[House Hearing, 116 Congress]
[From the U.S. Government Publishing Office]
REBUILDING AMERICA: SMALL BUSINESS PERSPECTIVE
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HEARING
BEFORE THE
COMMITTEE ON SMALL BUSINESS
UNITED STATES
HOUSE OF REPRESENTATIVES
ONE HUNDRED SIXTEENTH CONGRESS
FIRST SESSION
__________
HEARING HELD
MARCH 6, 2019
__________
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Small Business Committee Document Number 116-007
Available via the GPO Website: www.govinfo.gov
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35-169 WASHINGTON : 2019
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HOUSE COMMITTEE ON SMALL BUSINESS
NYDIA VELAZQUEZ, New York, Chairwoman
ABBY FINKENAUER, Iowa
JARED GOLDEN, Maine
ANDY KIM, New Jersey
JASON CROW, Colorado
SHARICE DAVIDS, Kansas
JUDY CHU, California
MARC VEASEY, Texas
DWIGHT EVANS, Pennsylvania
BRAD SCHNEIDER, Illinois
ADRIANO ESPAILLAT, New York
ANTONIO DELGADO, New York
CHRISSY HOULAHAN, Pennsylvania
ANGIE CRAIG, Minnesota
STEVE CHABOT, Ohio, Ranking Member
AUMUA AMATA COLEMAN RADEWAGEN, American Samoa, Vice Ranking Member
TRENT KELLY, Mississippi
TROY BALDERSON, Ohio
KEVIN HERN, Oklahoma
JIM HAGEDORN, Minnesota
PETE STAUBER, Minnesota
TIM BURCHETT, Tennessee
ROSS SPANO, Florida
JOHN JOYCE, Pennsylvania
Adam Minehardt, Majority Staff Director
Melissa Jung, Majority Deputy Staff Director and Chief Counsel
Kevin Fitzpatrick, Staff Director
C O N T E N T S
OPENING STATEMENTS
Page
Hon. Nydia Velazquez............................................. 1
Hon. Steve Chabot................................................ 2
WITNESSES
Ms. Terri Williams, Director, SBDC Procurement Technical
Assistance Center, University of Texas at San Antonio, San
Antonio, TX.................................................... 4
Mr. Tim Donovan, Senior Vice President, Legislative Affairs,
Competitive Carriers Association, Washington, DC............... 6
Ms. Roseline Bougher, President, A.D. Marble, King of Prussia,
PA, testifying on behalf of the American Council of Engineering
Companies...................................................... 7
The Honorable Kris Knochelmann, Judge Executive, President, Ohio-
Kentucky-Indiana Regional Council of Governments, Kenton
County, KY..................................................... 9
APPENDIX
Prepared Statements:
Ms. Terri Williams, Director, SBDC Procurement Technical
Assistance Center, University of Texas at San Antonio, San
Antonio, TX................................................ 32
Mr. Tim Donovan, Senior Vice President, Legislative Affairs,
Competitive Carriers Association, Washington, DC........... 37
Ms. Roseline Bougher, President, A.D. Marble, King of
Prussia, PA, testifying on behalf of the American Council
of Engineering Companies................................... 44
The Honorable Kris Knochelmann, Judge Executive, President,
Ohio-Kentucky-Indiana Regional Council of Governments,
Kenton County, KY.......................................... 49
Hon. Jim Hagedorn, Member of Congress, Minnesota............. 52
Questions for the Record:
None.
Answers for the Record:
None.
Additional Material for the Record:
None.
REBUILDING AMERICA: SMALL BUSINESS PERSPECTIVE
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WEDNESDAY, MARCH 6, 2019
House of Representatives,
Committee on Small Business,
Washington, DC.
The committee met, pursuant to call, at 11:01 a.m., in Room
2360, Rayburn House Office Building. Hon. Nydia Velazquez
[chairwoman of the Committee] presiding.
Present: Representatives Velazquez, Finkenauer, Kim,
Davids, Golden, Veasey, Evans, Espaillat, Delgado, Houlahan,
Craig, Chabot, Balderson, Hern, Hagedorn, Stauber, Stauber,
Burchett, and Joyce.
Chairwoman VELAZQUEZ. Good morning. The committee will come
to order.
I want to thank everyone for joining us this morning, and I
want to especially thank the witnesses for being here today.
I would like to welcome Ms. Angie Craig from Minnesota to
our committee. Her experience as a small business investor and
the former head of Global HR for a major Minnesota manufacturer
brings a unique perspective to the issues important to Main
Street businesses all over the nation. Welcome.
Whether it is the ports we rely upon to transport our goods
to the utility systems that power our factories, maintaining
America's infrastructure is fundamental to a robust economy and
to the nation's competitiveness.
The topic of infrastructure is vast, encompassing networks
of highways, bridges, and waterways that span thousands of
miles across America.
As a nation, we have a proud legacy of pushing the
boundaries of innovation. Historically, America's robust
infrastructure network has fostered strong economies and
allowed us to be both competitive and efficient. Today, we have
built telecommunications and broadband systems that connect us
in a matter of seconds.
However, by many measures we are failing to keep up with
the growing demands of our modern society. Whether it is the
high-speed internet connection that has not yet reached our
rural communities to the outdated and crumbling tunnels that
connect our cities, decades of neglect and lackluster
investments have allowed our infrastructure to fall apart and
fall behind other advanced economies.
Let us be clear, this has all come at a cost to commerce
and small businesses. That is why we must now address this
issue head on. Today, we are here to think big about the
countless ways in which our infrastructure impacts the small
business sector.
We know that investments in infrastructure promote future
economic opportunities for American workers and small
businesses. In fact, 61 percent of the jobs directly created by
infrastructure spending would be in the construction sector, 12
percent in the manufacturing sector, and 7 percent in retail
trade. That is 80 percent in these three sectors alone.
Most importantly, 90 percent of these jobs are good paying
middle-class jobs, many of which are supported by our nation's
small businesses. From construction to engineering to
architecture, small businesses are critical to maintaining and
expanding our infrastructure systems.
And yet, we must level the playing field to ensure that any
federal infrastructure plan includes opportunities for small
business owners, and particularly for women- and minority-owned
businesses.
All of us have an obligation to ensure there is adequate
federal infrastructure investment and guarantee our nation's
long-term competitiveness in the global economy. Accordingly, a
robust and well-planned investment in our infrastructure should
benefit small businesses, both as end users of these networks
and by creating business opportunities for them.
It is my hope that today's discussion can help identify
strategies for accomplishing that goal. With that, I thank each
of the witnesses for joining us today and I look forward to
your testimony.
I would like to yield now to the Ranking Member, Mr.
Chabot, for his opening statement.
Mr. CHABOT. Thank you, Madam Chairwoman.
During my tenure as both the Ranking Member now and in the
past as Chair of this Committee, I know that we have heard from
small businesses from all across the country in this very room
about the importance of repairing our nation's infrastructure
and how important it is to those small businesses and to many
others across our country. And I am glad that we are continuing
that conversation here today. So I commend you for doing that.
This is an issue that stretches across every state and
across every congressional district. I am willing to bet that
ever member on this side of the aisle and on the other side of
the aisle can think of at least one urgent infrastructure
project in his or her district that they would love to have
fixed today. I know that I can, and one of the witnesses here
is going to be addressing that shortly.
There are many important projects in Ohio, but one I can
think about in particular is the Brent Spence Bridge. This
bridge connects Ohio to Kentucky and carries an estimated
172,000 vehicles on Interstates 71 and 75 every day, more than
double its intended capacity. Today it is labeled functionally
obsolete by the U.S. Department of Transportation.
My district's challenge, however, is not unique. Currently,
an estimated 20 percent of Federal roads provide poor ride
quality, and 25 percent of our Nation's bridges are
functionally obsolete as is the Brent Spence Bridge. On
average, the typical American commuter loses 42 hours of
valuable, productive time each year to traffic alone, so that
is essentially an entire work week just sitting in traffic.
Some districts obviously it is harder than others. If you are
in Washington, D.C., or you are in New York, or probably a lot
of districts in California, it is particularly bad, but it
happens all over the country. I am sure the Chairwoman has
experienced this a time or two in her home district in Brooklyn
or Lower Manhattan. So we can all obviously relate to this.
At this Committee, we have learned in past hearings another
issue, broadband deployment, is also a crucial part of our
nation's infrastructure, particularly for entrepreneurs in
rural areas. I know that our colleague from Mississippi, Trent
Kelly has brought that up to me a number of times. As business
owners continue to move to a more global marketplace, access to
broadband is crucial to keeping small businesses competitive.
Unfortunately, too many small businesses still lack access to
broadband internet service considered fast by the FCC.
As with any major project, it is critical that small
businesses are not left out of the conversation. With small
businesses creating about 70 percent of the new jobs in the
economy every year now, they will be a driving force in
revitalizing our Nation's infrastructure system. We also must
be sure to engage state and local governments. States and
localities know the needs of their communities best, which is
why any Federal legislation created by this Congress must
empower local governments to be leaders in their communities.
I look forward to hearing from our witness panel here
today, if I ever stop talking, and their ideas for moving our
Nation's infrastructure into the 21st century.
So thank you, Madam Chair, for holding this hearing, and I
yield back my time.
Chairwoman VELAZQUEZ. Thank you, Mr. Chabot. The gentleman
yields back.
And if any committee members have an opening statement
prepared, we would ask that they be submitted for the record.
I would like to take a minute to explain the timing rules.
Each witness gets 5 minutes to testify and the members get 5
minutes for questioning. There is a lighting system to assist
you. The green light will be on when you begin, and the yellow
light comes on when you have 1 minute remaining. The red light
comes on when you are out of time, and we ask that you stay
within the timeframe to the best of your ability.
I now would like to introduce our witnesses.
Our first witness is Ms. Terri Williams. Ms. Williams
serves as the Director of the University of Texas at San
Antonio Institute for Economic Development Procurement
Technical Assistance Center. As director, she provides
direction, management, and oversight as part of the UTSA
Institute for Economic Development. The program provides
counseling, training, energy audits, and human resource
sustainable business and other support services to small
businesses. I welcome you.
