Reps. Nydia Velazquez (D-N.Y.) and Joe Pitts (R-Pa.) unveiled their new health care bill today before a full meeting room in the House of Representative's Longworth Building.

I chatted with Jim Helsel before the event where he gave a speech on behalf of the National Association of Realtors supporting the measure.

Helsel, who works at a small realty firm with about 50 employees in Pennsylvania, told the Small Business Blog that the realtors' group supports the bill because "it begins to allow us to provide our members with affordable health care that to date we've been unable to receive."

The association, which has 1.25 million members, is comprised of many micro firms as most realtors are independent contractors who must find and pay for their own insurance.

Marcia Salkin, NAR's managing director of public policy, said the group has only really gotten involved in health insurance debates during the last six years and it's only been in the last five years or so that members have been truly "feeling the pain" of health care premiums and related issues.

The House Small Business Committee said that according to calculations made by experts, the measure could help self-employed individuals save as much as $5,000 each while businesses could save more than 34 percent.

Both Pitts, who ran a family nursery for 30 years before becoming a lawmaker, and Velazquez stressed that the measure will help small firms remain competitive.

The event showcased a variety of other supporters including the National Roofing Contractors Association, International Franchise Association, National Restaurant Association, National Federation of Independent Business and the National Association for the Self-Employed.

The NASE recently released a study showing that the percentage of micro business owners who offer a plan that covers all or some of their full-time employees has dropped from 46.2 percent in 2005 to 18.6 percent in 2008.

NFIB Executive Vice President for Public Policy Dan Danner said small businesses under current law "don't enjoy the same tax breaks, coverage or pooling options as large businesses or corporations. As a result they pay an average of 18 percent more for the same health care benefits, and have seen their health care premiums increase 129 percent over the last eight years."

House Small Business Committee Chairwoman Nydia Velazquez plans to unveil health care legislation this afternoon in a Capitol Hill news conference.

The Small Business Cooperative for Healthcare Options to Improve Coverage for Employees Act (Small Business CHOICE) is designed to encourage small firms to join health insurance cooperatives. The bill's main co-sponsor is Rep. Joseph Pitts (R-Pa.).

These purchasing cooperatives enable small businesses, which usually operate within the boundaries of a particular state, to collectively negotiate for improved health insurance for employees.

Small businesses are currently able to form these co-ops, but the bill would increase the incentive to do so by offering a refundable tax credit to small firms with no more than 100 employees that join a cooperative. The tax credit would be 65 percent of the cost of insurance. If the employer didn't previously offer subsidized health insurance to employees, an additional bonus tax credit would apply.

The employer also would be required to subsidize at least 65 percent of self-only coverage and up to 35 percent of family coverage. The solvency and benefit requirements would remain governed by state law.

Committee spokesman Jaime Zapata said the bill takes elements of health care plans put forward by presidential contenders Sens. Barack Obama (D-Ill.) and John McCain (R-Ariz.). "It's a bipartisan piece of legislation which has always worked well for the committee and it takes the best elements" of each candidate's plan, said Zapata.

Research by the National Cooperative Business Association found that some of these health insurance cooperatives have been successful, "but some studies indicate that they face substantial barriers to offering members better prices." These barriers may include state regulation or hostility among health plan providers toward the co-ops. Co-ops also may be able to attract only the smallest employers and may find they are too small to leverage sufficient negotiating power with insurers.

Molly Brogan, vice president of public affairs at the National Small Business Association, said of the new measure: "Anything that people are going to try and do to reduce health care costs we applaud. Anything to help is a step in the right direction, but [we] are focused on truly broad reform."

The saying "united we stand, divided we fall" may be the inspiration of Corporate United, a large business that's reaching out to small firms to join its collective-buying consortium.

The Cleveland, Ohio-based business was founded in 1997 with the intent of becoming an office-supplies buying consortium so that businesses could bid on a contract as a group in order to get a better price and improved terms.

Corporate United started with six companies with an eye on office supplies, but quickly expanded into other sectors. Today, it bills itself as the world's largest group purchasing organization. Most of its current members make the Fortune 500 or Fortune 1,000 lists.

They've chosen to bid for goods and services contracts in areas such as temporary staffing, pharmacy benefits management, industrial supplies and uniforms. Three projects currently running include contract bids for vendor-managed staffing, electrical supplies and janitorial services.

"The most basic component is clearly that you're thinking, 'I can get this for less by participating in this aggregated model than I could on my own,' but the value proposition goes well beyond that," said company Vice President David Clevenger.

He cites the virtual community where 600 individuals from member firms discuss issues they're facing. "You could post a message to say I'm a buyer at a company in Washington, D.C., and I've just been assigned a project to source immigration legal services. You don't know suppliers and you've never done it before so you're probably going to hire a legal consultant and start Googling for RFP templates."

