Small Business and Politics: How Did Graves Do?

By JOYCE M. ROSENBERG, AP Business Writer

Small companies were still reeling from the recession in 2011 when Sam Graves became chairman of the House Small Business Committee. As the Missouri Republican prepares to leave his post, small business has a higher profile, partly because of the committee's legislation on issues like federal contracts and its more than 200 hearings.

"I think he's had a pretty good record," says Todd McCracken, president of the advocacy group National Small Business Association. "His is one of the most active committees in Congress."

Although the committee's primary function is overseeing the Small Business Administration, under Graves it became a forum on small business issues, McCracken says. Among them: health care, taxes, availability of bank loans and federal regulations. The committee also campaigned with other lawmakers for small business legislation.

Graves cites as one of his achievements the repeal of a law requiring businesses to report to the IRS sales of goods or services over $600, a regulation that would have sharply increased companies' paperwork. The committee was one of the first to hold a hearing about the law, says Kevin Kuhlman, director of legislative affairs for the National Federation of Independent Business.

Graves also pressured government agencies for more time for companies to comment on regulations like an Environmental Protection Agency rule on waterways, Kuhlman says.

The committee is one of several government advocates for small business, along with the Senate Committee on Small Business & Entrepreneurship and the SBA. Graves has been on the committee since 2001; his term as chairman ends Jan. 3 under limits set by the Republican majority. He'll move to the House Transportation and Armed Services committees and be succeeded by Steve Chabot, R-Ohio.

Graves spoke recently with The Associated Press. Here are excerpts, edited for brevity and clarity:

Q. What have been your biggest accomplishments on the committee?

A. The biggest by far is making the committee relevant. We came in at the height of the recession, and the Small Business Committee was in many cases taking a back seat and I think there were some out there who didn't think it was relevant. But when you have small businesses creating seven out of every 10 jobs, it's extraordinarily relevant, and we brought that relevance to the forefront with our very active hearing schedule and some very high profile witnesses including Treasury Secretary Tim Geithner.

We leveraged the Regulatory Flexibility Act in ways that hadn't been done before, forcing the administration to comply and do its analysis (of the burden regulations place on small businesses). We've been very active in contracting reform, which is one of the cornerstones of what I've been trying to do, making sure small businesses are included in government contracts.

Q. What is the biggest thing you've learned about small business from the committee?

A. Small businesses face different challenges in different parts of the country, and one of the biggest is access to capital. For some small business segments, it's very easy to get, but what I've learned is for some sectors, like service-based businesses or startups, it's very hard for them to get the capital they need. In many cases they don't have assets to use as collateral.

Q. What advice do you have for small business owners?

A. Sometimes when you're going after an SBA loan, it is so overwhelming, the amount of paperwork and the burdens. Don't give up. There is light at the end of the tunnel. We're trying to make it easier, trying to reduce that paperwork and the hoops you've got to jump through. Hang in, because it'll happen.

Q. What should Congress and the next Small Business Committee focus on?

A. Continue with contracting reform. We have to do everything we can to allow small businesses to be able to participate in these contracts. We have to continue to keep the government from (combining small contracts into larger ones) to the point where no one can compete except for the very largest businesses. My reforms led to the government finally reaching its goal for giving 23 percent of contracting dollars to small businesses. One of the things we tried to do was increase that to 25 percent. That's something that needs to continue.