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34–830 PDF 2007

SUBCOMMITTEE HEARING: IS THE VETERANS

CORPORATION PREPARED TO PROVIDE

ENTREPRENEURIAL DEVELOPMENT ASSISTANCE

TO SERVICE MEN AND WOMEN

RETURNING FROM IRAQ AND AFGHANISTAN?

SUBCOMMITTEE ON INVESTIGATIONS 

AND OVERSIGHT 

COMMITTEE ON SMALL BUSINESS 

UNITED STATES HOUSE OF 

REPRESENTATIVES

ONE HUNDRED TENTH CONGRESS

FIRST SESSION

MAY 2, 2007

Serial Number 110-18

Printed for the use of the Committee on Small Business

(

Available via the World Wide Web: http://www.access.gpo.gov/congress/house 

HOUSE COMMITTEE ON SMALL BUSINESS

NYDIA M. VELA ́ ZQUEZ, New York, Chairwoman 

WILLIAM JEFFERSON, Louisiana 

HEATH SHULER, North Carolina 

CHARLIE GONZA ́ LEZ, Texas 

RICK LARSEN, Washington 

RAUL GRIJALVA, Arizona 

MICHAEL MICHAUD, Maine 

MELISSA BEAN, Illinois 

HENRY CUELLAR, Texas 

DAN LIPINSKI, Illinois 

GWEN MOORE, Wisconsin 

JASON ALTMIRE, Pennsylvania 

BRUCE BRALEY, Iowa 

YVETTE CLARKE, New York 

BRAD ELLSWORTH, Indiana 

HANK JOHNSON, Georgia 

JOE SESTAK, Pennsylvania 

STEVE CHABOT, Ohio, Ranking Member 

ROSCOE BARTLETT, Maryland 

SAM GRAVES, Missouri 

TODD AKIN, Missouri 

BILL SHUSTER, Pennsylvania 

MARILYN MUSGRAVE, Colorado 

STEVE KING, Iowa 

JEFF FORTENBERRY, Nebraska 

LYNN WESTMORELAND, Georgia 

LOUIE GOHMERT, Texas 

DEAN HELLER, Nevada 

DAVID DAVIS, Tennessee 

MARY FALLIN, Oklahoma 

VERN BUCHANAN, Florida 

JIM JORDAN, Ohio 

MICHAEL DAY, Majority Staff Director 

ADAM MINEHARDT, Deputy Staff Director 

TIM SLATTERY, Chief Counsel 

KEVIN FITZPATRICK, Minority Staff Director

SUBCOMMITTEE ON INVESTIGATIONS & OVERSIGHT

JASON ALTMIRE, PENNSYLVANIA, Chairman

CHARLIE GONZA ́ LEZ, Texas 

RAUL GRIJALVA, Arizona 

LOUIE GOHMERT, Texas, Ranking 

LYNN WESTMORELAND, Georgia

(II) 

C O N T E N T S 

OPENING STATEMENTS 

Page

Altmire, Hon. Jason ................................................................................................. 1

Gohmert, Hon. Louie ............................................................................................... 2

WITNESSES 

Blackwell, Walter, National Veterans Business Development Corporation ....... 3

Elmore, William D., Office of Veterans Business Development, U.S. Small 

Business Administration ..................................................................................... 5

Sharpe Jr., Joseph, National Economic Commission, The American Legion ..... 8

Celli, Louis J., Committee on Veterans Business Affairs ..................................... 9

Cain, Allan D., Carthage Self-Storage ................................................................... 13

APPENDIX 

Prepared Statements: 

Altmire, Hon. Jason ................................................................................................. 26

Gohmert, Hon. Louie ............................................................................................... 28

Blackwell, Walter, National Veterans Business Development Corporation ....... 30

Elmore, William D., Office of Veterans Business Development, U.S. Small 

Business Administration ..................................................................................... 43

Sharpe Jr., Joseph, National Economic Commission, The American Legion ..... 49

Celli, Louis J., Committee on Veterans Business Affairs ..................................... 53

Cain, Allan D., Carthage Self-Storage ................................................................... 57

Statements for the Record: 

Clair, James A., Ultimate Defensive Driving School ............................................ 60

Wynn, Joe, Veterans Enterprise Training and Services Group, Inc. .................. 63

(III) 

(1)

SUBCOMMITTEE HEARING: IS THE 

VETERANS CORPORATION PREPARED 

TO PROVIDE ENTREPRENEURIAL 

ASSISTANCE TO SERVICE MEN AND 

WOMEN RETURNING FROM IRAQ AND 

AFGHANISTAN? 

WEDNESDAY, MAY 2, 2007

U.S. HOUSE OF REPRESENTATIVES, COMMITTEE ON SMALL BUSINESS, SUBCOMMITTEE ON INVESTIGATIONS & OVERSIGHT

Washington, DC. 

The Subcommittee met, pursuant to call, at 10:00 a.m., in Room 

2360 Rayburn House Office Building, Hon. Jason Altmire 

[Chairman of the Subcommittee] presiding. 

Present: Representatives Altmire, Gohmert. 

OPENING STATEMENT OF CHAIRMAN ALTMIRE 

ChairmanALTMIRE. I’m pleased to call to order this morning’s 

hearing on the Preparedness of the Veterans Corporation to Provide Entrepreneurial Development Assistance to Servicemen and 

Women Returning from Iraq and Afghanistan. 

The Committee is concerned about the country’s ability to fully 

meet the needs of our nation’s Veterans. I believe that we owe no 

greater debt to the men and women in uniform and to date over 

600,000 Veterans have come home from Iraq and Afghanistan. 

Given the significant number of returning service members, it’s 

critical that they’re afforded every opportunity for economic success 

at home. And to ensure that the emerging needs of Veterans from 

the Iraq and Afghanistan Wars are being met, this hearing today 

will focus on the effectiveness of the National Veterans Business 

Development Corporation. 

Congress created the Veterans Corporation in 1999 to help Veterans transition their skills and leadership experience into economic success. Its mission is to provide entrepreneurial development resources for these heroic Americans to start small businesses. The organization operates customized small business assistance programs including access to capital and entrepreneurial development resources. 

Today, we will examine the Veterans Corporation’s level of readiness to meet the emerging needs of Veterans. This Committee 

wants to work with all involved to ensure that the Corporation can 

fulfill its mission. 

2

Within the last few years, the organization significantly changed 

its operations, shifting much of its service delivery responsibilities 

to public and private entities such as the SBA’s Veterans Business 

Outreach Centers. There has been great unease about the organization as it implements its remaining direct services. The Veterans 

Corporation services should be reflective of the needs of Veterans 

returning from Iraq and Afghanistan. 

In addition to generating rapid growth in the sheer number of 

Veterans returning, the wars being waged in Iraq and Afghanistan 

have affected the composition of our nation’s Veterans. For example, 30 percent of these troops represent the National Guard and 

Reservists; 1 in 5 are now service-disabled; and 15 percent are 

women. This unique composition of Veterans creates unique needs 

as many return and seek economic stability through entrepreneurial opportunities. 

The Veterans Corporation must operate new programs for service-disabled and female Veterans and its reservist programs should 

be expanded. It’s clear that as Veterans continue to turn to the 

Corporation, it must respond appropriately to meet these emerging 

needs. We also need to reduce the Corporation’s dependence on its 

partners for the delivery of Veteran services. Many of the Veterans 

Corporation’s partners have not created programs that address the 

needs of the current composition of separating service members. 

The Veteran population requires customized assistance to be successful in starting or expanding these endeavors. By delegated the 

responsibilities, the organization has become less accountable in its 

service delivery performance. Outreach efforts have also lagged. 

Currently, one third of Veterans have no knowledge of programs 

targeted to them to promote small business entrepreneurship. 

The Veterans Corporation should utilize its resources more effectively and efficiently through improvements in its operational strategy. 

With more and more Veterans returning home from abroad and 

re-entering civilian life, I will continue to work to ensure the resources they deserve as will the other Members of the Committee. 

I look forward to the witnesses’ comments on the emerging Veterans’ needs and the Veterans Corporation performance in fulfilling 

them. And I wanted to make clear before our witnesses today and 

thank you all for being here, that we’re here to help you achieve 

your mission. This is not an effort to play gotcha in any way. We’re 

here to see if we can identify ways that this Committee can help 

you and work with you in achieving the goal that we all know is 

important, of helping these Veterans when they come back, returning into entrepreneurship activities. 

So thank you all and I now recognize Ranking Member Gohmert 

for his opening statement. 

