Committee on Small Business Holds Hearing to Conduct Oversight of SBA's Office of Entrepreneurial Development

WASHINGTON, D.C. - Today, Congressman Roger Williams (R-TX), Chairman of the House Committee on Small Business, held a hearing titled "Oversight of SBA's Office of Entrepreneurial Development" to examine how the SBA's Office of Entrepreneurial Development (OED) delivers counseling, training, and technical assistance to America's entrepreneurs, and to review the modernization initiatives implemented under the Trump Administration.

"America's entrepreneurs rarely succeed alone-they need trusted guidance, practical tools, and partners who understand the challenges they face," said Chairman Williams. "The U.S. Small Business Administration's Office of Entrepreneurial Development and its nationwide network of resource partners help small businesses start, grow, and compete. Under the Biden administration, outdated systems and a lack of accountability left taxpayer dollars vulnerable. Under Administrator Loeffler's leadership, the SBA is cleaning up that mess by modernizing these programs, strengthening oversight, and safeguarding every taxpayer dollar so it can deliver for Main Street businesses."

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Watch the full hearing here.

Below are some key excerpts from today's hearing:

Chairman Williams: "One of the Committee's priorities is ensuring that SBA programs deliver results for entrepreneurs while remaining responsible stewards of taxpayers' dollars; we talked about that. And as you look ahead, what are your top priorities for OED to improve program performance, reduce unnecessary administrative burdens, eliminate inefficiencies, and ensure that federal resources are directed where they can have the greatest impact for America's small business owners?" Mr. Fitzpatrick: "Under Administrator Loeffler, we have some major overarching priorities at SBA when it comes to specific industries. We are talking about manufacturing, we are talking about food supply, and we are talking about actually areas, rural communities, which have really been devastated over the recent decades. And so, what we're working to do is align the resource partners' efforts with those priorities. But we're also encouraging those organizations, the resource partners, to raise funds from other sources. These are public-private partnerships, and the ones we find most effective actually raise funds from other sources and don't depend solely on the federal government. The other thing we're doing is, we see the most effective help for small businesses when there's an ecosystem of resource partners that are collaborating. These are federally funded organizations, state-funded organizations, county, municipal, chambers of commerce, and so we're encouraging that collaboration. So not relying just on federal dollars in these public-private partnerships, but multiple organizations. And the other, finally, what I'd say, Mr. Chairman, is we are working with underperforming centers to help them get up to speed, and if not, then we will move them out of the program."

Rep. Alford: "As Chair of the Oversight Subcommittee, I was really disturbed with the SBA's recent discovery of roughly 340 million dollars in unpaid grant obligations that you basically inherited from the previous administration. This discovery demonstrates why strong oversight, modern financial systems, and accountability are just as important as funding these programs. Sir, how far back does this backlog go?" Mr. Fitzpatrick: "When we arrived, just for example, just in the Women's Business Center program, I got with their team, and I said, okay, what are the payments and how far do they go back? That program, they went back five years, and that was, you know, we had just been here a couple of weeks. And that was at least 12 million dollars. And so that was just that one program. So, there were about fifteen hundred payments in that 340 million dollars, but I don't know the details, but I have to assume four or five years." Rep. Alford: "Is more being discovered as you dig through this balance sheet basically?" Mr. Fitzpatrick: "Yes sir, yes."

Rep. Ellzey: "Can you walk us through how integrating the STEP grants under your office will reduce duplication and improve service delivery to entrepreneurs?" Mr. Fitzpatrick: "… [R]emember, Administrator Loeffler is a business person. When we came in, we had offices, we had functions that were spread out, such as HR, IT, within different offices. No company would operate that way. By the same token, we had some programs and some grant programs dispersed throughout the agency. So, what we're doing is, frankly, bringing groups together, like groups that have similar functions. So, while the STEP program has a critical connection to our Office of Capital Access, for example, and our Office of Manufacturing Trade, really what we're doing is putting together the program staff who are actually doing the hard work, day in and day out, of processing grants-and part of that is to drive efficiency. What we had before was staff spread out, sometimes busy and sometimes not. Now they're being cross-trained, and so they can surge when there is a demand."