Senator Heidi Heitkamp Introduces Bill to Reauthorize the Interagency Committee on Women’s Business Enterprise

Senator Heidi Heitkamp (D-ND)

Senator Heidi Heitkamp (D-ND) has introduced S. 3165, a bill to reauthorize the Interagency Committee on Women’s Business Enterprise. This Committee was created by an Executive Order in 1979, and played a vital role in monitoring, coordinating, and promoting programs within federal agencies that support and strengthen women’s business ownership. By reauthorizing this Committee, which has been defunct, it will renew focus on the importance of women in business and encourage key departments and agencies to continue to provide women in business access to technical assistance, government contracts, financial support via grant and loan programs, and business training.

WIPP has submitted a letter of support for Senator Heitkamp’s legislation reauthorizing this Committee.

To learn more, take a look at the Executive Order establishing the Interagency Committee on Women’s Business Enterprise.

WIPP Works in Washington – July 2018

A Little Less Conversation, A Little More Action, Please

 Ann Sullivan,                 WIPP Chief Advocate

Some days I feel talked to death. The 24-hour news cycle, Twitter, Congressional hearings, roundtables, forums – you name it – everyone’s talking. But to quote an Elvis Presley song, “a little less conversation, a little more action, please.”

Congressional inaction didn’t start yesterday. The budget process has been broken for some time. In fact, Congress passed all 12 appropriations bills by the October 1st deadline (the beginning of the fiscal year) just four times in the last 40 years. However, from 2011 to 2016, not a single appropriations bill passed by itself. For the last 7 out of 10 years, Congress has failed to pass a budget. Finally, the last time the Congress passed all 12 of its appropriations bills was 1994.

The same goes for legislation. Historically, this session of Congress is on pace to pass the least amount of legislation in the last 50 years. Congress has passed 194 pieces of legislation signed into law during the first 18 months of the 115th session of Congress. Of those 194, 23 bills were symbolic or ceremonial. Roughly 1.7% of bills introduced this session of Congress have become law, compared to 4.5% of bills in the 105th session (under President Clinton), and 3.3% of bills in the 110th session (under President George W. Bush.)

No one knows better than Congressional Members that the system is broken – especially its fundamental budget responsibility. A little-known effort is commencing on Capitol Hill – the Joint Select Committee on Budget and Appropriations Process Reform. This Committee, comprised of House and Senate Members of both parties, is tasked with recommendations to reset the way Congress budgets and appropriates the taxpayers’ money. Recently, the Committee asked Members of Congress to share recommendations and Speaker Paul Ryan testified that the Congress should do a biennial budget. Others suggested getting rid of the Budget Committee, indexing spending to a percentage of the gross national product and eliminating the debt ceiling vote by making it automatic. What struck me most listening to the hearing was the bipartisan interest in fixing the budget process.

Two former Senate Leaders, Tom Daschle (D) and Trent Lott (R), currently lead the Commission on Political Reform as part of their work at the Bipartisan Policy Center. They have shared three recommendations to address the gridlock:

  1. Move to a two-year budget cycle, allowing more time for Members to understand programs under their jurisdiction in-depth;
  2. Get rid of the Senate filibuster but make the majority 60 votes, not 51 votes;
  3. Have a minimum number of amendments that can be offered to legislation, thus encouraging Members to get involved in legislating.

Being an eternal optimist, I believe the Congress can fix the process. One small ray of hope is the Senate Appropriations Committee, which is moving its bills at a much faster clip than we have seen in many years. I anticipate the Joint Select Committee on Budget Reform will produce serious recommendations.

Changing the rules will lead to action. Members of Congress will get back to legislating and time will be spent considering serious issues that need resolution. Getting back to an action-oriented Congress would be the first step toward more action and less talk.

President’s Corner – July 2018

The Power of WIPP’s Voice in Action

Candace Waterman,        WIPP President

As a business owner, part of what makes you successful is staying abreast of what is going on in your industry, with your customers or clients, and within your company to ensure you can take advantage of any opportunities ahead or prepare for any changes on the horizon.  At WIPP, we too are consistently keeping our ear to the ground and eyes open to changes in policy and the impact it may have on businesses like yours.

