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On March 20, the U.S. Small Business Administration (SBA) Office of Advocacy submitted a comment letter on the Federal Trade Commission’s (FTC’s) notice of proposed rulemaking on the Non-Compete Clause Rule. Proposed by the FTC on Jan. 19, the Non-Compete Clause Rule would make it an unfair method of competition for an employer to: enter or attempt to enter into a non-compete clause; maintain a non-compete clause; or, under certain circumstances, represent to a worker that they are subject to a non-compete clause. The proposed rule will require employers to rescind current non-compete clauses, but will not apply to franchisees. Based on their analysis and data, SBA’s Office of Advocacy encouraged the FTC to: adopt an approach that addresses the different concerns of small businesses in the marketplace; estimate the full impacts of changes to non-compete clauses; and consider and analyze alternative approaches for small entities to minimize adverse impacts while achieving agency objectives. At the urgency of the small-business community, the FTC extended the comment period through April 19. NSBA encourages all affected parties to consider and comment. Read more from SBA’s Office of Advocacy, and follow NSBA for developments on the FTC’s efforts to reshape Non-Compete Clauses in the U.S.

During the Fall of 2019, Nicole Rodden and her husband, Robert, decided that “business as usual” just wasn’t working. Robert was grinding away in corporate America, and Nicole had finished a tenure serving as a dynamic positioning operator off the Gulf Coast at the beginning of the year before running for Congress. Nicole was accustomed to life on the water, having served for ten years as an officer in the United States Navy Reserve, but she was ready to have the freedom to raise a family and pursue her political ambitions. The campaign trail wasn’t easy, either. Nicole largely self-funded her run, receiving boots-on-the-ground support from her husband who’d been laid off towards the end of the primary. When the couple was able to step back and take a breath, they decided that they wanted to be their own bosses. After looking into their options, the Roddens decided to open a franchise in the waste management field called “Smash My Trash.” It was the perfect opportunity—a chance to help fill a need for other small businesses, disrupt a sleepy industry, and benefit the environment. They had their plan in place and business model in-hand, when March 2020 came around and upended everything. Over the next year of the pandemic, Nicole and Robert struggled to stay in business. According to Nicole, “a lot of family and a lot of prayer” kept the franchise afloat. In fact, Nicole and her brother managed sales, while their father operated their first truck. The Roddens relied on the community around them—from their Church, First Baptist of Atlanta, to Robert’s fellow Georgia Tech MBA alumni—for support, which Nicole says is key to success in small business. The business climate finally softened in the Spring of 2021, and the Roddens’ Smash My Trash franchise began growing 20 percent month-over-month. During this time, Nicole also kept her sights on advocacy. After her run for office, Nicole started fellowship positions with the Empower America Project and the Club for Growth. She was selected to be a part of the Smash My Trash’s National Franchise Council, an exclusive committee that represents the interests of franchisees to company leadership. Nicole sees this work as an extension of her military service and campaign for office—especially when it comes to fighting for small businesses. Nicole says that there’s a “misconception that small business ‘owners’ have it cushy, but that’s not the case;” rather, small businesses work hard to care for their customers and employees before themselves. As a small business advocate, Nicole knows the unique challenges facing small businesses and asserts that "folks in D.C. need to know we exist." To learn more about the issues that Nicole and other NSBA members are fighting for, please visit nsba.biz/issues.

On March 17, Senators Hassan (D-NH) and Young (R-Ind.) introduced the American Innovation and Jobs Act aimed at supporting research and development (R&D) investments made by small-business startups and innovators. The legislation would reverse a 2017 change in the tax code, which became effective in 2022, requiring small businesses to amortize R&D investment deductions over five years, rather than being able to deduct them as an expense in the year that they are made. NSBA strongly supports this legislation and an end to the requirement that R&D expenses be amortized over five years. The five-year amortization has a particularly negative impact on technology-focused members. Continuing efforts from last year that began more than five years ago, NSBA’s Small Business Technology Council (SBTC) is closely tracking developments related to R&D policy, recently drafting a letter to Congress outlining concerns with the 2017 change and urging reinstatement of an immediate, annual deduction. To learn more about NSBA and SBTC’s efforts, read SBTC’s letter and sign on to the cause here, and read the text of the pending American Innovation and Jobs Act bill here.