OPENING STATEMENT OF MR. GOHMERT 

Mr.GOHMERT. Thank you, Mr. Chairman, I do appreciate your 

having this hearing and I appreciate the witnesses being here. It’s 

obviously important or you wouldn’t have gone to this trouble and 

we appreciate your efforts. 

3

I want to particularly welcome a constituent of mine, my dear 

friend, Allan Cain, for making the trip to testify before the Committee and I’ll be introducing him a bit later. 

But as a U.S. Congressman and former Captain in the U.S. 

Army, one of my top priorities is to ensure that our nation’s military service Veterans receive the help and care they need and deserve. As I repeatedly said, any nation that fails to honor those 

who have honored it with their service will not remain a nation 

much longer. 

As I visit with small business owners in my District in East 

Texas, I’m continuously shocked at the increasing costs and number of procedural hoops that small business owners must deal with 

just to open their doors in the morning. Without any assistance in 

navigating the difficult process of starting a small business, Veterans may end up paying more, the process taking longer, or worse, 

the Veteran may not open a small business at all. 

According to Census estimates, about 4.2 to 5.5 million small 

businesses are owned by one or more U.S. Veterans. With the increased number of troops necessary for U.S. military operations 

abroad, there will no doubt be an increase of Veterans returning 

to the country, entering the job market and beginning a small business. It is essential we do our part here to ensure the transition 

from the service to small business is as simple and trouble free as 

it can possibly be. 

Again, thank you, Mr. Chairman, for holding this hearing and I 

look forward to hearing from our panel of distinguished witnesses. 

Thank you. 

ChairmanALTMIRE. I ask unanimous consent that the record will 

be open for five days for Members to submit their statements. 

Hearing no objection, so ordered. 

So I’d like to first, before I introduce the witnesses, extend a 

warm welcome to a constituent of mine, Mr. Jim Clair, who took 

the time to appear at the hearing today. 

Jim, could you stand up? Mr. Clair is a former U.S. Marine and 

a current member of the Army National Guard which he just recently rejoined at the age of 40. He is also an owner of a driving 

school business and I want to thank him for being here because 

there’s thousands and thousands of Veterans who are benefiting 

from small business entrepreneurship, but I can think of no better 

example than Jim Clair. And I appreciate you being here. 

Our first witness today is Mr. Blackwell. He is President and 

CEO of the National Veterans Business Development Corporation. 

The Veterans Corporation was established in 1999 to provide entrepreneurial development services for our nation’s Veterans and I 

want to thank you, Mr. Blackwell, for being here and we look forward to hearing your remarks. 

STATEMENT OF MR. WALTER BLACKWELL, PRESIDENT AND 

CEO, NATIONAL VETERANS BUSINESS DEVELOPMENT CORPORATION 

Mr.BLACKWELL. Chairman Altmire, Ranking Member Gohmert 

and distinguished Members of the Subcommittee, thank you for 

giving me this opportunity to testify before you today. 

4

I request that my written testimony, along with a copy of TVC’s 

annual report be entered into the official record. 

ChairmanALTMIRE. Without objection. 

Mr.BLACKWELL. My name is Walter G. Blackwell. I’m President 

and CEO of the Veterans Corporation and a Navy Veteran. I’m 

joined today by two of our three ex officio members of the board, 

Linda Oliver, representing Defense Secretary Gates; fellow panelist, Bill Elmore, representing SBA’s Administrator Preston; Scott 

Deniston, representing Secretary of Veteran Affairs Nicholson 

wanted to be here today, but his schedule did not permit. 

Together, these agencies and TVC are creating and delivering 

tools and opportunities for Veteran entrepreneur success. Joe 

Sharpe, also on this panel here today, from the American Legion 

and Joe serves as chairman of TVC’s Veteran Service Organization 

Council. Bill Ferguson, sitting behind me of the Iraq-Afghanistan 

Veterans of America, our newest member of that VSO, is also in 

attendance today. 

Today, you’ve asked us is the Veterans Corporation, TVC, prepared to provide entrepreneurial development assistance to servicemen and women returning from Iraq and Afghanistan. Our answer 

is a resounding yes. The Veterans Corporation is uniquely positioned to assist our nation’s Veterans. The needs of Veterans returning from the current conflict are really no different from the 

needs from past conflicts, however, this set of servicemen and 

women, returning from Iraq and Afghanistan, is the first set of 

Veterans comprised of those who embrace and implement on-line 

electronic tools for communications and education. 

TVC has made extensive efforts over the last several years to accommodate this fact in creating and assembling an on-line tool box 

for business in transition. TVC has leveraged the knowledge and 

experience gained in delivering face-to-face programs, education, 

mentoring and counseling since 2001 by expanding the essential 

elements of business education, mentoring and counseling into online deliverables. During the summer of 2006, we further enhanced 

TVC’s website to provide a straightforward format to access the extensive resources available to today’s Veteran entrepreneurs. Details of these programs can be found in my written testimony. 

Iraq and Afghanistan Veterans, like Veteran entrepreneurs from 

all generations, have three critical business needs: access to capital, access to bonding, and access to education through 

coursework, mentoring, and counseling. TVC’s status as a 501(c)(3) 

organization has allowed us to create valuable mentored public/private program partnerships not available through any current government agency. Two of TVC’s private sector partners are with me 

today: Jim Mingey, President and CEO of the National Economic 

Opportunity Fund. Jim operates TVC’s access to the capital program and works with Veteran entrepreneurs who need business 

loans, financial assistance or strategic financial planning. Also joining me is Lynn Schubert, President and CEO of the Surety and Fidelity Association of America. Lynn and her organization facilitate 

TVC’s fully mentored access to bonding program providing Veteran 

entrepreneurs involved in contracting fields such as construction 

with a complete set of bonding products. 

5

TVC continues to fund three Veteran business resources: in St. 

Louis, Missouri; Flint, Michigan; and Boston, Massachusetts. The 

Committee will hear from Lou Celli, the head of our Boston hub 

this morning. Lou is currently working with a soldier recovering 

from a traumatic brain injury at Walter Reed, who is interested in 

opening a Dunkin’ Donuts franchise. 

Let me give you just one example of our current work with a 

newly returned Veteran. David Barker is an Army Reservist currently in San Diego, California where he is recovering from injuries 

that he sustained while fighting in Iraq June 11, 2005. His goal, 

when he leaves the military next month, is to return to his home 

town and run his family’s collision, paint, and repair shop. Jim 

Mingey flew to El Paso, Illinois to meet and talk to David and his 

family and discuss their business plans and financial needs. David 

estimates that he’ll need approximately $265,000 for a building and 

two years of salaries and expenses. Jim’s currently working with 

David to get that financing. 

In my remaining time, I’d like to highlight two significant new 

programs. First is our Boots to Business Transition Skills for Success. Boots to Business is a comprehensive on-line resource providing educational workplace training, transitioning skills, and 

Boots to Business combines the elements from successful programs 

used independently in thousands of vocational schools, job training 

centers, community college, detention and correctional facilities, 

Job Corps Centers, and adult education programs nationally. TVC 

has integrated the best of these elements into a cohesive, interactive, on-line program. 

TVC has also launched a comprehensive new program Deployproof Your Business, designed to assist members of the National 

Guard and Reserve in protecting their businesses before they’re deployed. Deploy-proof Your Business includes sections on suspending 

or sustaining your business, as well as a comprehensive section 

comparing the two options side by side. With helpful tools, links, 

checklists and other on-line resources, this site is developed as an 

on-going program to answer the questions and frustrations many 

National Guardsmen and Reservists have when they leave their 

businesses for deployment. 

With us today is also Jim Clair, introduced by the Chairman previously. And we’re delighted that Jim works with us and we hope 

to assist him as he prepares for his own deployment in the future. 

Mr. Chairman, I’d be happy to answer any questions you or other 

Committee Members may have. Thank you. 

[The prepared statement of Mr. Blackwell may be found in the 

Appendix, on page 30.]

ChairmanALTMIRE. Thank you, Mr. Blackwell. 

The second witness is Mr. William Elmore. He’s the Associate 

Administrator for the Veterans Business Development at Small 

Business Administration. He heads the Office of Veterans Business 

Development, administers the Veterans Business Outreach Center, 

and is an ombudsman for Veterans Affairs at the agency. 

Welcome, Mr. Elmore. 

