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51–031 PDF 2010

S. HRG. 111–548 

MANUFACTURING CLOSURES IN NORTH 

LOUISIANA: IMPACT ON SMALL BUSINESSES 

AND LOCAL COMMUNITIES 

HEARING 

BEFORE THE

COMMITTEE ON SMALL BUSINESS AND 

ENTREPRENEURSHIP 

UNITED STATES SENATE 

ONE HUNDRED ELEVENTH CONGRESS 

FIRST SESSION 

APRIL 14, 2009 

Printed for the Committee on Small Business and Entrepreneurship 

( 

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

(II) 

COMMITTEE ON SMALL BUSINESS AND ENTREPRENEURSHIP 

ONE HUNDRED ELEVENTH CONGRESS 

MARY L. LANDRIEU, Louisiana, Chair 

OLYMPIA J. SNOWE, Maine, Ranking Member 

JOHN F. KERRY, Massachusetts 

CARL LEVIN, Michigan 

TOM HARKIN, Iowa 

JOSEPH I. LIEBERMAN, Connecticut 

MARIA CANTWELL, Washington 

EVAN BAYH, Indiana 

MARK L. PRYOR, Arkansas 

BENJAMIN L. CARDIN, Maryland 

JEANNE SHAHEEN, New Hampshire 

KAY R. HAGAN, North Carolina 

CHRISTOPHER S. BOND, Missouri 

DAVID VITTER, Louisiana 

JOHN THUNE, South Dakota 

MICHAEL B. ENZI, Wyoming 

JOHNNY ISAKSON, Georgia 

ROGER F. WICKER, Mississippi 

JAMES E. RISCH, Idaho 

DONALD R. CRAVINS, JR., Democratic Staff Director 

WALLACE K. HSUEH, Republican Staff Director 

(III) 

C O N T E N T S 

OPENING STATEMENTS

Page 

Landrieu, The Honorable Mary L., Chair, Committee on Small Business 

and Entrepreneurship, and a United States Senator from Louisiana ............. 1 

Vitter, Hon. David, a United States Senator from Louisiana (not present) ....... 4 

Alexander, Hon. Rodney A., a Representative in Congress from Louisiana ....... 5 

Hawkins, Hon. Clarence W., Mayor, City of Bastrop ........................................... 8 

Glover, Hon. Cedric B., Mayor, City of Shreveport ............................................... 12 

WITNESS TESTIMONY

Juarez, Joseph, Regional Administrator, Department of Labor, Dallas, Texas . 16 

Trichel, Tana, President and CEO of Northeast Louisiana Economic Alliance, 

Ferriday, Louisiana .............................................................................................. 21 

Ricks, Michael, District Director, Louisiana District Office, United States 

Small Business Administration, New Orleans, Louisiana ................................ 26 

Dupuy, Corinne L., Director, Manufacturing Extension Partnership of Louisiana, Lafayette, Louisiana ................................................................................ 32 

Nardini, Karen G., Acting Louisiana State Director for Rural Development, 

United States Department of Agriculture, Alexandria, Louisiana .................. 37 

Dembrozinski, Amy, Department of Commerce .................................................... 45 

Wilkerson, Mary Lynn, State Director Louisiana Small Business Development 

Center .................................................................................................................... 52 

ALPHABETICAL LISTING AND APPENDIX MATERIAL SUBMITTED

Alexander, The Honorable Rodney A. 

Opening statement ........................................................................................... 5 

Prepared statement .......................................................................................... 6 

Chart titled ‘‘Weeks of Unemployment Benefits Before July 2008’’ .................... 88 

Dembrozinksi, Amy 

Testimony .......................................................................................................... 45 

Dupuy, Corinne L. 

Testimony .......................................................................................................... 32 

Prepared statement .......................................................................................... 34 

Questions answered for the record .................................................................. 82 

Fleming, The Honorable John 

Letter dated April 9, 2009, to the Hon. Mary L. Landrieu ........................... 60 

Statement for the record .................................................................................. 61 

Glover, The Honorable Cedric B. 

Opening statement ........................................................................................... 12 

Prepared statement .......................................................................................... 14 

Hawkins, The Honorable Clarence W. 

Opening statement ........................................................................................... 8 

Prepared statement .......................................................................................... 10 

Juarez, Joseph 

Testimony .......................................................................................................... 16 

Landrieu, The Honorable Mary L. 

Opening statement ........................................................................................... 1 

Questions for the record ................................................................................... 72 

Locke, Gary ..............................................................................................................

Letter dated April 7, 2009, to the Hon. Mary L. Landrieu ........................... 87 

Nardini, Karen G. 

Testimony .......................................................................................................... 37 

Page

IV 

—Continued 

Prepared statement .......................................................................................... 39 

Ricks, Michael 

Testimony .......................................................................................................... 26 

Prepared statement .......................................................................................... 29 

Simek, Diana M. 

Statement for the record .................................................................................. 62 

Trichel, Tana 

Testimony .......................................................................................................... 21 

Prepared statement .......................................................................................... 24 

Vitter, The Honorable David 

Prepared statement .......................................................................................... 4 

Questions for the record ................................................................................... 80 

Wilkerson, Mary Lynn 

Testimony .......................................................................................................... 52 

(1) 

MANUFACTURING CLOSURES IN NORTH 

LOUISIANA: IMPACT ON SMALL 

BUSINESSES AND LOCAL COMMUNITIES 

TUESDAY, APRIL 14, 2009 

UNITED STATES SENATE, 

COMMITTEE ON SMALL BUSINESS

AND ENTREPRENEURSHIP, 

Shreveport, LA. 

The Committee met, pursuant to notice, at 9:30 a.m., in the 

Shreveport Convention Center, 400 Caddo Street, Shreveport, Louisiana, Hon. Mary L. Landrieu (chair of the committee) presiding. 

Present: Senator Landrieu. 

OPENING STATEMENT OF THE HONORABLE MARY L. LANDRIEU, CHAIR, AND A UNITED STATES SENATOR FROM LOUISIANA 

Chair LANDRIEU [In progress]. Our hearing today is looking to 

provide a snapshot on the impact of manufacturing closures on 

North Louisiana communities. In South Louisiana, we have the 

lowest unemployment in Terrebonne Parish at 2.9 percent, and as 

the Congressman knows, the highest unemployment in West Carroll Parish at 16 percent. Some of the plant closures, as Mayor 

Hawkins will testify today, for instance, in his town of Bastrop 

have doubled the unemployment rate of the parishes such as Morehouse. So we range from parishes that have low unemployment 

and fairly strong and robust economies to those that are really 

challenged by the economic situation of the country and our region. 

So the field hearing today is to talk through some of that, and we 

have asked our panelists to provide their insights for our Committee. 

North Louisiana has been especially hard hit, in particular, in 

the last year alone, with more than 2,000 manufacturing-related 

layoffs, including Georgia Pacific Plywood in Logansport, 280 employees; General Motors in Shreveport, 422; International Paper in 

Bastrop, 550; Weyerhaueser strand products mills in Simsboro and 

Dodson, 185. For communities in this area, a loss of 10 jobs and 

20 jobs there, let alone hundreds, it is a serious blow to communities that rely in large measure on these large employers. 

The closing of the International Paper mill in Morehouse Parish 

last year was particularly tough for Bastrop and the surrounding 

communities. I want to applaud Senator Alexander—Congressman 

Alexander—my apologies for elevating you to the Senate. Some say 

the House and Senate are equal branches of Congress. [Laughter.] 

2 

Sometimes I disagree with that terminology, the equal branches, 

the House and the Senate. But Congressman Alexander and the 

work that he has done to come to the assistance of Bastrop and 

other communities in his district should be commended. But, again, 

last month we received word from Pilgrim’s Pride that it would be 

closing its Farmerville facility, 1,300 employees, 260 or more independent growers. Operations in Athens, Choudrant, and Arcadia 

are challenged. 

I want to applaud the State’s efforts along with the congressional 

delegation, but the State and the State Legislature primarily for 

coming up with an opportunity for a $50 million investment to try 

to keep that operation moving forward. As I understand it, those 

negotiations are ongoing as we speak. We are hopeful that that 

would work out in a positive way, but they are very complicated 

and difficult negotiations from what I understand. We are very 

hopeful. I visited the parish just yesterday. 

Now, on a more positive note, while we have had some closures 

that are affecting small businesses—and that is what we want to 

hear about this morning—there are also some great assets in this 

community that we will not go into in full detail today, but obviously our forestry industry is the same in north Louisiana for many 

years, wood products, food processing, auto manufacturing, and the 

millions—thousands, I should say, of small businesses that are dynamic and expanding. Barksdale Air Force Base, which we just got 

some exciting news over the last several weeks about Global Strike 

Command being located right here in Shreveport-Bossier area, 

bringing an additional 1,000 jobs and opportunities for small businesses to be part either of contracting or indirectly supplying that 

operation. 

Obviously, sustaining in north Louisiana for many, many years, 

decades, the oil and gas industry. The Haynesville Shale is underway. That development, despite the depressed price of natural gas, 

which is now about $4, is still going very strongly. 

So there are great natural assets, the gaming industry, the riverfront development, but these manufacturing closings are causing a 

challenge, and all over the country manufacturing closings of large 

companies are affecting small businesses, and we want to talk 

about that today and talk about strategies that we might apply to 

help the situation. And please do not let me forget—and I will submit more for the record—to mention the four universities in this 

region—UL at Monroe, Louisiana Tech, Grambling, LSU-Shreveport, Centenary College, and Southern University in Shreveport— 

excellent universities in this region that are really bringing forward to help promote economic development in this area. 

Let me also mention the film industry in north Louisiana. I had 

the pleasure to visit with some of the leading citizens in that area 

last night, and it is very exciting. The Robinson Film Center typifies how Shreveport is developing, becoming a center for film, 

music, and art. And, of course, the health care industry sustains 

the community as well. 

Now, this is not a comprehensive list. I do not mean to leave anyone out, but I want the testimony to be balanced. We do have challenges related to these plant closings. We do have some tremendous assets in north Louisiana that we are proud of, and that is 

3 

true of every community in America. And our Small Business Committee wants to explore this issue. 

But today’s hearing will cover these and other important issues, 

and without further ado, since Congressman Alexander has to 

leave, I understand, to be the keynote speaker in Monroe, let me 

now open it up. He needs no introduction, Congressman Rodney 

Alexander, who is from Quitman, Louisiana, represents the 5th 

Congressional District. He was first elected in 2002. He knows this 

district well, having graduated from Jonesboro-Hodge High School 

and Louisiana Tech University. He also served in the U.S. Air 

Force Reserves, and he serves now on the Appropriations Committee, the Agriculture Committee, and I can tell you he has been 

a terrific Congressman for our State and a great partner to me in 

representing the areas that we share in common. I thank him for 

his aggressive efforts in many ways. 

So we will start with the Congressman, and then we will move 

to Mayor Glover, the City of Shreveport, who is helping us host 

this event today. We are grateful. A lifelong resident of Shreveport, 

Cedric Glover was educated in public and private schools in Caddo 

Parish. He served as a member of the city council and he was the 

youngest person ever elected to the council. In 1995, he was sent 

down to Baton Rouge to represent this community in the House of 

Representatives and then he was elected mayor of Shreveport, the 

first African-American mayor to serve in this post. 

Clarence Hawkins has been a veteran mayor in our State, serving in public service for over 40 years. He attended school in Laurel 

and Jackson, Mississippi. He received his degree from Grambling. 

He worked as a teacher in Morehouse Parish, received his Master’s 

of Education from Northeast Louisiana University. He was elected 

the 33rd mayor of Bastrop. He served for five terms. He served as 

Past President in the Louisiana Municipal Association Executive 

Board. 

So we have three outstanding leaders. Congressman, why don’t 

we start with you, and then I would invite the Congressman to join 

me on the dais for as long as he can stay for the hearing. Thank 

you. 

