Chairman Williams Launches Investigation into the SBA’s Community Navigator Pilot Program
Investigating the Community Navigator Pilot Program
Washington, March 23, 2023
WASHINGTON, D.C. – Today, Chairman Roger Williams (R-TX) issued the following statement after penning a letter to Small Business Administration (SBA) Administrator Guzman requesting information on the SBA’s Community Navigator Pilot Program.
“The Small Business Administration’s Community Navigator Pilot Program is yet another example of an unnecessary, duplicative federal program,” said Chairman Williams. “Over the last 2 years, this program has spent over $100 million dollars in order to start fewer than 500 businesses. This abysmal performance record of a little-known program is the type of waste that often goes unnoticed in the bloated federal bureaucracy. We cannot continue funding another duplicative, ineffective SBA program on the taxpayer’s dime.”
Read the full letter here.
Read key excerpts from the letter:
“The Program was created under the American Rescue Plan Act (ARPA) directed the Small Business Administration (SBA) to ‘make grants to, or enter into contracts or cooperative agreements with, private nonprofit organizations, resource partners, States, Tribes, and units of local government to ensure the delivery of free community navigator services to current or prospective owners of eligible businesses in order to improve access to assistance programs and resources made available because of the COVID–19 pandemic.’ Yet instead of bringing the program to a close at the end of the pandemic, President Biden’s FY2024 allocates nearly $42 million more for the Program.
“One of the stated goals of the Program is to service counties without access to any type of SBA Resource Partner/service center. However, SBA Resource Partners/service centers are also eligible for program funding. Funding centers that are already eligible for funding under other programs does not help meet the goal of serving ‘those who have historically not benefitted from the Agency’s services.’ In addition, it seems that the Program has failed to provide ample assistance to small businesses at a reasonable cost to the taxpayer. Between FY21 and FY22 Navigators spent a combined $131,631,000. According to the SBA’s budget justification, the program helped to start 422 new businesses in those two years, and ‘serviced’ 16,312 ‘new clients meaning the cost per new business started to the taxpayer was $311,921.80. The cost per client serviced was $8,069.58 during this two-year period.
“Further, the Committee seeks clarity regarding the selection process for grantees as well as methods of oversight used to determine whether Spokes, the local organizations funded to work in targeted communities, are properly using Program resources. Specific metrics for what constitutes an appropriate Spoke are unclear, with vague qualifiers for Spokes such as ‘trusted, culturally knowledgeable’ and ‘credible.’”