Clevenger says that the message board has grown into a service that offers "literally tens of thousands of dollars of consulting knowledge."

There's a membership fee to join Corporate United, but the company's primary source of revenue are payments from the awarded suppliers.

A committee made up of member firms chooses the ultimate supplier in a particular field. For example, for vendor-managed staffing, Corporate United put together a committee of five member companies that helped guide the process. They reviewed a master list of suppliers and chose one. Corporate United is able to say to a supplier, "We represent 130 firms that may or may not use you, but here's five you'll definitely get," said Clevenger.

Small businesses that find the membership fee reasonable and are interested in the types of contracts bid on can leverage a contract power that includes billion-dollar firms and get a piece of that contract, no matter their size.

Consortium member Tuthill Coupling, a company based in Berea, Ohio, that makes quick-disconnect couplings found anywhere from jet airplanes to amusement park rides, said the savings on office products alone would justify its membership, but it has found savings elsewhere. The firm just put a roof on its factory from a member roofing bid that company president Brett Jaffe said was at a greatly reduced cost. Tuthill Coupling is a subsidiary of Tuthill, a global manufacturer based in Burr Ridge, Ill.

"I think the collective buying power could have more impact for smaller businesses because they have less buying power and...they don't have to become an expert on copiers for example and instead can focus on whatever their business really is," said Jaffe. "Contracts are negotiated in high volumes but you can order from them in the volume that suits your company."

Savvy small businesses are increasingly looking to export their goods or services as a way to bump up their bottom lines in this weak U.S. economy. But the Export-Import Bank, which provides loans and insurance to support U.S. exports, needs to do a better job in helping small firms, according to the Government Accountability Office.

The bank provides loans, guarantees and insurance to support U.S. exports, and in 2006 Congress required that Ex-Im develop performance standards for the bank's assistance to small businesses, especially those owned by socially and economically disadvantaged individuals and by women.

In fiscal 2007, Ex-Im authorized more than $12 billion in loans, guarantees, and insurance. Of this amount, about $3.4 billion -- or about 27 percent -- directly supported U.S. small businesses, bank data show.

The GAO released a report (pdf) last week recommending that Ex-Im establish better performance standards, improve its measurable targets and time frames and take steps to establish a measure for financing for small businesses owned by disadvantaged individuals. The bank agreed with the GAO's suggestions.

The 34-page study said that overall the bank does have some performance standards in place, but it's in the very early stages of measuring their effectiveness.

The report said that while Ex-Im has established some measures for outreach to small firms, "11 out of 27 measures lack measurable targets and time frames to fully evaluate progress toward meeting the performance standards."

Additionally, "none of the standards directly addresses the function calling for increased outreach to businesses employing fewer than 100 employees."

Ex-Im also has no measurements for monitoring progress toward its performance standard for financing small businesses owned by socially and economically disadvantaged individuals and by women.

In discussions with the GAO investigators, Ex-Im officials said that developing measures for financing for these businesses is challenging because it is difficult to obtain reliable data. "Specifically, they stated that Ex-Im cannot require small businesses to report this type of ownership status information on their applications and available data sources are not adequately reliable for this use," according to the report.

Congress has taken a long-standing interest in the bank's outreach to small firms. Congress required Ex-Im to make available for fiscal 1986 and thereafter at least 10 percent of its aggregate loan, guarantee, and insurance authority for financing exports by small businesses. In 2002, Congress increased the percentage to 20 percent. Congress also requires Ex-Im to report annually on the number of its transactions that directly benefit small business and to estimate the number of small businesses Ex-Im indirectly supports as suppliers to companies receiving Ex-Im financing.

The report was sent July 17 to the chairmen and ranking members of the House Financial Services and Banking, Housing and Urban Affairs committees.

The Save the Balloons Coalition, an organization of more than 20,000 florists, small retailers, grocers, unions and other concerns, has been successful in getting a state lawmaker to scale back his bill that would make it illegal to sell helium-filled foil balloons and instead require more consumer education on the part of balloon retailers.

State Sen. Jack Scott's intentions were good - he offered SB 1499 because he believed that many of California's power outages were caused by these balloons getting caught in power lines. The measure was backed by some utility companies, although bill critics cited the California Public Utility Commission as saying that none of the state's approximately 6,000 annual power outages were caused by foil balloons.

Coalition member The Balloon Council, a group including small retailers, manufacturers and unions, was integral to the effort to temper the bill. The council was formed in 1990 - around the time that several state legislatures were considering measures to outlaw these balloons.