FOR IMMEDIATE RELEASE March 13, 2023 Contact: Molly Day 202-552-2904 press@nsba.biz Washington, D.C. – The National Small Business Association (NSBA) has heard from several small-business members whose funds were tangled up in the collapse of Silicon Valley Bank (SVB), prompting questions among all small businesses about the safety of their money. Although technically a regional bank, SVB was among the top 20 largest commercial banks and is a major player among high-growth and tech start-ups. Below is a statement from NSBA President and CEO Todd McCracken on the elections. “The announcement from the FDIC that they will guarantee the funds in SVB beyond the $250,000 typically insured is a life raft for many small businesses. However, it raises broader concerns about the meaning of “federally insured deposits” and highlights questions about whether small business and individuals should be treated virtually the same, despite their vast differences in cash-flow needs. “Unfortunately, the major losses that could have been incurred by the smaller firms at SVB—or other, similar financial institutions—could be catastrophic with significant ripple effects. Beyond massive cash losses that could have happened, small businesses in these situations could fail to meet payment deadlines, payroll, or other obligations that could cause significant harm to the broader community.” “While NSBA welcomes a thoughtful evaluation of the rules that govern the ‘safety and soundness’ of our banking system, we are mindful that a knee-jerk reaction that overregulates the system could render banks like SVB ineffective. Despite this major failure, banks like SVB fill an important niche and provide unique financing options for smaller firms that simply are unavailable at larger banks. “Access to capital is a major issue for small businesses—in fact, today more than one-third of small businesses say they are unable to obtain adequate financing—the highest this indicator has been since 2008. NSBA has, for years, been urging critical reforms to small-business lending and the SVB collapse is a clear indication that reforms are needed now.” Celebrating more than 85 years in operation, NSBA is staunchly nonpartisan and uniquely member-driven. We advocate on behalf of America’s small-business owners and entrepreneurs. NSBA's 65,000 members represent every state and every industry in the U.S., and we are proud to be the nation’s first small-business advocacy organization. Please visit www.nsba.biz. ###

The new bill is aimed at supporting justice-impacted individuals and their opportunities for work after repaying their debt to society. This month, Chair of the Senate Small Business Committee Senator Ben Cardin (D-MD) reintroduced his NEW START Act – legislation aimed at creating reentry programs with the SBA, awarding grants for business counseling and entrepreneurial development training to justice-impacted individuals. The bill would establish a five-year pilot program providing award grants of $100,000 to $500,000 to organizations annually over the five-year period. Participating organizations would execute entrepreneurial development training for formerly incarcerated individuals, and organizations seeking grants would partner with lenders in the SBA Microloan program and Community Advantage program; this would provide qualifying program participants the ability to obtain loans and build their business. While the bill is still only introduced, read Senator Cardin’s release on the NEW START act here, and follow NSBA as we continue to track legislation and related small-business initiatives from Capitol Hill.