At the core of WIPP’s mission is to advocate for public policy that supports women business ownership by creating economic opportunities and a favorable regulatory environment.  This past month highlighted the power of WIPP in action.

  • When the SBA Inspector General issued an audit report on the Women-Owned Small Business (WOSB) Procurement Program last month that highlighted issues with implementation of sole source authority in that program. WIPP led the response, calling on Congress and the SBA to encourage federal agencies to use the WOSB program and simplify the requirements, which have proven to be confusing.
  • As Congress debated workforce development programs and how to address the skills gap in various hearings, WIPP spoke up with a letter to policymakers about ensuring women business owners have a role in these discussions and sharing recommendations on how to create a skilled, qualified workforce for the jobs of today and tomorrow.
  • After the Department of Labor issued their final rule on Association Health Plans (AHPs) last month, WIPP was among the first to spread the word to our network about the details and impact of AHPs on the health insurance market and cost of coverage for business owners.

All of the above are a testament to the ways in which WIPP takes action on your behalf.  We know that your time is best spent running and growing your business.  However, we know the impact that a new regulation, tax or change to a government program can have on your bottom line.

That is why WIPP has spent years building key relationships with lawmakers and their staff to afford WIPP the access and clout needed to be at the table to affect change on legislation, regulations and key policy initiatives.

It is this collaborative spirit that has made WIPP successful thus far and makes people want to continue to be involved. We invite you to add your voice and join WIPP as we continue the great work of this organization on behalf of women business owners across the country.

 

Trump Administration Freezes Billions of Dollars in Payments to Affordable Care Act Risk Adjustment Program

Over the weekend, the Centers for Medicare & Medicaid Services (CMS) issued a statement saying it was halting billions of dollars of payments to insurers under the Affordable Care Act’s risk adjustment program due to conflicting federal court decisions on the program. This move will likely disrupt the insurance market in the Exchanges and could lead to more premium increases next year.

The purpose of the risk adjustment program, a permanent program, is to reduce the incentive for health insurers to select and cover only healthy individuals in the Exchanges. It shifts money from plans with healthier members to those with larger numbers of sicker members to help mitigate high costs of coverage for less healthy individuals.

America’s Health Insurance Plans (AHIP), the association for insurance carriers, expressed concern and stated, “the decision will have serious consequences for millions of consumers who get their coverage through small businesses or buy coverage on their own. It will create more market uncertainty and increase premiums for many health plans—putting a heavier burden on small businesses and consumers, and reducing coverage options. And costs for taxpayers will rise as the federal government spends more on premium subsidies.”

The CMS has asked for additional guidance from the district judge overseeing the case relating to this program, prior to unfreezing the funds.

WIPP Tells Congress to Help Women Business Owners by Addressing the Skills Gap

Women business owners across the country have shared with WIPP the challenges they face with finding qualified, dependable workers. The concerns ranged from finding truck drivers and master electricians to highly skilled technical personnel and qualified project managers. Key to the success of any business is human capital – a dynamic workforce that meets the needs of an ever-changing business environment. Government and the business community need to work together to ready a workforce that can meet those challenges.

Recently, WIPP submitted to the House Small Business Subcommittee on Economic Growth, Tax, and Capital Access a letter for the record regarding the hearing, “Shrinking the Skills Gap: Solutions to the Small Business Workforce Shortage.”

In the letter, WIPP shared the following workforce development recommendations:

  • Promote Partnerships Amongst Educational Institutions and Businesses
  • Increase Investment in STEAM Education & Workforce Development for Women & Girls
  • Support Apprenticeship & Workforce Development Programs
  • Incentivize Deployment and Modernization of Our Technological Infrastructure

The Senate has also taken interest in addressing the skills gap. Senators Mike Enzi (R-WY) and Bob Casey (D-PA) released a bipartisan draft bill, entitled ‘‘Strengthening Career and Technical Education for the 21st Century Act,’’ that aims to more closely align vocational education programs with the need of local businesses. This legislation is the companion to H.R. 2353, which passed the House in June 2017.

