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February 13, 2012 Senator Mattie Hunter 2929 S.

Wabash Avenue Suite102 Chicago, IL 60616 Dear Senator Hunter: I am a consultant in community and organizational development, working with organizations to create sustainable communities. This includes assisting small businesses and emerging nonprofits to increase their internal capacity through strategic planning, business planning, financial management and creation of social enterprise. I also help them create internal board and management systems to enhance operations and maintain financial and regulatory compliance. I am writing this letter to express my full support for SB2491. The proposed legislation grants the Illinois Department of Transportation the power to enter into agreements to make direct grants and low-interest loans to minority-owned businesses, female-owned businesses, and disadvantaged business enterprises certified by the Department for participation on Departmentprocured construction and construction-related contracts. It also provides that grant and loan funds be expended, subject to appropriation, from the Working Capital Loan Repayment Fund. SB2491 specifies permissible uses of funds and provides that funds may be loaned with or without interest. This would include grant funds for reimbursement of expenses incurred in the preparation of bids and proposals for State construction contracts and low-interest loans to cover working capital expenses associated with performing such contracts. The Department of Transportation will create criteria for eligibility and selection for grant and loan applications, approved use of funds, amount of loans or grants, interest rates, collateral, and terms. The law will also create the Working Capital Loan Repayment Fund and require the transfer of $10,000,000 from the Road Fund to the Working Capital Loan Repayment Fund. The bill as proposed will provide minority and other disadvantaged businesses with the resources they need to provide competitive bids and ensure that they have the working capital to perform. I respectfully request that SB2491 be enhanced to allow funding for comprehensive capacity building in addition to the proposed grant and loan funding for working capital and reimbursement of costs to prepare bid packages. This should include comprehensive assessment of the capacity of the States small business sector, including minority-owned, women-owned and disadvantaged businesses, regardless of certification status. This will allow the State to identify a range of key issues that impact the small business sector and develop a set of goals, objectives, strategies, work plan and compliance plan to ensure that our State provides an
4111 West 21st Place Chicago, IL 60623 Phone: 773-521-3137 Fax: 773-522-1832 Website: Valeriefleonard.com E-Mail: Consulting@Valeriefleonard.com Helping organizations create sustainable communities.

environment that will foster long term growth and sustainability for our minority and disadvantaged businesses. While the study has not been completed (to the best of my knowledge), I would imagine that a significant portion of the small businesses may need technical assistance with business planning, loan packaging, understanding the procurement process, risk management, etc. The comprehensive capacity building approach could improve outcomes of loan and grant programs by helping the small businesses to strengthen their internal management systems. Figuratively speaking, this comprehensive approach would allow the State to give disadvantaged businesses the fish today, while giving them the skills to catch bigger fish in the future. I would estimate that the additional costs for planning, development, implementation and administration of this component would be approximately $1,000,000$1,500,000, or 10%-15% of the program budget. The capacity building costs could include the costs associated with providing organizational assessments for businesses selected to receive grant for reimbursement of cost of preparing bid packages or working capital loans. The outcomes of the assessments will help them identify their individual capacity development needs. A capacity building grant would be provided to assist the businesses with developing their capacity building plans, and to cover the costs of implementation, including costs of a consultant, equipment, supplies, specialized training etc. to improve organizational productivity and efficiency. In closing, I thank you for your time and your consideration. I wish you much success in shepherding this bill through the Legislature. If you have any questions, feel free to contact me at 773-521-3137 or consulting@valeriefleonard.com.

Sincerely,

Valerie F. Leonard