6

STATEMENT OF MR. WILLIAM ELMORE, ASSOCIATED ADMINISTRATOR FOR THE VETERANS BUSINESS DEVELOPMENT, 

UNITED STATES SMALL BUSINESS ADMINISTRATION 

Mr.ELMORE. Thank you, sir. Chairman Altmire and Ranking 

Member Gohmert, distinguished Members of the Committee, thank 

you for your invitation and the opportunity to share with this Committee the initiatives of the U.S. Small Business Administration 

with regard to our efforts to support and assist the success of Veterans, National Guard and Reservists, as well as to share with you 

some of the assistance that we are presently providing to members 

of the U.S. military who have been or who may be activated for the 

global War on Terror. 

I am Bill Elmore, the Associate Administrator for Veterans Business Development. Before I begin my testimony, I would like to express my deepest sympathy for the loss of your colleague and a 

Member of this Committee, Congresswoman Juanita MillenderMcDonald. 

On behalf of Administrator Preston and the SBA, I want to 

thank you for the opportunity to be able to share some of SBA’s 

accomplishments over these past six years. On January 24, 2007, 

Administrator Preston and Office of Federal Procurement Policy 

Administrator Dennett, jointly issued a memorandum for heads of 

departments and agencies. This memorandum expressed SBA’s 

broad commitment to enhancing all of our entrepreneurial programs and services for our nation’s brave service members, more 

specifically those members returning from duty in the global War 

on Terror, who are injured or disabled. 

SBA’s Office of Veterans Business Development plays an important role in assisting and supporting Veteran entrepreneurs, however, it is important to note that SBA support efforts go beyond the 

activities of my specific office. 

To keep SBA’s commitment to our service members, we have 

tasked our loan programs, our business counseling and training 

programs, and our procurement assistance programs with expanding and improving services for Veterans and specifically service-disabled Veterans. We have significantly increased loans to Veterans. 

The number of new loans to Veterans has grown from 4,800 in FY 

2000 to approximately 8,000 in FY 2006. 

Prime contracts have a three percent government-wide federal 

procurement goal established by Public Law 106-50 for small businesses owned and controlled by service-disabled Veterans. In addition, 106-50 establishes a best efforts clause for Veterans in federal 

procurement at the subcontracting level. Though the Federal Government has yet to achieve the required three percent goal, it is 

making progress towards accomplishing it. In 2004, President Bush 

issued Executive Order 13360 to strengthen opportunities in federal contracting for service-disabled Veteran-owned small businesses. Preliminary data shows that SBA and the Department of 

Veterans Affairs both exceeded the three percent goal for SDV 

small businesses in Fiscal Year 2006.This accomplishment demonstrates leadership by example and represents a significant improvement for both agencies over our achievements in FY 2005. 

The number of small businesses owned by SDVs who are expressing interest in federal procurement by registering in GovernVerDate 0ct 09 2002 10:31 Jan 08, 2008 Jkt 033615 PO 00000 Frm 00010 Fmt 6633 Sfmt 6633 G:\CLERK SB\HEARINGS\TRANSCRIPTS\34830.TXT LEANN
7

ment Central Contractor registration has grown significantly and 

continues to grow. 

I wanted to share with you that SBA is strengthening our full 

range of programs, including our Small Business Development Center program, SCORE; our Women’s Business Center program; our 

Veterans Business Outreach Center program that you mentioned; 

our Special District Office Outreach Initiative; our Surety Bond 

Guarantee program. We’re going to be implementing a new matchmaking initiative very soon, specifically for Veterans and servicedisabled Veterans and we’re strengthening the role that our Procurement Center representatives play in the whole federal procurement arena, specifically for Veterans and service-disabled Veterans. 

I would now like to speak to SBA’s efforts to assist small business owners who are members of reserve components that have 

been or may be affected by activation. In FY 2001, we began offering and continue to promote a disaster loan program as one tool 

that can be of great assistance to an activated reservist business 

owner. I am proud to report to you that SBA initiated and continues to lead the federal effort to conduct outreach, develop assistance for and design program efforts to enhance pre- and post-mobilization business planning, lending and other assistance for small 

business owners who may be at risk of economic damage when activated. 

In the wake of September 11, 2001, attacks on America, we established an SBA working committee to coordinate agency outreach 

and service delivery to Reservists. In 2002, we took several steps 

to assist Reservists by creating the Reserve and Guard Fact Sheet 

which has been distributed to hundreds of thousands of mobilizing 

and de-mobilizing Reservists, as well as establishing a special 

webpage specifically for Reserve and Guard Members. 

We have also produced and we have distributed in excess of 

40,000 of what we refer to as our Reserve and Guard kits which 

is at least at last state of production, comprehensive, compilation 

of all the services and programs of SBA and every other agency organization that we could find across America. And those were included in there. 

It is important to note that we include Reservists with Veteran 

status in our Community Express Loan Program presently and last 

year Congress enacted our proposal for the authority to include Reservists in our definition of Veteran for purposes of our comprehensive outreach program. We recognize the importance of supporting 

and maintaining the civil skills of the self-employed Reservists involved in the global War on Terror as our nation’s efforts against 

terror continue. We understand the importance of SBA’s programs 

in providing assistance and support to our brave men and women 

and we are proud of the efforts of service-disabled Veterans, Veterans and Reservists and we intend to continue our aggressive efforts on their behalf. 

And I want to thank you for this opportunity to testify before you 

today. I am proud of the progress we have made and we look forward to continuing to assist our brave men and women who unselfishly serve our nation proudly. 

8

This concludes my testimony, and I welcome any questions you 

may have. Thank you. 

[The prepared statement of Mr. Elmore may be found in the Appendix, on page 43.]

ChairmanALTMIRE. Thank you, Mr. Elmore. 

Our third witness is Mr. Joseph Sharpe, Jr. He’s the third witness. He is the Deputy Director of the National Economic Commission for the American Legion. The American Legion, which has 

nearly three million members was founded as a community-service 

organization in 1919 to assist war-time Veterans. 

We’re honored to have you here today, Mr. Sharpe. We look forward to your testimony. 

STATEMENT OF MR. JOSEPH SHARPE, JR., DEPUTY DIRECTOR 

OF THE NATIONAL ECONOMIC COMMISSION, AMERICAN LEGION 

Mr.SHARPE. Mr. Chairman and Members of the Committee, I appreciate this opportunity to share the views of the American Legion 

on whether the Veterans Corporation is prepared to provide entrepreneur development assistance to servicemen and women returning from Iraq and Afghanistan. 

American Legion views small business as the backbone of the 

American economy. It is the mobilizing force behind America’s past 

economic growth and will continue to be the major factor as we 

move well into the 21st century. 

Presently, more than 9 out of every 10 business firms produce 

approximately half of the gross national product. Currently, over 

one half of the nation’s workforce is employed by small business 

with the average company employing approximately 11 persons. 

Small businesses created by some estimates, 60 percent to 80 

percent of the net new jobs, therefore providing a central element 

for strong economic growth. Government should assist in the creation of new jobs by encouraging qualified entrepreneurs to start 

and expand their small businesses. No group is better qualified or 

deserving of this type of assistance than our Veterans. 

Congress enacted the Veterans Entrepreneurship and Small 

Business Development Act of 1999, Public Law 106-50 to assist 

Veterans and service-connected disabled Veterans own businesses 

by creating the National Veterans Business Development Corporation. In the beginning of its inception, the Veterans Corporation 

created a Veterans Entrepreneur Training program to provide and 

foster successful Veteran entrepreneurship within the Veteran 

Business Committee. But this program no longer exists. 

Currently, the organization’s main efforts have been to provide 

distance learning education, would-be Veteran entrepreneur training and how to start and expand their own businesses to include 

training and finance, accounting, and contracting. The Veterans 

Corporation has gone through a number of mission and staffing 

changes since its inception. Its latest vision to assist Guard and Reserve in transitioning members of the Armed Forces and their families with establishment of their own businesses. However, the Veterans Corporation and the American Legion are currently involved 

in the discussion on the best method or methods of assisting these 

9

deserving Veterans. TVC has in the past stressed creating on-line 

education programs to assist Veterans with obtaining basic literacy 

skills hosted by other third-party organizations. Their current 

plans are to create an on-line platform to match Veterans with entrepreneur education and career opportunities and to provide 

grants to small business development centers around the country 

and other business development organizations to specifically assist 

Veterans. 