Comments to this working proposal are due in 60 days. UPDATE: At the urgency of the small-business community, the FTC extended the comment period through April 19. NSBA encourages all affected parties to consider and comment. The Federal Trade Commission (FTC) last week proposed rules, which would ban noncompete agreements across the board. Citing concerns with how nearly one in five college grads are subject to strict noncompete agreements, as well as how noncompete agreements impose restraint on trade, the FTC is collecting comments on its proposed regulations over the next two months. Until recently, governance of non-compete agreements has remained in the purview of the states. However, the FTC recently issued a ruling against three companies for their use of noncompetes. Those rulings, plus this new, unilateral move into an area that typically is dealt with at the state level adds a layer of confusion as to whether or not FTC even has the authority to promulgate such rules. According to a March 2022 FTC report, lack of competition for labor and restrictive covenant agreements “likely reduces” wages by as much as 20 percent. The issue of noncompete and nondisclosure agreements is one that impacts various small businesses differently. For many small, innovative businesses, noncompete and nondisclosure agreements ensure fair competition against larger companies that have greater ability to lure employees—and their working knowledge of the company—away from a smaller competitor. Faced with an already uneven playing field against larger, more powerful companies, noncompete agreements can help these companies better protect their intellectual property and processes from larger competitors. On the other hand, noncompete agreements can be a barrier to new business formation for employees looking to start their own business in a similar industry, particularly when there aren’t major intellectual property issues at stake. Furthermore, enforcement of noncompete and nondisclosure agreements is far more difficult for a resource-strapped small business than it is a large corporation. For more information on this proposal, including comment submissions regarding how this proposal affects small business employees and owners, follow NSBA and read more here.

"...what you might think of as failure is really teaching us something valuable.” When it comes to helping nonprofit organizations reach their full potential, Sandra Chaney wrote the book. Literally. As a matter of fact, the Annapolis, Maryland-based nonprofit strategist is an eight-time author on the topics of business, self-help and nonprofit management. Ms. Chaney says that she didn’t choose her journey, rather, “it chose me.” A survivor of domestic violence, she first began her career in advocacy and nonprofit strategy as a volunteer at My Sister’s Place, a local nonprofit women’s shelter. Seeing that “their story was my story,” Sandra dedicated herself to fighting for the welfare of domestic violence survivors. She also quickly took to the skill helping the group gain access to new resources—both through grant writing and lobbying local officials. After three years with the nonprofit, Sandra realized that she could add greater value to the nonprofit world by entering the private sector where she founded Sandra Chaney Enterprises, Inc. In 19 years as co-founder and chief visionary officer of Sandra Chaney Enterprises, Sandra has helped countless nonprofits find their “why” and build a sustainable organization around that mission. Guiding nonprofits to build from the inside-out has been her greatest joy. According to Ms. Chaney, “...everything my clients need, they already have.” Sandra helps her clients strategize and provides a variety of essential services including grant writing. Today, she has secured over $20 million in funds for her clients. Since 2005, she’s authored eight books on her story, single motherhood, success for women in small business, and nonprofit development. Among these, The Inside Secrets To Getting Money For Your Non-Profit has become a guidebook for nonprofits who struggle to secure the funding they need. Despite the demands of her consultancy and writing careers, Sandra continues to make advocacy one of her top priorities. To Sandra, the power of advocacy comes from using her voice for others who may not be able to make their own voices heard. And when it comes to small-business advocacy, she supports efforts to level the playing field: “I love to see people win, especially small businesses...if I can play a small part in that, then I’m all for it.” Graciously, the author and nonprofit strategist is happy to talk with other small businesses and provide her insight. When asked what advice she’d give to first-time businesspeople, Ms. Chaney simply replied: “Breathe. You’re going to be successful, so just breathe.” Sandra also advises that first-time small-business owners reframe their relationship with failure: “We always feel like everything we do is failing, when in essence, it’s not. But what you might think of as failure is really teaching us something valuable.” To learn more about Ms. Chaney, visit her website here.