[The prepared statement of Senator Vitter follows:] 

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5 

STATEMENT OF HON. RODNEY ALEXANDER, A 

REPRESENTATIVE FROM THE STATE OF LOUISIANA 

Mr. ALEXANDER. Thank you, Senator, and good morning. I do 

apologize for having to leave. I need to be in Monroe by noon for 

a luncheon there. But it is a pleasure for me to be here this morning and to sit with these distinguished gentlemen to my left and 

who I consider not only to be colleagues but good friends, having 

worked closely with them over the years. Mayor Glover and I had 

the opportunity to work together on the Health and Welfare Committee as State legislators, and as you can tell, we are both extremely healthy. [Laughter.] 

Mr. ALEXANDER. I have worked with them over the years, and it 

is a pleasure for me to be sitting here with them. And, Senator, I 

want to thank you for being here today and thank you for the work 

that you have done. Thank you for allowing us to work with you 

on projects that affect not only the 5th Congressional District but 

the State of Louisiana. And there are many sitting in the audience 

behind me that I want to thank for their participation, the quick 

response that we have had. Oftentimes the public is quick to criticize governmental agencies, but we do not do as much as we need 

to do to applaud agencies when they perform their duties successfully and quickly. 

We have had, as you said, some disasters in north Louisiana, especially northeast Louisiana, over the past year. Mayor Hawkins 

probably as well as anybody can testify to the fact that business 

has been devastated in his district, but there are many behind us 

that [inaudible] with your help, Senator. You allowed us to sign on 

as cosponsors of the letters to [inaudible] from Washington to 

Baton Rouge to assist in the problems there. 

We are not out of the woods, of course. I was glad to see just yesterday the President lifted the travel ban to Cuba. I have been to 

Cuba. I look forward to the chance that we will open more trade 

to that country, helping small businesses across the State of Louisiana and across the South. So there are some reasons for us to 

be optimistic about the future, but at the same time be cautious 

about the concerns that we have. 

As you said, timber and timber-related businesses in Louisiana 

have driven the State for many years as the number one product. 

But times change and there is not the need for timber like we have 

known in the past, and there are some adjustments that have to 

be made. And it is working with agencies that care about the future that make it easier for us to overcome some of the problems 

that we have. 

But we ultimately [inaudible] for all of us. It can be better for 

those that come after us, and that is what we are all charged with, 

is doing what we can to make sure that life is just a little bit better 

for those who come after us. 

Thank you for allowing me to be here, and I just want to say 

thank you to the people that have allowed me to be a spokesman 

for them in Washington for the last few years. And we enjoy working with you and look forward to working with you in the future. 

Thank you. 

[The prepared statement of Mr. Alexander follows:] 

6 

PREPARED STATEMENT OF HON. RODNEY ALEXANDER


Insert offset folio 2 here 51031.002
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8 

Chair LANDRIEU. Thank you, Congressman. Again, you are welcome to join me up here for the time you have remaining. 

Mayor Glover. 

Mr. GLOVER. Thank you, Senator. I do not want to deviate from 

the protocol that you have laid forth, but my mother would expect 

me to ask, since I am serving as the host here today, if it might 

be appropriate for me to yield to my guest, my dear friend Mayor 

Hawkins, and allow him to proceed. 

Chair LANDRIEU. Your mother raised you well. 

Go right ahead, Mayor Hawkins. 

STATEMENT OF HON. CLARENCE W. HAWKINS, MAYOR, CITY 

OF BASTROP 

Mr. HAWKINS. Thank you, Honorable Mayor Glover. Thank you 

for passing the buck. [Laughter.] 

Mr. HAWKINS. Senator, thank you for allowing me the opportunity to come, and I was ecstatic when I received the invitation 

to come and appear before this Committee and allowed the opportunity to speak. Thank you as well for what you have done for this 

State and for this region, and our Representative Alexander as 

well. 

As you have spoken about the closures that have occurred in 

northeast Louisiana, we can truly say that our State and Federal 

officials have been extremely responsive to us. This catastrophe 

that has occurred in our Nation, and specifically we speak for north 

Louisiana, has been devastating. But to know that the folks that 

we elect to serve us at higher levels personally care enough to come 

to our small communities, that really makes a difference, that [inaudible]. 

The closures that have happened in Bastrop, in particular, were 

not immediate. Both of you have been involved since 2005 and 

prior to then. The closure of IP was the culminating event in a series of events that have occurred over the last 20-plus years as we 

reflect historically. International Paper Company, which has been 

in Bastrop for almost a century now, has been going through spates 

of closure since the 1980s. Bastrop had over 2,000 employees involved in the paper-making industry back during that time. It diminished to about 550 when they finally closed earlier this year. 

One of the things that we have learned as we have done an analysis, with the help of the State and Federal Government, is that 

these closures are the end result of some indicators that if we paid 

attention to, I think we would be ahead of the game. Maturing and 

declining industries have signs when they stop growing. They have 

signs and indicators for small businesses as well. When maturing 

and declining industries stagnate, small businesses lose their opportunities. Entrepreneurship stops developing. And I think we 

have been extremely reactive, and the reactions that have taken 

place in the Louisiana Department of Economic Development from 

the State and Federal Government are very appropriate. But had 

we been corrected and read the signs, I think we would have made 

it a little bit more palatable. 

We are surviving. It has been emotionally and economically devastating to us. [inaudible] perspective, International Paper Company represented about 20 percent of my operating budget. EmoVerDate Nov 24 2008 11:33 Jul 22, 2010 Jkt 055045 PO 00000 Frm 00012 Fmt 6633 Sfmt 6601 C:\DOCS\51031.TXT SHAUN PsN: DPROCT
9 

tionally, there are many factors that deal with elections, but we 

had an election on April 4th, and it is true that I have served 

Bastrop for 20 years. We had none of the negatives that usually go 

with incumbents being not reelected: no malfeasance in office, no 

criminal charges; to use one of our favorite Governor’s terms, not 

being caught with a dead girl or a live boy. None of that kind of 

stuff happened. But the attitude of the people was they wanted 

change. That was not the major reason, but that was a contributing 

factor to the sustainability of government. When economic devastating activities happen, people lose hope. They lose their rational capacity to think wisely—not that I should have been elected, 

but they start looking for life preservers, and change might be a 

life preserver. 

One of the interesting situations that happened just recently— 

and we can attribute it, I think, to the closure of IP—is a staple 

in most communities, Kentucky Fried Chicken closed in Bastrop. 

That sounds comical to me to learn that if a chicken place closed 

in the South, that is a signal. And I use that to indicate that plant 

closures, economic conditions, whether globally inspired or because 

they were maturing or declining, definitely have an impact, and it 

reduces the potential of small businesses to grow. 

Thank you. 

[The prepared statement of Mr. Hawkins follows:] 

10 


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Chair LANDRIEU. Thank you, Mr. Mayor. 

Mr. Glover. 

STATEMENT OF HON. CEDRIC B. GLOVER, MAYOR, CITY OF 

SHREVEPORT 

Mr. GLOVER. Thank you, Senator. It is indeed a privilege to have 

the opportunity to be able to be here today. I want to thank you 

for your leadership as well as your commitment and your vision for 

Louisiana. Your continual presence throughout the entirety of the 

State, Senator Landrieu, is a great inspiration and has really been 

appreciated. I am also extremely honored to have the opportunity 

to be able to sit here at the table with my former chairman, Rodney Alexander. He and I served together, but there is only one individual who I continually refer to as ‘‘my chairman’’ whenever I 

have a chance to be in his presence, and that is Congressman Alexander, because when I was a member, he was the Chair of the 

House Committee on Health and Welfare. 

Chair LANDRIEU. And what Committee did you two terrorize? 

[Laughter.] 

Chair LANDRIEU. Health and Welfare? 

Mr. GLOVER. Absolutely. He led with great courage and aplomb, 

and it was always a pleasure to have the opportunity to be in his 

presence and to work with him, to do, I believe, some things that 

hopefully made the State of Louisiana a little bit healthier as well. 

I am also greatly honored to be here today with an individual 

that I respect. In 1992, when I was a young cub member of the 

Shreveport City Council and was given the great pleasure and 

privilege to be a part of what was called ‘‘Leadership Louisiana,’’ 

and [inaudible] down to Alexandria to meet my fellow participants, 

and I was just simply awed by the room of individuals assembled. 

I wondered how it is that a young 26-year-old could find himself 

in the midst of such distinguished individuals as Mayor Hawkins 

and Kathleen Blanco and so many others who were a part of that 

class of 1992. So I thank you for giving me the chance to be here 

to participate today. 

I also want to express my appreciation for all the various individuals from the Small Business Development Center, [inaudible] 

Shreveport and the leadership there, as well as our Chamber, our 

Development Foundation, my staff, the city of Shreveport, and all 

of the citizens who came out and participated yesterday, as well as 

those who are here this morning. 

Our community, Senator and Congressman, has suffered some 

serious blows in the area of jobs, most notably, the elimination of 

the entire ship at GM Shreveport. There are numerous suppliers 

and vendors who have had to downsize their operations as well. 

The loss of even one job to the citizens of Shreveport causes me 

great concern. As mayor, I hold economic development as one of my 

primary responsibilities. 

Studies have shown that approximately 85 percent of new job 

growth comes from existing businesses. Of those new jobs, 75 percent are created by small business. Business retention and expansion are two elements of my administration. Government often creates obstacles that limit small business growth. We as a government must focus on developing partnerships with the business 

13 

community to address and eliminate these obstacles. While we will 

continue to [inaudible] manufacturing, distribution, and retail companies relocating to our region, we must focus on the bird that is 

in our hand. Some of the finest companies in America are right 

here right now in northwest Louisiana. 

The number of jobs lost always seems to be bigger news than 

jobs gained. Just last month, we celebrated a groundbreaking by 

[inaudible], adding approximately 450 new jobs to the Shreveport 

economy. This is an existing business that decided to expand right 

here in Shreveport. It had opportunities to go other places, but we 

made the case for northwest Louisiana, and that case prevailed. 

In addition to growth in the oil and gas industry, our film industry is also [inaudible] a cushion to help soften the impact of the nationwide recession. The expansion of digital media in our area has 

served as a catalyst for the growth of many small businesses in 

this field. These industries attract and retain young, vibrant entrepreneurs. Shreveport has been recognized in the last 2 years by 

MovieMaker Magazine as one of the top five places to make movies, [inaudible] production and to engage in these creative endeavors. For the last year alone, over $280 million has been spent in 

the production of film and media here within the Shreveport area. 

And with the help of the Louisiana Legislature, we hope that that 

success will continue for years to come. 

We have strong, dependable, healthy small businesses all over 

our community. Now is the time for those businesses to thrive. The 

city of Shreveport will do its part and join hands with each one of 

these businesses to help them flourish, because we understand that 

small businesses and the workers who populate them are the backbone of our economy. 

Successful efforts in economic development depend on the ability 

to provide those resources that are critical to job development. The 

Federal Government seeks to provide assistance through valuable 

programs such as the Small Business Administration as well as the 

Economic Development Administration. These programs and others 

provide education, training, increased access to capital, and direct 

financial assistance to small businesses. But we can do better. We 

pledge to work with you and with small businesses to make them 

better. City government will continue to serve on the front line of 

economic development and job growth. We will continue to use all 

available resources to promote job growth. While the loss of even 

one job is tragic, the gain of one job by any one of the citizens of 

Shreveport is a blessing. We will count our blessings one job at a 

time, and one job at a time we will emerge from this recession. 

Thank you, Senator, for giving me the opportunity to come before 

you today. 

[The prepared statement of Mr. Glover follows:] 

14 

PREPARED STATEMENT OF CEDRIC B. GLOVER


Insert offset folio 6 here 51031.006
15 

Chair LANDRIEU. Thank you both very much for very insightful 

comments about the situation that you are both facing, and I thank 

you both for being optimistic and forward-looking and continuing a 

positive vision, which is why you two have been excellent leaders 

for so long in our State. 