The new measure would increase the fine for the sale of balloons sold without a weight, which keeps them earthbound but floating. The fine would rise from $100 to $250. California firms also will need to comply with new point-of-sale signage warning consumers of the risk if a balloon contacts a power line. Distributors and manufacturers also will be required to enclose a notice with each shipment of balloons into California notifying retailers of their responsibility of the proposed law.

The council said the reworked measure is a "vast improvement." Council Chairman Dan Flynn said of the initial bill that for the "20,000 florists, card stores and party shops that sell balloons across the state, this bill would mean a likely loss of $100 million in balloon sales and the potential loss of $900 million in sales of flowers and other merchandise. And for the state, this bill would compound the budget shortfall by reducing sales tax revenues by an estimated $80 million dollars every year."

The original version of the bill had made it successfully through the Assembly's Business and Professions Committee in late June before it was altered this month.

Factcheck.org, a nonpartisan, nonprofit resource for voters that aims to reduce confusion about topics discussed in U.S. politics, parsed Republican presidential aspirant John McCain's allegation that Democratic presidential contender Barack Obama would raise tax rates for 23 million small-business owners and concluded that it is a "false and preposterously inflated figure."

Factcheck.org, a project of the Annenberg Public Policy Center at the University of Pennsylvania, said that after analyzing the charges, "we find that the overwhelming majority of those small-business owners would see no increase, because they earn too little to be affected. Obama's tax proposal would raise rates only on couples making more than $250,000 or singles earning more than $200,000."

McCain (R-Ariz.) has been making his claims for months. In early June he spoke to the National Federation of Independent Business and said of the Illinois senator: "Obama's tax increases will hurt the economy even more, and destroy jobs across this country. If you are one of the 23 million small business owners in America who files as an individual rate payer, Senator Obama is going to raise your tax rates." He reiterated the allegation in a July 7 speech, a July 8 address to the League of United Latin American Citizens, a July 9 campaign event, and in a July 12 radio address.

Factcheck.org noted that the Small Business Administration counts 26.8 million small firms across the nation, but that fewer than 6 million of those are actually employer firms with any payroll.

The Small Business Administration relies on an outdated, inaccurate map to maintain its billion dollar HUBZone program that is rife with fraud, according to a government report (pdf) to be released Thursday at a House Small Business hearing.

The House panel is holding the morning hearing to unveil the results of the Government Accountability Office report that exposes fraud in the $8 billion HUBZone program, which is designed to award federal contracts to small businesses in economically disadvantaged areas.

The report said the map, which is designed to help firms determine if they're in a HUBZone area, contains areas that are not eligible for the program and excludes some eligible areas because the SBA has not updated the map since August 2006. The outdated map incorrectly includes 50 metropolitan counties that are ineligible and excludes 27 eligible non-metropolitan areas.

"As a result, ineligible small businesses participated in the program and eligible businesses have not been able to participate," states the report.

The mechanisms that SBA uses to certify and monitor HUBZone firms provide limited assurance that only eligible firms participate in the program, according to the report. Additionally, the GAO's analysis of 125 applications submitted in September 2007 showed that SBA requested supporting documentation for 36 percent of the applications and conducted one site visit. It also found that the agency has not complied with its policy of recertifying firms every three years. About 40 percent, or a bit more than 4,600 firms, have been in the program for three years but have not been recertified.

The GAO recommends that the SBA redo its flawed map, develop and implement guidance to ensure more routine verification of application data, eliminate its backlog of recertifications, formalize and adhere to a specific time frame for decertifying ineligible firms and further assess the effectiveness of the program.

The SBA's Office of Advocacy recently released a report on the HUBZone program and determined it was basically ineffective.

SBA Acting Administrator Jovita Carranza and authors of the GAO study are expected to testify at Thursday's hearing.

The official process to get Santanu "Sandy" Baruah situated as head of the Small Business Administration is slowly moving along since President Bush announced his intention to nominate Baruah last month.

Sen. Olympia Snowe of Maine, the top-ranking Republican on the Senate Small Business and Entrepreneurship Committee, met with Baruah this afternoon for about 30 minutes in her offices on Capitol Hill. Among the concerns she expressed with Baruah, is his positions on the controversial women's procurement issue, according to a Senate aide.

"For nearly eight years, the SBA has chosen the path of absolute least resistance and ignored a congressional mandate to make certain that women-owned small businesses can finally have a procurement program that makes a real difference," Snow said in a statement released today. "I am very concerned that the SBA will just re-issue this flawed rule as the final rule and undermine the will of Congress. That's why in our meeting today, I demanded Mr. Baruah make a commitment to either withdraw this proposed rule or defer action on this issue until the next administration."