Our second witness is Mr. Tim Donovan. Tim Donovan is the
Senior Vice President of Legislative Affairs for the
Competitive Carriers Association, the nation's leading
association for competitive wireless providers and stakeholders
across the country. In this capacity he leads the association's
legislative advocacy before policymakers on issues impacting
the competitive wireless community, including roaming,
universal service, spectrum policy, device availability,
broadband policy, and others.
Our third witness today is Ms. Roseline Bougher. Ms.
Bougher is the president of A.D. Marble, a woman-founded,
environmental and engineering firm based in Pennsylvania. Ms.
Bougher is responsible for the functions and operations of the
company, including marketing, budgeting, building and
maintaining client relationships, and the development of
employees. Raised in San Juan, Puerto Rico, Roseline went on to
attend Cornell University and NOVA Southeastern University in
Fort Lauderdale. Welcome.
And now I yield to our Ranking Member, Mr. Chabot, to
introduce our final witness.
Mr. CHABOT. Thank you, Madam Chair.
Our final witness today is The Honorable Kris Knochelmann,
Judge Executive for Kenton County, Kentucky, which is just
across the Ohio River, which is actually, by the way, mostly
owned by Kentucky. And he is in the Northern Kentucky area.
Judge Knochelmann also serves as the President of OKI, the Ohio
Kentucky Indiana Regional Council of Governments, the
organization that oversees all federal dollars spent on
infrastructure in our region. He and his wife are also the
owners of Schneller Plumbing, Heating, and Air, a small
business founded all the way back in 1928. And we thank you for
testifying today.
Chairwoman VELAZQUEZ. Ms. Williams, you are recognized for
5 minutes.
STATEMENTS OF TERRI WILLIAMS, DIRECTOR, SBDC PROCUREMENT
TECHNICAL ASSISTANCE CENTER; TIM DONOVAN, SENIOR VICE
PRESIDENT, LEGISLATIVE AFFAIRS, COMPETITIVE CARRIERS
ASSOCIATION; ROSELINE BOUGHER, PRESIDENT, A.D. MARBLE; KRIS
KNOCHELMANN, JUDGE EXECUTIVE PRESIDENT, OHIO-KENTUCKY-INDIANA
REGIONAL COUNCIL OF GOVERNMENTS
STATEMENT OF TERRI WILLIAMS
Ms. WILLIAMS. Thank you so much.
Chairwoman Velazquez, Ranking Member Chabot, members of the
Committee, good morning.
I have already been introduced, so I am going to in essence
try to stick to my time.
Over the past 30 years, I have been involved in listening
to the needs of small business owners and providing solutions.
Today, key issues have been identified as infrastructure,
broadband, cybersecurity, government contracting opportunities,
and access to capital. My testimony is focused on these issues
and some anecdotes of small business owners who continue to
struggle toward success.
Small businesses continue to be the driving force of our
Nation's economy. According to the most recent SBA Small
Business Profile of 2018, 30.2 million businesses meet the
definition of small, which accounts for 99.9 percent of all
U.S. businesses. They also employ 58.9 million people, which
accounts for 47.5 percent of total employees and are
responsible for creating 1.9 million net new jobs. Small
businesses also hire 43 percent of all workers in the high-tech
sector, and produce 13 times as many patents per employee as
large firms in high-tech industries. However, this cannot
continue to be sustained or increased without investment in
infrastructure to help small businesses be competitive with
their counterparts.
Broadband has become an essential tool for doing business.
It is important for connecting with customers, working with
suppliers, enabling remote access to employees, and improving
operations. It is a critical component in competing locally and
globally. According to a report of the State Broadband
Initiative of New Jersey, in order for small businesses to
adopt broadband, three areas have to be considered--
availability, affordability, and adoption.
Availability must consider two important factors: Is the
infrastructure to deliver broadband available and accessible at
their location? Does the available broadband meet the security
needs of the small business?
And then affordability must consider is there a need for
upgrading the infrastructure or expanding it to the location?
Is it affordable? Can the small business afford the technology,
devices, equipment, applications needed to adopt the use of
broadband into their operation and business? And can they
afford to train or hire new staff for implementation?
Finally, adoption considers knowledge and how to adopt it
into their business, effectively integrating it into their
operations, and realizing the benefits. For many businesses in
rural areas of the country, broadband is not an option which
leaves them unable to comply with electronic submissions to
register their business, submit a bid or proposal, receive
payments, or meet data security requirements.
In an effort to address national security issues, the DoD
has identified a need to increase the number of businesses who
are resilient and compliant with cybersecurity requirements and
decrease the vulnerability of the supply chain. Requirements
are now included in many DoD acquisition documents for
businesses to have a system security plan consistent with the
National Institute of Standards and Technology (NIST). Unless
small business owners are equipped with human and financial
resources to comply with these standards, they will be left
behind in the Federal contracting market.
In an effort to respond to this need, USTA has developed a
Small Business Cybersecurity Training Academy for the purpose
of helping small businesses develop a system security plan.
However, this training does not provide relief to cover any
necessary costs for equipment upgrades. As a result, small
businesses are limited in government contracting as a primary
contractor or vendor, as well as a subcontractor.
Over the past 30 years, Federal, state, and local
government agencies have strategized at the request of small
business owners to provide information and assistance in
responding to requests for government contracting bids and
proposals.
The remainder of my testimony speaks to access to capital
as well, and we know that the support of small business
financing mechanisms that relax total dependence on high credit
scores and lowers interest rates will help businesses be more
competitive and infuse money back into their business.
So thank you for the opportunity to share this information,
and I will be glad to answer any questions you may have.
Chairwoman VELAZQUEZ. Thank you, Ms. Williams.
Mr. Donovan, you are now recognized for 5 minutes.
STATEMENT OF TIM DONOVAN
Mr. DONOVAN. Chairwoman Velazquez, Ranking Member Chabot,
and members of the Committee, thank you for the opportunity to
testify about the importance of broadband connectivity as
Congress continues its work to revitalize our Nation's
infrastructure.
CCA is the Nation's leading association for competitive
wireless providers, representing nearly 100 carrier members, as
well as vendors and suppliers. The vast majority of CCA members
are small businesses or work closely with them. They invest in
their hometowns, not only through providing wireless service,
but also by employing their neighbors, sponsoring local events
and hometown teams, and hosting community service events.
Robust broadband networks are vital infrastructure for the
21st century, particularly for small businesses and the
consumers they serve. These businesses rely on connectivity to
provide a digital storefront to reach customers in their
communities and around the world. In addition to connecting
with consumers, wireless services revolutionize how entire
industries operate. From telehealth to precision agriculture,
distance learning and the internet of things, these and other
services are economic multipliers and job creators that depend
on reliable broadband coverage.
While critical for today's mobile economy, the potential
benefits and capabilities of next-generation and 5G networks
will supercharge existing services and enable new technologies.
The possibility of a fully connected world is both
groundbreaking and exciting.
But this generational leap of technology and the very
existence of 5G is not inevitable, particularly in rural
America. While 5G buzz grabs headlines, too many rural areas
and small businesses remain on the wrong side of a persistent
digital divide. Decisions made by policymakers today can either
launch innovation and economic growth or exacerbate
insufficient access, leaving rural America behind. Small
businesses depend on policies that preserve and expand wireless
services.
To determine whether services are available, Congress must
have reliable coverage maps. Unfortunately, based on your own
experiences, member of this Committee know that coverage is
frequently overstated, leaving consumers frustrated and small
businesses lacking connectivity. This is a cornerstone issue
which must be addressed.
In addition to developing reliable data, Congress should
act on three key policy issues: funding, spectrum, and
deployment challenges. First, additional funding will preserve
and expand wireless broadband coverage. CCA commends the FCC
for making support available through the Mobility Fund Phase II
program. However, additional resources are necessary to ensure
that rural areas have access to reasonably comparable services
as those provided in urban areas.
As Congress considers legislation to rebuild America's
infrastructure, CCA strongly supports employing all policy
options to advance deployment, including providing direct
funding to build broadband infrastructure where private capital
alone is not sufficient to support a business case for service.
Next, Spectrum is the invisible infrastructure for wireless
service and the lifeblood of our industry. All carriers must
have access to spectrum at low-, mid-, and high-frequency bands
to provide the services their customers depend on and the
capacity necessary to support innovative applications. As small
businesses increasingly rely on wireless broadband connections,
the demand for additional spectrum resources grows
exponentially.
Finally, carriers must have certainty regarding the costs
and time necessary to deploy towers, small cells, and the fiber
required to backhaul tremendous amounts of data. Wireless
services depend on this physical infrastructure. Smart policies
to deploy, maintain, and upgrade these networks, are key
components to both closing the digital divide and completing
the generational upgrade to 5G.
While Congress and the FCC have taken important steps to
streamline siting approval and permitting processes, additional
work remains. It is important to underscore that these reforms
need not pit wireless carriers against the municipalities and
the states that they serve. Smart policies can create a win-win
scenario that saves resources by eliminating unnecessary
reviews for both carriers willing to invest in network
deployments, as well as state and local government agencies
seeking to upgrade services for their constituencies.
Modern wireless services will revolutionize how small
businesses connect with their customers, while creating new
jobs and allowing anyone to work from wherever there is a
broadband connection. The services enabled by wireless
broadband would not long ago be considered science fiction, but
today's networks are making them a reality, improving
opportunities for small businesses, and reducing their costs.
5G services promises an immediate and expansive impact on the
lives of all Americans, but absent smart and swift action from
policymakers to close the digital divide, those in rural areas
will be sidelined from a connected future.
I appreciate this Committee's attention to ensuring that
all small businesses have the national infrastructure in place
to survive and thrive, and reliable broadband is an
increasingly important component to achieving this goal.
Thank you for holding today's important hearing, and I
welcome any questions you may have.
Chairwoman VELAZQUEZ. Thank you very much. I really
appreciate that you are kindly sticking to the 5 minutes. Thank
you, Mr. Donovan.