Let me ask both of you, if I could, the first question, and I will 

do a round of about 10 minutes of questions, and then we will move 

to our second panel. 

In your communities, what Federal programs have you found the 

most helpful in situations when either plants have closed or workers are laid off or business is impacted? And there are any number 

of programs offered, I think, through the SBA, Commerce, and 

other agencies. Can either one of you talk about either the Department of Labor in terms of the TAA funds for Bastrop workers, 

transitional assistance, HUD renewal programs, USDA Rural Development? In your experience, in your current or previous offices, 

have you found any Federal programs to be particularly effective? 

Why don’t we start with you, Mayor Hawkins. 

Mr. HAWKINS. Especially going from the proactive approach, the 

renewal community [inaudible] available for employers as it relates 

to employees is extremely beneficial, and this [inaudible] of diagnosing and prescribing situations to address potential closures [inaudible] community is extremely important. [inaudible] audience 

with the authority [inaudible] development. And even though the 

renewal community—the growth in the renewal community [inaudible] is extremely good, its limitations are it is on a census tract 

basis, and census tract based on population, poverty, [inaudible]. 

And in many cases, the industries that need to be impacted are 

outside of the [inaudible] census tracts. So we were able to [inaudible] help, get some concessions made. The International Paper 

Company as an example was not in the census—original renewal 

community designation. That program is extremely beneficial as 

well as Labor coming in doing the things that they do, the TIA, 

TAA, whatever it is called, and the displaced worker program, the 

[inaudible], all those are extremely beneficial. 

Chair LANDRIEU. And have you heard specific stories from some 

of the workers about the training that they have received? Do they 

find it to be quality training? Is it helping them actually connect 

to other jobs either in the region or somewhere else in the State? 

Just your general sense of the quality of these training programs. 

Mr. HAWKINS. Absolutely. It is always amazing, the people [inaudible] every dark cloud has a silver lining, and many of the individuals who were impacted by IP and Jordache Apparel back in 

1996 took advantage of the Federal and State retraining program, 

and they have launched careers that they ordinarily would not 

have gone into had the status quo. So, naturally, we did not want 

to lose the industries, but thank God for the government being, the 

Federal and State government being there, to provide them assistance and redirecting them to [inaudible]. 

Chair LANDRIEU. I know the Department of Labor is here. They 

may be able to answer this question if you do not know the specifics. But in terms of the unemployment benefits for the workers 

in Bastrop, these 550, can you generally describe what those beneVerDate Nov 24 2008 11:33 Jul 22, 2010 Jkt 055045 PO 00000 Frm 00019 Fmt 6633 Sfmt 6601 C:\DOCS\51031.TXT SHAUN PsN: DPROCT
16 

fits are or have been? And if not, I want to ask the Department 

of Labor, if they have that information, to come forward. 

Mr. HAWKINS. And I would be calling on them for more specifics, 

but one of the criticisms that we heard [inaudible] was that the unemployment benefits in Louisiana have a disconnect. We [inaudible] with the program in Louisiana versus Arkansas as it related 

to the period of time that was covered. I think there were some attempts made in Louisiana to change that, but—— 

Chair LANDRIEU. Will the Department of Labor come forward, 

please, and see if you can give this testimony for the record if you 

know it? If not, we will have to submit it in writing. Mr. Juarez, 

what is the general situation that—and you are out of the Dallas 

Office. Could you identify yourself? 

Mr. JUAREZ. Yes, Joseph Juarez. I am the Regional Administrator of the Dallas office. 

Chair LANDRIEU. Could you comment on the situation as it relates to the 550 workers, either specifically in Bastrop or generally, 

the unemployment benefits for people laid off and opportunities 

through your department for either retraining or low-interest loans 

or trying to move them to self-sufficiency? 

Mr. JUAREZ. Certainly. The first line of defense would be the 

basic unemployment insurance, which in Louisiana [inaudible] 

$284 a week. You have got the basic 26 weeks. As you are certainly 

aware, it has been extended where you can draw now up to at least 

52 weeks, depending on what the State determines the people [inaudible]. 

Chair LANDRIEU. Could you repeat that? What are the maximum 

benefits? 

Mr. JUAREZ. $284 in Louisiana a week, and the basic entitlement 

would be for 26 weeks. 

Chair LANDRIEU. Could it be extended at the option of the State? 

Mr. JUAREZ. Absolutely, extended benefits, and the Federal Government is paying that extended benefit now, an additional 26 

weeks, for a total of 52 weeks. And then the State would have the 

option to extend further. That would require State legislation. 

Also, I think a benefit which was alluded to are the training benefits that are provided. The Louisiana Workforce Commission, 

Workforce Investment Act, we provide extensive retraining to individuals who cannot go back into those jobs, and training could, 

again, go out to 2 years, provide assistance while they are being 

trained, a myriad of supportive service programs to include child 

care, transportation, assistance with supplies and equipment that 

they might need for training. 

Chair LANDRIEU. And is that training done on site? Or does that 

training occur off site in a community college? And what kind of 

training? And what are the costs associated with it? 

Mr. JUAREZ. The training could take various forms. It could be 

on-the-job training. It could be customized training that we would 

develop with the employer. A lot of training is through community 

colleges. It could be through private training institutions. 

The average cost will vary. It will depend if you do short-term 

training, if someone just needs short-term training to get back in. 

I also should mention incumbent worker training, the State has 

discretionary dollars that they can use for incumbent worker trainVerDate Nov 24 2008 11:33 Jul 22, 2010 Jkt 055045 PO 00000 Frm 00020 Fmt 6633 Sfmt 6601 C:\DOCS\51031.TXT SHAUN PsN: DPROCT
17 

ing. That also would apply to the State of Louisiana, which I think 

has one of the more aggressive incumbent worker training, which 

you have provided general revenues through the unemployment insurance tax for incumbent worker training. 

So the training can take a myriad of forms, be provided, again, 

on-site, in community colleges, and other training institutions. 

Chair LANDRIEU. Are you aware or Mayor Hawkins, you may be 

aware of the specific new training or options for training that was 

designed specifically in the Morehouse incident, the incident of the 

plant closing there? Was there a special training program developed either designed by the management in anticipation of lay-offs 

or by the workers themselves who anticipated this might happen 

or by the leaders of the community what training might be more 

beneficial than others, health care, construction, IT, et cetera? Do 

you know any specifics about that? 

Mr. HAWKINS. One of the things that we are doing—and this is 

looking forward. We are in the middle of a [inaudible] study which 

will help our community determine its direction in the future. We 

have been single-industry dependent for generations. The paper 

mill was our [inaudible]. People looked forward to going to work 

there, retiring from there, and receiving the benefits forever. 

So historically the training that has taken place through the 

workforce development of the State has been training that was specifically related to the paper-making process almost until the closure, because nobody felt that the paper industry—the paper mills 

in Bastrop would close. So the training [inaudible] related to the 

paper-making industry, now people who are taking basically—taking basic inventory tests to determine what their likes are and 

what their potential is to see where they will go. 

Regrettably, in small communities, in small rural communities, 

especially in north Louisiana, the training that people become involved with, unless it is [inaudible] related in most cases, the training that people will acquire will also cause them to have to leave 

because there are not that many opportunities for employment 

there. 

Chair LANDRIEU. Well, I think you raise a good point, and I have 

a question for Mayor Glover, and then we are going to move to our 

next panel. While incumbent training programs are absolutely, I 

think, very important to partner with businesses to make sure that 

their current workforce as well as training for the jobs they are 

doing, I do not think that we can do that at the expense of aggressive retraining programs for employees that, through no fault of 

their own, even having worked faithfully for 15, 20, sometimes 25 

years, find themselves in a period in their life where their one skill 

is no longer required in that industry. And I think that is what 

government needs to ensure, that we have the right programs and 

partnerships to give that particular family an opportunity to honor 

their lifetime work and service. And that is what I want to really 

focus on. 

In addition, it occurs to me about what is happening in these 

communities that since now many families are dual-income families and one spouse is laid off, let’s say, from one of the plants up 

in north Louisiana, the other spouse is employed at an ongoing 

concern, but the one spouse that is unemployed has to relocate for 

18 

work, locate outside of a 2-hour driving distance, if the spouse then 

has a choice to either follow the spouse to work and quit their job 

or to maintain that job and commute—which some couples do. My 

husband and I actually did that ourselves. But I understand that 

if the spouse left their job to accompany the family to another location to work, that person is not entitled to unemployment compensation under our current law. 

I think that we have to very strongly consider the flexibility required in our laws today to try to accommodate as many of the 

families’ choices that are very tough choices that these families are 

making and really honor the family unity and honor the spirit of 

the family being together. We have had many families separated 

through just terrible catastrophes and disasters. 

There is a young man I just met working, Mr. Bair, at one of 

your hotels, and with sort of sad eyes he looked at me and said, 

‘‘Senator, you do not recognize me, but I am from New Orleans. 

And part of my family is there, and part of my family is here.’’ Just 

as an example, I hear that every day. And he is enjoying it here, 

but he wants to get home. 

So I think that our laws, particularly as from our perspective, 

from Louisiana’s perspective, need to really be sensitive to the 

many challenges that families are dealing with to stay intact and 

to keep that check or checks coming through that front door to 

maintain themselves. 

Mayor Glover, let me ask you, what programs in your experience 

as mayor have been most effective? What would you want to suggest, anything that we might adjust or modify any of those programs? And if you could give any specifics, that would be helpful. 

Mr. GLOVER. Well, I am going to have to join, I believe, the chorus that has already stressed the success that both the Department 

of Labor has managed to achieve [inaudible] in terms of [inaudible] 

indirectly remember as a younger man dealing with the initial contraction, downsizing and ultimate closure of the AT&T Western 

Electric plant, an operation at one point that employed somewhere 

in the neighborhood of 6,000 people, and in a similar fashion as 

Mayor Hawkins just described, the very course [inaudible] 

downsized, reduced its employment numbers until its eventual closure as a result of the retraining provisions, workforce training 

provisions, education provisions within the Department of Labor 

for folks who are in those types of situations. 

One of the areas in particular I know that was enriched here in 

the Shreveport area that there are legions of folks who are now 

within the health care industry who were formerly employed with 

Western Electric, General Motors, or other companies that 

downsized, shut down, and individuals found themselves in situations having to acquire skills that allowed them to support themselves and their families. We are thankful that health care is such 

a significant part of this area’s economy that those individuals 

could stay here and find themselves employment situations that 

were not only stable but that afforded them an opportunity to livable wages as well as to be on a career track that could lead to additional growth and additional opportunities. 

And so we are beginning to see some of the initial phases of that 

manifest itself again within this area with the General Motors situVerDate Nov 24 2008 11:33 Jul 22, 2010 Jkt 055045 PO 00000 Frm 00022 Fmt 6633 Sfmt 6601 C:\DOCS\51031.TXT SHAUN PsN: DPROCT
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ation as I am counting the individuals throughout this region who 

are once again availing themselves of those opportunities. And 

what appears to be even one reality of our situation is that no matter how dire or how down the economy can be, if you are within 

the health care industry, especially those who [inaudible], then 

they are able to be able to find not just employment but the kind 

of employment that allows them to support themselves and their 

families in a decent fashion. 

Chair LANDRIEU. Well, I am glad you raise that issue, and it is 

right on point. I was at a dinner last night, and I understand that 

there is a requirement, I believe, a 30,000 gap in the number of 

nurses required in Louisiana right now. Now, I do not know how 

much it is region to region, but right now hospitals and the health 

care industry could hire an estimated 30,000 qualified nurses. 