It is impossible to determine how added safeguards could have potentially slowed the disbursement of funds to those small businesses most in need. At the outset of the pandemic as business closures were mandated, small businesses faced the very real possibility of laying off workers and possibly never opening their doors again. NSBA and other small-business groups implored Congress to seek some lifeline for these businesses and their employees and the Paycheck Protection Act (PPP) came to be. The PPP was broadly supported by lawmakers on a bipartisan basis and was passed in less than two weeks—a remarkable speed for Congress. The tenets for providing these loans: make it simple for small businesses to apply and make the approval process quick. Unfortunately, bad actors chose to exploit those tenets, which led to a significant amount of fraud – bad actors who defied the intent of the law and the PPP program to make a profit. Government officials overseeing the pandemic funds’ distribution—and many others—have since conceded that additional safeguards could have prevented some fraud associated with these federal dollars. The difficulty with such criticisms is that hindsight is 20-20: it is impossible to determine how added safeguards could have potentially slowed the disbursement of funds to those small businesses who most needed it. This week, President Biden announced a new plan to address pandemic fraud and the effects it caused for the small-business community. Centered around implementing stronger fraud and identity theft prevention moving forward, the proposal is in three parts: Ensure resources & time for investigations and prosecution of those engaged in major or systemic pandemic fraud ($600 Million); and Invest in fraud prevention and identity theft ($600 Million); and Help the victims of identity theft ($400 Million). With $1.5 billion directed at reconciling the impacts of pandemic-related program fraud, law enforcement and agencies will be equipped to pursue recovery of the funds and justice for those committing the fraud. While NSBA condemns fraud and supports efforts to recover what amounts to stolen federal funds, it is imperative this effort not be unduly directed at small businesses or owners’ accidental errors in applying for pandemic programs. Relatedly, the Small Business Administration (SBA) – responsible for overseeing and implementing a significant portion of the country’s pandemic-related programs for small-business owners – would be better equipped to implement President Biden’s proposal with a full staff. For too long, key roles at the SBA have been vacant, and filling those roles must also be a priority for the administration. Read more about the White House’s proposal here. Read more about NSBA’s call for a fully staffed SBA here.

How grit and being involved helped build a life-raft for small business during COVID. If you’ve been to a recent NSBA event, you’re likely familiar with Bill Belknap as one of our resident contracting experts. Over the past seven years, Belknap has been a fixture in issue committees, webinars, and NSBA events. But what really separates Bill from the rest of the pack is his ethos on small business and service, which he’s developed through more than 40 years of experience in the military, corporate America, and as a Small Business Owner. After growing up on a farm in Indiana, Bill was accepted to the United States Military Academy at West Point where, he graduated in 1981. Serving 20 years in the Army with combat units and then in acquisition, his final assignment was Director, Army Science Board (ASB). ASB is a federal advisory committee that provides independent outside advice to senior military leadership on science and innovation. There, Bill developed a core competency on creating proactive policy solutions in a nonpartisan environment. Retiring after 20 years in the Army with numerous awards and accolades, Bill’s knack for innovation carried him to the world of big business, specifically Pfizer Inc. At Pfizer, he managed a site that generated over $1.5B in annual revenues. Bill learned the value of consensus building and stakeholder relations at Pfizer, two skills to which he attributes his success in small-business advocacy. Bill then decided to set out on his own, founding AEONRG, LLC, a veteran-owned small business that provides construction services to federal and state agencies. Since 2012, Bill and his team have been awarded over 180 government contracts. The company built a reputation as one of the most admired small businesses in Eastern Pennsylvania culminating with receiving Chester County Chamber’s 2023 Small Business of the Year Award. In that time, Bill has become a steadfast voice for small business, serving on several different NSBA Issue Committees and Policy Groups, and currently on the NSBA Board of Trustees where, he is the Vice Chair for Advocacy, overseeing all NSBA policy decisions. As COVID significantly affected his business starting in March of 2020, Bill became a strong proponent in NSBA’s fight for the creation of the Paycheck Protection Program (PPP). Having fought for the legislation that served as an operational “bridge” while many businesses were forced to shut down, Bill said, “I can’t over-emphasize the importance of being in-touch with policy and participating in the policy process for small businesses. NSBA has made a huge difference in my ability to be involved politically.” One value that Bill credits for success in his career is: GRIT. To Bill, grit is the art of “incorporating extreme perseverance and aggressively seeking resources to help overcome any obstacle or to achieve business goals.” Grit enabled him to find success in the Army, build a sustainable business, and weather the COVID storm. Bill believes that his grit isn’t proprietary—in fact, it’s his advice to all new and current business owners. When asked what words of wisdom he’d like to impart onto members of the small-business community, he said, “if other people can successfully start and grow a business, so can I. And, so can you.” Please click here to learn more about Bill and AEORNG, LLC.

