Small Business Administration: Opportunities Exist to Strengthen Engagement with Historically Black Colleges and Universities
Fast Facts
Historically Black Colleges and Universities (HBCU) educated more than 226,000 African-American students pursuing a college degree in 2017.
Among other things, the Small Business Administration works with colleges and universities to provide entrepreneurial training and counseling for students and adjacent communities. We looked at how SBA has worked with HBCUs.
SBA’s efforts included providing training and counseling through its Small Business Development Center program, with centers on at least 16 HBCU campuses. We made 3 recommendations, including that SBA collect additional information to measure the effectiveness of its efforts.
States with Historically Black Colleges and Universities
Map showing states with historically black colleges and universities
Highlights
What GAO Found
The Small Business Administration (SBA) worked with Historically Black Colleges and Universities (HBCU) to foster entrepreneurship, primarily through its Small Business Development Center program (which provides counseling and training), strategic alliance memorandums, and co-sponsorship agreements. Two HBCUs—Howard University and the University of the Virgin Islands—have hosted SBDC “lead centers” since the 1980s. SBA also signed at least 35 strategic alliance memorandums with HBCUs and at least 16 co-sponsorship agreements in 2013–2018.
States with Historically Black Colleges and Universities
In 2018, SBA developed a plan to support HBCUs (including goals and measures) for the White House Initiative on HBCUs. However, SBA headquarters did not communicate this plan or its goals to key Small Business Development Centers or SBA district offices (those with HBCUs in their service areas). As a result, SBA may have missed opportunities to collaborate with HBCUs and help achieve the goals of its plan.
SBA has collected limited information about its programs and activities with HBCUs. SBA could not establish a baseline for performance measures developed in its 2018 plan because SBA district offices and the Small Business Development Centers are not required to collect or report information about their HBCU-related outreach and other activities. For example, while representatives from the nine Small Business Development Centers with whom GAO spoke said they conducted outreach to HBCUs, this information was not reported to SBA headquarters. Without collecting relevant information about its HBCU-related efforts, including data for performance measures, SBA cannot assess the extent or effectiveness of its efforts to support HBCUs.
Why GAO Did This Study
The 101 HBCUs play an important role in higher education and in their local and regional economies. Among African Americans who obtained a doctorate in science, technology, engineering, or mathematics in 2005–2010, more than one-third earned their undergraduate degrees from an HBCU. SBA is part of a long-standing White House initiative to strengthen the capacity of HBCUs, including their ability to access and participate in federal programs. SBA's mission includes business development, and SBA also works with colleges and universities to provide entrepreneurial training and counseling.
GAO was asked to review SBA's entrepreneurship-related efforts with HBCUs. This report examines (1) SBA efforts to foster entrepreneurship with HBCUs in recent years, (2) SBA's plans for the White House Initiative on HBCUs, and (3) the extent to which SBA collected information specific to HBCUs. GAO analyzed SBA information on HBCU participation in programs and activities for fostering entrepreneurship and reviewed related standard operating procedures. GAO also interviewed officials at SBA headquarters and eight SBA district offices, and representatives of nine Small Business Development Centers (selected for a high number of agreements with HBCUs and other factors).
Recommendations
GAO is making three recommendations, including that SBA communicate planned efforts to support HBCUs to key Small Business Development Centers or district offices, and collect additional information on its efforts to support HBCUs. SBA agreed with GAO's recommendations.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Small Business Administration | The SBA Administrator should assign and document clear roles, responsibilities, and reporting lines for headquarters offices' implementation of SBA's plan for addressing the White House Initiative on HBCUs in a timely manner. (Recommendation 1) |
In response to Executive Order 14041 of September 3, 2021 (White House Initiative on Advancing Educational Equity, Excellence, and Economic Opportunity Through HBCUs), SBA established the SBA HBCU Working Group. In December 2023, SBA approved the agency's HBCU Working Group Charter which outlines the objectives of the working group as well as roles and responsibilities of its members. For example, the charter designated the Office of Entrepreneurial Development (OED) as the chair of working group and the Office of Field Operations (OFO) as co-chair. In January 2024, SBA submitted its FY24 HBCU agency plan to the Department of Education. Subsequently, during the second quarter of fiscal year 2024, both OED and OFO communicated SBA's FY24 HBCU agency plan to resources partners and field offices.
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| Small Business Administration | The Associate Administrator of the Office of Entrepreneurial Development should take and document steps to ensure that the office's reporting mechanisms collect the information needed to establish a baseline for, and also inform future monitoring and assessment of, efforts to support HBCUs. (Recommendation 3) |
In June 2020, the Associate Administrator of SBA's Office of Entrepreneurial Development (OED) stated in a letter to GAO that the agency's Office of Field Operations (OFO) had sent guidance to SBA field offices on how to upload evidence of HBCU-related activities into a SharePoint system. As of November 2023, in its written response to GAO, SBA confirmed that OFO utilizes its SharePoint-based tools for capturing and reporting outreach efforts and activities by district office staff. According to officials, HBCU outreach was added as a specific field to help track specific outreach efforts with HBCUs. SBA provided documents to illustrate the data collection tool used by SBA district offices and demonstrated the tracking of HBCU related activities in fiscal year 2020-2023. In June 2022, SBA explained that OED's capability to track resource partner activities with HBCUs is not as robust as it could be. OED was evaluating and prioritizing updates to data elements in its reporting system, including updates to capture quantifiable information on activities with HBCUs. As of November 2023, SBA responded that OED is utilizing a centralized web-based reporting system to collect information on efforts to support HBCUs. SBA provided documents to illustrate the data collection tool used by OED program offices and demonstrated the tracking of HBCU related activities in fiscal year 2021-2023.
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| Small Business Administration | The Associate Administrators of the Office of Entrepreneurial Development and Office of Field Operations should communicate planned efforts to support HBCUs, including expectations, goals, and related measures, to the district offices and Small Business Development Centers with HBCUs in their service areas. (Recommendation 2) |
In June 2020, the Associate Administrator of SBA's Office of Entrepreneurial Development (OED) stated in a letter to GAO that his office would address this recommendation by placing a requirement in resource partners' cooperative agreements to host at least one event with an HBCU and their local SBA District Office during 2020. In March 2022, in its written response to GAO, SBA stated that OED has taken a broad approach to making certain that opportunities for HBCUs are better communicated. For example, a 2021 SBDC funding opportunity announcement specified the goals for SBDCs to collaborate with and conduct outreach to HBCUs. Similarly, a 2020 Strategic Workshop Plan provides guidance to SBDCs on conducting workshops and outreach with HBCUs and describes roles for SBA District Offices.
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