So when you think about how much effort government puts into 

running after a manufacturing plant here and the money required 

to put up to save 1,000 jobs there, it seems to me that a very smart 

strategy might be to eliminate whatever barriers and obstacles 

there are right now to training nurses required to meet that requirement. And from my perspective as a United States Senator, 

I am often asked to extend H–2B visas to people coming in with 

special skills, and I am happy to accommodate the industry of a 

State that continues to cry for skilled workers, and I understand, 

particularly in places like Terrebonne Parish, with a 2.9-percent 

unemployment rate. But it is hard for me to justify that action 

when I am looking at Morehouse Parish with a 16- or 13-percent 

unemployment rate, or Shreveport-Bossier with a 6- or 7- or 8-percent unemployment rate or other places. And I am questioning: 

What is the disconnect between our resources and assets to train 

our people for jobs that are here now waiting to be filled? 

So I hope that the series of these hearings will help develop some 

strategy and call attention to some of these issues, and I am hoping 

that some of our panelists can expand on that on the second panel 

about what some of these options are. 

Do you have any comments about that from the Department of 

Labor? Are you all involved in any kind of way working in partnership with States to identify the career options that are available 

even in these difficult times? 

Mr. JUAREZ. Yes, Senator. One of the, I think, strong services 

provided by the Louisiana Workforce Commission is labor market 

information. And you are absolutely right, and certainly you are 

aware that this Administration strongly supports putting people in 

training in high-growth industries where there is a future. The 

stimulus dollars, the Recovery Act dollars to provide an additional 

80 percent or so of what we already put into the system we hope 

doubles the number of individuals that will be in training. But it 

has to be the type of training that you are discussing. It can’t be 

the short-term training that as the economy gets better, but it goes 

down, then the person is out the door. And I think the health care 

industry is an excellent example of the type of training. 

Remedial training is also available to our training system and I 

think provides those stepping stones, if you will, for individuals 

that do not have that education, that they can get into this higher 

type of education that is needed for these types of careers. 

20 

Chair LANDRIEU. Well, let me just mention for the record as we 

close—and I invite this other panel to come forward. But under 

education and training, the State has received $718 million 

through the Economic Recovery Act for education and training. In 

addition, $188 million for Special Education Part B State grants to 

improve educational outcomes for individuals with disabilities, raising the Federal contribution to nearly 40 percent. The level established by the law was authorized more than 30 years ago. Finally, 

a $5 million grant for a State employment service grant to match 

unemployed individual job openings through State employment 

service agencies and allow Louisiana to provide customized reemployment services. 

There is a $9.8 million dislocated workers grant that has been 

authorized for the State. There is an $8.8 million Department of 

Labor adult State grant. There is a $20 million Department of 

Labor youth State grant. There is a $9.8 million grant for vocational rehabilitation. And that is just to list a few of the additions 

and investments that the Federal Government is making in this 

specific area for the State of Louisiana. 

So we are hopeful that the State and the local officials, nonprofit 

organizations, and community-based organizations will take advantage. I know, Mayor, you and Mayor Hawkins have a copy of this 

document that our office provided. I am very proud that our office 

was the first Senate office to provide a customized document to our 

own State. This, I understand, is now being modeled throughout 

the Senate. We provided this to our elected officials weeks ago so 

we could get comfortable with what is in this recovery package and 

fashion some remedies that will help our people throughout the 

State face the challenges that are here and before us. 

So, without any further ado, I thank this panel for your testimony, and I thank Mr. Juarez for answering our questions. Thank 

you both. And the record will stay open, if you have any further 

things to submit, for 2 weeks. 

Mr. GLOVER. Thank you, Senator. 

Mr. HAWKINS. Thank you very much. 

Chair LANDRIEU. Thank you all. 

While the next panel is coming forward, let me recognize the 

elected officials that are in the audience. Senator Lydia Jackson is 

here. 

If the next panel will come forward, Karen Nardini, Acting State 

Director, Rural Development, U.S. Department of Agriculture; Michael Ricks, Louisiana Small Business Administrator; Corinne 

Dupuy, Director, Manufacturing Extension Partnership of Louisiana; and Tana Trichel, president and CEO of Northeast Louisiana Economic Alliance. 

We will give Mr. Ricks a minute to come to the witness table. 

While we are waiting for Mr. Ricks, let me begin by introducing 

Ms. Tana Trichel first. As I said, she is the President and CEO of 

Northeast Louisiana Economic Alliance. In this capacity she represents over 14 parishes for economic development and works with 

State and local groups to create and retain jobs. The Northeast 

Louisiana Economic Alliance is also responsible for the two largest 

U.S. Department of Housing and Urban Development renewal comVerDate Nov 24 2008 11:33 Jul 22, 2010 Jkt 055045 PO 00000 Frm 00024 Fmt 6633 Sfmt 6601 C:\DOCS\51031.TXT SHAUN PsN: DPROCT
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munity areas in the United States: the Northern Louisiana Renewal Community and the Central Louisiana Renewal Community. 

Corinne Dupuy is the Director of the Manufacturing Extension 

Partnership of Louisiana. She received a bachelor’s degree in mechanical engineering from the University of Louisiana at Lafayette, 

ULL, in 1986 and her master’s degree in engineering from the 

same university in 1995. She has been part of the Extension Partnership program since its inception and was Deputy Director of the 

program in Louisiana from 2001 to 2004. 

Michael Ricks is Louisiana District Director of the SBA. He was 

born and grew up in New Orleans, received his bachelor’s degree 

from the University of Houston, graduated from the Naval Postgraduate School, an MBA from Troy University in Alabama. He is 

medically retired from the army, and is a former infantry officer. 

Thank you for your service, Mr. Ricks. And he has served as Louisiana District Director for the SBA since last year. Prior to that 

he was District Director in Alabama. 

And, finally, last but not least, Karen Nardini is Acting Director 

of Rural Development of the U.S. Department of Agriculture. She 

is a native of Alexandria, Louisiana. She was appointed Administration Director in 1996. She began her career with USDA in 1979. 

So why don’t we start with you, Ms. Trichel, and thank you for 

your written testimony. But if you could summarize that testimony 

in the 5 minutes that has been allocated to you today, I would appreciate it. 

STATEMENT OF TANA TRICHEL, PRESIDENT AND CHIEF EXECUTIVE OFFICER, NORTHEAST LOUISIANA ECONOMIC ALLIANCE 

Ms. TRICHEL. Okay, thank you very much, Senator. We appreciate your efforts in our work with the renewal community. You 

have been out in the region working and promoting this benefit 

that has been so important to our region. 

We can document that the Commercial Revitalization Deduction 

Allowance has created 3,000 jobs since 2002, and that there has 

been over $250 million newly constructed businesses within these 

two renewal communities, the two urban renewal communities. 

The good news is that the program is working. The bad news is 

that we were progressively unemployed and progressively poor to 

qualify for the program in the first place. I appreciate Mayor Hawkins’ comments regarding this program, because I believe that the 

extension of these benefits will be critical to helping rescue us from 

the problems that we are now experiencing in this difficult economic time. 

Our job is, of course, to create jobs and to help whenever we can. 

When IP shut down in Bastrop, we worked and partnered with the 

Louisiana Workforce and local economic development leaders to put 

on a work fair, and we did this one differently. We invited companies only that had openings that were similar in their labor needs, 

and we were able to get jobs for 100 people of the 264 who came 

to the work fair. 

Additionally, I am glad you mentioned the educational component because we invited the technical schools and universities to 

22 

come, and we had 160 interviews for people who were encouraged 

to seek educational opportunities in high-demand fields. 

We have success stories in the region that can demonstrate the 

effectiveness of the Renewal Community Benefit Program. A small 

business in Winnsboro added four employees, built a new structure, 

and doubled their business. We have a company in Arcadia that 

added 235 employees and expanded their building. Union Tank testifies that renewal communities were an important component of 

their locating in Alexandria, Louisiana, and we have story after 

story and testimony that we could offer you. 

We feel that this program is currently at risk. However, it was 

recently costed at $11.5 billion to extend the renewal community 

program, but the Department of Housing and Urban Development 

can document that the program thus far, which was regionally cost 

at $11.5 billion at its inception, has cost about $3 billion. So we are 

very [inaudible] we feel that the extension money does not cost that 

much at all. And we appreciate your efforts and encouragement 

and are hoping that this bill gets the attention that would be important to our area. 

When Pilgrim’s Pride lost 1,200 jobs in Farmerville, we provided 

community economic triage. Assuming the worst, we looked at food, 

shelter, education, how were we going to handle people who did not 

have health care and could not pay for it. And I must say that it 

was a shining example of what a community can do if it works together, partners, and has a common goal. 

The risk to jobs in that area was so much higher, the impact has 

been estimated at 5,000 jobs if we lose the 1,300 jobs at Pilgrim’s 

Pride. That is a loss of services in the city, the loss of services in 

the parish. The school cannot be supported at its current level. So 

it is so much more devastating than just the loss of jobs, other 

small businesses closing, as Mayor Hawkins alluded. 

One of the bright spots we have in our area—you were talking 

about training, and although [inaudible] is not here, I would like 

to mention the fast-track training program which we will give to 

any employer a trained workforce or we will train them for free. 

This new program that is modeled after Georgia was key in our 

luring Gardner Denver Thomas to put their headquarters in Monroe, moving it from Sheboygan, Wisconsin. 

Another bright spot in our region is Franklin Farm. You are so 

familiar with that initiative. But it is at the moment the only 

State-owned site being marketed to the manufacturing industry. 

We have focused on the automotive industry, and we have not let 

up on those efforts. We have pent-up demand in changing—the 

changing automotive environment means there are still opportunities out there. But the objective is to create a massive number of 

jobs at one time. We have been poor forever. We have had wonderful initiatives to help us in our poor situation, but jobs cure poverty. And this is our wonderful opportunity to make that happen 

in northeast Louisiana. 

In fact, we are now ranked in the top growth sites in the Nation. 

With a little more work, we are hoping to [inaudible] we hope to 

encourage them. We believe that this site can be moved to the 

number one spot in the Nation. 

23 

We realize that we face as many challenges as we have opportunities, but we do not want to lose any of our opportunity efforts. 

We appeal to Congress and we appeal to you to give Federal consideration to the passage of the EZ, EP, RSD legislation. Those are 

various versions of the same initiative, and most every State in the 

United States has one of those programs, and that we [inaudible]—— 

Chair LANDRIEU. Does it have a real name? 

Ms. TRICHEL. Yes, the EZ–EP–RSD Coalition effort to—it is Senate bill—it does not have a number this year, but I will get that 

information to your office for sure. 

[The information follows:] 

Ms. TRICHEL. We are grateful for your dedication and your commitment. I want to say thank you personally for saving Louisiana 

after Katrina. You know, that—— 

Chair LANDRIEU. Thank you. There were a lot of people that 

helped with that, and it is still in the works, particularly with the 

people from Morehouse Parish, the challenges before them in a parish of 24,000 and how difficult this 1,400 loss of jobs is going to be 

and the potential impact of an additional 5,000 jobs in the area. 

That is not necessarily counting the impacts of the hundreds of 

growers that are in the region, and if a solution is not found, it 

could have ripple effects all the way through south Arkansas and 

that plant shutting down as well. And there is only a part of the 

processing plant to be kept intact. But I will share that the public 

in St. Bernard lost—the community of St. Bernard lost every home 

and every business in St. Bernard Parish in Katrina. And it will 

be the 4-year anniversary this August, and that is a 100- percent 

loss of homes, physical loss of homes, and 100 lost businesses. That 

parish is slowly but surely, through just the heroic efforts of the 

people of that parish and the help that the rest of us have been 

able to provide for them, they saw a future that looked extremely 

dim 4 years ago. 

So you always have to put these things in perspective. As difficult as things may be, there is a road forward, and there is a way 

up. And if you put the right strategies in place, which is what this 

hearing is about in some measure, we can grow better and stronger 

communities, even out of, you know, these very frightening and 

troubling and in some ways catastrophic situations. 

Do you have any closing remarks? Because your time is almost 

up for testimony. 

Ms. TRICHEL. One more thing, and I hate to end on a negative, 

but I failed to mention the $1 billion farming disaster that we had 

last year that we are recovering from all over the State. But we 

appreciate your efforts, again, Senator and thank you for having 

this hearing. 