And now Ms. Bougher, you are recognized for 5 minutes.
STATEMENT OF ROSELINE BOUGHER
Ms. BOUGHER. Thank you, Chairwoman Velazquez, Ranking
Member Chabot, and members of the Committee.
I appreciate the opportunity to testify before you today.
As Chairwoman Velazquez indicated, I am the president and CEO
of A.D. Marble, an environmental and engineering firm with 50
employees across four offices in Pennsylvania and Maryland. Our
headquarters are located in King of Prussia just outside
Congresswoman Houlahan's district.
Our firm conducts natural resources, cultural resources,
and engineering, environmental engineering services on a range
of transportation, water, and site development projects. Our
environmental services focus on the completion of NEPA
clearances and the environmental permitting process.
I am here on behalf of the American Council of Engineering
Companies (ACEC), the business association of the Nation's
engineering industry. ACEC is a national federation of state
and regional organizations representing more than 5,600
engineering firms and 600,000 engineers, surveyors, architects,
and other specialists nationwide. Nearly three-fourths of ACEC
members' firms are small businesses.
This is a timely hearing because we believe Congress has a
unique opportunity this year to pass major infrastructure
legislation to modernize the Nation's transportation, water,
energy, and communications networks. Federal infrastructure
programs are essential to small businesses. Most importantly,
they provide resources in partnership with state and local
governments who are directly responsible for maintaining and
improving infrastructure systems.
These public agencies are a primary market for small
engineering firms. For example, approximately 85 percent of my
company's work comes from transportation clients in the state
of Pennsylvania, Maryland, and Delaware. State and local
agencies rely on consistent, multi-year Federal funding in
order to plan and implement their projects. Without this
funding, they can only undertake the most basic maintenance and
short-term fixes and cannot effectively implement a long-range
improvement plan that would unlock business opportunities for
small firms.
Although it is not in the jurisdiction of this Committee, I
would be remiss if I did not specifically mention the need to
restore long-term solvency to the Highway Trust Fund. The user
fees were last raised in 1993, and have lost over 40 percent of
its purchasing power. More than $140 billion has been
transferred from the General Fund into the Highway Trust Fund
since 2008 because of the failure to address systemic funding
shortfalls with real revenue solutions. It is time for Congress
to provide new sustainable revenue for service transportation
programs.
Another advantage of infrastructure investment is that
Federal funds are directly invested in physical assets that
create a lasting benefit for the public and spur additional
economic growth. In addition to the construction activities
that provide local businesses with direct contracting
opportunities, the flow down effect helps bolster other
economic activity as well, such as service industry, retail,
and manufacturing among others.
Conversely, as a small business leader and owner, I have
seen how challenging the lack of infrastructure funding can be
to our industry. It is more difficult for my firm to retain
employees if there is no work available. We cannot afford to
keep employees that cannot bill to projects even when the lull
may be short term. When there is no work, we must make quick
and difficult decisions when it comes to personnel. This is a
problem that affects engineering firms of all sizes but is
particularly problematic for the smaller specialty firms like
mine that lack the resources and markets that enable larger
firms to keep their employees busy.
Lastly, on the issue of workforce development, I think it
is important to note that we do not have enough engineers in
this country. According to the most recent quarterly ACEC
survey of company executives, more than one-third pointed to
the lack of engineering talent as the greatest threat to their
firm's success. As experienced senior staff are retiring at a
rapid pace, we are not backfilling that gap with enough
graduates in engineering. Firms of all sizes are fighting to
attract and retain experienced engineers.
This national workforce challenge does not have a silver
bullet solution. It involves a multi-faceted strategy,
including improvements in K-12 STEM education, incentives for
engineering students at the collegiate level, as well as worker
retraining initiatives and increasing the number of employment-
based visas for high-skilled workers.
On behalf of ACEC and the Nation's engineering industry, I
want to thank this Committee once again for focusing attention
on this important issue.
I would be happy to answer any questions.
Chairwoman VELAZQUEZ. Thank you, Ms. Bougher.
And Mr. Knochelmann, you are recognized for 5 minutes.
Welcome.
STATEMENT OF THE HONORABLE KRIS KNOCHELMANN
Mr. KNOCHELMANN. Thank you, Madam Chairwoman and Committee
members.
Good morning. As noted before, my name is Kris Knochelmann.
I am a Kenton County, Kentucky judge executive and president of
the OKI, the Ohio Kentucky Indiana Regional Council of
Governments, an 180-member board. It is an honor to appear
before you to discuss the vital importance of reliable
transportation infrastructure on all businesses, particularly
small business.
I am a small business owner. As you heard, our family
business was started in 1928. My wife and I, by the way, with
help of an SBA loan, acquired it in 2011, and by the grace of
God, creative work of our team, our business growth has now
gone to over 64 employees. We are located in greater Cincinnati
with offices in Cincinnati, or in Ohio and in Kentucky.
All of us live in a global economy with trillions of
transactions in millions of markets, driving commerce in every
corner of the world. However, any accurate reading of data will
show that almost all economies, and certain the United States'
economy, is driven by small business. In the United States,
small business is the growth engine for jobs and critical to
our place on the world economic stage. You know this. Small
business encompasses 99.7 percent of United States employer
firms; half of all employment; 60 percent of all new jobs; 98
percent of all exporting firms; and 46 percent of private
sector output. And the list goes on.
As competitors in the world economy, all businesses,
particularly small businesses, need to get their products to
their customers in the most efficient way possible. The
transmission of goods is dependent on adequate transportation
infrastructure, particularly sound, effective roads, and
bridges. Alarmingly, our country's transportation
infrastructure is in such poor condition that it is stifling
our economy.
The facts are frightful. And again, you know, this. Over
70,000 bridges are structurally deficient; 40 percent of the
urban roads are congested. We waste $160 billion due to
congestion every year. And, the problem is not just economic;
30 percent of all accidents are the result of poor road
conditions, and highway deaths in this country have risen to
over 40,000 per year. The country's infrastructure network
problem is so large, it is estimated it would take a trillion
dollars just to bring it up to standard.
While the burden of our deteriorating infrastructure
affects all businesses and their employees, it falls most
heavily on small businesses. Small businesses, like mine, are
least able to absorb the impacts of road delays on fuel costs
and wasted time.
Small businesses, almost by definition, are closer to their
customers than larger companies. The currency of small business
is not only the American dollar but the trust I must have with
my customers who live on our streets, in our communities, in my
neighborhood, and around my region. If our employees are stuck
in traffic and cannot be on time for appointments, my customers
can easily find my competitors by pressing a button on their
cell phones and getting them out there if they are down the
street. If my fuel costs and other costs rise because of wasted
time in traffic, I cannot just pass them on to unknown
stockholders. My employees, my wife, and I bear the brunt of
lost dollars due to poor infrastructure that we cannot reinvest
in our community.
In my part of the country, we have one of the Nation's most
critically needed infrastructure projects, the Brent Spence
Bridge. Maybe you have heard of it.
The Brent Spence Bridge does cross the Ohio River at
Cincinnati into my home county in Kentucky. However, it also
connects Michigan to Miami and other points north to south
because it is the lynchpin of the I-75 and I-71 trade
corridors. The bridge was constructed to carry 80,000 vehicles
a day, and now carries over 160,000 vehicles a day. And I can
see them from my office. It was engineered over 50 years ago to
handle 3,000 trucks per day and now carries over 30,000 trucks
per day.
Years ago, the safety side lanes were moved, making a
simple lane change a dangerous maneuver, and the cost of
congestion caused by the bridge is approaching a billion
dollars a year. The value of the Brent Spence Bridge to our
Nation and to our region is obvious because over this bridge a
billion of freight passes every day. The Brent Spence Bridge is
the poster child of the aging and inadequate infrastructure in
our country and Federal and state officials have been there
regularly to use it as a backdrop to know that we have to make
a change.
I would like to thank Congressman Chabot especially for all
he has done over the years to put the needs of the Brent Spence
Bridge front and center in front of Congress.
And if you look at the traffic on the Brent Spence Bridge,
you will not only see hundreds of semitrailers, but you will
see thousands of panel trucks and services vehicles just like
mine. Every day, those small trucks carrying so much of our
region's and Nation's economy fight thousands of hours of delay
to get to our customers.
I thank this Committee's work on working on behalf of small
business, and I want to let you know that I am here ready to
help you in any way possible in the future. Thank you so much.
Chairwoman VELAZQUEZ. Thank you. We really appreciate all
you have to share with us today.
I am going to recognize myself for 5 minutes. And I would
like to start with Mr. Donovan.
For carriers both large and small, buildout in rural areas
is often prohibitively expensive. What can be done to help
carriers remain competitive in this area of doing possible
infrastructure expansion?
Mr. DONOVAN. Thank you for that question, Chairwoman.
You are correct. In some places, after 30 years of building
wireless networks, places that still are not served are likely
because there is not a business case to build out those
networks with private capital alone. The FCC does have the
Universal Service Fund to provide some assistance, but that is
not enough to close the size of the gap that we have. As you
continue to work on an infrastructure package, we would
strongly urge you to include dedicated funding to make sure
that we can close the digital divide.
Chairwoman VELAZQUEZ. Other than costs that you discussed
with us this morning, what are the largest barriers to rural
broadband competition and access?
Mr. DONOVAN. So there are additional factors other than
direct spending that can make builds more expensive or take
more time. That includes the permitting process, moving through
that, access to Federal lands is particularly important in
rural areas as so much of rural areas is Federal lands. And so
working with the relevant agencies to get approval so that
carriers can have the confidence and the certainty to put their
capital to work to build out these networks.
Chairwoman VELAZQUEZ. Thank you.
Ms. Williams, as agencies continue to identify and
prioritize cyber standards, it is very likely more procurement
obligations will be implemented because the energy grid is
related to our nation's infrastructure and also vulnerable to
cyberattacks. What can we do to ensure small contractors are
best situated to evolve to new cybersecurity guidelines?
Ms. WILLIAMS. Thank you for that question.