In conclusion, the American Legion realizes the National Business Development Corporation created through Public Law 106-50 

was uniquely positioned to provide American Veterans with superior entrepreneurship training and business resources that shows 

them how to start or grow a business and in turn contribute to the 

economic well-being of the nation. The American Legion believes 

that the Veteran Corporation has not fulfilled all the mandates of 

Public Law 106, and is actively moving away from those mandates 

into a different direction by focusing their efforts and funding on 

on-line entrepreneur programs they believe would maximize their 

available resources and reach more returning Veterans. Therefore, 

the American Legion strongly recommends that the Small Business 

Administration Office of Veterans’ Business Development, be the 

lead agency to ensure Veterans returning from Iraq and Afghanistan are provided with entrepreneur development assistance. Comprehensive training should be handled by SBA, and augmented by 

TVC’s on-line training. The American Legion strongly supports the 

mandates of Public Law 106-50 that were designed to assist all 

Veterans wishing to start or expand their businesses and to protect 

their businesses. 

If there’s a true desire to assist Veterans returning from Iraq 

and Afghanistan in developing small businesses, we must work together to enforce the mandates of Public Law 106-50. 

Mr. Chairman, this concludes my testimony. I appreciate the opportunity to present the views of the American Legion. 

[The prepared statement of Mr. Sharpe may be found in the Appendix, on page 49.]

ChairmanALTMIRE. Thank you, Mr. Sharpe. 

Our fourth witness today is Mr. Louis Celli. He is the founder 

and CEO of the Northeast Veterans Business Resource Center 

which trains Veterans to start and grow small businesses. He is 

also chair of the Advisory Committee on Veterans Business Affairs 

which provides advice to the Administrator of the Small Business 

Administration, Congress, and the President. 

Welcome, Mr. Celli. 

STATEMENT OF MR. LOUIS J. CELLI, JR., CHAIRMAN, 

COMMITTEE ON VETERANS BUSINESS AFFAIRS 

Mr.CELLI. Good morning, Chairman Altmire, Ranking Member 

Gohmert, and distinguished Members of this Committee. Thank 

you for the invitation to come before you and share my experiences 

and work within the Veteran business-owner community. I’m a 22-

year Veteran of the United States Army, a disabled Veteran and 

I’ve started two businesses. I am the chairman, as you’ve mentioned, of the SBA’s Veterans Small Business Advisory Committee, 

10

and the vice chairman of the American Legion’s Small Business 

Task Force. 

My company, the Northeast Veterans Business Resource Center 

is headquartered in Massachusetts and has an office at Walter 

Reed Army Medical Hospital. We’re a nonprofit organization that 

teaches, coaches, and mentors Veteran to start and grow micro enterprises and small businesses and we receive our funding from the 

Veterans Corporation. 

Over the past four years, we’ve served over 4,000 Veterans 

through counseling, seminars, and formal classroom-style training. 

I’m here today to offer testimony on behalf of these clients as 

well as to offer you the benefits of research and opinion of our Veterans Small Business Advisory Committee which was established 

under the same public law, Public Law 106-50 that created the 

Veterans Corporation. 

The question before the Committee today is: is the Veterans Corporation prepared to provide entrepreneurial development, assistance, to service men and women returning from Iraq and Afghanistan? In my opinion, the answer would have to be no. The Veterans 

Corporation has neither the reach nor the funds to adequately address the needs of the growing number of Veterans interested in 

entrepreneurship. 

Congress, and specifically, this Committee, have been working 

for Veteran business owners for years. This issue and specifically 

the Veterans Corporation is as important to our Veterans as it is 

to you. Public Law 106-50 was written as a plan, a plan to assist 

self-employed Veterans and encourage entrepreneurship. 

At the time 106-50 was written, a number of federally-funded 

programs were already in place and available to Veterans. Small 

Business Development Centers, Procurement and Technical Assistance Centers, better known as PTACs, SCOR, Women Business 

Centers, and yet, Congress finds the following and I read directly 

from Public Law 106-50, ‘‘Veterans of the United States Armed 

Forces have been and continue to be vital to the small business enterprises of the United States. In serving the United States, Veterans often face great risks to preserve the American dream of 

freedom and prosperity. The United States has done too little to assist Veterans, particularly service-disabled Veterans in playing a 

greater role in the economy of the United States by forming and 

expanding small business enterprises. The medical advances’’—and 

this is especially true now seven years later today—‘‘and new medical technologies have made it possible for service-disabled Veterans to play a much greater role in the formation and expansion 

of small business enterprises in the United States. The United 

States must provide additional assistance and support to Veterans, 

to better equip them to form and expand small business enterprises, thereby enabling them to realize the American dream they 

fought so hard to protect. 

Each of the entities created by 106-50, the SBA’s Office of Veterans Business Development, the VA’s Office for Veterans Enterprise, the SBA Veterans Business Advisory Council, the Veterans 

Corporation, and the Veterans Representative for SCOR and all the 

others were established solely for the purpose of expanding the eligibility for certain small business assistance programs to include 

11

Veterans, directing certain departments and agencies of the United 

States to take action that enhanced small business assistance to 

Veterans and establish new institutions to provide small business 

assistance to Veterans or to support the institutions that provide 

such assistance. 

The Veterans Corporation specifically was established to expand 

the provisions and improve access to technical assistance regarding 

entrepreneurship for the nation’s Veterans and to assist Veterans 

including service-disabled Veterans with the formation and expansion of small business concerns, by working with and organizing 

public and private resources including those of the SBA, the Department of Veterans Affairs, the Department of Labor, the Department of Commerce, Department of Defense, SCOR and the 

Business Development staffs at each department and agency of the 

United States. 

And’’—and this is most important—‘‘in carrying out the purpose 

described in Public Law 106-50, the Corporation shall establish and 

maintain a network of information and assistance centers for use 

by Veterans and public.’’

In 2004, TVC had built up to I believe it was 12 contracted resource partners delivering hands-on training and entrepreneurship 

programs around the country. By February 2006, they had consolidated to eight regional hubs and today they’ve been reduced to 

three. 

In the past six years, TVC has been through four leadership 

changes, four logo and branding changes, and at least as many 

business models. Within the past two years, TVC has focused on 

a variety of different initiatives, each more spectacular than the 

last: an elaborate self-pacede-learning project, SUNY University, 

University of Maryland, the Veterans Economic Opportunity Fund, 

TVC’s Governors and Mayors Advisory Council, the Veterans Business Directory, a Mobile Entrepreneurial Resource Center, branded 

and sponsored by NASCAR, professional artists and announcers 

providing and donating recorded PSAs and the virtual business 

center just to name a few. 

To date, none of these projects have assisted Veterans and over 

the years, the only success stories and clients presented as accomplishments in the fruits of the labor continue to be that of the resource centers. 

House Report 106.206 that accompanied Public Law 106-50 references the Veterans Corporation’s most significant and single purpose is to establish an independent network, a nationwide network 

of business assistance and information centers for Veterans. Chairman Talent, on June 23, 1999, at the mark-up hearing for H.R. 

1568 said the following in response to a question/comment from 

Congressman Pascrell. ‘‘The gentleman exposed a little secret behind this bill. I think these, the Veterans Assistance Centers, are 

in effect going to empower the Veterans community to advocate effectively on their own behalf. Then you’re going to see agencies and 

also the Congress sit up and take notice and give them a high priority.’’

On September 9, 1999, Chairman Talent’s statements in the 

House of Representatives included in the following, in a section by 

section analysis of H.R. 1568, a section entitled ‘‘To Establish a 

12

Federally-Charted Incorporation, TVA, for the Purpose of Guiding 

and Monitoring Public and Private Sectors’ Initiatives and to Assist 

National Veterans in their Efforts to Form and Grow Small Businesses. The most significant purpose of the corporation will be to 

work with the public and private sectors and to establish independent nationwide network of business and assistance in information centers. These centers represent one third of TVC’s total direct 

access to working with clients and already stretched to the limit.’’

Our center employs two full-time employees, two part-time employees, three volunteers. Our area spans the six New England 

States, New York, and Washington, D.C. We have one resource 

center in Boston and a training and counseling office at Walter 

Reed. We’ve received over $200,000 in donations this year, including over 30 desk top computers, 15 laptops, 7 servers, a resource 

library which would rival that of any small business library, complete with over 300 audio and video training programs. 

Over the past four years, we’ve provided training and seminars 

to over 4,000 clients from all over the country. We’ve developed 

partnerships with major companies and organizations. We’ve received support and donations from a wide variety of corporate and 

federal donors and in 2007 our funding from TVC was reduced by 

20 percent. 

TVC doesn’t actually work with clients, the resource centers do. 

Their website is a collection of links which all lead to third-party 

activities. TVC maintains that they should not be required to create a fourth network. That’s us. 

What this means is that they don’t believe they should be required to support the community-based training resource centers 

and in their own words they’re trying to get away from Public Law 

106-50. As you can see from my previous testimony, this corporate 

direction is in direct conflict with the spirit and intent of the law. 