[The prepared statement of Ms. Trichel follows:] 

24 


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25 


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26 

Chair LANDRIEU. You are speaking about the losses from Ike and 

Gustav? 

Ms. TRICHEL. Yes. 

Chair LANDRIEU. That was about a $1 billion—almost a $1 billion loss to our State, somewhere calculated by Commissioner 

Strain between $700 million and $1 billion. I am happy to report 

that we were able to secure under the American Recovery Act $750 

million to help our farmers. Now, not all of that money will come 

to Louisiana, but a good portion of it. I am thinking that approximately 50 percent, based on what Commissioner Strain has been 

able to negotiate, will come directly to the impacted parishes that 

were really not—the Federal Government was not as helpful as I 

thought they should be, and one of the things I was able to get in 

the recovery package was $752 million help through the Department of Agriculture. Those funds are on their way, and they are 

being worked out now. So that will be very helpful to counties in 

the south and particularly the parishes in Louisiana. 

Mr. Ricks. 

STATEMENT OF MICHAEL RICKS, DISTRICT DIRECTOR, LOUISIANA DISTRICT OFFICE, U.S. SMALL BUSINESS ADMINISTRATION 

Mr. RICKS. Chairwoman Landrieu and distinguished members of 

the Small Business and Entrepreneurship Committee, thank you 

for the opportunity to testify before you today on the topic of manufacturing closures in northern Louisiana and the impact that these 

closings will have on small Businesses and communities in general. 

The Small Business Administration is acutely aware of the difficult economic situation being experienced by small businesses in 

the State and throughout the Nation. Recent closures of several 

large businesses in northern Louisiana has severely impacted 

many small businesses in our community that depend on these 

large firms for revenue and jobs. 

SBA’s Louisiana District Office stands ready to assist small businesses in this area by providing access to capital through our guaranteed loan programs and also through the provisions included in 

the American Recovery and Reinvestment Act of 2009, counseling 

through our entrepreneurial development program, our SBDCs and 

Women’s Business Centers, and also SCORE chapters throughout 

the State, and also procurement contracting opportunities that 

small businesses can leverage through our procurement counseling 

representatives that work with Federal agencies to ensure that 

small businesses have an opportunity to participate in Federal contracting. 

SBA’s entrepreneurial development programs delivered by Louisiana Small Business Development Centers have worked in partnership with the Entrepreneurial Development Office and also the 

university system, and they provide 11 centers across the State to 

deliver that service. In addition, we have six SCORE chapters 

throughout the State and two Women’s Business Centers—one located in New Orleans, and I think that you were very instrumental 

getting it started, and also another on in Lafayette, Louisiana. 

The numbers speak for themselves, and last year, our total counseling resource partners served 13,380 clients, and based on perVerDate Nov 24 2008 11:33 Jul 22, 2010 Jkt 055045 PO 00000 Frm 00030 Fmt 6633 Sfmt 6601 C:\DOCS\51031.TXT SHAUN PsN: DPROCT
27 

formance to date this fiscal year, we are expecting a 21-percent increase. So, understandably in difficult economic times, we are seeing an increase in requests for assistance, and the SBA will work 

to ensure that we can deliver the requested services and in an efficient way. 

Consistent with overall credit markets, the SBA loan volume 

under our guaranteed loan programs is below fiscal year 2008 levels. In Louisiana, as you mentioned, the lending activity here in 

this State is not as bad as across the country, but we are still pacing at only 72 percent of 2008 levels. Early indications are that 

some of the changes that were made by the Economic Recovery Act 

are having a demonstrable impact on lending activity in the State. 

Loan approvals, for example, over the last 2-week period have increased 148 percent over what we were experiencing in the first 

few weeks of this current fiscal year. So I believe that it is possible, 

given these trends, that in Louisiana our loan volume could actually exceed last year’s with these changes. 

Commenting on that, providing guarantee percentages up to 90 

percent from our normal 75 percent in our standard 7(a) loan program has had a significant—is a significant factor in increased participation by SBA lending partners. It is clear that these risk mitigation steps have been effective in increasing participation by our 

lending partners. The elimination of borrower and lender fees on 

SBA-guaranteed loans has also had a positive effect not only on 

lender participation, but has also provided substantial benefits to 

small business borrowers. While I was preparing this statement, I 

took a call from one of our lending partners in Monroe, Louisiana, 

who had used SBA to fund a restaurant and a pharmacy, and he 

called back with very positive statements about how the SBA 

quickly and efficiently provided a $15,000 and a $13,500 refund 

back to these businesses after the loans had already been closed. 

It is these kinds of things that the SBA has to maintain and continue to do to assure—to demonstrate that we have a commitment 

to our lending partners to efficiently deliver our services and that 

the SBA is committed to implementing effectively and efficiently 

these policies to increase economic activity. 

Government contracting under the 8(a) loan program has been 

robust. We have 115 certified 8(a) firms in the State of Louisiana, 

and over the last 3 fiscal years where we have complete data, a 

total of $656,704,651 with 773 contracts and contract modifications 

have been earned by these 8(a) firms. As Hurricanes Katrina, Rita, 

and Wilma recovery construction contracts reach their conclusion, 

we are seeing a drop-off in contracting opportunities for these 8(a) 

firms, but even though these are dropping off, we are still seeing 

contracting dollars maintained at levels higher than prior to post– 

2005. So indications are that we are going to continue to have robust growth in the program. 

Chair LANDRIEU. One more minute, please. 

Mr. RICKS. Yes. Everyone is rightly concerned about the SBA 

HUBZone certification program. Currently, we have 291 certified 

HUBZone firms in Louisiana, and the administration has begun an 

aggressive site visit plan to ensure that these small businesses are 

in compliance with the requirements. 

28 

Again, I thank you for the opportunity to address the Committee, 

and I appreciate the opportunity not only to answer your questions, 

but also to hear what other people have to say so that I can more 

effectively do my job. 

[The prepared statement of Mr. Ricks follows:] 

29 


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30 


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31 


Insert offset folio 11 here 51031.011
32 

Chair LANDRIEU. Thank you, Mr. Ricks. I will have a few questions as we come back after the panel has completed the testimony. 

Ms. Dupuy. 

STATEMENT OF CORINNE L. DUPUY, DIRECTOR, 

MANUFACTURING EXTENSION PARTNERSHIP OF LOUISIANA 

Ms. DUPUY. Good morning, Senator Landrieu. I would also like 

to take the opportunity to thank you for the work that you have 

done in the State, and especially for manufacturers. You have been 

of great assistance to our program as well. 

As you mentioned, I am the Director of the Manufacturing Extension Partnership of Louisiana, and I very much appreciate the 

opportunity to talk here today about the MEP. We are the NIST 

MEP affiliated center in the State of Louisiana hosted by UL-Lafayette. The mission of the MEP is to provide Louisiana manufacturers value-driven best practice solutions that increase profitability and productivity. With a field office located right here in 

Shreveport, we have firsthand appreciation of the difficulties Louisiana manufacturers are facing. In the last 3 years, eighteen manufacturing facilities have closed in north Louisiana with an estimated loss of 5,243 jobs. While the current economic downturn 

poses serious challenges for Louisiana manufacturers, I believe it 

also provides an impetus for companies to consider their future. 

Now, more than ever, the Louisiana manufacturers require access 

to tools that allow them to cut costs and increase productivity but 

also position their companies for growth through the identification 

of new markets and new customers—both in the U.S. and abroad. 

MEPOL and the entire MEP network of centers are working to 

provide manufacturers with those tools. We are making a difference. In 2008, in Louisiana alone, we helped our clients generate 

new and retained sales of $120 million, achieve cost savings of $73 

million, and create and retain more than 1,977 jobs. This data 

comes directly from measurements by the companies once we finished work with those companies. 

In supporting Louisiana manufacturers, we work with many 

partners, including the Louisiana Small Business Development 

Centers, the [inaudible] Technical Assistance Centers, USDA Rural 

Development, the Southwest Trade Adjustment Assistance Center, 

Louisiana Economic Development, and the Louisiana Workforce 

Commission. 

A recent success was our work with a company called Louisiana 

Binding Service. Louisiana Binding was devastated by Hurricane 

Katrina in 2005. They are an archival products manufacturer specializing in custom high-end document binders. Owners and brothers Pat and Scott Williams made the tough decision to relocate to 

DeRidder, a small community in rural Beauregard Parish near the 

Texas border, after losing their facility in Harvey, Louisiana, which 

is near New Orleans. 

Following the relocation, they had numerous issues and challenges with the workforce and training them and having skilled 

workers. Only a couple of their previous employees with the necessary skills permanently relocated with the company. They needed 

training for their new workers. LED asked MEPOL to come in and 

assess their situation. 

33 

MEPOL assessed their workforce issues and coordinated training. The company underwent leadership and motivational classes 

to combat work ethics and morale issues. After training was complete, with a more cohesive team in place, Louisiana Binding began 

a series of lean training to streamline and standardize their process. 

As a result of the devastation of Hurricane Katrina, which included widespread mold and water damage, an innovative solution 

to protecting important documents was realized by the Williamses. 

The Williams brothers designed a ‘‘Disaster Safe County Binder,’’ 

and in late 2007, with the help of MEPOL, filed for a provisional 

patent. 

The services Louisiana Binding received from MEPOL attributed 

to $12 million in increased and retained sales, $750,000 in cost savings, and 115 jobs create or retained in a very rural community. 

And as we understand, by the end of this year, they plan to open 

a second facility back in the New Orleans area with hiring initially 

30 people. 

I believe that with additional resources, new collaborations, and 

expanded partnerships, MEPOL and the entire MEP network will 

be positioned to not just help companies survive in the near term, 

but also work with these organizations to set them on a path to 

sustained and profitable growth. Much like our response to the recent natural disasters, we are ready to pull together in this economic disaster with targeted responses to meet Louisiana manufacturers’ most immediate needs and provide tools to help them prepare for the future. 

I would just like to add that we also were successful in receiving 

USDA Rural funds for manufacturers in the rural areas of the 

State with your support, and also through LED’s small and emerging business program, we received a small amount of funds to help 

manufacturers become involved. 

Thank you. 

[The prepared statement of Dupuy follows:] 

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Chair LANDRIEU. Thank you very much, and I particularly appreciate your sharing the specific story about a success, because it 

really helps us to learn of the opportunities that business lost and 

people think they could recover, but through the tragedy they 

found a great need to find a new way to protect documents from 

natural disasters. Whether it is a hurricane, a tornado, or an earthquake, I would say that is quite an expanding business model or 

opportunity considering as the country searches for solutions to 

prepare themselves better for a disaster. So we are very encouraging by what you shared about that business, and please give the 

owners my congratulations. 

Ms. DUPUY. Thank you. 

Chair LANDRIEU. Ms. Nardini. 

STATEMENT OF KAREN G. NARDINI, ACTING LOUISIANA 

STATE DIRECTOR FOR RURAL DEVELOPMENT, U.S. DEPARTMENT OF AGRICULTURE 

Ms. NARDINI. Senator, thank you for the opportunity to discuss 

the opportunities for business and industry available through 

USDA Rural Development. 

USDA Rural Development is committed to the future of rural 

communities. Nationally we administer over 40 programs that help 

provide infrastructure, housing, community facilities, and job creation and retention. Our economic and community development 

mission is supported by a diverse program portfolio. 

We strive to help build and expand Louisiana’s workforce 

through our business and cooperative programs. We help build 

strong infrastructures in Louisiana’s rural communities through 

our electrical, water and waste, community facilities, and telecommunications programs, in addition to our mission to finance 

homes and apartment complexes in rural areas. 

During the past 5 years, USDA in rural development has invested about $2 billion in rural Louisiana through our business, 

community, and housing programs. We also seek to increase the 

impact of Federal funds by partnering with other Federal and 

State agencies as well as nonprofits, to respond flexibly and efficiently to the needs of Louisiana residents, businesses, and communities. When a rural community is facing a crisis, we respond by 

working with local, State, and Federal partners to identify ways to 

provide assistance. 

