Report Title:

Hawaii Small Business Development Center Network; Appropriation

 

Description:

Appropriates funds to support the statewide economic development program of the Hawaii small business development center network.

 


HOUSE OF REPRESENTATIVES

H.B. NO.

1618

TWENTY-FIFTH LEGISLATURE, 2009

 

STATE OF HAWAII

 

 

 

 

 

 

A BILL FOR AN ACT


 

 

MAKING AN APPROPRIATION FOR SMALL BUSINESS DEVELOPMENT.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 


     SECTION 1.  The purpose of this Act is to appropriate additional moneys to the Hawaii small business development center network to further its mission of providing assistance to small businesses through management-force training.  Management-force training promotes improvements in the conditions under which small businesses thrive and promotes sustainable economic development.  This process of management-force training, as practiced by the Hawaii small business development center network, includes short-term intervention in Hawaii's small business sector where most new jobs are created (eighty-three per cent of all net new jobs in Hawaii) and where increased tax revenues are generated for the State.  These increased tax revenues support the social, health, and educational programs of the government.  The Hawaii small business development center network has provided management-force training statewide since 1990.

The Hawaii small business development center network organization is the only accredited business assistance organization in Hawaii and the only accredited business assistance organization that conducts third-party annual economic impact studies of its outcomes.  Moreover, it is part of a matching-funds program partially funded by the United States Small Business Administration, the University of Hawaii at Hilo, and a consortium of other federal, state, and private-sector sponsors and partners.

This investment in human capital will lead to real, sustained growth and increased productivity.  Funding provided under this Act will generate an annual economic impact of approximately $29,000,000.  This projection is based on an independent economic impact study completed in 2004 by the Annual Economic Impact of the Hawaii Small Business Development Center.  According to the study, for every dollar invested by the State, $4.45 was returned to the State in the first year in new incremental taxes from job creation, retention of existing jobs, and sales increases.

     SECTION 2.  There is appropriated out of the general revenues of the State of Hawaii the sum of $699,000 or so much thereof as may be necessary for fiscal year 2009-2010 to create sustainable economic development through consulting and training services at the Hawaii small business development center network to be allocated as follows:

     (1)  $111,000 to fund a sustainable energy initiative among small businesses.  These funds will be used to create a statewide initiative to assist small businesses in managing spiraling energy costs. The initiative will enable the Hawaii small business development center network to coordinate university, public utility, state agency, federal government, and other small business resources with its own resources, including the research facilities of the Hawaii business research library, leveraging its unparalleled position in the small business community to effect change.  Controlling or reducing energy costs provides an immediate "bottom-line" benefit to small businesses and a substantial economic impact to the State;

     (2)  $111,000 to fund a statewide international trade initiative among small businesses, leveraging the resources of state and federal agencies working to assist small businesses develop international trade with the resources of the Hawaii small business development center network, including those of the Hawaii business research library;

     (3)  $300,000 to fund a statewide high technology initiative among small businesses in order to focus an increasingly substantial segment of the Hawaii small business development center network's resources on high technology and fast growth businesses.  Current research shows that the greatest job growth occurs with high-impact businesses, particularly those with twenty-five or fewer employees.  The consulting expertise that most entrepreneurs in high technology and fast growth businesses need includes not only traditional consultant knowledge of business and market planning, finance, accounting, and human resource issues, but also knowledge to address intellectual property issues, equity-based capitalization, small business innovation research funding, and global market development;

     (4)  $108,000 to fund additional capacity at the Honolulu center.  Currently, there is only one Hawaii small business development center network consultant available in Honolulu for the entire island of Oahu.  With the high number of small businesses and new entrepreneurs on Oahu, it is important to provide sufficient resources to reduce to more acceptable levels waiting lists for services and response time to requests for assistance.  This funding will enable the Hawaii small business development center network to hire one additional full-time, business consultant for the Honolulu center.  It is a fully impacted cost; and

     (5)  $69,000 to fund costs associated with sustaining the organization.  The Hawaii small business development center network has long deferred costs associated with increasing prices for rent, travel, salaries and benefits, and equipment.  A quality organization cannot long be maintained without addressing these issues.

     The sum appropriated shall be expended by the University of Hawaii at Hilo for the purposes of this Act.

     SECTION 3.  This Act shall take effect on July 1, 2009.

 

INTRODUCED BY:

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