I have four recommendations to offer this Committee as you consider re-authorizing the National Veterans Business Development 

Corporation. Remove the training mission and professional certification board mission from TVC and place that mission with the 

SBA’s Office of Veterans Business Development with the licensing 

certification mission belonging to the Advisory Committee on Veterans Business Development; have future nominees to the board of 

directors of the Veterans Corporation proposed to the Chairman 

and Ranking Member of the Committees of Small Business and the 

Committee of Veterans Affairs of the House of Representatives and 

the Senate be recommended through the Advisory Committee on 

Veterans Business Affairs; assign a permanent oversight committee 

to monitor the progress of programs of the National Veterans Business Development Corporation to ensure compliance with congressional directive and Public Law 106-50. And lastly, a flagship resource center should be created here in D.C., this center should be 

established for the purpose of training, meetings and conferences 

and should be offered to use to the Veterans entrepreneurial training community as a resource. 

The resource centers created and supported by TVC, St. Louis, 

Flint, and Boston, have made a significant impact in the area of 

Veterans entrepreneurial development and Veterans advocacy. Unless Congress has a plan to grow and support these centers indeVerDate 0ct 09 2002 10:31 Jan 08, 2008 Jkt 033615 PO 00000 Frm 00016 Fmt 6633 Sfmt 6633 G:\CLERK SB\HEARINGS\TRANSCRIPTS\34830.TXT LEANN
13

pendently of TVC, it would be detrimental to Veterans on a national level to continue to underfund this organization. The Committee on Veterans Business Development, as well as my organization, stands ready to assist this Committee with detailed suggestions for these recommendations should you wish to pursue them 

any further. 

Thank you very much for your time. 

[The prepared statement of Mr. Celli may be found in the Appendix, on page 53.]

ChairmanALTMIRE. Thank you, Mr. Celli, and since our final witness, Mr. Cain, resides in our Ranking Member’s District, I’m going 

to allow him to make the introduction. 

Mr.GOHMERT. Thank you, Mr. Chairman. It’s my pleasure to introduce a constituent of mine, Mr. Allan Cain, who is owner of 

Carthage Self-Storage and a distinguished Veteran of the United 

States Army. I’m just kidding, he was a Marine, too. 

(Laughter.) 

And actually, I was delighted to hear a former Marine would 

come back into the U.S. Army, actually after 9/11, I called the recruiting office in Tyler, Texas and said I was interested in coming 

back at 47 years of age or so and they said well, how old are you 

and I told them and they said that’s a little beyond the 35. I said 

now I know people that are in older than 35 and they said well, 

you can come in if you can deduct your years of service from your 

age and get to 35 and I said well, let’s see. I was in for four years, 

I’m not sure that I get there. But anyway, I’m greatly respectful 

of anybody that’s served our country in the Armed Services and 

that includes Mr. Cain’s honorable service in the United States Marine Corps. 

He’s a member of the Texas Mini-Storage Association, a former 

board member of the Panola County Chamber of Commerce. He’s 

a member of the Carthage Lion’s Club and a former police officer. 

Has a Bachelor’s degree in Criminal Justice from Sam Houston 

State University and it was from ’67 to ’70 that he served honorably in the United States Marine Corps. Currently a member of the 

VFW and formerly served as the Veteran Service Officer from 

Panola County so is quite familiar with helping Veterans on Veterans’ issues. 

He gained valuable experience dealing with the broad array of 

Veterans’ issues in that capacity. So I didn’t realize until we got 

into this that we don’t provide the transportation costs to witnesses 

so that makes it even more impressive that someone would take 

time out of their schedule to come. So we appreciate your being 

here. This is a man who has dealt with the issues, is out there on 

the ground. We have folks here that care about Veterans. Like I 

said, I tried to come back into the service, but not able, so I had 

to revert to a far less honorable course of service here in Congress. 

Anyway, we appreciate all of you, but Allan, appreciate your 

being here. 

14

STATEMENT OF MR. ALLAN CAIN, CARTHAGE SELF-STORAGE, 

OWNER 

Mr.CAIN. Chairman Altmire and Ranking Member Gohmert, and 

other Members of the Subcommittee for having me here today, it’s 

an honor to testify before each and every one of you. 

I live in a rural East Texas town with a population of 6200. Our 

area is predominantly an oil and gas business with very limited resources for Veterans wishing to strike out into the small business 

world. Although I was fortunate in my entrepreneur ventures in 

that I had a co-signer for my first business, I worked very closely 

with many East Texas Veterans in the numerous organizations and 

positions I’ve been in including the Veteran Service Officer for 

Panola County. 

I’ve seen firsthand the helplessness that overcomes many Veterans as they return to a world that has sped past them. As a combat decorated Veteran, I experienced the difficulties and the troubles with adjusting to fit back in a society that left me behind. I 

was able to finish college and enter into the workforce, but all the 

while coming from a three and a half year delayed start, with 

heavy combat experiences whose effects continue to challenge me 

today. 

As most Veterans in a rural community, I had no background for 

business administration. I understood work and results. But conducting business with the public, navigating the complicated tax 

code, contracts, payroll, operating schedules, learning curve on ordering supplies, and ordering reliable supplies, employee issues 

and not enough money to turn a profit was a challenge. Especially 

when frustration and lack of understanding cost you money that 

you’ve worked hard for. 

It can often develop into pressure that ends up in bankruptcy 

and large legal tabs. A strong work ethic, coupled with a forgiving 

God, got me through to where I am today. Most Veterans I know 

are good at their specialty, reliable and understand pushing 

through, but get very lost when having to confront starting a business, especially with little capital to put into a business while still 

putting food on the table at home. 

I believe that in the mind of the Veteran, when they hear ‘‘assistance’’ they hear someone is going to help me. But instead, they get 

such a volume of paperwork in a language that is foreign to them 

they just lay it aside. I believe that just a small amount of help 

navigating the bureaucratic obstacles will go a long way in providing Veterans returning from Iraq and Afghanistan with a start 

they need to re-integrate into our great nation. 

An important first step for any organization wishing to provide 

assistance to returning Veterans is an effective outreach program. 

Outreach has always been a challenge when delivering information 

to those who could benefit. How would anyone get the intended information and even if they get it, they may not remember it two 

years from now? 

First, we must look at who are the targets, where do they live, 

how do we get to them, hopefully without recreating the wheel, 

sources could be tapped to place the information as close as possible all the while understanding fiscal restraints. 

15

In my opinion, there are a few steps of an effective outreach program. One, again, with numerous lending institutions that participate or can direct a Veteran to a program that will benefit the 

most. Get the information into the hands of those who will be in 

front of the Veteran when they drop by. Don’t make it only the job 

of the Veteran to know and understand all the options that he 

qualifies for. 

Two, State Veterans Service Commissions would be a great resource for the dissemination of information. The great State of 

Texas has possibly the finest Commission for Veterans in the 

United States. The organization has offices throughout the state 

and also is solely responsible for training and certifying County 

Veteran Service Officers. Again, these are the folks who see the 

Veteran face-to-face. 

Finally, there’s an enormous volume of information given to 

transitioning Veterans. This information is often overwhelming and 

leads to more confusion than it’s worth. This information needs to 

be precise and distributed to the Veterans from the folks that will 

help them transition most effectively. 

Another important step would be for an extensive education program that will be designed to give access to all Veterans. In my experience, many Veterans have limited resources and lack the understanding they need to truly understand how to begin and manage a business. It’s important that Veterans be given the handson learning experience that they’re used to from the military. 

One, provide more Internet courses. There’s a very effective, especially cost-effective mode of reaching and teaching Veterans. Today’s technology-advanced world, many of our soldiers will be returning—and that should be Marines, I’m sorry—will be returning 

home from abroad with a solid understanding of computer technology. The Internet will provide a fast and cheap mode of educating these Veterans on making the transition into small business 

world. 

Two, although the Internet has many benefits, there are many 

who are not computer literate. These folks should not be left out 

of the many benefits that they fought hard to preserve. We should 

have seminars and classes available to these people, possibly 

through their local Veterans organizations. While I understand 

that there will always be challenges in trying to reach out and provide education to returning Veterans, it is a service that is owed 

to those who gave up many years to defend our great nation. Providing effective assistance to those returning home from abroad 

would not only save as many Veterans from years of struggle and 

financial hardship, but it will boost the morale of those still fighting. They will not only have family and loved ones to come home 

to, but they will have the tools they need to provide better for their 

families. 

I would like to end my testimony by saying thank you to the 

Government of the United States of America for its gratitude to 

those who serve through the military services and Coast Guard. 