Sen. Snowe hopes to question Baruah publicly this summer in a hearing before Congress adjourns for its August recess, a Snowe aide said. Panel Chairman John Kerry (D-Mass.) sets the committee's schedule.

The aide noted that Snowe would like to have the hearing soon because it could be disruptive to go through a lengthy confirmation process during hurricane season. Since the SBA provides disaster relief services to homeowners and businesses, late summer and fall months can be an exceptionally busy time for the agency.

Baruah currently is the nation's assistant secretary of Commerce for Economic Development.

Hurricane season is upon us, floods recently have ravaged places like Iowa and Wisconsin and wildfires have been burning some of California's most beautiful coast, so I thought I'd take a look at the resources available to help small firms prepare and recover from a disaster.

I interviewed Admiral Steve Smith, who heads the new Small Business Administration Executive Office of Disaster Strategic Planning and Operations, to find out about the new office and how it can help. This is the first in an occasional series of tools, tips and resources to help businesses think about disaster preparedness and response on federal, state and local levels.

Admiral Steve Smith heads a new disaster assistance and recovery office at the SBA. (Photo courtesy of SBA)

A month ago, Admiral Steve Smith joined the SBA to head the office, which reports directly to the SBA administrator and is responsible for overseeing the agency's disaster assistance and recovery operations. The office grew out of the agency's Accelerated Disaster Response Initiative created by former Administrator Steven Preston.

Smith spent 34 years in the U.S. Navy and retired as a two-star admiral. After leaving the Navy, he ran two small businesses - first a late-stage startup and then an initial stage startup.

Here are excerpts of our conversation:

Small Business Blog: Why did you decide to take this job?

Smith: I've run large organizations and have experience in financial management, budget preparation, program management and I was the congressional liaison with the Department of Defense. I've worked in Washington for about 10 of the 34 years.

I joined the SBA because of the challenge of this position. It's pretty exciting and it's a follow-up to the Accelerated Disaster Response Initiative. We're looking at disaster assistance in two ways - to ensure our readiness...and to make sure we're going to be responsive to citizens and communities.

I don't think it's well-known that the SBA provides the majority of homeowners' assistance after various disasters. I'd like to focus on disaster assistance but also disaster recovery...How can we help them get the assistance and support in the recovery period and help an area become economically vibrant? There are lots of other services within the SBA that can contribute to this...Part of my charter is to help integrate the efforts of the Office of Disaster Assistance and the other offices of the Small Business Administration.

SBB: How is your office helping small businesses?

Smith: On my second week on the job I was in Cedar Rapids [Iowa] where SBA has established a business recovery center. It's different than the response recovery center [led by the Federal Emergency Management Administration], although SBA does have a presence at the FEMA centers.

In Cedar Rapids, we're sitting down with small businesses and helping them get reestablished. In some cases they may need help and expertise in documentation. In other cases, they may have to redo their business plans. We're using our senior core of retired executives (SCORE) to sit down and help them plan their long-term recovery. We're also working with federal agencies to determine what other federal government resources might be available in that process.

When I was out in Iowa, I saw the initial things that the community was dealing with - if you don't deal with them quickly, it's going to impact how long the recovery will take. A business needs to know definitively if the power will be back on in six weeks or six months.

Also, we don't want to say to a business, "We'll get you funding as soon as we can." That's not a good answer because what does that mean - a month or three months? If it's a month, a business might be able to stay afloat through investors or personal credit cards until a loan comes in. I told them that our processing time standards are now 16 days with a disbursement within five days of that.

SBB: How can businesses get prepared?

Small businesses say the federal government is not doing enough to help them, according to a new poll released Monday.

Sixty-three percent of the 400 participants said the federal government was "doing nothing" to help small firms while 23 percent said it's "doing little."

Seventy-eight percent said the economic stimulus checks did nothing to help their businesses and 81 percent feel that the United States is in a recession.

The poll was released by American Management Services and conducted by Suffolk University in Boston. The full survey results are available online here.

On politics, the poll showed that small businesses favor Sen. John McCain (R-Ariz.) over Sen. Barack Obama (D-Ill.) by a margin of 38 percent to 21 percent, although about half of the respondents said they didn't know which presidential candidate would offer the best program for small businesses. Of the 400 respondents, 33 percent identified themselves as Republicans, 22 percent as Democrats and 37 percent as Independents.

Meanwhile, a new poll from U.S. Bank shows that 74 percent of Minnesota small business owners believe the economy is in a recession with nearly half of the businesses reporting lower revenues in 2008 than the prior year. However, most Minnesota small business owners also say that the availability of loans or credit has had a positive impact or no impact on their businesses. The poll surveyed 401 small business owners in the state last month.