Walk this way: with more funding, SBDCs can lead you in the right direction

Entrepreneur, July, 2005 by Stephen Barlas

SMALL BUSINESSES may soon have access to a new translation service--not for when they need to pore over foreign language import rules, but rather to get help from Small Business Development Centers on deciphering the mumbo-jumbo that often characterizes small-business regulations. Rep. John Sweeney's (R-NY) National Small Business Regulatory Assistance Act of 2005 (H.R. 230) has passed both the House and Senate in previous Congresses; 2005 may be the year it lands on President Bush's desk for signing.

There are now 63 Lead SBDCs--one or more in each state, the District of Columbia, Guam, Puerto Rico, Samoa and the U.S. Virgin Islands--with a network of more than 1,100 service subcenters. The SBA provides 50 percent or less of the operating funds for each state SBDC.

Currently, SBDCs provide limited federal regulatory counseling, but the Sweeney bill would expand that role and establish a new $5 million-a-year grant program, which would feed a minimum of $200,000 a year to SBDCs in 20 competitively selected states. More important, the legislation would drape a cloak of confidentiality over all information offered by entrepreneurs seeking advice, plus the advice they receive from the SBDC.

"[Entrepreneurs] are worried that if they go directly to the IRS or EPA and ask questions about compliance, those agencies will send an inspector to their business," explains Don Wilson, president and CEO of the Association of Small Business Development Centers. Regulatory burdens are typically ranked as a top concern for small businesses. The SBA estimates those burdens cost employers almost $7,000 per employee per year--that's 60 percent higher than costs for businesses with more than 500 employees.