In recent months, as plant closures were announced, USDA 

Rural Development worked with LED, Louisiana State University 

Agricultural Center, Louisiana Department of Agriculture and Forestry, Louisiana’s Governor’s office, and the Small Business Administration to identify ways to assist impacted communities. Our 

agency also worked with Louisiana’s Commissioner of Agriculture, 

Louisiana’s Commissioner of the Office of Financial Institutions, 

and Louisiana State University’s Business and Technology Center 

to examine financial options for closed plants. 

We deployed our staff to communities in crisis to provide the information on USDA Rural Development funding opportunities, and 

we regularly follow up with partner agencies, community leaders, 

and borrowers, to assess those needs and address those needs. 

38 

In the two parishes most impacted by recent plant closure announcements, Morehouse and Union, USDA Rural Development 

has invested almost $73 million. Our portfolio includes hospitals, 

community water systems, a farmers’ market, homes, apartments 

for families and the elderly, fire departments and equipment, law 

enforcement facilities and equipment, community waste systems, 

and more. 

This investment could be greatly influenced by adverse impacts 

of any plant closures. We are committed to working with the affected communities to restore a healthy, growing economy. 

When nature’s storms struck Louisiana, we joined forces with 

our partners to help Louisiana’s communities recover. Now, as Louisiana faces an economic storm, USDA Rural Development is working with our partner agencies to help Louisiana’s communities recover. 

We will protect our investment and continue to work to find financial solutions to the economic problems in Louisiana. 

Senator, thank you for the opportunity to present this information on behalf of Rural Development today. 

[The prepared statement of Ms. Nardini follows:] 

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Chair LANDRIEU. Thank you very much, and I want to by thanking you, Ms. Nardini, for being so quick in following up on the 

hearing yesterday where I suggested that maybe the SBA and the 

USDA could work more in partnership, because the Small Business 

Administration—which I now have direct oversight of as the Chair 

of this Committee, it occurs to me that many of the programs that 

we are operating are very similar to the USDA. And if we can join 

forces in Louisiana, I think we can be even more effective through 

our communities. So I thank you very much, and I understand you 

have already had a discussion this morning with the SBA representatives, and I appreciate that, Mr. Ricks. 

Let me ask—and I think someone from the Department of Commerce is here—if you would just come forward, if you could and 

give us a little bit more—I think it is Amy Debrozinski. Thank you, 

Amy. I may have butchered that name there, but could you correct 

me for the record? 

Ms. DEBROZINSKI. Most of the folks call me ‘‘Amy D,’’ Senator. 

CHAIR LANDRIEU. ‘‘Amy D,’’ all right. But thank you for being 

here. Could you just comment in a little bit more detail about this 

Manufacturing Extension Partnership Program. I understand it 

was created by law and funded in 1996, so it has been around for 

over a decade. Can you describe the Federal Government’s perspective on this program and maybe add something to what has already been testified to by Ms. Dupuy? 

Ms. DEBROZINSKI. Yes, I would love to. Thank you for the opportunity today. The program actually started in 1989. It went national in 1996, so we have been operating for 20 years, two decades, and Corinne has given a great example of what happens at 

the local environment, and the national program brings together 

all of these resources so we are able to share best stories and best 

practices across the country and to bring observations that we may 

see in one State, bring it to bear to the local communities. 

Also, she highlighted a very important part of our program. We 

strongly believe in partnership. It is in our name, and we have 

tried to seek out other government agencies, whether they are at 

the local, State, or Federal level, to do just what you have indicated. We need to leverage the resources we have. Everything is 

going to be constrained in the future, and what we really need to 

do is build on those investments so that it comes to the benefit of 

these small businesses and manufacturers. 

Chair LANDRIEU. Can you give, besides Ms. Dupuy’s, an example 

or two from Louisiana or from any State that might come to mind, 

some success story that typifies the kind of work that you all try 

to do on behalf of this program? 

Ms. DEBROZINSKI. I don’t have one specifically from Louisiana. 

We submitted one for the record from Louisiana [inaudible] an interesting one for today is our program to work with companies, and 

specifically in the Midwest, we have identified the impact on the 

auto industry and [inaudible] pertains to the South as well, but the 

idea of market diversification. As Corinne indicated in her example, 

the idea that companies have to recognize that they may go into 

different industries. And our experience [inaudible] to help companies comply with regulations and new standards, whether they are 

national standards or international standards, gives us the opporVerDate Nov 24 2008 11:33 Jul 22, 2010 Jkt 055045 PO 00000 Frm 00049 Fmt 6633 Sfmt 6601 C:\DOCS\51031.TXT SHAUN PsN: DPROCT
46 

tunity to help those companies realize that they be more than an 

auto supplier. They could get into the medical industries, into new 

technologies, and things like that, and that is the area that we are 

very focused on right now. 

The people of Louisiana, their association with the university is 

a great opportunity for us to really take the technology and research that is happening in the universities and move that out to 

our small companies. So that is what we are looking forward to. 

Chair LANDRIEU. Thank you. And, Ms. Dupuy, state for the 

record where you all are currently located, and you have, I think, 

three offices in Louisiana. 

Ms. DUPUY. Yes, ma’am. We are headquartered at UL-Lafayette 

in Lafayette, Louisiana. We have an office in Shreveport [inaudible], and we also have an office at LSU in Baton Rouge serving the 

[inaudible]. 

Chair LANDRIEU. I am very interested, and I am going to pursue 

this program to learn more about it through the Department of 

Commerce. I do understand that it was scheduled for elimination 

annually under the last administration, and Congress stepped forward to keep this program running. So I would like to learn more 

about it, as I was a part of helping to keep this program operating, 

and see how it can be even more effective here in Louisiana. 

Let me ask you a few questions, Mr. Ricks. I know you are a 

New Orleans native but your recent experience has been in Alabama. I am very pleased to hear you say that in the last 2 weeks, 

according to your testimony, the loan approvals have increased 148 

percent. I would suggest and ask you if you agree or if you could 

comment, there would be some other pressures pushing these numbers, that this would probably be a direct impact of the Economic 

Recovery Act that, again, reduced the fees—eliminated the fees, 

which can be in some instances substantial for these small businesses and banks. We have eliminated those fees and raised the 

guarantee of these SBA loans from 75 percent to 90 percent in our 

attempt—and we hope a successful attempt—to unfreeze the credit 

markets and get credit flowing to business that have proven profitable and sustainable for decades that now look out and see the 

next year or two as a very difficult time to manage through. And 

we want to do what we can to unfreeze those credit markets and 

thought that perhaps this action—I am hoping that these reports 

that you are giving us for Louisiana are being reflected around the 

Nation. 

So my question is: Is that the record that you submitted? And 

do you have any indication that these numbers are jumping like 

this around the country? 

Mr. RICKS. I don’t have any specifics to point to, you know, I do 

not have any broad data that shows where the increase is across 

the country. But indications are, based on my cursory analysis of 

what is going on not only in Louisiana but other districts that are 

in our region, we are seeing an increase in lending activity. It is 

my opinion that the reason why the numbers are going down is because of the changes in the Economic Recovery Act. 

Increasing the guarantee percent at 59 percent actually has a 

couple of effects. Number one, it provides a greater risk mitigation 

for the lender, makes him more likely to make the loan, since their 

47 

exposure goes down significantly; but also an important factor [inaudible] as you know, the guarantee rate on an SBA business loan 

does not count against a lender’s lending limits. So right now we 

are having this—when you look at the credit market that is clogged 

up, one of the reasons is—the banks, they have money to lend out, 

but because of lending limits imposed by regulators in the interest 

of institutional safety, they cannot do it. Well, the guarantee percentage, that SBA guarantee percentage does not count against 

their lending limits, so 90 percent of the loan that they make does 

not count. 

So, in theory, what you could have is you could have $10 million 

in loans that you can have and would like to make, but your lending limits are only going to let you make a million dollars in loans 

rather than lending out the whole $10 million, because if you take 

each loan and you put a 90-percent guarantee on top of it, of 

course, do the math, you only have 10-percent exposure, so there 

is only $1 million of the $10 million that you are actually making 

count against the lending limit. Lenders are starting to see this, so 

I think you are going to begin to see more activity. 

Some other changes, the secondary market, the creation of the 

secondary market by the administration I think sent a positive impact nationally. These kinds of programs have a limited effect on 

Louisiana because most of our lenders here in Louisiana want to 

make loans and keep them on the books. There is not a real market for secondary market sales, but we are seeing that. We do have 

some [inaudible] lenders that operate in that space, like Chase 

Bank, [inaudible] of Houston, and I expect to see some numbers increase there as well. 

But that, I think, is going to have a big impact on getting some 

of the larger national lenders back in the business of making loans. 

They are going to be able to sell those loans in the secondary market, free up the money, and then make more loans. 

The elimination of lending fees, I think—of course, it has a direct 

impact on the businesses because that puts more money in their 

pockets. I mentioned in my opening statement that—and that is 

just while I was preparing the document. I get calls all the time 

from people telling us that this is going to have a significant impact on their ability to keep their doors open because now they 

have got more money in their pocket. 

So, you know, if do the math, $15,000 or $13,500, that is a significant impact on a small business, and so, yes, eliminating the 

fees I think has had an impact. But as far as lenders are concerned, it is a lot easier for the lender to sell the concept of an SBA 

guarantee to a potential borrower when there are no funding fees 

attached. One of the key obstacles that you have with lenders participating in the program is, you know, all of our lenders are in 

competition with each other; they are all out there looking for the 

best loan deals. And when a potential borrower is sitting across the 

table from them and they do the risk analysis and determine, well, 

you know what we could do, this is with an SBA guarantee, well, 

now that loan officer has to sell the idea of a loan, an SBA loan, 

to that potential borrower. When there is a 3.5-percent funding fee 

on top of that, it makes it a lot more difficult. 

48 

What ends up happening is, you know, they may leave and they 

may go to another bank, and the truth of the matter is that actually extends the capital access problem. You know, the worst thing 

you can do when you find yourself in an economic bind is to drag 

it out. You need money, you need it as soon as possible. 

Chair LANDRIEU. You need it today. 

Mr. RICKS. Right, and it is a psychological barrier. And I think 

what we are seeing is it is a lot easier for a bank to say, ‘‘I’ve got 

to do an SBA loan. What is it going to cost me?’’ Nothing. You 

know, there is no funding fee. So it makes it a lot easier for banks. 

It makes it easier for them, sort of a package, didn’t cost—require 

them that they do not have large—the smaller the bank, the less 

likely they are going to have a dedicated staff for government-guaranteed lending, and if we can—so they have to outsource that service to third parties. And not having to pass that funding fee on to 

other people makes it a lot easier for them to absorb that cost. 

So, overall, I think it has had an impact here in Louisiana. I 

would venture to guess—and I will be happy to provide you with 

some more specific details later, but it is my opinion that these 

changes are going to have more of an impact in Louisiana than you 

are going to see in other parts of the country because of the unique 

characteristics of the banks that we have here. Our banks want to 

stay in the State; they want to make money in the State. They 

want to make money—they want to [inaudible] in the State. 

Chair LANDRIEU. And they are generally very healthy. 

Mr. RICKS. They are very healthy. We don’t have to paint them 

with a broad stroke, but, generally speaking, community banks in 

Louisiana are significantly healthier than other community banks 

across the country, and they are certainly a lot healthier than the 

national banks across the country. So I think that these—since 

they have money to lend, all they need is a method to either get 

around lending limits or also mitigate some of the risk factors, and 

that is what these changes in the Economic Recovery Act have 

done. 

Chair LANDRIEU. Well, let me follow up by asking you this: Given 

that—and I agree 100 percent with what you have just outlined. 