I think the best thing we can do is to keep conducting
specific training events, outreach evenings, continue that one-
on-one guidance for them because a lot of the perception is
that they have to invest enormous amounts of financing and
monies to get their systems secure. But not knowing or not
having all of the information of things that they can do as far
as training their employees, having adequate processes in place
that they can do themselves is critical to them in complying
with the requirements.
Chairwoman VELAZQUEZ. Do you feel that the Small Business
Administration is doing enough in the area of education and
providing information to small businesses so that we empower
them with the information they need?
Ms. WILLIAMS. I think they have been doing a lot in
providing specific webinars or specific, some training events.
But again, what I have been finding is that the small
businesses really need a lot of hand holding and that is where
specific areas can help with that.
Chairwoman VELAZQUEZ. Thank you.
Ms. Bougher, energy and infrastructure are inherently
linked together and existing electricity infrastructure is
aging rapidly. Inarguably, the United States' energy problems
are largely rooted in its crumbling infrastructure. An influx
of investment must be considered in order to prevent additional
weather events from exacerbating its delicate state as we saw
in Puerto Rico after Hurricane Maria. What steps can we take
now to modernize our energy grid and how can that further the
growth of the small business sector?
Ms. BOUGHER. Thank you, Chairwoman.
I think it goes back to infrastructure and how are we
utilizing the right modern, up-to-date, latest innovation? Are
we really thinking ahead to try to create an infrastructure
that can prevent or at least reduce a level of impact that
these mostly, for the most part, natural disasters are
bringing? There is very little we can do to control that and to
control the intensity, but there is a lot more that we can do
to create infrastructure systems that can withstand, if not
reduce the level of impact.
Chairwoman VELAZQUEZ. Thank you. My time has expired, we
will do a second round and Mr. Knochelmann, my first question
will be to you.
Now I recognize the Ranking Member for 5 minutes.
Mr. CHABOT. Thank you, Madam Chair.
Judge Knochelmann, I will go with you to begin with. And
not surprisingly, I think I will talk about the Brent Spence
Bridge.
Mr. KNOCHELMANN. Sure.
Mr. CHABOT. Could you, and we have talked about that. We
have worked on it for a long time. And when I say ``we,'' I
mean all levels of government. I think we have gotten $53
million so far. Most of that has gone into engineering studies,
EPA studies, and kind of the preparations for it. But could you
remind us again, and this not only affects the folks obviously
in my district and the greater Cincinnati area, and all the way
up to Michigan and probably into Canada as well, but also the
folks on the other side of the Ohio River in Kentucky where you
are at, but all the way down to Florida. Could you remind us
what actually replacing the bridge, what the direct and
indirect impacts would be to the communities in our area? And
then if you want to touch on small businesses as well, how it
would affect them since we are the Small Business Committee.
Mr. KNOCHELMANN. Sure. Well, and I think one important
note, we think about this bridge in our region as being the
replacement bridge. I think it is important for everyone to
remember the existing plan, the design that has been done is to
actually keep the existing bridge, not waste it, refurbish it,
and add a companion bridge next to it. So the good news is past
dollars of decades ago would not be wasted; they are just
improved.
And then the access through that entire region, which is
the project is estimated to be a $2.5 billion project today,
but it would actually include about a 15 to 20 mile swath of
expressway that also needs to be expanded though that
community, which obviously ties in one of our key airports, CVG
in Cincinnati, which happens to be in Kentucky. Amazon Prime
has just relocated or is going to be growing a $1.5 billion
project there for their regional----
Mr. CHABOT. And just to clarify that, we are not talking
about taking away Ms. Velazquez's New York project.
Mr. KNOCHELMANN. No, absolutely not. This was well before--
--
Mr. CHABOT. Yeah, okay. I would not want to upset the Chair
now since she is Chair now.
Mr. KNOCHELMANN. But Amazon has announced a large expansion
at our airport in Cincinnati. And so we are talking about major
infrastructure, national importance to get product and
services, as well as the wonderful thing about what is
happening with the project is small businesses are there to
serve them. So we have small carriers in our area who are
actually serving the future Amazon prime with their own freight
businesses. So we see that impact. We see the economic impact.
We see the improvement opportunity that infrastructure can make
into the cities and the counties and the community, as well as
the quality of life that we see improving just because people
are able to get connected across the state. So it is needed.
And of course, our hope is that we never see an issue where,
like Minneapolis where we have something catastrophic happen.
We would rather be proactive.
Mr. CHABOT. Thank you very much. And just to conclude, one
thing I wanted to mention, I am sure you are aware of this,
we--and when I say ``we'' again, not just myself, other members
here on both sides of the aisle--have been successful in
getting something called Projects of National and Regional
Significance into the previous transportation bill. So there is
an access, there is a pot of money there waiting. It will not
fund the whole thing but a significant part of it. But the
local communities, obviously, and Ohio and Kentucky have to
determine how they are going to come up with a local part of
the funding. And that has kind of been the challenge in recent
years. Thank you very much.
Ms. Williams, let me turn to you. Could you elaborate on
the challenges, and we have talked about this in this Committee
a lot over the years, that small businesses face that comes
from the cybersecurity threat and what kind of impact there can
be on a small business if they are successfully hacked?
Ms. WILLIAMS. So we have had, well, when I say ``we,'' UTSA
and our Procurement Technical Assistance Center office services
many small businesses. A lot of times they do not come to us as
a resource until they have been hacked. And that is when they
will come to the trainer or come to the classes and they will
talk about the impact of them being hacked and losing all of
their customer information. Or making their customers
vulnerable to having their information out there and stolen. At
some point, or at one point they literally will have to shut
down their business because all of their records have been
compromised. So it is a great impact when they have been
hacked.
Mr. CHABOT. Thank you. My time is about ready to expire,
and I would just note that I know we have heard testimony that
there is a pretty high percentage of small businesses that
literally go out of businesses after a hack. They just cannot
survive. So it can be a very serious and devastating event. And
I yield back. Thank you.
Chairwoman VELAZQUEZ. The gentleman yields back.
And now I recognize Ms. Finkenauer, Chairwoman of the
Subcommittee on Rural Development, Agriculture, Trade, and
Entrepreneurship for 5 minutes.
Ms. FINKENAUER. Thank you, Madam. I always do that. Thank
you, Madam Chair. And thank you to our guests here today as
well. I really appreciate you being here and talking about this
very important topic.
I get very excited talking about transportation
infrastructure. I also, besides having the honor to sit on the
Small Business Committee, I sit on the Transportation
Infrastructure Committee as well, where March is going to be
infrastructure month. So I am very hopeful we can actually
start moving forward here and it is incredibly important that
we do. I am from Iowa. We actually have the most structurally
deficient bridges in the entire country. On top of that, we
rank number 39 in broadband connectivity, which is a problem
when I am from Iowa and our agriculture economy, our farmers
are relying on cloud-based services and the internet to be able
to use precision ag the way that they need to to be able to
save money and, you know, again, be able to do what they need
to do in the field.
Along with that, we are also desperately trying to grow
rural American and a big part of that is making sure that we
have broadband in all parts of my state. And so this is
something, again, I am really excited to talk about. And Mr.
Donovan, I know this is really kind of your wheelhouse as well.
And I want to know, you know, I have been having a lot of
conversations about this lately, and we all know there are
areas of our country where we desperately need broadband. We
need to expand it. But for example, I just had the National
Association of County Administrators in the other day and one
of their things is, you know, well, we know we need it. We do
not always know exactly where because of the FCC data. And so
one of the things they have been doing, you know, there was
somebody who had an app showing, you know, depending on where
you are at in the county you can use your app and that data
will go in and you can see what your connectivity is and your
download speeds, which is creative and a good idea. But what
more do we need to be doing, especially on the Federal level
here to make sure that we have the data we need to know where
we need to be expanding?
I know one of the things I am working on right now is a
bill that would address some of these issues, but I want to
make sure we are doing everything the right way, and wondering
if you have any suggestions about what we should be looking at
to make sure, again, we know exactly where we need to be
investing.
Mr. DONOVAN. Thank you. It is such an important part of the
discussion, especially as these maps and what the coverage
should have is going to determine where any funding is going to
go, to build it out. For the Mobility Fund USF, we have
overstated coverage that is going to determine where $4.5
billion gets invested. In December, the FCC had a different
report that claimed that approximately 100 percent of the
population lives in geography with 4G coverage. We have got to
do better than that, and it needs to be more--it should be
dependent on collecting better data at the FCC and the Federal
level, instead of relying on local administrators pushing a
button on an app to prove where they do or do not have service.
It should not be offloaded onto industry and state and local
governments to prove the negative. We need to tighten up those
standards and make sure we are starting with reliable data.
Ms. FINKENAUER. Great. Thank you.
And this one just to shift gears a little bit, Ms.
Williams, I am happy to have you here as well. And one of the
things I get really excited about as well is making sure,
again, that rural America has more opportunities, and that
means getting to compete for government contracts. And so that
was actually my first bill in the House, was making sure that
the Small Business Administration and the procurement officers
were working with small businesses to be able to compete for
government contracts and research grants, which is great. But
when we are looking right now at an infrastructure package that
will be, hopefully again getting done here, how do we make sure
that our small businesses are able to compete for those? And is
there anything else we should be doing to look out for that to
again make sure they are able to get these contracts?
Ms. WILLIAMS. Thank you. Great question.
I think a lot of I has to do with information. With making
sure that they understand the resources that are out there that
are available. A lot of times we have businesses that come to
us after they have already paid a consultant to do something
that is already being paid for through the Federal government,
through the SBA, through the Department of Defense. And being
paid for in the form of having advisors and counselors
available to help them navigate through the process. SBA has,
or the Federal Government has contracting goals. Six out of 10
of those goals consistently are met, but women-owned
businesses, that goal continues to be lacking. HUB-zone
business goals, that continues to be lacking. So making sure
they have information is very, very important.
Ms. FINKENAUER. Thank you. I appreciate that.
Chairwoman VELAZQUEZ. The gentlelady's time has expired.
Ms. FINKENAUER. I yield back.
