Cutting red tape: Boston leads the way

U.S. Small Business Administration Administrator Maria Contreras-Sweet and Boston Mayor Marty Walsh announce the Startup in a Day Initiative on June 11 at District Hall at a table full of Boston small business owners. (Photo: Photo courtesy SBA)

Last week President Barack Obama picked Boston as the launchpad for his new plan to make it easier for entrepreneurs to get their businesses off the ground. The goal: streamline the license and permitting process via the creation of one-stop, business-friendly digital tools, thus reducing the time and cost of navigating government red tape. “I’m calling on city halls across the country to join the initial eleven mayors in a simple but powerful pledge to entrepreneurs and small business owners: If you want to start a business, we’ll make it so easy to navigate the license and permitting system online, that you’ll be off and running within 24 hours,” the president said in a statement.

U.S. Small Business Administration head Maria Contreras-Sweet came to Boston to announce the “Startup in a Day” initiative, a collaboration with the White House, the SBA and the National League of Cities. In its first phase, participating cities make a pledge to create a “Startup in a Day” online tool by the end of 2015; develop a streamlined, business-friendly online permitting system; and share best practices to encourage other municipalities to join in.

In addition to describing the program, Contreras-Sweet lauded Boston’s efforts to foster small business growth while easing the startup burden on entrepreneurs. She called upon Mayor Marty Walsh and a group of local small business owners gathered at District Hall on Northern Avenue to promote the initiative and help lead the way with other cities across the country.

She said the SBA will develop a companion portal to augment the digital tools developed by the Startup in a Day cities. She also announced: $1.5 million in prizes for two competitions — a “Start Small” and “Dream Big” contest — that will be awarded to U.S. cities and Native American communities across the country that adopt the Startup in a Day goals with their ideas and implementation.

Walsh said he had no problem shouldering the challenge.

He pointed out that Boston already has made progress reducing the hurdles small businesses face, so as to make Boston a more welcoming environment for innovation and startup activity.

“We are really trying to change the culture here,” Walsh said.

There are substantial barriers to opening up a new business, such as forming a legal business structure, understanding zoning laws and licensing requirements and acquiring various permits, according to a “business friendliness survey” of a wide range of business owner-operators, sponsored by the Ewing Marion Kaufmann Foundation, this kind of red tape is considered the number one obstacle. Reducing the days or sometimes weeks spent on the paperwork to get a business running allows entrepreneurs to

turn their attention to the kind of things that help a business succeed, such as developing goods and services, finding customers and hiring talented employees.

As for the “Start Small” and “Dream Big” competitions, Contreras-Sweet said the hope is the $50,000 prize to 25 winning cities and up to 2 Native American communities can help offset overtime costs or extra time needed to develop and launch online portals. Another $250,000 is available to local and state governments that develop online tools covering multiple regions that can be replicated elsewhere.

Boston leads the way

Late last year, Boston launched an online tool that increased on-time permit issuance by 12 percent, shortened the time to review and issue long-form permits by eight business days and shrank the backlog of building complaints from 3,5000 to less than 300.

“We have been watching and we are really admirers of what you are doing,” said Contreras-Sweet. “We are asking the rest of the country — mayors across the country — to follow your lead.”

Walsh took the opportunity to burnish Boston’s lead role by announcing the release of “Boston Zoning Check”, an online tool that will help small businesses navigate Boston’s zoning code. Instead of wading through the arcane details of Boston’s Zoning Code — which currently comprises three volumes and roughly 3,000 pages — a user can answer a few questions online and make an initial determination if they are eligible to open a new business or expand an existing one.

“We should be encouraging our residents with great ideas to focus on building their businesses, not being burdened with understanding municipal code,” said Mayor Walsh. “This new tool will help make the process of starting a business in the city one step easier.”

Improving access to capital

A number of Boston area small business owner-operators were able to express their views and concerns with Contreras-Sweet during a roundtable discussion of the Startup in a Day program, along with other pressing issues. chat with Contreras-Sweet . “This is an opportunity for you to tell us what we can do better by you and I don’t mind you being candid,” Contreras-Sweet said. “We can grow. We can learn. And we think that is important.”

Participants included Solmon and Rokeya Chowdry, owners of Shanti Taste of India; Jose de la Rosa, president and CEO of Guardian Healthcare; James DiSabatino, CEO of Roxy’s Grilled Cheese; Sherie Grillon, owner of Nola’s Fresh Foods; Juliette Mayers, president and CEO of Inspiration Zone; Todd Snopkowski, president and CEO of Snapchef; Ian So, CEO of Chicken & Rice Guys; Melissa Tyler, head of TummyToys; and Tricia Young-Shaw, founder and principal of TLE Consulting Group.

They all expressed a similar refrain: better access to loans to start or expand their businesses.

Ian So recounted the experience of seeking a small business loan for their food truck company, yet discovering it wasn’t possible. That ended up providing their own financing, with the help of family members.

Solmon Chowdry said the 15-year saga of his business to succeed — Shanti Taste of India now has restaurants in Dorchester and Roslindale and more on the horizon — would have been a lot easier if loans were available.

“We have been to many banks and we were never able to get any loans for the restaurants,” he said. “The way we financed some of this was we refinanced our house and got money.”

Contreras-Sweet reiterated the SBA’s commitment to improving access to capital for all kinds of businesses, because that’s part of its mission.