That has been my observation, which is why my Ranking Member, 

Senator Snowe, and I fought so hard to get this included along 

with our colleagues in the House, in the House Committee, to have 

this included in the stimulus package, the American Recovery and 

Reinvestment Act. But what is SBA planning to do? And as you 

know, Mrs. Mills, it was her first day on the job, the Administrator, 

on Monday. Her confirmation went through the Senate Thursday 

before we left. So she is very new to the job, but not new to the 

area. 

What is the SBA doing specifically and maybe you could say 

what you are doing in this region to reach out to Louisiana community bankers—those that are federally chartered as well as State 

chartered—to educate them about these new rules, the elimination 

of fees, and to encourage them to be partners with the SBA? Because I understand—I always am puzzled why only—I think it is 

less than 50 percent of our banks participate, and I would like to 

actually see a 100-percent participation rate so that the people that 

I represent can walk into any community bank in their own town 

49 

and avail themselves of the opportunities offered by that bank, 

stand-alone or in partnership with the Federal Government 

through the SBA. And I have been puzzled for many years about 

why that is not the case. So would you comment, please? 

Mr. RICKS. Yes, thank you. Well, first, what we have been doing 

since the change in administrations is we have had a significant focused effort by the Office of Field Operations to outreach to community banks and get them more on board. I will say this: That 

is something that I did in Alabama, and I did here in Louisiana 

even before the change of administrations. I agree with you, Senator, that our goal should be to try—the best opportunity for a 

small business to succeed is to develop a relationship with their 

local banks. 

In the past, in previous administrations, it did not really—it 

wasn’t that kind of focus. It was more of, you know, if we can get 

money—if a non-bank, out-of–State lender can make a loan to 

somebody, then that is great. And don’t get me wrong. I certainly 

appreciate our out-of–State non-bank lenders. Certainly they do 

offer a significant service. But I think that in the long run a local 

bank is going to give the borrower not only more favorable terms, 

but also the service that they are going to need as a relationship 

with their lender to guarantee success. I have to say that because 

that has always been our focus. You know, we have been outreaching to banks. 

One of the principal problems we have when you are trying to 

market to local community banks like that, my experience is they 

are all in competition with each other. So it is not realistic to say, 

hey, let’s all have a big meeting and talk about SBA lending, because they do not want to do that. And that is fine. I understand 

that. 

So our approach has always been one on one. You know, you 

really have to fight these battles one at a time, go from lender to 

lender to lender, because each lender has a different business 

model, and you have to understand what they want to do and develop a training strategy that fits with their business model. 

Chair LANDRIEU. Well, also—and I understand that. I have been 

puzzled by this myself, particularly when there is a 90-percent 

guarantee that the Federal Government is willing to absorb. I 

mean, we are absorbing the risk and are in a position to be able 

to do it. Of course, we are lending—you know, there are standards 

of lending. You must meet a certain standard, and you must be 

creditworthy. But we give a little more leniency than potentially a 

bank standing on risking their own capital, but that is what Government can do and what it should do. 

But there has got to be some incentives that potentially the Federal Government or the State, particularly those that are State 

chartered, in terms of encouraging banks, you know, not with a 

stick but with a carrot, to be aggressive in really seeking out opportunities to lend, because I will tell you, on the small business 

side—we have had many small businesses testify before the Committee. We did not structure this particular meeting this way because we needed to enlist this information for the record first. But 

I intend to follow up with panels of small business owners. We 

hear from small business owners in a variety of different fields 

50 

their inability to access loans from banks or from traditional credit 

lenders and that the markets are frozen to them. Their lines of 

credit are being reduced. Their interest rates are being increased. 

And we will never find our way out of this recession unless we are 

aggressively identifying creditworthy emerging businesses and give 

them the money and get out of their way and let them expand to 

create the jobs to take the place of the 1,400 that we potentially 

are going to lose at Pilgrim’s. We need to make up those 1,400 jobs 

somewhere. It is going to take a lot of small businesses to get the 

assets and resources. This archives company is an example that 

could potentially pick up two or three of those workers, or four or 

five or six or seven. Is there coordination between MEP and SBDC 

on this issue? 

Ms. DEBROZINSKI. I can provide the answer from a national perspective, and Corinne Dupuy can provide the answer for the local 

level. But we have been working with the SBDC centers, and specifically Antonio Doss, the Assistant Associate Director at the SBA, 

who is in charge of the SBDC programs. 

Chair LANDRIEU. Say what SBDC is for the record. 

Ms. DEBROZINSKI. Small Business Development Centers. And so 

we have been able to work together with him, and so our national 

network of centers who are focused on [inaudible], their national 

network of centers who are focused on small businesses, the larger 

population, have been able to work together and identify—the 

Small Business Development Centers work more with the folks at 

the entrepreneurial level to really identify how to start that business. We think that [inaudible] manufacturers and the operational 

level and the technology assurance. 

Chair LANDRIEU. Do you want to add anything, Corinne? 

Ms. DUPUY. Absolutely. I would just like to say that the Louisiana SBDCs and the MEP of Louisiana have signed an MOU, a 

cooperative agreement indicating that we promote such programs. 

And the way that pretty much works, for instance, I will talk about 

in the Lafayette area, the Small Business Development Center and 

UL–Lafayette, when they get a manufacturer that comes in and 

they need assistance beyond the business plans or starting—entrepreneurial starts, they will send them to the MEP to take it a step 

further. We might have an entrepreneur that comes in with a new 

product design. The Small Business Development Center will take 

them to a certain point; then they are referred to us, and we help 

them get patent applications, create prototypes, help them with 

marketing, and other things. So it sort of takes it a step further. 

When we are done with the portions that we work on, we refer 

them back to the SBDCs, and so it works out very well. The SBDCs 

sort of act as a marketing arm for the MEP program. They are in 

a lot more locations than we are. So it really works out well. 

Chair LANDRIEU. And I understand that Mary Lynn Wilkerson, 

our State director, is here. Would you mind coming forward if you 

would like to add anything? And while you are maybe thinking 

about that, let me ask Mr. Ricks: You said that in the 8(a) program 

in Louisiana we have 115 certified 8(a) small businesses. Can you 

share with us how they are divided around the State? Do you have 

the regions broken down inside of Louisiana? 

51 

Mr. RICKS. I don’t have that specifically, but I will tell you that 

a concentration of 8 (a) firms are—and this is true across the country—aware of what the Federal contracting opportunities are. We 

have a significant number of 8(a) firms that participate with Army 

Corps of Engineers projects along the intracoastal waterway and 

also the greater New Orleans area. So we have a concentration of 

8(a) firms there. 

We also have concentrations of 8(a) firms around Federal installations like Fort Polk and Barksdale Air Force Base as an example, 

and that is really mostly construction-related 8(a) opportunities. 

According to the Federal Regulations, these are locality based so it 

makes sense that they are near, in and around these areas. But we 

have a number, and I will be happy to supply specifics as to where 

they are located and get that back to you. But we do have a number of 8(a) firms that really are not locality based, where they are 

in the State but they actually leverage 8(a) contracts in other district offices as well. So they might be based here in the State, but 

they are actually leveraging contracts elsewhere. 

Chair LANDRIEU. And do you have any information, either during 

your time of service or prior, about how many companies apply to 

be 8(a) in Louisiana, how many are accepted, and how many are 

denied? A general, rough estimate or percentage. 

Mr. RICKS. Many times what ends up happening, it is difficult to 

tabulate that information because people drop off at different 

times. We have a number of people that express interest in the program, and then when they come to our certification seminars—we 

are going to have one today, as a matter fact. Once they realize 

what the 8(a) program is all about, they realize that it is not really 

something for them. It is really a program just for people who want 

to leverage Federal contracting opportunities. So if you are a restaurant, you know, there is not going to be a whole lot of opportunities. 

So it really is focused on different kinds of business sectors and 

what kind of opportunities are available. My guess is probably 

about for every 8(a) firm that comes into the program, you have at 

least four others that express some interest in the program, and 

when they drop off really depends on—most of them drop off on 

their own, and once they get into the application process and they 

realize what the reporting requirements are going to be and some 

of the unintended costs of actually participating in the program, 

they elect to withdraw prior to completion. 

But I will get that to you. I don’t know how many actually make 

it through the application process and actually drop off, but most— 

the SBA over the last few years has been very liberal in its interpretation of what is socially disadvantaged. So we have a number 

of people who come into the program that really do not fit the traditional dispatch business category. We have any number of 

women-owned businesses that operate in predominantly male 

fields, and the current interpretation is that is a social disadvantage, and they come into the program as well. People with disabilities is another one. 

Chair LANDRIEU. And the point of this program is to try to promote opportunities for entrepreneurs from socially disadvantaged 

groups. I support the goals of the program. I want to try to make 

52 

sure that the quality of this program and the effectiveness is made 

stronger. I think we can all work on strengthening. And I say that 

because the Federal Government is a major buyer of services, just 

like any large corporation would be. And our Committee, both Republicans and Democrats, actually feel very strongly about having 

small businesses in America be able to provide services to the Federal Government and not have small businesses shut out of opportunities that are right there in their own backyard just because 

they are small. They can be very profitable, very efficient, and very 

well run. But just like any large corporation, large corporations are 

comfortable dealing with their peer groups. And it is very hard to 

get a large corporation to divide up their big contracts in small 

enough chunks that small businesses can get involved. And it is 

very important for the Federal Government in my view to try to 

do that, because a Federal contract sometimes could help a small 

business at a very critical time in their growth and then really help 

them to go to that next step and then grow. 

So it is a strategy for growth as well as economic opportunity. 

And, I don’t know, Mary Lynn, if you have anything you wanted 

to comment about that or something else. 

Ms. WILKERSON. Mary Lynn Wilkerson, State Director for Louisiana Small Business Development Center. Thank you, Senator. 

I would just reiterate what Corinne said. Right after the national 

program signed the memorandum of understanding, we here in 

Louisiana signed a memorandum of understanding, and I think we 

have had it at least 3 years. We probably in our network see about 

300 manufacturers in any given year. That can be from thinking 

about it to in. My centers tell me all the time anecdotally that they 

send people to the Manufacturing Extension—MEPOL here in Louisiana, and we do—they come back to us. We do not formally track 

them, but we know that there is a significant number of the folks 

we work with that are referred to MEPOL. 

In addition, with the contracting, we also—there is a Federal 

memorandum of understanding with the PTAC program. And 

Sherrie Mullins and Kelly Ford are here with the PTAC program. 

We do use that exactly as you said because some of these small 

businesses are seeing a downsizing in their sales, or strategies for 

Government contracting, State contracting, international trade. So 

we look for any opportunity. We work for lots of people through the 

PTAC program, and I know that they have significant contracts, 

last year probably about $1 billion in contracts, Louisiana companies, which is significant. 

So, you know, you have three Federal programs that are working 

very closely together here in Louisiana. 

Chair LANDRIEU. Well, I think people would be encouraged by 

that because, you know, many of our experiences, including mine 

as an elected official, and citizens generally, sometimes think that 

there is not as much coordination as there could be or should be 

between Federal agencies, and it seems complicated and duplicative. But I am very pleased to see that in this particular area there 

seems to be a fairly substantial level of understanding and cooperation among your individual programs and how you can maximize 

the Federal investment, which is substantial to get the maximum 

benefit of being helpful and supportive on Main Street, on the 

53 

ground in our communities, large and small, throughout the State, 

which is where our focus is going to be. 

I am prepared to wrap up in just a few minutes. I do not mind 

at all having the Procurement Technical Assistance Centers come 

forward if you would like to just say a word for the record, if you 

would like to. While they are thinking about that, is there anybody 

else that wants to add something to this record before we close? 

Mary Lynn? 

Ms. WILKERSON. One thing I did forget to say is we have also leveraged funding through U.S. Rural Development. We do have dollars and, in fact, have just requested reprogramming some of those 

dollars for northeast Louisiana since the problems we have had up 

there, so we will be trying to do some of that. And we are actually 

working with some ag people at the University of Louisiana–Monroe to develop task management so we can begin to work with the 

chicken farmers and other people to help them streamline their financials. 