Chairwoman VELAZQUEZ. And now we recognize the gentleman
from Ohio, Mr. Balderson, Ranking Member of the Subcommittee on
Innovation and Workforce Development, for 5 minutes.
Mr. BALDERSON. Like my colleague, I forget the microphone,
too. So I apologize.
Mr. Knochelmann, good morning. And thank you for being here
and for representing my state of Ohio, too, with Congressman
Chabot. I also sit on the Transportation Infrastructure
Committee, and I can personally attest to the infrastructure
issues that we are dealing with in Ohio. And right now Governor
DeWine has just proposed, and they are doing the budget, the
transportation budget work there now as we see what is going on
there.
I have had a chance to learn the opportunities that are out
there on a national level and what infrastructure is facing.
And I, like my colleague, agree that, you know, we need to
address this issue. And that is one of the main reasons I went
on this Committee because I think it is something that we can
do.
What can Congress do to help small business owners overcome
some of these transportation issues that you referred to with
your company?
Mr. KNOCHELMANN. Sure. Thank you, Congressman.
I think maybe one of the key factors, I think, is to really
be able to listen and know that small businesses are willing to
make an investment in infrastructure. That we not expecting and
do not look to the state or the Federal Government to take care
of even state and Federal roads. We know that our businesses
generate those dollars that you are so good about making sure
you dispense across the country. So I think one of the big
topics, as you referred to, is Governor DeWine's talking about
bringing up a gas tax. And I can tell you, I will speak for
myself as a business owner with literally 50 trucks on the road
every day, I am happy to invest in a gas tax that goes to roads
and bridges. I know that most, if not a super majority of my
friends and colleagues in my industry, those who have 50 trucks
or semis, et cetera, they say the same thing. As long as it is
not diverted, we want to make sure it goes into concrete,
blacktop, bridges, et cetera, to make sure that it moves our
economy forward. I think that that is a message that needs to
be heard loud and clear because I do not think that
infrastructure is partisan. You know, we all want them, and we
all know we have to pay for it. And I think that as long as it
is a partnership, and when I think across the levels of
government, as well as among the states and your governor and
our governor in Kentucky have been, I think, working very
professionally about how to present that to the public in a way
that is--and the business community. So I think just listen.
Mr. BALDERSON. Thank you very much.
My next question is for Mr. Donovan. And thank you for
being here.
We know about broadband. We have been talking about it for
a long time. I came into the state legislature in 2008. They
were talking about broadband and lack of. My former Senate
district is very rural, Appalachia region. And it is a weekly
occurrence of, you know, not having access to small business
owners in those rural communities. So having been talking about
it since even before 2008, I mean, what can Congress do to
deploy this and get some, you know, faster action? I mean, you
talked about some of the regulatory processes that we have to
go through and the permitting issues, and mostly the national
lands. Those are some things that we do not have to deal with
in the region of the state that we are lacking. It is mostly
the terrain and the hills. And I just did not know if there was
anything out there that you could suggest to us that we can do
to deploy that a little bit quicker.
Mr. DONOVAN. Thank you. The cost to deploy goes up
tremendously when you are going through mountainous areas and
rough terrain. One thing that there have been efforts
previously is to push that in programs like the Universal
Service Fund, to include a terrain factor so that if you are
having--flat prairie lands are not competing for the same
dollars against mountainous terrain so that you can have some
sort of bid credit or balance that out to compete on a level
playing field there. Additionally, continuing to push for
additional spectrum to be available for wireless carriers to
deploy. I talked in my opening statement about low-, mid-, and
high-band frequencies. Low band frequencies, actually, they
penetrate through obstructions and cover longer distances so
particularly in rural areas using those signals can help you
serve a greater area off of the same tower. Currently, the FCC
is working on, at Congress's direction, we reallocated some
spectrum frequencies from broadcasters, reimbursed them, and
are using that now for wireless carrier service. That repack
process is ongoing. Once that is complete, these low band
spectrum will be put to use and can tremendously help expand
service availability in rural areas.
Mr. BALDERSON. Okay. Thank you very much.
Madam Chair, I yield back.
Chairwoman VELAZQUEZ. The gentleman yields back.
And now we recognize Ms. Davis, congress member from
Kansas.
Ms. DAVIS. From the great state of Kansas.
Thank you, Chairwoman. And I appreciate you calling this
hearing today. I also sit on the small business committee and
the transportation and infrastructure Committee. And so because
of that I am becoming that much more aware of the interplay and
the need to invest in kind of these core infrastructure issues
in our communities. You know, the Kansas City Metro area, and
my district includes Overland Park, Kansas, and Olathe, and
Lenexa. We have got a ton of businesses that are very dependent
on things like broadband. We are also seeking to expand our
reach into things like transit and that sort of thing. And all
of these things are playing in together. You know, our area was
the first google fiber city in the country, and Ride KC is our
transit. You know, we have got this awesome thing going on. It
has got Wi-Fi on it. So we are trying to figure out ways to
make sure that when we are doing one thing we are also
addressing another, like internet access.
So when I think about how we build infrastructure that will
be good for us and for our grandchildren, certainly, broadband
is at the top of mine. And so Mr. Donovan, you said a couple of
things earlier that I thought were really interesting. And
obviously, broadband is a vital, economic driver. And there are
lots of small firms, and you mentioned the number of smaller
carriers you have. And that there are not just monetary but
regulatory barriers. And specifically, you said that there were
unnecessary reviews. I am curious what you mean by that. And
then I want to do a follow up about tightening up
accountability which you also mentioned. You know, I guess I
would love to hear about both of those two things.
Mr. DONOVAN. Sure. Thank you.
So in terms of the reviews, when we're looking at that, the
FCC is working on modernizing some of their review processes.
But you don't need to go through the same review for a small
cell the size of a backpack that goes up in an afternoon, as a
200-foot tower that you are building along the side of a
highway.
Ms. DAVIS. And right now that review process is the same
for a lot of carriers?
Mr. DONOVAN. The FCC is in the process of implementing some
changes there that are actually estimated to save about $2
billion off the cost. And that is real money that can then be
put back into the networks to further expand it. For smaller
firms doing this, that cost of the delay and additional fees is
even more dramatic as you are operating on a much tighter
margin with fewer resources to be able to put into play.
Ms. DAVIS. and then earlier you were talking about
increasing accountability for purposes of--I believe you were
talking about for purposes of what is the actual coverage and
that it would be great for Congress to have reliable maps. Can
you expand on that a little bit?
Mr. DONOVAN. Happily. So, the FCC that collects data for
particularly, for the Mobility Fund, they set standards looking
at if there is an 80 percent likelihood that you will have
signal at a certain loading factor, the certain number of
people using that tower. If you can tighten that up, include
signal strength, then you have a more direct idea of where you
actually have coverage without having to then have people go
out and test it. We learned through that process, there is a
challenge process off that initial map. And after reviewing
over 20 million data points that did not even come close to
touching as much of the country that needed to be checked, the
FCC found significant flaws. So they are currently
investigating that and we want to give them credit for that.
But as we look at future data collections, if we can have
parameters that more accurately reflect what you experience on
the ground, we will be starting off with a better map.
Ms. DAVIS. Okay. And then last thing. And I was hoping to
ask more questions but 5 minutes is so short.
What does accountability look like? What do you think
accountability? What should be the consequence?
Mr. DONOVAN. So the consequence should be going back and--
making a measurement one time does not need to be the last
time. We should keep going until we have it right. What is the
right map? It is what you know from traveling in your district
and knowing where your dead zones are. And making sure that the
data reflects that so we can set policies to fix that problem.
Chairwoman VELAZQUEZ. The gentlelady's time has expired,
and she yields back.
And now we recognize the gentleman from Oklahoma, Mr. Hern
for 5 minutes.
Mr. HERN. I appreciate it very much. Thanks for the
witnesses for being here today.
As an engineer, lifelong business man, and spending 5 years
on the Oklahoma Turn pike Authority as the Finance Committee
Chair, I certainly understand how vital infrastructure is to
small businesses and the necessary burdens that are put on by
the government to achieve the infrastructure repairs that we
needed to do and the costs associated with those.
Ms. Bougher, I am going to get right to the questions here
because I think you, you know, dealing with infrastructure and
contracting with them, you certainly understand those. Could
you help us understand what public-private partnerships, how
those look and what are your thoughts on those as a person
dealing directly with the infrastructure?
Ms. BOUGHER. Sure, actually, thank you for asking that
question.
We just recently completed--I do not know if you are
familiar with the P3 Bridge replacement program in
Pennsylvania. Pennsylvania used a P3, a public-private
partnership to complete about 556 bridges and that is in
response to the deficient bridges, the number of deficient
bridges in the state, and is an effort to move that needle at
the right level. And we just completed the NEPA clearance for
$459 of those bridges in 15 months. And so talk about the
challenges with the P3 process. It is a funding alternative.
But there needs to be better communication. From my experience,
much better communication between the concessionaires, the
contractors and the engineers. And so it is a big team effort.
Usually these projects tend to be really timely, with very
tight deadlines. And without that communication it could be
challenging.
I guess another example is the Turnpike Commission in
Pennsylvania just asked us to do a clearance, environmental
clearance for 270 miles, and this is related to what Mr.
Donovan is also talking about because they are looking to use
the existing right-of-way of the Pennsylvania Turnpike to
provide broadband access. They are also planning on that
through a P3. And I recently heard that it looks like it is
going to be more design build. But regardless, it is, again,
going back to looking at what makes more sense to do as a
public-private partnership and what benefits both parties will
get out of that partnership, which is not always even. And so I
think there is some work that needs to be done there but that
would be my response.
Mr. HERN. Fair enough. And just to continue with this
conversation, as that being a possibility of how to fund our
infrastructure in the future, obviously, the private part has
an interest how they get repaid. They are ROI on their
investment which is much different than the public side.
So keeping that thought, what do you see, as we know, the
Highway Trust Fund is basically front-end loaded until the end
of this year and then we have a problem with funding that going
forward. What do you see as some viable, maybe the most
effective and efficient ways? I am familiar with the trucking
industry. Would like to see fuel being charged or upcharged,
increased across the board. Are there any other ways you see?
