A Key Piece of the Infrastructure Bill Aims to Help Minority-Owned Businesses

After decades of advocacy, the Minority Business Development Agency (MBDA), a federal agency that supports minority-owned businesses, is finally on the cusp of officially solidifying its status. 

“It is a historic moment,” says Chiling Tong, president and CEO of The National Asian/Pacific Islander American Chamber of Commerce and Entrepreneurship, or National ACE, a Washington, D.C.-based nonprofit. “It is a huge victory for all minority-owned small businesses.” 

The MBDA, which helps minority founders get access to government contracts and capital, will be codified in the $1-trillion-plus Infrastructure Investment and Jobs Act. The House passed the infrastructure bill on Friday and sent it to President Biden, who said he would sign it when lawmakers return from their week-long recess. 

The bill provides $110 million in annual funding through 2025 for the MBDA, more than double the $48 million Congress allocated in 2021. (The agency also got a total of $35 million in supplemental funding in 2020 and 2021 in response to the pandemic.) Lawmakers could set another funding level after 2025. The majority of the money is slated to go to the MBDA Business Center Program, which provides minority entrepreneurs with support such as technical assistance and community referrals. 

Funding also will be used for programs including a network of MBDA centers run by Historically Black Colleges and Universities (HBCUs) or other Minority Serving Institutions located in rural areas. Another initiative is the Parren J. Mitchell Entrepreneurship Education Grants, through which HBCUs and MSIs can apply for funding to support classes related to entrepreneurship. The bill authorizes the MBDA to give other grants to nonprofits that serve minority founders as well. 

The MBDA declined to comment until the bill is signed into law, but it did acknowledge the House’s action in a tweet and on LinkedIn. Senate Committee on Small Business and Entrepreneurship Chair Ben Cardin (D-Md.) said in a statement that the agency “will now have the stability and resources to help small businesses in minority communities grow and create jobs.”

President Nixon created the MBDA through an executive order in 1969. But, as no law authorized its existence, Congress has had to allocate funding each year to keep it going. According to the MBDA, members had introduced bills to solidify the agency as far back as 1980. But none had passed until now. 

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