Without the assistance of our elected officials at the national and 

state level, we, Veterans, would have a much more trying time in 

readjusting after giving so much. There is no other country or republic that honors and respects its Veterans like the United States 

16

of America. My family and I thank you and I look forward to answering any questions you may have. 

[The prepared statement of Mr. Cain may be found in the Appendix, on page 57.] 

I was going to suggest that Mr. Gohmert, we will each do a fiveminute round of questions and then we’ll do a second round with 

follow-up. 

Is that okay with you, Mr. Ranking Member? Okay. 

So my first question is going to deal with, there’s several issues 

involved with what you’ve all talked about. There’s the issue of returning folks, but I wanted to focus my first set of questions on 

people like Mr. Clair and others who are being deployed that currently run small businesses and the issues that are associated with 

that side of the equation, where they have to keep this business 

somehow up and running during the terms of their deployment. 

So my first question for Mr. Celli is the Reservists who operate 

the small business and are deployed face many challenges maintaining their businesses while they serve overseas. What is your 

experience working with these Reservists and what types of resources do they need to most effectively protect their businesses 

during the deployment? 

Mr.CELLI. Thank you very much. That’s an excellent question. 

The first thing that the business owner has to do is make sure that 

their business has been built and structured effectively to operate 

in their absence. What we like to do is we call this the franchise 

mode. So that every task, every set of daily operational procedures, 

are written down in some way so that the business owner can step 

away, the key employee can step away and somebody else can come 

in and pick up like an owner’s manual, almost like McDonald’s say, 

and most importantly after they leave, or before they get ready to 

leave, they need to make sure that their bank accounts are in 

order, that the right people have access to the funds so they can 

still make deposits to the IRS so that they can still pay their bills. 

They also need to make sure that the proper legal paperwork is 

in place to allow people to act in their behalf, depending on whether it’s a limited liability corporation or a C corporation, they can 

move people around accordingly. That has to happen before they 

even think about leaving that business in a state that can still sustain itself. 

The other real concern is the customer base. The customer base 

in many times, especially with small businesses is reliant on the 

personal knowledge and the charisma of the business owner. And 

when that business owner leaves, there’s going to be a very difficult, it’s going to be very difficult for that small business to maintain that existing customer base. We see this quite frequently with 

professional trades such as lawyers or doctors or tax accountants, 

these types of professionals that have built relationships with their 

folks and there aren’t a lot of people that can step in and take that 

over for them. So they have to rely on a network of support that 

will watch over their clients while they’re gone and then have the 

decency to give them back when they return. 

So in preparation to deploy, they have to build their business accordingly and properly which sometimes means completely rewriting their business plan and while they’re gone it’s going to require 

17

a very strong hands on support network led by an organization 

that understands small business and can work with either the family or the rest of that business. 

ChairmanALTMIRE. Thank you, and I would also ask Mr. Sharpe 

to address that question from the context of the changing nature 

of these Reservists, given who the American Legion has served in 

the past and now the time on active duty for many of these Reservists has doubled or greater and what you see as the challenges and 

the resources that would be required to keep that small business 

up and running during the deployment? 

Mr.SHARPE. I agree with everything Mr. Celli has said. When my 

unit deployed to Iraq back in 2003 to 2004, I’m currently in a civil 

affairs unit where there were quite a few business owners, and 

when I first realized there was a problem was when we returned, 

a couple of my friends lost their businesses and others’ businesses 

were under real financial hardship. And a result of that is all those 

individuals leaving the military because, of course, we’re scheduled 

to return to Baghdad March of ’08. And they just could not survive 

another deployment. 

And I think it’s a real issue. I think for Reservists who are business owners, there should be some sort of pre-plan to assist them 

prior to their departure. With the new realities of the way Reservists are being activated, a Reservist shouldn’t, especially a business 

owner, shouldn’t have to make the decision whether or not to serve 

his or her country because of their business. And that’s the problem right now. And I think we definitely need more resource centers around the country. We need to have centers on a lot of military bases, VA hospitals. There should be some pre-education plan 

prior to a Reservist even joining the military. 

ChairmanALTMIRE. Thank you. I wanted to ask you, Mr. Sharpe, 

one more question that will lead into my second set of questions 

after we hear from the Ranking Member. 

In your testimony, you state that the Veterans Corporation increasingly cedes its responsibility for providing entrepreneurial development and in your opinion this responsibility should be shifted 

to the SBA. You suggest that this would be more effective given the 

agency’s existing framework through its Veterans Business Outreach Centers and Small Business Development Centers. 

So I wanted you to just clarify that. If I heard you correctly, that 

that’s what you were saying and is your suggestion to shift training 

responsibilities to the SBA, the Veterans Corporation would permanently see a large portion of its mandate and what do you think 

the outcome of the Veterans Corporation would be if that change 

were to be made? 

Mr.SHARPE. I just don’t see the Veterans Corporation being able 

to accomplish those missions as stated currently by 106-50 with the 

current resources that they have. I definitely believe in hands-on 

training. SBA already has the SBDCs. They are already funding 

five Veteran Resource Centers. It doesn’t make sense, I agree with 

the Veterans Corporation, for them to try and duplicate those services. They have seemed to develop an expertise on on-line training 

and I would prefer to see them excel in those things that they do 

best. And I definitely believe that the SBA should be the lead orgaVerDate 0ct 09 2002 10:31 Jan 08, 2008 Jkt 033615 PO 00000 Frm 00021 Fmt 6633 Sfmt 6633 G:\CLERK SB\HEARINGS\TRANSCRIPTS\34830.TXT LEANN
18

nization. They have the expertise. They should be provided the 

funding to expand and do the things that they do best. 

ChairmanALTMIRE. Thank you. Mr. Gohmert? 

Mr.GOHMERT. Thank you. I was going to ask Mr. Elmore, has the 

Small Business Administration Inspector General or any other SBA 

organization or official ever examined the Veterans Corporation? 

Mr.ELMORE. From my understanding, sir, no. We don’t have an 

oversight responsibility. The Veterans Corporation, obviously, is in 

the Small Business Act, but we view them as a partner. They’re 

not a program of SBA. We’ve tried to do a lot of cooperative work 

with them and we have accomplished some things over the past 

few years. But from an oversight perspective, as I understand the 

way the law is written that really rests with Congress and perhaps 

with GAO. 

Mr.GOHMERT. Are you aware of any programs in the Veterans 

Corporation that may be duplicative of what is offered elsewhere? 

Mr.ELMORE. I don’t think they’re duplicative. I think the point 

that Joe made is probably very accurate, that there’s really great 

value and we understand that and hands-on, face-to-face, one-onone assistance, especially for Veterans who come back and the 

other testimony is correct as well. These men and women have 

been gone for six months, 15 months, 3, 5, 6 years. They need some 

assistance if they’re capable of pursuing entrepreneurship as a real 

and viable vocation. So we focus primarily on that, but we have online services. 

I think there is great value in an Internet overlay that helps coordinate and deliver those services because regardless of how many 

programs or partners we have, we cannot be everywhere. I mean 

the gentleman from Texas is correct. Those County Veteran Service 

Officers with the State Departments of Veterans Affairs, I think, 

are a critical piece in this whole process that bluntly, since I’ve 

come to Washington over the last seven years, there’s a real disconnect between what we talk about in this town and what happens where these men and women return home to. And I think 

those pieces in concert with what the corporation is trying to do 

with a robust overlay of technical assistance and resources electronically can be a really effective and important mix. 

Mr.GOHMERT. Thank you. Mr. Sharpe, has the Veterans Corporation worked with the American Legion in outreach, making known 

the services it has available? 

Mr.SHARPE. When I returned back from Iraq, and the issue of entrepreneurship, especially with the Reserve and National Guard 

became so apparent, American Legion, we became more active as 

far as working with federal agencies that are involved in this particular situation and with the Veterans Corporation. 

We’ve asked the Veterans Corporation and Louis Celli who works 

with them, as one of their resource centers, to participate in many 

of our workshops. We’ve had, last year we had our national convention at Salt Lake City and we had a two-day workshop helping 

those Veterans who wanted to start a business and those Veterans 

who —

Mr.GOHMERT. I don’t mean to be technical, but you said you invited them to participate. Did they participate? 

Mr.SHARPE. Yes, they did. 

19

Mr.GOHMERT. Okay. 

Mr.SHARPE. Everything we’ve asked SBA and the Veterans Corporation to do, they’ve done. They participate in practically all our 

programs and they’ve been extremely helpful to us. 