Chair LANDRIEU. And do you know how much money you are 

asking to reallocate? 

Ms. WILKERSON. Well, we just sort of added all the parishes. I 

have about $190,000 right now left in that grant, and we have 

got—you know, so I can—it is not per parish, I do not believe specifically. 

Chair LANDRIEU. But you are trying to allocate it and focus it for 

north Louisiana? 

Ms. WILKERSON. Yes. 

Chair LANDRIEU. I appreciate Mayor Hawkins staying with us. 

But the Pilgrim’s Pride situation hopefully will work with the partnership between two private entities with the State serving as a 

financier in this situation. But if it does work, there could continue 

to be a need to help these growers particularly refocus and reorganize themselves so they become more diversified. And they are 

growing not only chickens but potentially thinking about the opportunity to grow something else so that if this happens again, they 

will have some sort of diversified product base. 

There are all sorts of options, which brings me to a meeting I did 

yesterday on broadband technology, because getting high-speed 

Internet to some of our businesses, to our farmers, to our ag communities is absolutely crucial to strategic, strong economic development in the whole State, but particularly in rural areas. 

Again, I am very proud that the recovery package—and President Obama and his administration feel very strongly about this 

and have invested $7 billion for the Nation. Now, some people testified that they could use $7 billion in California alone to accomplish this goal. So it sounds like a lot of money, but the needs of 

the Nation are great. We are positioning Louisiana, I am trying to 

position Louisiana to get as aggressive as possible in this effort because this is a lifeline to many of our small businesses who do not 

have access to high-speed Internet. If they did, they could more 

easily change or strengthen their business model. Not only do we 

want our businesses to have access, but we need them to have affordable access. Fifty dollars a month for a residence or several 

hundred dollars a month for a business is sometimes very difficult 

to achieve. So we are looking for some creative solutions as to how 

54 

we get our businesses, you know, on high-speed broadband and getting access in every corner of this State. And I am going to take 

that on as a special project and working with anybody that would 

like to work with me on it. 

Let me ask you, if you could, to please identify yourself and you 

want to give a word or two about PTAC, Procurement Technical 

Assistance Centers, and identify your funding source. 

Ms. MULLINS. We are funded through the U.S. Department of 

Defense, and we have to have local matching money. The program 

that I represent is based at UL–Lafayette. We are called the statewide program. The program that Kelly runs covers ten parishes in 

west Louisiana. It strictly depends on where our funding money 

comes from. 

The program at UL has been there since the late 1980s. The past 

5 years’ worth of contract documentation we have collected from 

our clients indicates we have seen over $2.6 billion of contracts 

awarded at the Federal, State, and local level to our contractors, 

and those were folks that we have signed documentation—— 

Chair LANDRIEU. Is that nationwide? 

Ms. MULLINS. No. This is in Louisiana only. I do not have the 

Federal numbers. I know that the Association of Procurement 

Technical Centers at this particular time is compiling the data for 

2008. 

We do work with some large businesses also. One of our success 

stories has been actually working with Textron over in the New Orleans area and working with them on their small business subcontracting plans, which includes our small businesses. So the majority of our contracts come from small businesses, but we also have 

a hand in the private contractors, which is an excellent way to connect up those small businesses. 

Chair LANDRIEU. And why don’t you share for the record—because it is something I am particularly proud of since I helped to 

keep the Textron plant open. Explain to the public what they manufacture. 

Ms. MULLINS. Now you are asking me something tough here because I am not the one that is in that facility. 

Chair LANDRIEU. Well, let me help you out. They manufacture an 

armored security vehicle which is mine resistant and is a vehicle 

that is in great demand in Iraq and Afghanistan, as our troops patrol the areas and are subject to sniper attack and explosive device 

attacks, which is a pattern of warfare in that area, and the armored security vehicles, which are manufactured for the whole Nation here in Louisiana, at the New Orleans plant and the Slidell 

plant were subject to be closed. And our delegation fought to sustain them, and then the Army after the attack of 9/11 ordered 400 

vehicles. It was a huge contract, and I think what you do is step 

in to see that potentially some of the small businesses could participate in that project worth millions of dollars to contract to buy 

these vehicles. So you stepped in and worked with whom? 

Ms. MULLINS. We worked with the small business office, their 

small business liaison office, actually put together a subcontracting 

plan, which is a requirement that they use small businesses. And 

our contractor—or, excuse me, my councilman in that area is a retired contracting officer, and he actually spent day after day after 

55 

day working with them, formulating a small business plan, and put 

it together to comply with the Federal guidelines. And then we 

worked with them on an event that they did where they brought 

in small businesses to meet with them. 

Chair LANDRIEU. Okay. Ms. Trichel, do you have any other closing comments? I would like to wind down our panel. Just close for 

a minute or so, something that you want to testify to that you 

might have passed over. 

Ms. TRICHEL. Well, I would like to discuss the SBA lending. I 

was the first certified lender in the State of Louisiana for Small 

Business Administration, and my experience in that banking position and since, working with small businesses to acquire loans, is 

that small banks in particular perceive SBA loans as [inaudible] 

making a bad loan good instead of making a good loan better. And 

I believe that if there was an awareness campaign I believe if there 

were some incentives for small banks to become certified lenders or 

‘‘preferred lenders,’’ as it is called today, the decision process would 

be easier. 

Chair LANDRIEU. Thank you. 

Mr. Ricks, anything? 

Mr. RICKS. Just in light of that, I agree, I think that a goal, a 

worthy goal to get banks, local banks more involved in SBA lending 

would be to bring them on board as certified lenders, and the SBA 

does have two programs for that, the express program and the 

standard preferred lender program. That does make things a lot 

easier, but ultimately what we have to do is we have to do a very 

good job or a better job of convincing banks that SBA is their business model and how SBA fits and how the analysis needs to happen. And we are doing that now, and hopefully we will be able to 

get more people on board and make that work better for everybody. 

Chair LANDRIEU. Thank you. 

Ms. Dupuy. 

Ms. DUPUY. I would just like to say that earlier you had asked 

about specific examples in the State of Louisiana, and we have submitted some to you for the record. 

Chair LANDRIEU. Yes. 

Ms. DUPUY. Specifically north Louisiana, we have already done 

that. But we have many more success stories, and we have a lot 

of data that is substantial. If you need any of that information, we 

would be happy to give that to you. 

We would like to also offer you the opportunity to tour any of the 

facilities that we have worked with. A lot of the folks that we have 

worked with are very proud of the changes and the transformations 

that have taken place, and we would love to have you come in and 

see it. 

Chair LANDRIEU. Well, I am very and specifically very interested 

in this because there is a great clamor around the country and a 

call that the manufacturing base in America is declining and collapsing, and I think there is another story to be told. I think there 

is some traditional manufacturing that has moved overseas. It has 

been very disruptive and very difficult for communities. The textile 

industry comes to mind. The petrochemical industry is challenged 

by that as well, which we see in the State. And as things move 

internationally, I believe that I can see real opportunities for new 

56 

kinds of manufacturing, using cutting-edge technology across the 

board. And we want—I would like our manufacturing sector in the 

whole Nation to be strengthened. But, of course, my focus is to see 

it strengthened in Louisiana, and I want to look for opportunities, 

and I want us to be smart about the assets that are already here 

and making them work. 

So, Ms. Dupuy, I may want to take you up on a follow up, if not 

an official field hearing, a roundtable discussion to highlight some 

of these success stories. 

Ms. DUPUY. Well, I think you would be pleasantly surprised at 

what you may find, what Louisiana can offer in terms of manufacturing. 

Chair LANDRIEU. Thank you. 

Ms. Nardini. 

Ms. NARDINI. Thank you, Senator. I just want to summarize by 

saying Rural Development has about a $2.4 billion portfolio, and of 

that portfolio, about $235 million of that is our business cooperative programs. But the remainder of that money is in every other 

aspect of the rural communities, that all the things you heard me 

talk about today, the community facilities, the water, the sewage, 

the housing. So truly Rural Development has a big investment in 

rural communities, not just in the businesses but in all of the other 

things in the communities that are needed to sustain these businesses. And we truly are committed to the rural communities 

throughout the State and devising everything that we can to help 

them build and grow and sustain that growth. 

Thank you. 

Chair LANDRIEU. Thank you very much, and for the record—and 

I am going to submit this for the formal record, which is just an 

outline of the additional funding brought into the State through the 

American Recovery and Reinvestment Act. In the Department of 

Agriculture, there are substantial increases in the Aquaculture Assistance Grant Program, the Forest Service Grant Fire Management Watershed Program; the National School Lunch Program, 

which people do not realize is funded through the Department of 

Agriculture; rural broadband, which I spoke about; rural business 

programs, grants, and loans; rural community facilities grants and 

loans; rural utility grants programs; and rural water and waste. 

Now, these are block grants that have come from the Federal 

Government in addition to the annual appropriations through the 

stimulus package to try to in some cases double and triple the 

amount of money that the Federal Government normally sends to 

the State, to try to get projects underway, hire people, you know, 

keep local government and nonprofits moving forward. 

So I hope that people will be focused on what substantial help 

some of this funding can be for the programs and how small businesses in these rural areas can benefit directly and indirectly. 

Any closing comments or remarks from the panel? 

Ms. DEBROZINSKI. No. We just appreciated the opportunity and 

your focus on manufacturers and small businesses. 

Ms. WILKERSON. Thank you on behalf of the College of Business. 

You have helped us. We are going to create the incubator in northeast Louisiana. It is the only region of the State that has not had 

one, and I think that is going to be beneficial to the region as well. 

57 

And your support to small businesses has just been incredible, and 

we appreciate that. 

Chair LANDRIEU. Well, I intend to get even stronger now that I 

am the Chair of this Committee. I have been able to help somewhat as a committee member, but now as the Chair, I may be able 

to really bring additional focus to the SBA. Both Senator Snowe 

and I believe it should be elevated to a Cabinet level position. We 

have asked the President for that designation. Whether it comes or 

not, we remain hopeful, and that request will get due consideration 

by the President. The SBA was under the Clinton administration— 

part of the Cabinet, and we would like for it to be again. I think 

it is very important for small business to have a seat at the table 

when these major negotiations are going on about the credit markets and the TARP monies and the bailout funding. And I think 

that our idea, at least my idea as a Senator is to get help as quickly as possible to the Main Streets of Louisiana and to our other 

States. And I would like to see the Main Street ambassador in Columbia and Tallulah and in places like Concordia Parish that could 

use a great deal of help and support, and right here in Bossier and 

Caddo Parish region. So that is what the hope of this Committee 

is. We want to strengthen the SBA. We have already seen good 

comments and actions from this administration about increasing 

funding to the SBA. But I will say I will speak to this at a later 

venue about keeping taxes reduced and particularly on industries 

like oil and gas, which fund in large measure and support any 

number of small businesses throughout the country. It is under the 

Finance Committee’s jurisdiction. But regulations, taxes, and effective programs do affect the amount of money for small business, so 

my Committee will track these issues and provide, where needed, 

a voice or forum for small business priorities. 

Thank you, panelists, and for anybody in the audience that 

wants to submit testimony, the record will be open for 2 weeks. 

You could submit it in writing, and I will be here for another 20 

minutes to take any personal comments that anyone has. 

Thank you. We also have copies of the American Recovery and 

Reinvestment Act. This is a preliminary guide to competitive grant 

funding specific to Louisiana, and it was the first guide. I am very 

proud of our office. We worked with our other members of the delegation, but we led the effort to create this for the State, and we 

were the first Senate office to prepare it so our agencies here in 

Louisiana and our local communities, our mayors, our police jurors, 

our nonprofits understand what is available through competitive 

grants in large measure, some formula funding, but in large measure competitive grants that must be applied for to use this funding 

that is now available. 

So, the Small Business Committee meeting will adjourn. Thank 

you. 

[Whereupon, at 11:30 a.m., the Committee was adjourned.] 

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