Ms. BOUGHER. I would not give up on the public-private
partnerships. I actually think that these are fairly new, at
least to the state of Pennsylvania and Maryland in my
experience. I think that we can still do a lot with that type
of agreement, with that type of partnership. So I would not
necessarily give up on the P3s. And I do think that alternative
funding could provide that balance that we need between the
Federal and state funding and coming from the private sector.
Having said that, I still think that there are a lot of
things that we can do internally through the Federal Government
to----
Mr. HERN. So if I may, I have got one other question I want
to ask. And this is to Mr. Knochelmann.
Since you are a small business owner and have a trucking
industry, what else do you think we should be working on
outside of transportation? My point to asking that question of
Ms. Bougher was to show that we all agree that there is an
issue. We have got to fix it. What we have a difference on is
how we are going to pay for it. And that is for RT&I folks to
figure out but again, it is for us to point that out.
What do you see quickly as some other opportunities or
things that this Committee should focus on in helping small
businesses?
Mr. KNOCHELMANN. Thank you for the question. I think the
other idea, and you talked about it, a few members talked about
it earlier, is innovation. You know, what kind of ideas can be
aggressively gone after, whether that be with special grants to
evaluate. How do we become more innovative in how we are moving
people around our communities and businesses? Does it make it
more efficient? And can we reduce costs? Whether it be the
capital cost and/or the overall cost of operation of these,
whether it be a P3 or otherwise, I think that we have got to be
more innovative. And I think there is a lot of small businesses
and a lot of young innovative people in our colleges and in our
communities who are willing to look at that in aggressive ways.
Mr. HERN. Thank you.
Chairwoman VELAZQUEZ. The gentleman's time has expired.
And now we recognize the gentleman from Maine, Mr. Golden,
for 5 minutes.
Mr. GOLDEN. Thank you, Madam Chair.
Just kind of following up on that conversation a little
bit. I have become very familiar with public-private
partnerships in Maine, and I think it is a new thing in Maine
as well, ma'am. I served on the Transportation Committee in the
Maine legislature and I think we get a lot of good, you know,
we stretch our dollars nicely that way.
But I do have a concern that I want to keep in mind in this
Committee about the proposal that has come out of the
administration for infrastructure. And that is simply to make
sure that we do not leave some states behind, Maine being one
of them where we also have a State Highway Fund that is
underwater. You know, in many ways bonding our way out of it,
which is almost like swiping a credit card to pay for basic
maintenance. And it is not a good situation to be in. And when
I hear that we may have an infrastructure package that
prioritizes those states that have more private resources, more
state resources to put up and match, you know, I am fearful, of
course, that those that just do not have the capital resources
might get left out. So you know, something that I am going to
be looking to make sure states like Maine do not get left
behind.
On that, earlier we had a hearing where someone said one of
the most important things we needed to do in an infrastructure
package was make sure that the money got down to Main Street.
And I am sure that was a reference to businesses like your own.
So I just wanted to give you an opportunity to maybe talk a
little bit about what we can do. I hear a lot of small business
owners say it is tough for them to get involved with Federal
projects because it takes so long to actually get the shovels
in the ground and they just cannot float the upfront costs. So
if you could maybe just talk a little bit about that. What can
we do to speed up the process? Because in your testimony you
hinted at it a little bit.
Ms. BOUGHER. In my case, with an environmental firm that
works with environmental permitting all the time, I can tell
you that there are a lot of things that we can do within that
process to make it more efficient. Like Mr. Knochelmann
referred to being more efficient and being more innovative is
allowing those small businesses to come up with the ideas, and
they can. They do this work all the time. We work on this. This
is our bread and butter. And we can suggest ways to make it
more efficient. And innovative ways that may not be how it has
been done for the last 50 years, but maybe a better way to do
it and now a better way that belongs more to the, you know,
more up to date. And I think our systems in terms of review
process have been going around for many, many years. And we
have not really reconsidered whether or not they are still
necessary and whether or not we require as many days with all
that we can do online, all that we can do very quickly, we are
still keeping those same review times that we had back when we
were using snail mail. And so that may not be necessary any
more. Just things like that is what I can think off the top of
my head right now that we can, you know, and small businesses
can definitely help.
Mr. GOLDEN. So shorten the period of time for review
process is something that we should look at as an example.
Ms. BOUGHER. Yes. Yes.
Mr. GOLDEN. But when you say getting small businesses more
involved in the planning of projects, is that an issue with,
let's say, working with State Departments of Transportation? Is
that what you are saying? Is it the Federal Government should
encourage more of a partnership in the planning process?
Ms. BOUGHER. I think having a seat at the table early on,
and it is not necessarily that they do not take it into account
right now, but being able to say, and it is not necessarily so
much about being a small business that can contribute, but
being experts in the field. Our business right now is small
because we are a specialty firm. And what we specialize on is
environmental permitting and NEPA clearance. So we go out to
the experts and ask them, how do you think it can be done more
efficiently? That would be a suggestion.
Mr. GOLDEN. Thank you.
Mr. Donovan, I think I have got time for one more exchange
here.
Something that happens in Maine a lot, and you talked about
how coverage is overstated. And I could not agree with you
more. Many a small town has some broadband running down Main
Street, and they are doing a good job of rebuilding Main
Street. They run out of space though and then growth is
basically stuck. Because when you talk to people they will say,
yeah, you know, it is nice on the downtown. We have got good
access to broadband or faster internet, but you get a mile out
of town and the consumers, their market is in the dark. So I
just want to give you a chance maybe to talk about what
Congress can do working with carriers to try and get at that
problem right there because I do think it is overstated. Maine,
on the map here, said that only 14 percent are without access
to broadband. There is no way that is true.
Mr. DONOVAN. Yeah, thank you, Congressman. For where you
are locating on Main Street, you know, it is not just location,
location, location. Now it is location, location, and is there
broadband, is what businesses are looking at. Or else, you do
not exist if you do not exist on there. You know, Senator King
uses the phrase that there is no silver bullet but there is
silver buckshot for solving this digital divide. So we want to
embrace in all the above strategy.
Chairwoman VELAZQUEZ. The gentleman yields back.
And now we recognize the gentleman from Minnesota, Mr.
Hagedorn, for 5 minutes.
Mr. HAGERDON. Thank you, Madam Chair, and Ranking
Republican. I appreciate that. Witnesses, thanks for your
testimony.
One of the most important things that I am trying to help
accomplish is to sustain agriculture and our rural way of life,
and a lot of that involves, of course, the success of small
businesses. And I have come to the conclusion that the best way
to level the playing field and to do all we can for our small
businesses is to eliminate bad government at every level of
government, especially here at the Federal Government. And when
you look at areas like regulations and taxes, I think
Obamacare, which has not been good for small business, and
energy independence, things of that nature, we have got a lot
of work to do. Trade is another area.
And I would like to focus in though on transportation. In
our district, Southern Minnesota, the district goes all the way
from South Dakota to Wisconsin and then Iowa up about 80 miles.
There is a main thoroughfare, Highway 14. It is the most
densely populated, contiguous road without a--that does not
include four lanes all the way across. And it has quite an
impact on business and commerce and efficiency. And it all
relates back to small business in our rural communities.
I will give you a little story. In the city of New Ulm, a
beautiful community of about 14,000, it is in Brown County,
just a wonderful place. 3M is located there. Lots of good
businesses. But the mayor and some of the Economic Development
folks told me a story a year or two ago where there was a
company that was looking to relocate into New Ulm. Going to
bring in 500 to 1,000 jobs. And the representative of that
company drove in and looked around and said, is the only way in
and out of town two lanes? And they said, yeah, unfortunately,
that is the way it is. And they said, okay, thanks. And they
got back in their car and left. And so there are 500 or 1,000
jobs not in that wonderful, vibrant community that could be
even stronger. And of course, that is a larger business. But
think of what those folks are going to do if they live there,
shop there, you know, go to school there, how it helps all
involved, especially small businesses.
So I know my friend, Mr. Stauber, Congressman Stauber, is
on the Committee of Transportation. I am looking to work with
him and everyone else because there is a project, Highway 14,
that people, including my father 44 years ago when he arrived
here, he started working on that and we still have not
completed it. So I understand exactly how important
infrastructure of that nature is.
I would say to our friend, Mr. Donovan, thank you for your
staff for stopping by our office yesterday. We appreciate what
you are doing and looking into in the issues.
Do you have an example or two that you can provide us as to
how broadband is so critically important for our farmers and
our small agri businesses in places like southern Minnesota?
Mr. DONOVAN. Thank you.
So when we look at farming today, you almost become
agricultural engineers with the amount of connectivity that
they depend on. So precision agriculture techniques will allow
farmers to be more efficient and have more profitable yields
while using fewer resources. And there has been a lot of talk
of autonomous vehicles generally as things that 5G will enable.
And we have had them in rural America for years, they are just
John Deere green. They are based on following that wireless
connection in order to power how they are operating.
Mr. HAGERDON. Thank you. I will give you another example. I
grew up on a grain and livestock farm. We had hogs, and my
father would send me out on occasion to feed the hogs, but now
they can do that all automatic. They sit in a computer room and
turn the machines on and off and nobody has to even get close
to the animals in many cases.
Mr. DONOVAN. I will add on to that, if I may. In addition
to feeding them, you even have applications that are
essentially a Fitbit for piglets that can track them and you
can see where the animals are. And that actually, it helps
prevent instances where the pigs get smothered while they are
getting fed and in other instances, you can track the vitals.
It is pretty incredible what you can do with these connections.
Mr. HAGERDON. Very good.
Very quickly, Ms. Williams, I would ask you a quick
question, your analysis. Do you support the Small Business
Runway Extension Act of 2018, which affects small businesses
and their qualifications during the procurement process? What
is your opinion of that legislation?
Ms. WILLIAMS. Thanks for asking.
I would have to say I am not familiar with it. I have not
read that piece of legislation.
