It’s an honor to be here today with you for the 2nd Annual SMBE Symposium…
When Martin O’Malley asked me to join his team for a Better Maryland…for One Maryland… in 2005, we both saw a state that builds on its strengths to create better and higher-paying jobs…and a state that values the contributions of small and minority-owned business.
We saw, and still see, Maryland as a business incubator…where small and minority-owned businesses can grow and thrive and where entrepreneurs can meet the challenges of starting from scratch and build successful business.
But we also know for small and minority-owned businesses to thrive, they need the tools to grow and create new job opportunities that stay here in Maryland.
One of our shared priorities is to ensure that the State’s workforce is as diverse as the State’s population, and we’re going to ensure that we meet that goal by forging stronger public-private partnerships with small and minority-owned businesses.
Small and minority-owned businesses are the big business in Maryland…
Nearly half of Maryland workers are employed by the State’s 450,000 small businesses. Women own 31 percent of Maryland firms, ranking the state first in the Nation in percentage of companies with majority women ownership. Maryland also leads the Nation in the percentage of firms that are majority African American-owned…a full 16 percent, more than 69,000 firms.
Our small businesses and our minority-owned businesses are driving our economy. Nearly all of the State’s biotech firms in the research triangle are small businesses and have created a combined 6,000 jobs here in Maryland…
And our local companies are making impacts at the state, national and international level…In fact, I heard of one minority-owned IT firm in Prince George’s County last week that is currently bidding for contracts to rebuild and enhance the IT infrastructure in Iraq.
Small business in Maryland truly is big business, and highly-educated business, and well-paying business…
But we need to be able to do more.
We need to commit to new methods that encourage more small and minority-owned business…
Although Maryland has a long record of commitment to small and minority-owned business, minority firms are still under-utilized in State contracts and subcontracts.
Between 2000 and 2004, minority firms comprised nearly 30 percent of all available firms in the local marketplace… yet received less than 15 percent of the contract dollars awarded by the State.
Minority entrepreneurs face other obstacles:
Higher rates of loan denial; Higher credit rates; Lower business formation rates; And lower business owner earnings…even when comparisons are restricted to similarly situated businesses and owners…
We have programs in place to help small and minority-owned businesses compete…but we need to do a better job meeting the goals of such programs…
The Small Business Reserve Program is a great program that enables small and minority-owned businesses to compete with larger companies for government procurement contracts…
The program requires 22 designated state agencies, the Department of Business and Economic Development, the Department of Natural Resources, the Department of Transportation…and a handful of others…It requires that the designated agencies award a minimum of 10 percent of the agency’s total procurement dollars to small or minority-owned business…
We’ve got to do more to encourage the success of this program…
In the most recent review, only 8 of the 22 designated agencies met the 10 percent goal… 8 out of 22…
Of the 14 agencies that failed to meet the Small Business Reserve Program goals, 7 agencies failed to even meet the goal halfway.
We’re working with Secretary Jenkins and the Governor’s Office of Minority Affairs to address and formulate new strategies to make this program work more effectively and more efficiently.
We’re already working to make government work better and to measure our performance:
In partnership with the Legislature, we established StateStat to make government more efficient, more transparent, more open and more accountable to programs such as the Small Business Reserve Program.
We’re working to assist small and minority business to ensure that every one of Maryland’s citizens can participate in the economy of the State so that economic prosperity can expand to every region in the State…
We, Governor O’Malley and I, realize more everyday that, to use Sec. Jenkin’s words, MBE really stands for More Business for Everyone.
But folks, we’ve got work to do and we’ve got to work together.
When BRAC comes in 2011, Maryland will experience the largest job influx since World War II. We’ll see 8,000 new direct jobs coming to Aberdeen Proving Ground…5,400 to Fort Meade… In all, we expect 60,000 new direct, indirect and induced jobs to be created in Maryland because of BRAC.
To accommodate this influx and welcome the 24,000 families that will be moving to Maryland, we must develop adequate infrastructure, provide suitable and responsive workforce training, and identify the business opportunities to sustain that population influx…
And we’re looking to Maryland’s small and minority-owned businesses to help.
To accomplish our goals and transition smoothly when BRAC is implemented, Gov. O’Malley—working with the legislature—showed great leadership by establishing the BRAC Subcabinet, which I have the honor and privilege to chair. The Subcabinet’s focus is to horizontally coordinate our efforts on the State level and to vertically integrate and synchronize coordination at the federal, regional and local levels…
When BRAC comes, we’re going to build on our strengths… We’re going to build on the strengths of our highly educated workforce, our nationally-renowned colleges and universities, and our State’s proven track record in partnering with the federal government.
But we have other challenges ahead of us, we know. And we are going to meet those challenges head on; and we’re going to embrace the opportunities that come with those challenges:
We inherited a projected $1.4 billion deficit for Fiscal Year 2009 when we took office in January that resulted from two ambitious and well-intended decisions made by previous administrations: a middle-class tax cut and a groundbreaking investment in public education.
It’s a deficit that is partly the product of investments that we felt could not be deferred to some other time because kids are only in the third grade for a little while. And it is partly the result of poor long-term planning in recent years.
We have to close that deficit and close it in a way that is:
We’re already working hard to do just that. We passed a budget this year that increased spending by only 2.1 percent. That’s lower than the rate of inflation and less than 9 of the last 10 state budgets.
And two weeks ago, Gov. O’Malley directed the State’s Department Secretaries to identify $200 million in departmental savings.
Our mission of making progress, of making Maryland a better place to work and live, is not something that’s ever done in a 90-day session…It might not be completed in a four-year period of time. It’s an ongoing process, and our success is contingent upon our working together…which the Governor and I pledge to you to do.
Thank you very much.