President Trump Signs Bill to Improve SBA 7(a) Loan Program

President Trump signed into law a bill to strengthen the Small Business Administration’s (SBA) oversight of its loan programs and increase maximum lending authority. Championed in the Senate by Sens. Jim Risch (R-Idaho) and Jeanne Shaheen (D-N.H.) and in the House by Reps. Steve Chabot (R-Ohio) and Nydia Velazquez (D-N.Y.), the Small Business 7(a) Lending Oversight Reform Act, will strengthen and improve one of the core SBA loan programs responsible for providing access to capital to entrepreneurs.

In FY2017, the 7(a) program supported more than $25.44 billion combined across 62,430 loans. According to the SBA, 7(a) lending to women-owned businesses (both majority and minority-owned) grew in total dollar and volume in FY2017, exceeding $7.5 billion which is an increase of $298 million from FY2016.

The law will help the SBA increase efficiency of the (7)a Loan program and expand its reach by strengthening the SBA’s Office of Credit Risk Management which manages the loan program, enhancing the SBA’s lender oversight review process, providing the SBA Administrator with flexibility to increase the program’s maximum lending authority should it be reached, and requiring the SBA to perform a full annual risk analysis of the program.

Trump Administration Releases Plan to Reorganize the Federal Government

In a wide-ranging blueprint to overhaul the federal government, the White House released a report entitled, “Delivering Government Solutions in the 21st Century,” which outlined a wide-ranging plan to overhaul the federal government. The blueprint would impact nearly every agency.

This effort stems from an Executive Order signed by President Trump last year which directed the Office of Management and Budget (OMB) to work on a comprehensive plan to reorganize the executive branch and reduce duplication and redundancy while improving efficiency. Outlined in the report, beginning on page 93, is a recommendation to streamline small business programs across the federal government, specifically citing duplicative programs in the Small Business Administration and the U.S. Departments of Agriculture, Transportation, Treasury, and Veterans Affairs.

Programs dealing with small business lending, various certifications and contracting support would be consolidated and managed within the Small Business Administration. If there are contracting programs requiring technical expertise, those programs could continue to reside in their current agency. Per the report, the goal would be to “strengthen and streamline SBA’s operations across two of its primary program areas: 1) capital access; and 2) Government contracting support.”

It is important to note that most of these actions would require congressional approval.

Administration Eases Restrictions on Association Health Plans

Due to a move by the Trump Administration, the Department of Labor released the final version of its Association Health Plan rule, which allows industries and small businesses to band together via bona fide associations to buy insurance as part of a plan to encourage competition in health insurance markets and lower the cost of coverage. AHPs will be an important part of employer options for coverage beginning in 2019.

The Association Health Plan (AHP) rule broadens the definition of an employer under ERISA, the Employee Retirement Income Security Act, to allow more groups to form association health plans across state lines, similar to large employers. Key provisions in the final AHP rule include:

  • Expansion of definition of those that can form an Association Health Plan (AHP) – An association that represents a single trade, specific industry or profession can now establish an AHP that provides coverage to their members across the entire country, like a large employer plan. General business organizations and workers, or business owners in unrelated professions can band together to obtain coverage through an association health plan, but they must be in the same geographic region. While this allows for a breadth of types of AHPs – national, statewide or local – by restricting criteria of commonality to establish AHPs across state lines, many existing national associations will be unable to set up AHPs and provide access to affordable insurance options to their members.
  • Association Health Plans (AHPs) can bypass certain requirements of the Affordable Care Act (ACA) – AHPs do not have to meet ACA essential health benefits requirements, thus they do not have to cover all the benefits that are currently required in the health insurance plans presently sold in the state exchanges. While this will allow AHPs more flexibility in customizing plan options, and likely result in lower premium costs, it is important for business owners and workers to note that these plans will likely offer less comprehensive coverage.
  • Association health plans cannot restrict membership based on health status or charge sicker individuals higher premiums – An AHP will operate like a large employer plan and includes nondiscrimination rules ensuring the association cannot deny coverage to anyone that meets their membership requirements and wants to purchase coverage. AHPs can adjust premium costs of members based on age, which is similar to age rating rules in current ACA health exchanges.

WIPP has supported the implementation of AHPs as an effective mechanism for small businesses to pool together to obtain affordable health insurance. WIPP submitted comments to the Department of Labor on the proposed Association Health Plan rule, highlighting that WIPP believes that a successful healthcare market should encompass three core principles: an effective pooling mechanism, a wide array of health plan options, and a protection in place for those with pre-existing conditions.

