Entrepreneurship Led Economic Development Introduced in Michigan House

Yesterday State Representative Tommy Brann (R-Wyoming), a small business owner himself, dropped off the long-awaited bi-partisan legislative package focused on small business growth called Entrepreneurship Led Economic Development (E-LED). E-LED is a concept in economic development that focuses on streamlining processes and interactions with state government as well as providing business acceleration services tailored to meet the needs of rapidly growing small businesses. With Michigan’s small businesses employing about 50% of our state’s workforce and between 1993 and 2016 providing an impressive 61.8% of net new jobs, it’s about time we had an economic development plan for our state’s most prolific job creators.

When it comes to economic development most services focus on either start-ups or large corporate expansions, but the companies in the “middle” where a majority of Michigan’s jobs come from, tend to be left out. Since the inaugural “50 Companies to Watch” list came out in 2004, which focuses on exactly these “middle” companies, the cumulative job growth of the total 750 recognized businesses came to 12,506. Now imagine that, an Amazon “HQ2” level amount of jobs already being created here in Michigan, diverse in industry and location, with little or no state investment. Imagine what growing small businesses could do if the government was easier to deal with and if economic development plans included them.  We are not talking about tax credits here. It is supplying growth acceleration services and setting up the state government in a way that is responsive and mindful of issues small businesses are having. 

For over a year SBAM has been working with state policymakers to craft a package that will make state government work for small business, make it easier for businesses to deal with compliance issues, and to assist our state’s powerhouse of job creation when it comes to common issues that are setting them back from their full growth potential. 

The Policy:

Creation of the Small Business Growth Acceleration Board, Sponsored by Rep. Tommy Brann (R – Wyoming)

The Small Business Growth Acceleration Board, made up of small business owners, would be located within the Michigan Economic Development Corporation’s Strategic Fund and would be tasked to develop growth-oriented services for small businesses across the state. The Board would also look to address common barriers for growth as well, so if the Board sees an issue that is directly hindering business growth, it would be their job to address it. With a group of small business owners at the Strategic Fund’s table, there is a great opportunity for Michigan to lead in small business economic development.

Creation of a Small Business Director, Sponsored by Rep. Donna Lasinski (D – Saline)

The Small Business Director would be tasked with creating a one-stop-shop for small businesses interactions with state government, facilitating creation and retention of small business jobs in the state, and creating a website tasked with providing resources for small businesses. This Director and their office would be similar to what many businesses have as an account manager, making sure that any small business owner who is interacting with the state government has as seamless of a process as possible. The days of calling through a list of various government bureaucrats hoping to stumble on someone who understands your businesses’ issue, or even picks up the phone, is over.

Creation of Department Level Small Business Liaisons, Sponsored by Rep. Eric Leutheuser (R – Hillsdale)

Require all state agencies that investigate, inspect, or monitor small businesses to have a specific Small Business Liaison in said agency. Currently, many of the departments and agencies that regulate and enforce regulation on small businesses don’t have an individual in their office that focuses on small businesses. This means that if you have an issue with a department as a small business owner, there usually isn’t a contact for you to speak with – this bill would change that. Many of the issues that small businesses have are very unique, and many of the rules that these bodies create internally are discussed without a small business voice at the table. Our current system demonstrates how rules and regulations that departments enact are created without understanding implications on small businesses because they don’t have to interact with them. It’s time for the government to be responsive and mindful about their impact on small businesses and have the infrastructure in place to assist small business owners when they have an issue.

Virtual Business Roadmap, Sponsored by Rep. Diana Farrington (R – Utica)

This legislation would task the state government to do a feasibility study on creating a Virtual Business Roadmap. This “Roadmap” would work much like the common tax platform “TurboTax” in which it would ask a series of questions in an easy format that would: Identify possible legal entities for said business; Assist users with state compliance issues; identify and assist in applying for appropriate licenses and permits; and link to other pertinent small business resources available. Many small business owners struggle with keeping up with regulations and rules the government is making. Having a system that is simple to use and effective in assisting owners with compliance and regulatory issues will give business owners more time to focus on business growth as well as make it much easier for new entrepreneurs to get started.

These ideas are common-sense changes that will make Michigan attractive to entrepreneurs and create an environment that would make Michigan a national leader in home-grown small businesses. This bill package would make our state government deliberate in removing barriers to small business growth, proactive in creating growth-oriented programs, responsive to inquiries, and mindful of its’ impact on small business owners. It’s about time state government worked for small business.

Micah Babcock is SBAM’s Director of Government Operations. He can be reached at micah.babcock@sbam.org.