Mr. HAGERDON. It is a relatively new bill and I am sorry if
I caught you off guard. But maybe you can submit something for
the record and respond to us down the road.
Ms. WILLIAMS. I would be glad to do that.
Mr. HAGERDON. With that I yield back. Thank you.
Chairwoman VELAZQUEZ. The gentleman yields back. And now we
recognize the gentleman from Texas, Mr. Veasey, for 5 minutes.
Mr. VEASEY. Thank you, Madam Chair.
You know, as we talk about expanding our broadband and
moving it out to rural America, one area that I am concerned,
and I am fully supportive of that. I think it is very important
that we expand our broadband. One area that I think that we
need to address now before we start any large expansive
movement of that is when those contracting opportunities take
place to help build out that broadband, that black-owned,
woman-owned, minority-owned firms are a part of that work that
actually takes place. I think that is critically important on
everything that we do for that matter, whether it is expanding
our green infrastructure or any of those things that we talk
about that are on the horizon for helping create a better
America.
And so with that I wanted to ask Ms. Williams, because I
know that you have some background in helping out small
businesses, as it relates to expanding contracting
opportunities for small businesses, can you speak on how
retainage and prompt pay affects the growth of small businesses
and contractors, specifically when they are trying to be able
to have enough capital to be able to work on various projects,
different projects if their money is being held up?
Ms. WILLIAMS. Thank you for that question. Great question.
We have dealt, in my 30 years of experience in dealing with
small businesses, not only through this program but at the
local level as well, all of those issues have been significant
to small business growth. On local projects retainage has
definitely been an issue. Not only that but bonding continues
to be an issue, as well as prompt payment. That also relates to
access to capital. That is one of the reasons why they need
significant access to capital is to be able to cover some of
those expenses while they are waiting for payment. With Federal
Government contracting prompt payment continues to be an issue.
We continue to see business after business come to us for
assistance to find out where they can gain more access. Some of
them tend to go to organizations where they submit their
contract or borrow on their contract while they are waiting to
get paid. So that continues to be an issue. We continue to look
for resources to help them. Some local governments have
provisions in place to speed up that prompt payment process but
we have not heard anything as far as expediting that at the
Federal level.
Mr. VEASEY. I know a local contractor in the Dallas-Fort
Worth area that told me that they were owed about $600,000 on a
project that they were working on and literally did not get it
for almost 9 months. And for a lot of small businesses,
particularly smaller, you know, black-owned companies,
Hispanic-owned companies, that could be really a death blow.
What other challenges out there do small businesses face?
Again, particularly, you know, small minority-owned businesses
face when working with the Federal Government on bids and
projects?
Ms. WILLIAMS. Navigating through the system is a huge
challenge. Again, a lot of them try to do it on their own
before coming to resource providers. Having proper paperwork in
place. Having their business structures in place. So those
areas continue to be an issue. Once they get those in place,
then they can focus on actually providing the service. But
navigating through the system continues to be an issue.
Mr. VEASEY. Madam Chair, I yield back.
Chairwoman VELAZQUEZ. The gentleman yields back.
And now we recognize the gentleman from Minnesota, Mr.
Stauber, for 5 minutes.
Mr. STAUBER. Thank you, Madam Chair. And thank you,
witnesses, for coming. Your testimony is enlightening because
we are talking about small businesses owners. I am a small
business owner and have been for 28 years. We know, and the
four of you know that small businesses are the engine of our
economy.
A couple of questions. Ms. Williams, you talked about, the
question was, what is the biggest challenge for small business?
And you talked about navigating the system. I would encourage
you because you are the expert, to help us incorporate some of
those suggestions from the small businesses so it can be easier
because, I mean, I am sure all of you understand that small
businesses, we are assets to the Federal Government in repair,
fixing their assets, and what have you. And so I would
encourage you to bring those forward. From your 30 years of
experience, Ms. Williams, you can bring a wealth of expertise
to that in the procurement process because that is going to
continue to expand our small businesses. That would be my
request of you because of your expertise. And you know, when we
talk about my good colleague from Maine talks about expanding
broadband in the rural areas, I could not agree with him more.
My area is rural northern Minnesota, a beautiful place to live,
but they are not expanding because as you talked about,
location, location, location, broadband. That is an important
piece of the infrastructure.
Ms. Williams, your testimony, you concentrated in three
areas of deploying broadand--avaiability, affordability, and
adoption. Which of these do you think is the biggest challenge
for small businesses?
Mr. WILLIAMS. Thank you so much. And I definitely will
follow up with how we can help small businesses navigate
through that.
As far as broadband, affordability. Well, let me retract a
little bit. I think accessibility is number one. Affordability,
of course, definitely is number two. And I say accessibility
because there is a lot of, speaking from a Texas viewpoint,
there are a lot of areas in south Texas where just
municipalities, the small municipalities are longing for access
to high speed broadband.
We have an event called the Texas Rural Challenge where we
meet with those municipalities and we have directly heard that
from them. So if the municipalities are having issues, the
small businesses also in turn are having issues just accessing
it in their area. There are pockets where you just cannot get
any cell phone service, let alone broadband service. So I would
say the number one issue is accessibility.
Mr. STAUBER. Thank you.
And then my next question would be I guess to the entire
group. I am on the Transportation and Infrastructure Committee.
And when we have to build, rebuild American roads and what have
you, I would challenge us as supporters of small business, to
understand the importance of road access into our small
businesses, and also to make sure that our State Department of
Transportations understand when they rebuild or reroute that
small businesses have a voice in that. And I would encourage us
to get into, look at those projects that hopefully will be
appropriating very soon, but that small businesses have a voice
in the access roads, the frontage roads, whether they are going
to bypass or not, but have that local input. And you folks are
the experts to do it and help us move forward.
I have one other question to Mr. Knochelmann. As a small
business owner yourself, what areas do you think this Committee
should focus on in addition to infrastructure to help us
flourish, help small businesses flourish?
Mr. KNOCHELMANN. Well, it is a great question, Congressman.
I think that it all comes down to education and whether or not
we--I think about the small business. I happen to have an
accounting degree, so I think that it was very beneficial for
me to go right into the plumbing/heating business. Even though
I do not install water heaters personally, I have people who do
that. Education. You know, so you do not need a 4-year-degree
to know how to be an entrepreneur. You do not need a 4-year
degree to be a good business person. But I think the
communities need access to those business ideas. And whether or
not we encourage the education system to include it at a high
school level, after high school, as well as having the region,
the ability for people to come and get their quick answers, how
do you start and grow your small business? That is a huge
issue, and it is not very expensive.
Mr. STAUBER. I appreciate that answer. That was music to my
ears.
Madam Chair, I yield back.
Chairwoman VELAZQUEZ. Thank you. The gentleman yields back.
And now I am going to recognize myself for 5 minutes as we
go into a second round.
And to follow the line of questioning of the gentleman that
just was asking the questions, I would like to raise--so
imagine for a second here that we are going to enact
legislation, an infrastructure bill. It sounds like there is
bipartisan desire to enact such legislation. The question is,
how are we going to pay for it? I am optimistic when I hear Mr.
Knochelmann say that a gas tax, and many people are proposing
such a tax increase to be able to finance it. But let's say for
a moment that there is bipartisan support that we enact the
legislation.
Ms. Bougher, you mentioned how a shortage of skilled
workers constrain the ability of small businesses to expand
operations. What would you say, Mr. Donovan, Mr. Knochelmann,
and Ms. Bougher, how can it work? Talk to us about the
workforce challenges that you will face if such legislation is
enacted.
Mr. Donovan?
Mr. DONOVAN. Thank you. We encourage your efforts to enact
legislation and stand ready to assist in that. On the workforce
piece, there was bipartisan legislation last Congress we would
like to see come back looking at, particularly in the
telecommunications world, at tower climbing and other tower
engineering jobs-on bringing that more into community colleges
and into local communities, so that you can start using
additional resources to make sure that the people have the
skills to work on broadband deployment to accomplish the goals
that you will have in the infrastructure bill.
Chairwoman VELAZQUEZ. Ms. Bougher?
Ms. BOUGHER. So I have a short-term and a long-term answer
to that question. The short-term, it is the lack of engineers.
We would have to go back to high school. We would have to
convince these kids to go to engineering school. And that is
something that is going to take time. So in the short-term, I
would think a cross-training program where engineers that may
not be as familiar with the different areas of, you know, there
is a structural engineer. There are very specific fields within
the engineering field that we can help cross-train now, start
that process now, especially with our entry level engineers so
we can have a more diverse set of talents within the same
engineer. That, in my opinion, would be a short-term, we can
work on it now solution. But the long-term and most sustainable
solution would have to be going to workforce development that
starts at the--I would even say at the middle school level, not
just at the college level. I think in college we are a little
too late. So I would say we would have to--that K-12 is
important.
Chairwoman VELAZQUEZ. Thank you.
Mr. Knochelmann?
Mr. KNOCHELMANN. Thank you. And I would agree with
everything that has been stated on that. And I think another
area, and you see a shift in the culture, I think, of a
discussion about that not everyone also needs to have a 4-year
degree and take on a lot of debt to be able to be successful in
the workforce environment. I think that is very healthy. We
need to encourage that.
We have been drawing in our business, we have been drawing
in a lot of individuals who are both college educated and not
in the service industry. So we have been going to all fields,
including encourage co-oping from high schools, seniors who
come in and work half a day paid. And be able to feel the
industry out to know whether or not they are going to be able
to do that. But I also think it is a reality that the public is
also willing to pay for infrastructure, too, because
ultimately, as much as I would like to think that it all comes
out of my pocket, ultimately I have to pass those costs on to
consumers. I think they are willing to pay for good services
and good roads and infrastructure.
Chairwoman VELAZQUEZ. Thank you.
I yield back the balance of my time.
I would like to recognize the gentleman from Pennsylvania,
Mr. Joyce, for 5 minutes.
Mr. JOYCE. I thank the Chairwoman for yielding.
