Senate Democrats launch effort to give big boost to small business

OLYMPIA – When Michael Heppler moved to Eastern Washington from the Bay Area, he hoped his dog wash business, U-Shampooch, would prosper. But after three and a half years, he just wasn’t making it. When he filed for bankruptcy, his wife left him, and he found himself sleeping on his nephew’s couch.

A college graduate, Heppler said he couldn’t get jobs that paid more than $10 an hour, which wasn’t enough to support himself and two children. Determined to be successful, he got involved with a microenterprise development program in Spokane, and months later, launched another business, Atta Boy Plumbing.

“Because of the microenterprise training, I went from a $10 an hour job … to gross sales of $10,000 for the month of November,” Heppler said.

A group of Senate Democrats today introduced a package of legislation that aims to give people like Michael Heppler more opportunities to start up microenterprises – businesses with five or fewer employees that require $35,000 or less in start-up costs, and that do not have access to the traditional commercial banking sector.

While microenterprises account for close to 17 percent of all employment in Washington, many people don’t know that they exist.

“Small businesses are the workhorses of Washington’s economy. Any tools that we can give them to succeed will be doubly beneficial – to their employees and to our state,” said Sen. Tracey J. Eide, D-Federal Way, who is sponsoring three bills in the package, including:

• Senate Bill 6711, which would establish a statewide online entrepreneurial and small business development training curriculum. The curriculum would be available for individual, agency and private organization use by June 30, 2007.
• SB 6712, which would exempt small businesses with five or fewer employees from business and occupation taxes for two consecutive years in their first five years of business. The exemption would apply to small businesses in the service sector whose gross income is less than $60,000. For all other sectors, the exemption would apply to small businesses whose gross income is less than $120,000.
• SB 6713, which would allow unemployed individuals to receive unemployment benefits while pursuing entrepreneurial efforts. The Department of Employment Security (ESD) would inform individuals likely to exhaust regular unemployment benefits of the opportunity to enroll in commissioner-approved, self-employment assistance programs.

Senate Majority Leader Lisa Brown, D-Spokane, said that microenterprise provides moderate- and low-income individuals a viable alternative to minimum wage jobs and public assistance.

“In my district, I’ve seen the programs work that help these smallest of small businesses get started. They are hair dressers, jewelers, computer technicians. Many are trying to escape poverty, and with the proper assistance, succeed in doing so. There should be resources available throughout the entire state so that people can have these jobs – jobs they not only feel good about, but that allow them to provide for their families,” she said.

Brown’s bills are:

• SB 6714, which would establish a new state Microenterprise Development Program to improve low-income entrepreneurs’ access to capital, training and technical assistance. The Department of Community Trade & Economic Development (CTED) would house the program and would leverage federal funding and charitable and private sector support for state micoenterprises.
• SB 6715, which would broaden the mission of local Work Force Training Boards across the state to include entrepreneurial training opportunities. The boards would integrate entrepreneurial education and training into their school-to-work transition programs that are offered in industries with few apprenticeships programs.

Sen. Darlene Fairley, D-Lake Forest Park, understands the difficulty involved in getting a small business up and running.

“As a small-business owner, I know how hard it is to get established. We need to encourage banks to get more involved,” she said.

Fairley’s bills are:

• SB 6716, which would provide incentives to banks that support microenterprise development and offer credit counseling services. The bill carries the spirit of the federal Community Reinvestment Act (CRA), which encourages banks to help meet the credit needs of their communities, particularly in neighborhoods with low to moderate incomes.
• SB 6168, which would establish Business Development Corporations to promote economic development in the state. The bill provides incentives for financial institutions, lenders and investors (including venture capitalists) to participate in small-business development and job creation.

Sen. Paull Shin, D-Edmonds, chairs the International Trade & Economic Development Committee, and will hear all but two of the bills at 10 a.m. today in Senate Hearing Room 3.

“The ‘Big Boost’ bills offer small businesses a very big boost, indeed, to serve the people in our state who need it most – the smallest, most fledgling businesses, whose owners typically have the fewest resources and experience in launching what could be very profitable enterprises,” Shin said.

Rose Ayars, of the Spokane Neighborhood Action Program’s (SNAP) microenterprise development program, said all her clients are highly motivated; they just need a little direction.

“If we weren’t there, they’d have all the motivation in the world, but they’d have no one to say, ‘Run in this direction.’ They want to run – they just don’t know which way to go,” Ayars said.

SNAP, which helped Heppler get his plumbing business established, runs one of at least 13 microenterprise programs in Washington. Microenterprises provide employment for an estimated 584,357 people in Washington.

Heppler’s next microenterprise? Manufacturing and distributing a product he has designed that he says will “de-ice” a car’s windshield in 30 seconds. Might not be a big seller in the Bay Area, where he came from, but it sure could sell well in Eastern Washington, he said.

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