Trump cuts to business aid programs alarm entrepreneurs, advocates

Zena Forest Products might not be a household name in Oregon, but its products have been under the feet of many Oregonians.

The family-owned company makes hardwood flooring, including

the oak flooring in the renovated Portland International Airport

terminal.

The 10-employee company, based in the town of Rickreall, west of Salem, is among those that have benefitted from federal programs that support small businesses.

It’s taken out a U.S. Small Business Administration loan, won U.S. Department of Agriculture grants, sought technical assistance from Small Business Development Centers and consulted the federally funded Oregon Manufacturing Extension Partnership.

“All of those programs have been essential,” said Ben Deumling, the company’s president. “We definitely wouldn’t have been growing and building new facilities and adding employees like we are without these programs.”

But many of those programs are now in jeopardy, as President Donald Trump slashes federal agencies and programs.

The U.S. Small Business Administration in March said it will

cut more than 40% of its staff

. The website for the federal agency’s Portland office lists two employees, one of whom recently posted on LinkedIn that he retired.

Trump also

has signaled he wants to gut the federal CDFI Fund

, which serves disadvantaged businesses. Oregon’s Manufacturing Extension Partnership expects to lose federal funding. The Oregon office of the federal Minority Business Development Agency doesn’t expect to get the fourth, and final, year of funding from a federal contract.

The president’s proposed budget also eliminates federal funding for SCORE, a nonprofit partner of the Small Business Administration, which provides free advice from volunteer experts. Women’s Business Centers, another SBA program, also face elimination.

“We’re going to be the only technical assistance provider standing,” Mark Gregory, the state director of the Oregon Small Business Development Center, said last week at a manufacturing roundtable attended by U.S. Sen. Jeff Merkley, D-Oregon, the ranking Democrat of the Senate Budget Committee.

Small business development centers, commonly referred to as SBDCs, provide technical assistance using a mix of federal and state funding.

The federal squeeze on programs that support small businesses is expected to be particularly painful in Oregon, a state that embraces local companies and is home to only two Fortune 500 businesses.

Worries about the funding losses bounced off the walls at separate roundtables attended last week by U.S. Rep. Suzanne Bonamici, D-Oregon, and Merkley, both of whom promised to work to protect federal dollars now in jeopardy.

“I’m going to do all I can to maintain programs, to restore programs that invest in getting our small businesses off the ground supporting entrepreneurs,” Bonamici said.

Mike Vanier, president of the Oregon Manufacturing Extension Partnership, which helps small- and medium-sized businesses, said he expects to lose $2.5 million in annual federal funding, about 40% of his organization’s budget. He’s also worried about the loss of another $1.9 million in federal funding that he expects to receive over the next three years from the Department of Commerce.

“We’re in tumultuous times,” Merkley said at a Friday roundtable at OMEP’s Tigard office. “Contracts being canceled left and right, people retired, put on leave, contracts being restored, funds being unfrozen, frozen again.” He later characterized the “chaos” as “counterproductive to our national economy.”

Vanier said OMEP’s federal funding last year created or retained 1,800 Oregon jobs.

“I can preach on this for a long time,” he said. “It is an absolutely vital program.”

At a separate roundtable in Beaverton last week, Bonamici heard from small business owners and community lenders about possible cuts to Community Development Financial Institutions, or CDFIs, organizations designed to help disadvantaged businesses access technical and financial resources.

The panelists included Joe Sky-Tucker, CEO of Business Impact NW, a CDFI that works with numerous groups, including minority-owned businesses, veterans and women.

“We run almost all the federal programs you can think of,” Sky-Tucker said, adding, “All of (them) are at risk.”

In April, Business Impact NW got a letter terminating its four-year contract to run an Oregon office of the federal Minority Business Development Agency.

The office gives small business owners one-on-one help and connects them with contracting opportunities. It’s served nearly 200 people, including Hector Bautista, one of three employees at Beaverton’s Red Hammer Construction.

Bautista said Red Hammer got one-on-one help, including on how to write a business plan, from the office. Bautista also took a six-week class it offered on estimating.

“It helped me a lot to understand how we should be bidding correctly on future projects,” he said.

The government recently rescinded the Oregon MBDA’s termination in a follow-up letter, but Sky-Tucker isn’t confident his organization will get the final $420,000 in annual federal funding.

At the roundtable, entrepreneur James Orr said he’d used federal resources to grow Moore & Orr Trucking, his Tigard-based trucking company.

Orr said he’s used Business Impact NW’s newsletter to learn about and connect with other programs, including the Black United Fund’s Emerging Entrepreneur Program. Business Impact NW also helped him get an SBA loan for a second truck.

He’s passing along to the truck’s driver the lessons he’s learned about entrepreneurship.

“If it wasn’t for Business Impact NW helping me get a loan to get a second truck, he wouldn’t be there for me to educate,” Orr said.

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