My question is for Mr. Donovan. What can we do to
incentivize better relationships between providers and state,
city, and local governments who have experienced limited
coverage? I am from rural south central Pennsylvania, and many
of these municipalities are hesitant to share the control with
any other existing infrastructure.
Mr. DONOVAN. Thank you for the question.
I think part of the discussion today is we have bipartisan
agreement that access to broadband is an economic multiplier
and a must-have for the 21st century. As we look at the
permitting process, the application, rights-of-way, it is
looking at it as a partnership that is a win-win. It is an
investment in the local community, and maybe looking a little
less that it being a one-time, revenue generator off of
different fees and different access, and instead taking a step
back and looking at all the revenue that will come to that area
because the investment is flowing in there. The investment, the
wireless carriers are continuing to work to expand networks,
and more of that attention is going to go where they are able
to have a municipality that can work with them to try and find
some creative solutions, particularly for the small carriers
that I represent. They also live in these communities. And if
they do not do something right by their community, they are
going to hear about it. They are serving on local boards, so I
think they might be some of the model on how you can work to
improve these relationships to make sure we can get to that
goal of expanded service.
Mr. JOYCE. Do you see a role in incentivizing these
entities to work together?
Mr. DONOVAN. Absolutely. And again, any incentives you can
have to spur additional deployment are great. And we have seen
that already in some states that have eased restrictions on
small cells, are some of the first 5G cities. So how we look at
those incentives to make sure that carriers can work with the
municipalities to make sure we expand service.
Mr. JOYCE. Thank you for your concise answer.
I yield back.
Chairwoman VELAZQUEZ. The gentleman yields back.
And now we recognize the gentleman from Maine, Mr. Golden,
for 5 minutes.
Mr. GOLDEN. Thank you, ma'am.
Not to pick on you, Mr. Donovan, but we will just keep
going with this one. And I look forward to working with my
colleagues on some of the regulatory stuff that might help in
rural areas. I think that has been a good conversation.
I just wanted to ask, you know, getting back, I love your
response about the buckshot, by the way. It sounds very much
like Senator King. And as a Mainer, I understand the reference.
But do you foresee a time where carriers that you represent
and others are going to see that it is a good investment for
them to expand significantly without public assistance? Or are
we just going to--consumers are, I think, are going to have to
either accept that they are not going to have it or are we
going to have to do some kind of Federal investment in the
infrastructure or public partnerships? I mean, in the state of
Maine, they have looked at doing bonds related to this to lay
down the infrastructure so that carriers can then provide the
service. But do we realistically think that carriers will ever
see a financial incentive to do this without public investment?
Mr. DONOVAN. Congressman, thank you.
Yes, we do. That is part of the exciting part of 5G
deployment, is that in many ways it is going to affect
everything other than your phone first. Yes, you will have
faster speeds and greater access, but the connections that it
will enable, can set up a river of pennies where you may not
have as many data plans sold to people but you have additional
sensors and other data plans that ride on that, you know,
powered through 5G networks or some of the precursors like
narrowband internet of things networks.
As one example, we represent a carrier that serves rural
Wyoming, and they have a massive footprint but less than
100,000 subscribers. Talking with them, they say they have
identified another 5 million subscribers. The difference is
that 3 million of them are cows and 2 million are sheep. So how
can you get those connected as well? And once you build that
network, and we may need some additional support to get the
networks built, but then can you use that river of pennies
approach to have many different streams that can help build a
sustainable business case.
Mr. GOLDEN. So, what you are basically saying is if we do
nothing your belief is carriers are going to bring 5G access
out to rural America by themselves?
Mr. DONOVAN. Parts will. I think if we do nothing then, we
are on the wrong side of the digital divide right now and we
need to build that bridge. Once we get there then they can
sustain the businesses, but we do need additional support in
order to get that initial build out.
Mr. GOLDEN. Gotcha. The infrastructure part?
Mr. DONOVAN. That is correct.
Mr. GOLDEN. All right. Thank you.
Ms. Williams, just really quickly. You talked earlier about
how some small businesses are going out and getting some people
to come in and advise them how to do, you know, get in on
Federal contracting and other things, and that is essentially
what the PTAC is for. And I have seen this firsthand where we
had a PTAC in Bangor, Maine, and 30 miles down the road a small
business that was paying some advisor consultant to come in
from as far away as Boston on how they could get involved with
pursuing some contracting opportunities relevant to their
shipbuilding. I mean, obviously, the contractor, you know, the
advisor is putting money into getting word out there and
pursuing clients. What is it going to take for PTACs to compete
against that? I mean, what are you lacking in terms of getting
the word out about the services that you offer and then getting
in touch with those businesses? Because I cannot help but feel
like in the case I just described they would love to have a
supported service through PTAC rather than paying some
expensive consultant out of Boston.
Ms. WILLIAMS. Right. You are absolutely right. We come into
scenarios every day where businesses want to get on the GSA
schedule, General Services Administration. They have already
paid a consultant $9,000 and still did not get on the schedule.
They will come to a PTAC and get on the schedule in a matter of
2 months.
I think one of the things that is lacking is advertisement.
As you mentioned, a lot of the consultants put money into
advertising and the way they advertise it makes it seem that
they are federally connected. I came across one that actually
used federal logos without permission. But because a lot of the
funds that we get have to be put into services instead of
advertising, then that is where we cannot compete with private
consultants.
Mr. GOLDEN. Thank you. That is very helpful.
I yield back my time.
Chairwoman VELAZQUEZ. The gentleman yields back.
And now we recognize the Ranking Member for 5 minutes, Mr.
Chabot.
Mr. CHABOT. Thank you, Madam Chair. And I think I am the
last questioner if I am not mistaken here, so I am the only one
that is standing between the folks in this room and lunch. So I
will be brief.
So I will go to the Brent Spence Bridge and Judge
Knochelmann.
When we had Elaine Chao, the head of Transportation
Department in Cincinnati, we had a hearing with the local
chamber folks from Kentucky and Ohio and we talked about
principally the Brent Spence Bridge, but also the Western Hills
Viaduct, which is another infrastructure project we are working
on in our area. And she mentioned something that Ms. Bougher
talked about here for a while, and that was public-private
partnerships. With respect to local, especially the Brent
Spence Bridge, do you have any thoughts on that area where that
might come into play on those two particular projects, either
one or both?
Mr. KNOCHELMANN. Sure. Well, I think that it has been
proven that P3s can be done well and they can be done extremely
poorly. And it seems as though that I think that is going to
have to be something that is on the table for both the projects
that you referred to. And I know that Governor Bevin has said
the same thing, that they have to be talked about. We have got
some issues as you are probably aware of in Kentucky with some
legislation that local, or state legislation that has been
problematic on the Brent Spence project.
But in terms of, I think what I have seen from the outside
and all the reading that I have done and the advocates and
opponents of it realize that the sophistication on the capital
side has got to be balanced so that you do not have the state
in a situation, either state in a situation where the liability
is there and the private sector has no liability. Or that the
freedom by which they are able to set rates, et cetera, really
damage the state financial situation. So I think that it is
about balance. It is about accountability. It is about real
return and making sure that no one is too--the risk side of it
is balanced with the capital investment. And I think that we
have got to have it on the table.
Mr. CHABOT. Thank you. And then finally, you mentioned a
potential gas tax. The Chair did as well, and I would be remiss
if I did not mention that a former member of the House, a
former United States senator is now our new governor in Ohio,
and that is Mike DeWine, and he has brought that up, that
issue, controversial, but he has brought it up and put it on
the table. We do not know what the legislature will do with it.
That is in Columbus. But he has, at least it is out there and
we will see where that goes. But sort of related to that in
some ways, and I had mentioned this relative to the Brent
Spence Bridge, that we do have this project of national and
regional significance that is waiting there but it is waiting
for the local folks to determine how they are going to pay for
the local share. And maybe that is part of it, and I know that
our new Governor DeWine and Governor Bevin from Kentucky are
going to be talking about funding for this major project.
Do you have any thoughts on the local funding aspects of
the Brent Spence Bridge? What you are hearing now or what you
think about that however you would like to comment?
Mr. DONOVAN. Sure. And I think the big discussion has been
about tolls for us, as you know, in the region. And I think
whether or not that is a contribution from the state, or the
state has to set that financing model up. While no one likes to
pay it, I can speak only as a business owner and not as my
elected official position because I can only speak for myself.
I think those, again, are costs that have to be balanced out.
And if it is reasonable, I think we are very willing to pay
those kind of contributions that are made on the local level to
get those projects done.
And I will tell you from the community in general, I have
sensed a willingness to be willing to step up to the plate and
play a part in that in making sure that local dollars are
invested in those kind of projects. So I think that the
movement, we just have to kind of, now that there has been a
ground swell of support for saying we know we have a major
problem. It is going to take dollars. You all do not have
magical checkbooks to write on any project around the country,
that we are all going to have to be reasonable about the fact
we are going to have to step up to the table and make some
investments. And I think there is a willingness to do that. I
really do.
Mr. CHABOT. Thank you very much.
I would like to compliment the panel for I think excellent
testimony. I want to compliment you, Madam Chair. This was a
very good hearing. Thank you for pulling it together. And I
yield back.
Chairwoman VELAZQUEZ. And now you are on the record
supporting a tax increase.
Mr. CHABOT. I have to correct the record. I am not on the
record doing that.
Chairwoman VELAZQUEZ. I echo the Ranking Member's statement
regarding your participation, it is very enlightening and we
really thank you because we know that you are all very busy
people and you are here today. It is very important for this
committee.
Ensuring small firms can participate in the federal
marketplace and win a greater share of federal work is always
top of mind. And as we have heard today, investment in our
crumbling infrastructure is a great opportunity to help small
businesses grow in every corner of our country. As we discuss
any future infrastructure investments, it is critical that we
listen to and prioritize small business needs to ensure their
future success.
I ask unanimous consent that members have 5 legislative
days to submit statements and supporting materials for the
record.
Without objection, so ordered.
And if there is no further business to come before the
committee, we are adjourned. Thank you.
[Whereupon, at 12:39 p.m., the Committee was adjourned.]
A P P E N D I X
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