve their
sites. They are trying to make the investment, which obviously
we need to help them as far as tax incentives or otherwise, but
it is tough to convince them when just a short distance away
you have to look at this. Furthermore, the fact of the matter
is while it sits there, there are jobs that are not being
addressed. There are jobs that could be given out to
contracting firms and others on that property, not to mention
onceit is up and running, the maintenance of the site, which
are not being addressed.
It also goes contrary to visitors and our residents who see
this and tend to want to avoid that area because of its look
and because it is not attractive and inviting. If it is not
attractive and inviting, again, businesses suffer. So these are
things that I am asking for on behalf of our residents that you
can address.
Chairman Grucci. Supervisor, isn't it fair to assume also
that the businesses depend upon that post office for being able
to get their bills paid on time and get their invoices out? It
was my understanding in reading through the files and records,
there was a consolidation that was taking place of several
entities coming together to create a more efficient Postal
Service covering this community, and being able to help your
business community, as well as your residents, and without that
there has to be some suffering that is taking place; would you
agree to that?
Mr. Kozakiewicz. We are stagnated with what we have. This
was designed to be a more efficient location, taking what is
existing and providing a more efficient operation; so certainly
it has stagnated us and it is counter-productive to the growth
and the spurt that we are experiencing in Riverhead.
Chairman Grucci. What would you say the impact on the
existing businesses are, not necessarily from the standpoint of
walking in traffic and having to deal with the eyesore, but the
everyday operation of their businesses and dependency upon that
post office?
Mr. Kozakiewicz. It forces them to the current location on
Second Street, which we have talked about, and we have had some
correspondence back and forth. The current location is not
handicap accessible, and that is counter-productive to
businesses and to the community at large. I see that we need
this new facility to be opened. We need help and assistance to
make it a reality.
What it is also doing is clearly hampering--again, I can't
emphasize this enough--hampering our efforts to just improve
that area.
Chairman Grucci. Thank you very much.
I know that our time is closing, but I did offer the
opportunity to anyone who would like to make a comment or a
question. I see a hand raised, so we will take you first.
Mr. McKnight. Bob knows me, Judy McEvoy knows me. I guess
I've worked for BOCES as a consultant.
Chairman Grucci. If you would just put your name on the
record.
Mr. McKnight. Warren McKnight, Middle Road, Riverhead.
I worked for BOCES as a consultant, for the minority
entrepreneurship program. Part of that program, I was
privileged to assist people on disability and handicapped
people, to provide employment in the Town of Riverhead.
Approximately ten percent of our population receive some sort
of disability checks from our Governments.
To get right to the point, these people have a real
problem: They want to participate. I have started a number of
people in business, sent them to Judy. Part of their problem is
that they have temporary housing, rooming houses around here,
they become self-employed sales people or they start their own
craft business or their own businesses, they work at home.
Their problem is this: They have not been able to get a post
office box at Riverhead to use. They have to go into hospitals
for treatment and when they come out, they have to live in
Riverhead because of low rents, where are they going to get
their business checks, their other checks and all their mail
sent? They can't get it sent to the rooming house. They can't
get a post office box. They can't get a post office box in
Calverton. I mean, this is a clear violation of the handicapped
rules.
This is why I have been calling your office, being a pain.
This is why I have been writing letters to the editors. This is
why I am saying, ``Can they please, if they are not going to
build a new post office, rent a couple of stores and get post
office boxes for people with heart conditions and people who
have wheelchairs down there, so they can participate and become
small business people, become self-employed.'' They want to pay
their double social security. They make anywhere from $5,000 to
$30,000 a year.
You know, you want to know what's wrong with the programs,
the other thing that I did when I worked for BOCES, as a
minority entrepreneurship, I went to soup kitchens, I stayed at
the unemployment office there, I told people about these
programs. I went to work fairs, I went to job fairs. You need
hands-on people. What you really need is somebody in a
wheelchair to reach out to people who are in wheelchairs.
Somebody who is on disability to reach out to somebody on
disability, if you want to get it moving here.
I am going to cut it real short now, but the only thing is
that's why I am so upset about this, and that's all we have to
do, get some post office boxes down there, get some real
outreach workers in this program, people one on one, maybe
dedicated people in the clergy. So basically that is I hope you
really can do something. Just get some post office boxes.
Chairman Grucci. I appreciate you bringing this to our
attention. We have been moving forward on trying to help get
this resolved. I guess it underscores the point that the
Supervisor was making that we really do need the completion of
the post office done so we can expand the service of the post
office to do just what you are saying, to provide more space,
more boxes and more ability for more entrepreneurs, more small
businessses to grow and to become a small business. I
appreciate your comments.
One of the things that we were just talking about,
Congresswoman Kelly and I, is that at least on a temporary
basis, places like Mailboxes Et Cetera is a bone fide drop
point that could be used for the purposes of delivering mail,
if there is any available, but if they're not available----
Mr. McKnight. It is not available, and what had happened
over the years, they go out of business. We are the poorest
town on Long Island.
Chairman Grucci. I am not suggesting that to be a permanent
fix, I was just trying to see if this might be a temporary fix
while we work on the Supervisor's bigger problem.
Mr. McKnight. Only if they could be like Fed Ex,
underwritten by the Federal Government. We are the poorest town
on Long Island. We have a disproportionate amount of people on
disability. We have a disproportionate amount of people who
need these services, and that's what really hurts. It hurts
this town, it hurts the pride of our Supervisor and everybody
that lives here.
We are the poorest town on Long Island, the lowest income.
People who are poor have to live here because they are on
disability or partial disability, and they have this extra
handicap.
Chairman Grucci. I am just going to have to ask you to sum
up so we can get a couple of more in before we have to close.
Mr. McKnight. I think I made my point and I want to thank
you for listening, and I want to thank the Supervisor and you
and for doing it, but please, let's get something done. Thank
you.
Chairman Grucci. Anyone else?
Yes, ma'am?
Ms. Blostein. My name is Anne Blostein, from Calverton.
I am very glad that you are going to take care of what is
happening in our post office in Riverhead. I think right now it
is a blight for our town and it is stopping the economic
development, which we are very hard trying to do. Thank you.
Chairman Grucci. I appreciate that, but a lot of the credit
belongs to the Supervisor for being on the forefront in
bringing that to my attention.
Any other questions?
Seeing none, I just wanted to sum up by saying I want to
thank our panelists for being here. I think the testimony today
was a good one and it will give the Congresswoman and I an
opportunity to go back to the full Committee and report what we
have heard here today, which is probably not going to be
dissimilar to other places throughout the country, the same
kinds of problems that are out there. Maybe those in Arizona
may not have the fishing problem but I know that they enjoy
eating our fish because I have spoken to a couple of them
already.
We are going to continue to work on this. Small business is
the heart and soul of our economy. It is what has built this
country. It is where our giant entrepreneurs started; every one
of them will tell you the story, whether it's Mr. Grumman or
whether it's Bill Gates, their ideas started in their basement
or their library or their garage and grew, and with the help
that we can provide from the Federal Government--and, Mr.
Rogers, I suspect that you will hear the cries of the small
business community and put a special emphasis on helping the
Long Island region.
Mr. Rogers. Yes.
Chairman Grucci. We will be able to continue to grow this
economy, keep these jobs flourishing, and I thank you all for
being here today. Thank you, and God bless you all.
[Whereupon, at 3:50 p.m., the committee was adjourned.]
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