Mr.GOHMERT. What kind of feedback have you heard about the 

effectiveness of Veterans Corporation from people entering the 

American Legion? 

Mr.SHARPE. The workshops that we’ve had have been quite successful and the feedback that we’ve received has been positive, but 

the positive statements have been directed to all the federal agencies and the Veterans Corporation that you know, everyone that’s 

participated we’ve received a lot of positive feedback and that went 

to VA, SBA, DOD and the Veterans Corporation. 

Mr.GOHMERT. Thank you. Mr. Cain, do you know of particular 

services that could be targeted to Veterans in rural areas? 

Mr.CAIN. Rural is the key, just getting these opportunities before 

them. We have to drive 50 miles to get to a bank that even might 

offer SBA services. And I think that’s pretty consistent with the 

State of Texas and with a lot of Veterans. 

Disabled Veterans, it’s a real challenge. 

Mr.GOHMERT. What’s the best way to reach them, do you think? 

We heard the Internet overlay mentioned. I don’t know what percentage of that’s coming out, play with the Internet. 

Mr.CAIN. A lot of them, if they’re steered properly through the 

VSOs, Veteran Service Officers, and so forth, VA has a great program, probably one of their best programs that I’ve worked with 

and that was vocation rehabilitation. And they do a marvelous job 

from diagnostics and assessments and aptitude and they do all that 

stuff and so they’re mostly in contact with disabled Veterans. 

And then they could give them that information as an option 

and—or however the Committee wants to develop it, but that’s—

from my little perspective, that would be a great place to put the 

emphasis. 

Mr.GOHMERT. Thank you. 

ChairmanALTMIRE. We’ll do one more round of questions. I wanted to give Mr. Elmore the opportunity to respond to what we were 

discussing and what you heard about the idea of the SBA recapturing primary responsibility for operating Veterans outreach and 

training programs. 

Mr.ELMORE. Sir, I think my answer has to be that if we’re given 

that responsibility and that authority, we will. Clearly, we have 

five centers now. I think they’re effective. They provide assistance 

to approximately 2,000 Veterans and Reservists each year. Our 

Small Business Development Centers alone last year provided assistance to almost 5,000 Reservists and in ’06 was the first year we 

got the forms changed so that we could begin to track that kind 

of service, not just with them, but with SCOR as well. 

ChairmanALTMIRE. Is it your opinion that the SBA could do it 

better? 

Mr.ELMORE. I don’t know that I would say it better, but given 

the size and scope of our reach, we’re already in a systematic mode 

where we have processes in place to go out for competition to 

evaluate proposals, to look at who we think could be effective in delivery and to oversee that delivery and to support it as well with 

20

our other field resources. So in that sense, I would have to say yes, 

sir. 

ChairmanALTMIRE. Mr. Blackwell, would you like to comment on 

that? 

Mr.BLACKWELL. I think that two things need to be said. First of 

all, I certainly appreciate my other panelists and their comments. 

Many things I agree with, some things I do not. And I’ll be happy 

to get back to the Committee formally in a written rebuttal if that’s 

the easiest way to do that. 

ChairmanALTMIRE. Please. 

Mr.BLACKWELL. Let me just say that 1999 when 106-50was finally placed into law was a very different economic and a very different political and a very different need for Veterans issues. 

Today, we’re faced with monumental issues of multiple different 

Veterans, Veterans that are literally from the World War II era 

into those who will come back over the next several years. Clearly, 

given the resources available to TVC, as you know, our funding 

was cut another 25 percent last year. In previous years, going before OMB, we’ve taken plans to both enlarge and enhance services 

through our networks. Those have not been granted to us. Again, 

I’ll refer to that in the formal rebuttal. 

I would just tell you that given the resources we have chosen to 

deliver as many programs and opportunities as we can by being a 

virtual catalyst, an ability to assimilate materials already available 

through agencies in a more readable format and perhaps more 

grouped format. I think those are working well. 

Currently, our board believes that given our limited resources, 

it’s impossible to expand our network beyond the three centers we 

have. I do believe that a fourth network is not practical. I do believe in leveraging third party support and I believe that our status 

as a 501(c)(3) should be utilized to expand programs that are currently available in the public sector that can be leveraged back into 

the community. 

One of the main issues I would leave you with, although not in 

my written testimony on this particular question, is that our access 

to bonding and our access to capital programs are in addition to 

those programs 7a and 7b by the SBA. 

As you know, the SBA has a limit on the amount of money that 

can be given out into loans and limits the amount of money in 

bonding available to $2 million. Our third-party programs in both 

of these areas have no caps. There are 50 state programs and directly mentor and guide Veterans through these very tricky processes. 

It’s been our experience that Veterans who go before a bank too 

early, without a proper business plan, and without the knowledge 

they need to talk to these folks, generally fail in their first approaches. Our goal is to be with them from the beginning of the 

process, through the middle of their businesses and obviously be 

there for the transitions from their businesses to other Veteran organizations. 

So I would say the simple answer is given the funding, I believe 

that our current programs are succeeding well and we plan to leverage those in the future. 

21

ChairmanALTMIRE. On the issue of funding, Mr. Blackwell, the 

charter and the mandate obviously of the organization is that you 

have the ability to go out and raise funds in a way that to be candid has not necessarily been fruitful yet. The numbers I had was 

that last year the organization spent $230,000 on fund raising, but 

received back only $150,000 in grants of which one came from 

$100,000 grant. So the question is what is the reason that it hasn’t 

been as productive as we had hoped and what can we do to help 

you with that process? 

Mr.BLACKWELL. The simple answer is private sector funders believe that this is not a private sector issue. This is a government 

issue and because it was created by a public law that Congress has 

a definite interest in supporting the needs of our Veterans, whether 

that’s in healthcare, whether that’s well care, whether that’s starting a business. They see that as an issue that Congress should address directly. 

I can tell you that in my first year, I’m not approaching almost 

27 months, in my first year, I approached 76 C-suite executives 

personally. Although all of them embraced the idea of what we 

were doing, none of them opened their pay books. And the reason 

for that is they typically see that their dollars are put into the local 

communities where their constituents of their companies live. 

Think about it kind of as a Habitat for Humanity model. We put 

our associates into work in communities. 

I will tell you that we have been very blessed recently to become 

affiliated with SMA Global. SMA Global is owned by a Korean conflict Vet and SMA Global is opening doors to us that we have not 

had opened doors to us before, including folks like the folks at 

Hewlett-Packard and Aflac. I’ve been in meetings with them on 

and off for the last three or four months and we hold some promise 

with that. I will just tell you that generally speaking private sector 

does not see it as their issue and typically don’t fund it. 

Over the last seven years, 52 different approaches have been 

used to raise capital on the outside. All 52 of those were noble efforts. All 52 of those have not garnered enough dollars to even offset minimal operation expenses. 

ChairmanALTMIRE. I would just say in wrapping up before I turn 

it over to the Ranking Member, we all agree that there is no group 

that should stand ahead of our nation’s Veterans when it comes 

time to make funding decisions. There’s no dispute about that and 

it would seem to me in moving forward that we should be in position to work with you and enhance the ability to convince some of 

these folks that you’ve been visiting that they do have a role and 

it is to their benefit to help businessmen in their local communities 

and service areas to position themselves in a way that when they’re 

deployed that business is going to stay open and when they return, 

it’s going to be fruitful. 

So I would just say that we want to help and not just this Committee, but Congress in general. So let’s just keep the discussion 

going on ways that we can reach out into the private sector in a 

way that might be a little more productive than what we’ve done. 

Mr.BLACKWELL. We would welcome that, Mr. Chairman. 

ChairmanALTMIRE. Thank you. Mr. Gohmert. 

22

Mr.GOHMERT. Thank you. And I am glad that this Committee 

looks at financing situations, says that no one should stand ahead 

of Veterans because we’re taking up the Hate Crimes Bill that 

came out of Judiciary last week where we’ve said we will not, the 

majority said we refuse to put Veterans in a protected class so that 

people are punished more severely if you attack one of this group, 

because they’re not entitled to the same heightened protection that 

a transvestite with gender issues has. But we’ll keep working on 

that. 

Anyway, with regard to the raising of capital, it is a concern. You 

spend that much money and get less back than you spent to raise 

money and I can’t help but draw from my own personal experiences, I hear people in East Texas talk about yeah, we want to help 

the Vets. I can’t help but wonder if maybe if it was—if the fundraising was segmented in such a way that people could donate 

money that would benefit Veterans in their area, if that might not 

help. I don’t know if the current law or organizational or corporate 

by-laws would permit that kind of segmentation, but Mr. 