In addition, WIPP recommended including an additional criterion for commonality of interest to allow employers to band together for the purpose of establishing an AHP through a membership organization or association that is comprised of members regardless of whether they are in the same trade, industry, line of business or profession, and regardless of whether they are located in the same area. Unfortunately, as highlighted above, the Department of Labor did not agree with this more expansive view, leaving national business organizations like WIPP unable to set up an AHP across state lines.

The Department of Labor shared a fact sheet on the new rule that noted important dates for associations or business owners interested in AHPs:

  • All associations (new or existing) may establish a fully-insured AHP on September 1, 2018.
  • Existing associations that sponsored an AHP on or before the date the Final Rule was published may establish a self-funded AHP on January 1, 2019.
  • All other associations (new or existing) may establish a self-funded AHP on April 1, 2019.

Although the Affordable Care Act envisioned state exchanges rather than AHPs, WIPP believes there is room for both. Though the Obamacare Exchanges initially gave small businesses more coverage options, many plans have dropped coverage, leaving the small business market with fewer coverage options and premium costs have risen year over year. The expansion of AHPs would provide more cost-effective coverage options for small businesses and the self-employed.

WIPP Statement Regarding the SBA Inspector General’s Audit Report on the WOSB Procurement Program

The SBA Inspector General (IG) issued an audit report late last week that found 50 of the 56 sole source awards the IG chose to review were done incorrectly, either by the contracting officer or the woman-owned business.  They found paperwork problems, such as self-certifying WOSBs that did not have all of their required documentation in place, contracting officers that awarded a sole source with a NAICS code that was not in the WOSB program or awarded a sole source under a NAICs code that the WOSB had not indicated they were eligible to perform the work.

To read the full report visit:  https://bit.ly/2tyir3G

To those of us who have been involved with the Women-Owned Small Business (WOSB) Procurement Program from the inception, this is not the first time the SBA Inspector General has aggressively advocated to do away with self-certification in the WOSB program. The Congress passed legislation in 2015, instructing the SBA to stand up a certification program, replacing self-certification. The SBA has stated that it is in the process of putting together this directive sometime later this year.

There is history behind this effort – when the program was put in place in 2011, it would have taken decades and further delays for an SBA certification program to be put into place.  Therefore, the SBA opted to allow self-certification and third-party certification in its stead.  The IG was directed to aggressively investigate fraudulent companies, but we are not aware of any such efforts or reports from the IG issued with that focus.  In fact, WIPP sent a letter to the IG asking for status of investigations into fraudulent companies and is not aware of a response.

Specifically, the IG makes the following recommendations:

  1. Conduct eligibility reviews for the firms identified in this report that lacked the required documentation in Certify.SBA.gov and require those firms to remove their designation in the System for Award Management.
  2. Initiate debarment proceedings, if warranted based on the results of eligibility reviews in Recommendation 1.
  3. Implement a Women-Owned Small Business Federal Contracting Program certification process as required by the National Defense Authorization Act for FY2015.
  4. Conduct quarterly reviews of firms with newly obtained WOSB or EDWOSB status, to ensure that they have the required documentation in Certify.SBA.gov, until SBA implements a Women-Owned Small Business Federal Contracting Program certification process.
  5. Conduct quarterly reviews of Federal Procurement Data System-Next Generation data for Program set-aside contracts to ensure Federal agencies’ contracting officers used the appropriate North American Industry Classification System codes and take the necessary action(s) with identified exceptions.
  6. In coordination with the Office of Federal Procurement Policy and the General Services Administration, strengthen controls in the Federal Procurement Data System-Next Generation to prevent Federal agencies’ contracting officers from using ineligible North American Industry Classification System codes.

SBA Response

At the end of the report, the SBA provides a rebuttal to the IG’s recommendations.  The SBA reiterates its intention to establish a certification program sometime this year with implementation next year.  The SBA questions the IG’s data conclusion saying that miscoding on FPDS does not necessarily mean that the sole source contract was improperly awarded and rejects the recommendation that SBA should check quarterly reviews on women new to the program and on contracts awarded through the program, ensuring contracting officers used the proper NAICs codes.  The SBA also disagrees with the IG interpretation that sole source contracts should only be awarded when SBA has a certification in place.

