Biden Cabinet's small biz leader visits Tucson to promise investment in Latinos, local shops

White House cabinet member Isabella Casillas Guzman, head of the Small Business Administration, joined Tucson Mayor Regina Romero on Thursday to promise more federal investment in local shops and Latino business owners, as she promoted the work of President Joe Biden’s economic plan.

Guzman and Romero toured shops such as Petroglyphs and La Estrella Bakery at Mercado San Agustín and its annex on Tucson's West Side as Guzman began a “Latino prosperity tour” in Tucson, which aims to tout the investments made in small businesses by the Biden administration.

En español: Jefa de pequeños negocios por Biden visita Tucson, promete inversión en latinos, tiendas locales

The SBA administrator is going “around the country to make sure that the opportunities presented by historic investments from the Biden-Harris administration are fully leveraged by all of our community members, including Latino entrepreneurs,” she said. Her department “is fully leveraged and inspired to empower possibilities here in Tucson” as well, she said. Tucson was the first stop on her tour.

Small businesses have been growing in number, Guzman said, with her department recording 10.5 million new business applications during the Biden administration, which she said is higher than pre-pandemic rates. The country currently has more than 33 million small businesses, which the SBA defines based on size and revenue.

“We’re seeing those new business applications soar, including among businesses that are creating jobs,” Guzman said. Latinos in particular “are starting businesses at incredibly high rates over the last 10 years,” she said.

Manufacturing companies with 500 employees or fewer and non-manufacturing businesses with average annual receipts under $7.5 million qualify as a small business, per the SBA. Registering with the SBA can help win government contracts reserved for small businesses.

Small firms are “giants in the economy,” Guzman said, as “they’re the ones that deliver products and services.”

“They innovate to solve global problems, but importantly, they are competition,” she said. “They are innovation for this country’s economy, and they are critical for us to grow.”

The growth in small businesses is the result of Biden’s plan for recovering from the pandemic, which included the $1.9 trillion American Rescue Plan and the $2.2 trillion Coronavirus Aid, Relief, and Economic Security — or CARES — Act.

“The economy is responding to the historic investments that the president has committed to making in America,” she said. “The president talks about building the economy, from the bottom up, and the middle out, and we're seeing that his economic plan is working in terms of a massive economic recovery.”

The “massive economic recovery” shows, she said, with more than 12 million jobs have been created during the past two years, that inflation decreased during the past two years, wages have risen and GDP is strong.

“The American Rescue Plan and all the COVID relief funding that was available was really critical for saving millions of our businesses,” Guzman said. “The SBA put out, during President Biden’s first year in office, $450 billion in relief.”

While individual Americans were receiving direct payments from the federal government at the start of the COVID pandemic, the SBA offered loans and cash through the Paycheck Protection Program — also known as the PPP loans — and the Small Business Debt Relief Program. That initial COVID relief came through the CARES act, which passed in March 2020.

That funding from the SBA “was critical,” Guzman said, along with the ARPA funding that went to local governments to continue supporting small businesses.

Biden announced at the end of January that the public health emergency declared in response to COVID will end by May 11, which will wind down COVID-era programs. However, Guzman assured that SBA’s core programs that provided COVID relief will remain, along with the $50 million a year that her department invests in “entrepreneurship in this country.”

Small businesses are still “fighting to defend their balance sheets” and increase their revenues, Guzman said. The federal government, however, wants to contract with more small businesses while other major spending packages such as the Inflation Reduction Act, Bipartisan Infrastructure Law and CHIPS Act are also expected to boost small business, she said.

Her job, Guzman said, is “to ensure that the American dream of business ownership is available to more Americans, making sure that they have the funding that they need. That they have the revenue growth opportunities.”

Guzman is considered the highest-ranking Latino or Latina who deals with the economy in the Biden administration. She’s from East Los Angeles, and grew up in a small business family that owned a chain of veterinary hospitals in Southern California. She served in the Obama administration as the deputy chief of staff and senior advisor at the SBA. Her career started in the private sector as an advisor and consultant.

During her visit, Guzman also joined a roundtable discussion with local Latino leaders. She went on to the University of Arizona to speak with students at the McGuire Center for Entrepreneurship.

Mayor Romero boasted that Tucson started working on their $1.5 million Avanza Revolving Loan Fund, which is meant to support “under-represented entrepreneurs,” especially those of color, with low-interest, flexible loans according to a city memo.

The Tucson City Council approved the first steps of starting the loan fund at a study session on Tuesday and directed staff to prepare the program for approval by the Council as soon as possible. The idea is similar to the $10,000, interest-free BIPOC loans offered yearly to small business owners of color by the Community Investment Corporation, a local nonprofit, also through a revolving fund, which means repayments are put back into program for future loans.