Blackwell, what do you think about that concept? 

Mr.BLACKWELL. Actually, we have started that initial concept 

through visiting with the Governors and in many cases, currently 

in Texas, in San Antonio, with the Mayor’s Office, to talk about utilizing their offices to mobilize a local campaign where giving could 

be done. By-laws of our organization were changed last summer so 

that we could create a mentor membership category. That category 

allows individuals and/or organizations be they city or state, to give 

money and support Veteran issues. 

We have one member in that category at this point. We solicit 

openly the support of both cities and states. As I say, we continue 

to meet with those folks. It’s part of our outreach. It’s part of our 

fundraising activity. And we’ll continue to do that. 

Mr.GOHMERT. With regard to your expenditures, it appears that 

over $200,000 was spent for outside fundraising, isn’t that correct? 

Mr.BLACKWELL. No, that’s not correct. 

Mr.GOHMERT. That’s in-house. 

Mr.BLACKWELL. It’s all in-house, yes. In fact, if you look at our 

annual report, you’ll see that over 68 percent of TVC’s budget last 

year was put directly back into programs and activities. The remaining number of those dollars, that $1.5 million goes back in direct support of trying to obtain self-sufficiency as mandated by 

Public Law 106-50. It is an enormous effort. Also in this report 

you’ll see all of the people we’ve talked to, all the reports that have 

been written and our success is growing, but it’s very, very, very 

slow. 

Mr.GOHMERT. So what would it take to make itself sufficient? We 

need some kind of tax incentive, tax advantage, something to help 

give you the tools to draw in capital to help the Veterans? 

Mr.BLACKWELL. You already have the tax incentive available to 

you because we’re incorporated as a 501(c)(3). 

Mr.GOHMERT. But apparently it’s not enough, that’s what I’m 

saying. 

Mr.BLACKWELL. That’s correct. Part of the problem is that many 

corporations, especially large corporations, are going to use marketing dollars and/or foundation dollars to do that, so that to the 

23

extent of the law available to them it’s not a significant write off, 

if at all. 

From a tax advantage, there’s no real impetus for them to go 

through that. 

Mr.GOHMERT. But I’m asking about potentially new tax advantages, things that we could do to help raise the capital. Obviously, 

what’s there isn’t helping. 

Mr.BLACKWELL. That’s correct. And I will tell you that anything 

Congress can do to assist in this is most welcomed. 

Mr.GOHMERT. And I’m asking you what would you suggest is 

that anything we can do? 

Mr.BLACKWELL. I don’t think that having a tax incentive per se 

is going to encourage them. I think the vested self-interest of private corporations is just that. What’s in it for that corporation, if 

they support this endeavor? And right now, private corporations 

don’t seem to believe that starting Veteran businesses, basically 

underwriting the cost of entrepreneurship in small business is an 

advantage to them 

Mr.GOHMERT. I guess that’s why I was asking if there was any 

heightened tax advantage that they would see to be to their advantage to assist. 

But anyway, let me throw that open to the other panelists. do 

you have any ideas for how we could go about raising capital from 

private enterprise? I realize it can be tough because in some cases 

you may be asking people if they mind contributing to helping set 

up a competitor, but —

Mr.CELLI. Thank you, sir. And we, as a 501(c)(3), we share and 

face some of the challenges, many of the challenges that the Veterans Corporation face in fundraising. We have our own fundraising efforts at the local level and what we find and you’re probably not going to believe this, in the fundraising efforts, larger corporations have foundations that they’ve set up which handles their 

philanthropy efforts. 

On those web pages, it tells you who qualifies and who doesn’t 

and I can point to a very large number of corporations that specifically say on their foundation pages, that they will not donate to 

Veterans organizations. It’s specifically there. And —

Mr.GOHMERT. Why is that? 

Mr.CELLI. That’s a good question and I asked that very question, 

because they group it right under the VSOs and then they put it 

right next to lobbying activities. So I wrote a letter and an e-mail 

to some of these organizations and I won’t mention any right now 

and I asked and I said is this exclusion specifically designed to separate your company from that of lobbying activities such as Veteran service organizations because we are not, we’re a training activity that reaches out to Veterans to help them start and grow 

businesses and I got back a very polite reply that says we’ve looked 

at your website. We’ve looked at your application, but we do not 

find that you are in our corporate giving arena. Thank you very 

much, have a nice day. 

So I gave them the opportunity to kind of re-look at that and addressed it to no avail. 

Mr.GOHMERT. Could we get a list of companies. 

Mr.CELLI. I could supply that list. 

24

Mr.GOHMERT. I think it would be interesting if America knew 

who took a stand against helping Veterans. But if I could get a list 

or the Committee could get a list, either submit it to me or the 

Committee, I would sure appreciate that. 

Mr.CELLI. Absolutely. And the primary focus with most of these 

foundations is children who are seeking literacy assistance and 

major diseases, that seems to really be the thrust of corporate giving, so we’re on the fringe and it’s very difficult. 

Mr.GOHMERT. I could see how that to some people wouldn’t be as 

important that we’re allowing the children and the others needing 

that help to live in a free country. I don’t know. 

Mr. Elmore, you had something before we close? 

Mr.ELMORE. Yes, sir. I’d like to try to help respond. In my previous life before I came to this position, I had helped create and 

managed a Veterans not-for-profit community program in St. Louis 

for 20 years. And I for those many years looked at foundations and 

they’re both correct. There are more foundations listed in philanthropic guides that specifically indicate they will not consider Veterans than there are foundations who say they will consider Veterans. 

And if you really wanted to look at that, you might look at some 

of the organizations that overarch a lot of the philanthropic community like independent sectors and ask them that question. I’d 

love to hear their answer, just as a guy who has been doing this 

work for 33 years. 

Mr.GOHMERT. Could you give me—after the hearing, if you could 

supply me the best way to get that information? 

Mr.ELMORE. I’ll work with Lou and help him understand at least 

from my previous experience, I have to be cautious because obviously I’m a federal employee and I’m not looking to attack anybody. 

Mr.GOHMERT. But you’re here testifying and I’m asking for your 

help. 

Mr.ELMORE. I will do that, sir. 

Mr.GOHMERT. Okay, thank you. 

Mr.ELMORE. A second point, in May of 2005, the Congressional 

Budget Office released a paper about the effective activation on 

small businesses that either employ Reservists in key positions or 

they’re self-employed Reservist small businesses. And they raised 

what I think was a very interesting question that nobody else has 

really seemed to have paid a lot of attention to. They raised a question of fundamental fairness. If I recall correctly less than one half 

of one percent of the self-employed people in America are Reservists. And if my numbers are correct, please don’t hold me to this, 

I think it was either four or six percent of businesses in America 

employ Reservists. The question they raised was through those 

small businesses commitment, through USERRA responsibilities 

and so on, are they, those limited number of businesses in America 

essentially subsidizing the war effort because they incurred additional costs when they employ Reservists? 

And if you wanted to look somewhere —

Mr.GOHMERT. That’s a good question. 

Mr.ELMORE. It’s a place that I thin really deserves more scrutiny 

and more exploration and take a look at what might be doable, if 

you will, to help spread that cost out across the entire American 

25

economy, as opposed to just those businesses that specifically employ Reservists. 

I think that’s an area that could take another looking at. 

Mr.BLACKWELL. Congressman Gohmert, it occurs to me that perhaps a two-plan that would allow companies and individuals to 

take 100 percent tax donation, much like the Katrina 100 percent 

tax deduction was in the fall of 2005 might be a good option. This 

would encourage individuals and companies, I think, to leverage 

their donations. 

Mr.GOHMERT. You know, any structuring following the example 

of relief to Hurricane Katrina would probably not be a good idea. 

Mr.BLACKWELL. No. Just a similar program like that. It could be 

structured in a completely different manner, but a program that 

would benefit at 100 percent those individuals who gave. 

Mr.GOHMERT. Thank you. 

ChairmanALTMIRE. That will conclude the hearing. I want to 

thank the panelists. We heard some different points of view on how 

to achieve a goal that I know that we all agree on. I look at this 

hearing as the first step in this Committee’s investigation and offer 

to help what’s going on, but I do want to just reiterate the fact that 

this is not a one-time hit for us. We want to work with you moving 

forward. We want to help improve the program and most of all we 

want to make sure that these returning servicemen and women 

who want to get into small business and want to have the resources and the ability to do that and pursue an entrepreneurial 

career are able to do so and I know that you share that as well. 

Thank you for coming today and we look forward to continuing 

the discussion. 

[Whereupon, at 11:20 a.m., the hearing was concluded.]

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