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Testimony to the senate on American Indian small business

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Thank you, Mr. Chairman and members of the Senate Committee on Small Business & Entrepreneurship and the Senate Committee on Indian Affairs. On behalf of the National Indian Business Association (NIBA), I would like to thank you all for the opportunity to testify today on this very important legislation, the "Native American Small Business Development Act."

As you are aware, socio-economic statistics pertaining to Native Americans remain grim. Even today, many Native American businesses are still without adequate training and technology to compete and do business with the private sector and the federal government. Yet in spite of this, there are some bright spots on the horizon for Native American Business development. The explosive growth and demand for information technology and business e-commerce continues. Overseas businesses often fill the void in U.S.-based information technology businesses, while the potential resources of Native American businesses on and off Native American reservations are overlooked. Among the problems cited by Native American businesses is that there are few training and technical assistance centers, mentor or incentive programs that focus specifically on assisting the development of Native American businesses. It is this void that drives NBA in its support of the Native American Small Business Development Act.

The establishment of Small Business Development Centers in Indian country would serve as the central focal point for training, technical assistance, education, e-commerce development programs and technical assistance services with the goal of expanding the number of Native American businesses and creating Native American jobs. NIBA recommends the SBA, Native American Small Business Development Act includes the following objectives:

1. Provide training, education, management and technical assistance to Native American tribal and individual businesses nationwide;

2. Develop and maintain an inventory of Native American vendor firms qualified and capable of selling their goods and services to the public and private sectors and an outreach program to facilitate this interface;

3. Identify, develop and coordinate capital sources for investment in or lending to Native American firms or potential businesses;

4. Identify, develop and coordinate public/private sector management and technical assistance resources for qualified Native American firms;

5. Provide education and technical support for Native American Women firms or potential businesses;

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6. Fund a National Native American Business Development program in Washington, D.C. to provide coordination and technical support for computer access for e-commerce, b-commerce and the development of Information Technology;

7. Develop a Native American computerized data resource center that will transfer e-commerce and other technology to Native American businesses nationwide and establish a National web site for information transfer; and

8. Develop the important linkages and coordination with all SBA Regional and District offices needed to coordinate nationwide all SBA services to Indian country.

This Senate legislation will create a bright future for Indian country because for the first time in SBA's history, legislation will establish a statutory SBA, Office of Native American Affairs. This office will focus on outreaching to all Indian reservations and Native communities to provide training and technical assistance, ensuring that efforts, equal access and opportunities will increase Native American participation in SBA programs.

The establishment of a financial and resource assistance program to fund Native American Business Centers through Tribal Colleges, Tribal Governments and Native organizations will provide culturally tailored business development assistance to Native Americans. We all know that access to capital in Indian country is very limited and loans, small or large, are non-existent, creating a barrier to business development on reservations.

This legislation will create the assistance for Native businesses to seek other loans outside the Bureau of Indian Affairs guaranteed-loan program. There are many choices of government loan marketing programs, like Fannie Mae and Freddie Mac who serve as secondary lenders. The SBA has very good guaranteed loan programs and operates a secondary loan market for its loans. This legislation will provide the assistance needed for development of loan packaging that will have positive effects in Indian country. Community banks play a critical role in providing small loans to Native American businesses especially through SBA lending programs. We support the financial resource assistance of this legislation that will provide capital for economic development on Indian Reservations.

This legislation establishes two innovative pilot programs for native reservation and community businesses: the Native American Development Grant Pilot Program and the American Indian Tribal Assistance Center Grant Pilot Program. These programs will bridge the gap of the digital divide in information technology for Native American communities. NIBA supports the two innovative pilot programs.

Sustainable small business development in Indian country remains as the engine for new job creation and economic growth. Given the current fragile state of the economy, this is no time to further weaken much needed small business resources.

Pete Homer Jr., a Mojave Indian and enrolled member of the Colorado River Indian River Tribes of Arizona, was first director of the Small Business Administration's Office of Native American Affairs in 1992. The National Indian Business Association represents 24,000 Indian-owned businesses.