WIPP Perspective

WIPP led a 13- year effort to put in place the WOSB Procurement Program garnering the support of women-owned companies nationwide.  The SBA’s IG audit found much of what we already know antidotally – that the program is complex, that contracting officers and women alike are confused by the requirements, and more education is needed.  We do not agree with the IG that it was the intention of Congress to require an SBA certification before any sole source awards could be issued.  We know this to be true because we were there when it happened – leading the charge on this effort. Furthermore, we find the recommendation that WOSBs should be monitored quarterly for compliance as demeaning given the recommendation is specific to WOSBs only.

We agree that the WOSB program should be better utilized by the contracting community.  The government has only met its 5% women-owned goal once.  Since 2013, WIPP has educated tens of thousands of women on federal contracting opportunities via the WOSB procurement program through our ChallengeHER and Give Me 5 programs.  We call on Congress and the SBA to encourage federal agencies to use the WOSB program and simplify the requirements, which have proven to be confusing.  We will continue to promote federal contracts to women-owned companies both in our advocacy and our programming.

If you have any questions regarding this report, please contact WIPP’s Chief Advocate, Ann Sullivan at asullivan@madisonservicesgroup.com.

WIPP Works in Washington – June 2018

Adding the Voice of Women Business Owners in Addressing the Skills Gap

Ann Sullivan,                 WIPP Chief Advocate

At a recent meeting with women business owners—midsize and small–they pointed out shortages in the workforce that presented a present and future issue.  The concerns ranged from finding truck drivers and master electricians to highly skilled technical personnel.  Business owners aren’t the only ones talking about the shortages in the workforce, Congress and the Administration are concentrating on strategies to fill what is known as the “skills gap.”

The Obama Administration workforce development priorities focused on promoting community colleges and their two-year, associates degree tracks as a valid alternative to four-year degree programs, as well as encouraging partnerships between community colleges and employers.

The Trump Administration is focusing its efforts on apprenticeship.  Last year, President Trump signed an Executive Order (EO), “Expanding Apprenticeships in America,” which would provide industry associations, unions, and other stakeholders the flexibility to develop industry-recognized apprenticeships, loosening the Department of Labor regulations on apprenticeship programs.  The Administration’s Executive Order also doubled the amount of money for apprenticeship grants, from $90 million to almost $200 million a year. Additionally, the order establishes a new Task Force on Apprenticeship Expansion, chaired by the Secretary of Labor and co-chaired by the Secretaries of Education and Commerce. It would also include representatives from industry, labor, and educational institutions.

Congress is also taking a hard look at the skills gap. In a recent House Small Business Committee hearing, “Workforce Development: Closing the Skills Gap,” the committee discussed career and technical education (CTE), as well as apprenticeships as a strategies to addressing the lack of qualified, skilled workers needed by business and industry. Other Committees on both sides of Congress are also trying to figure out how to chip away at this issue.

WIPP members come to the workforce development issue from two angles:  one as an employer and one as a woman who likely experienced additional challenges in the workplace.  We are sensitive to making sure women are an important part of the workforce and treated fairly.  The article “10 facts about American women in the workforce,” highlights particular issues that women struggle with such as the wage gap, labor participation rates and paid maternity leave.

In fact, the President’s daughter, Ivanka Trump, has also brought forth the struggle with childcare as a priority issue for this Administration— with good reason. Most young children in the U.S. have parents who work outside the home or are business owners. According to the Brookings Institute, in 56% of married families with children under six, both parents work.  For single mothers the employment rate is 6%. Childcare is a necessity for these families, and unfortunately often unaffordable in the United States. Working families are spending on average between 29% to 52% of their take-home pay on childcare costs, yet the U.S. Department of Health and Human Services concludes that affordable childcare should not exceed 7% of family income.

Workforce development is a new issue to WIPP’s policy team and we welcome your thoughts and experiences.  Our goal is to ensure that the voice of women business owners is part of the discussion in both Congress and the Administration.  Businesses of all sizes share a common goal of building America’s workforce to adapt to the economy of tomorrow.  Women as business owners should be taking the lead in this effort by taking steps from strengthening women’s participation in STEAM, to being visible in the highest positions in business and industry.  There is so much work to do and our voice is critical to the solution.