The House Small Business Committee convened today for its annual hearing on the State of Main Street in America. On Tuesday, Feb. 28, 2023, the House Small Business Committee (HSBC) held a hearing on the state of Main Street America with those who know it best: small-business owners. The hearing was an opportunity for the Committee to shine light on the importance of small business and their unique contribution to the U.S. economy. The witnesses also discussed some of their key challenges as a small-business owner to help set the tone for how to address small-business policy and best support America’s small businesses. Check back here for more, watch the hearing on the HSBC’s YouTube Channel, and catch up on the latest from HSBC, including the Committee’s organizational meeting to get organized for small business moving into the 118th Session of Congress: (will embed video)

Public participation in the regulatory process is a priority on every level in every phase. On March 7 at 3:00 p.m. EST, the Office of Information and Regulatory Affairs (OIRA) within the Office of Management and Budget (OMB) will host a virtual public listening session on “Public Participation in the Regulatory Process.” Along with several agencies, including the U.S. Department of Labor and the Environmental Protection Agency, OIRA Administrator Richard Revesz will offer opening remarks and share current efforts to expand public engagement in the regulatory process. OIRA is looking for participants to share ideas and feedback on how federal agencies can better engage the public in the regulatory process. From drafting to implementation, OIRA is offering the following questions as a starting point for consideration: How to most effectively broaden public engagement in the Federal regulatory process, especially from members of underserved communities and those who do not typically participate in the regulatory process; How to eliminate or remove obstacles or barriers to greater public participation; How can existing materials be effective in revising and enhancing engagement; and How can intermediaries—such as trade associations or coalitions—be helpful in reaching stakeholders. Interested members of the public can submit written or recorded audio and video feedback to publicparticipation@omb.eop.gov. OIRA will be actively reviewing any submissions received through 5 PM ET March 10, 2023. Read the full OIRA announcement and objective list here, and RSVP to attend the virtual public listening session next Tuesday.

On Friday, Feb. 17, House Small Business Committee Chairman Roger Williams (R-Texas) and Ranking Member Nydia Velázquez (D-N.Y.) called on President Joe Biden to nominate a Chief Counsel for the U.S. Small Business Administration (SBA) Office of Advocacy. NSBA applauds this bipartisan effort to strengthen the Office of Advocacy, one of the organization’s recently-voted Top 10 Priorities for small business. According to Chair Williams, “The Small Business Administration’s Office of Advocacy is a critical watchdog fighting on behalf of our nation’s primary job creators. It is essential the vacant Chief Counsel for Advocacy role is filled to ensure small businesses are defended against burdensome regulations. I urge President Biden to nominate a qualified candidate to this post and hope he sees the necessity of this position.” Ranking Member Velazquez went on to say, “The SBA Office of Advocacy serves as the independent voice of small businesses within the government, promoting the concerns of entrepreneurs before all three branches of the federal system. I look forward to working with the Administration to fill the position of Chief Counsel, so the Office of Advocacy can represent small firms as effectively as possible.” Since 2017—more than five years—the position of Chief Counsel has not been filled, instead relegating the duties of this position to an already resource-strapped staff at Advocacy. The Office of Advocacy’s efforts at monitoring federal agency compliance with the Regulatory Flexibility Act (RFA) resulted in changes to 10 specific rules that led to $773 million in quantifiable small-business regulatory compliance cost savings in FY2019 alone. “While not every small business may be aware of the Office of Advocacy, every small business across the country has benefited deeply from Advocacy’s efforts,” stated NSBA President and CEO Todd McCracken. “The House Small Business Committee ought to serve as an example to all lawmakers of why bipartisanship is not only important, but doable.” NSBA looks forward to working the both the House and Senate Small Business Committees on this critical issue and thanks Chair Williams and Ranking Member Velazquez for their bipartisan leadership.