Change is good. Change can be frightening. Change is a political slogan.

Change is also nothing new to the federal Small Business Administration. Under the Bush administration there were two chiefs and a couple of interim administrators with staff changes arriving and leaving.

The transitions haven’t been completely smooth. Chief Hector Barreto resigned under fire after critics castigated him for making ill-conceived loans in the wake of 9/11 and acting glacially during the post-Katrina catastrophe.

His replacement, Steve Preston, was shifted out of the SBA to take over Housing and Urban Development. The head of that agency split after it was revealed the FBI was investigating him on corruption charges.

President Barack Obama named Maine venture capitalist Karen Gordon Mills to head the SBA on Dec. 22 and she now awaits confirmation by the Senate. Small business advocates are hoping she’ll stick around a little longer than her predecessors.

Thomas Shinick also hopes she can redress the grievances of local small business owners. “There are a lot of frustrations out there,” said Shinick, who teaches courses in small business at Adelphi University and is chairman of the university’s School of Business Advisory Board.

There has been a lack of communication from the SBA to small businesses, Shinick said. “A lot of them aren’t even aware of what the SBA does for them,” he said.  In addition, past sudden changes at the top have triggered a sense of futility within the population the SBA is charged to serve.

Change can happen more rapidly in good or bad ways at the SBA as opposed to other federal agencies because of its size, according to Thomas Sullivan, who served for seven years as the SBA’s chief counsel for advocacy under the Bush administration.

“The SBA’s position is like a motor boat compared to, for example the Department of Agriculture, which is like a cruise ship,” Sullivan said. “You’re able to navigate quicker and change direction.”

The changes at the beginning of Mills’s reign will be more of personality rather than policy, Sullivan said. “Take any company on Long Island and see what happens when every manager changes,” Sullivan said, comparing private corner office changes with what’s happening at the SBA.

By naming Mills before Christmas, President Obama has done the SBA’s current employees a service, said Sullivan. “Anxiety about change leading up to a switchover is much more harmful to an agency’s morale than anything else,” Sullivan said. “Not knowing who your boss will be takes its toll.”

Most people associated with small business believe the Mills appointment is crucial to an economic recovery.
“Economic circumstances will demand that Karen Mills be in the conversation that is usually reserved for West Wing staff,” Sullivan said.

Gloria Glowaki, director of operations at the New York State Small Business Development Center at Stony Brook University, said small business is the engine that will drive Long Island’s economy out of recession. “Anyone with common sense knows it has to start with small businesses,” she said. “Let’s guide the money and make sure it gets down to Main Street.”

Shinick said if Mills can improve communication on the local level by meeting and listening to small business advocates and owners, the economy can begin to grow. He especially is pleased with Mills’s theory of improving “economic clusters.” This concept takes innovative businesses with a wide geographic reach and helps them attract additional suppliers and investors to their area.

One prominent SBA critic doesn’t believe Mills deserves even a honeymoon when she takes control of the agency.

“On day one she needs to start solving the SBA’s number one problem, which is the diversion of federal small business contracts to corporate giants,” said Lloyd Chapman, president of the American Small Business League, which has been battling the SBA over the awarding of federal contracts. “We’re concerned Mills, a venture capitalist, will support policies that will divert even more small business contracts to companies owned by venture capitalists.”

For now it’s wait and see on the local level, said Alfred Titone, branch manager of Long Island’s SBA. Titone was thankful the new chief was picked early.

“There’s been no word on policy so far and no one here has any idea what will happen,” Ttione said. “But we all know there’s been a lot of changes in the past eight years.”

Source:  http://libn.com/blog/2009/01/30/sba-pins-hopes-on-venture-capitalist/