- While Irving W. McConnell, citizen soldier and veterinarian,
was rescuing the big cats languishing in Baghdad's zoo, his business back
home was going to the dogs.
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- In April 2003, the Army reserve colonel led a special-operations
unit that brought food, medicine and security to the looted zoo's distressed
animals. He also cared for palace-bound lions and cheetahs that had belonged
to Saddam Hussein's son Uday, which were later moved to the zoo. For his
service, Col. McConnell earned the Bronze Star.
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- But the accolades didn't mollify his wife, Helene, who
nearly failed to keep their biomedical-research support-services company
alive during Col. McConnell's nine-month deployment in Iraq. "My wife
said, 'No more stars. You can't be replaced,' " he says. "It's
kind of hard to own a business and be in the Army reserves."
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- Not since World War II has the U.S. military made such
heavy use of part-time soldiers like Col. McConnell. Some 168,000 of the
country's 1.2 million members of the military reserves and National Guard
have been deployed in the war on terrorism. About 55,000 have been sent
to the Middle East, where they account for about a quarter of the total
force.
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- But the economic burdens they shoulder aren't equal.
Of course, all face the prospect of long and more frequent deployments,
which in ways large and small disrupt life at home. Reservists and guardsmen
who are employees in the public and private sectors are, by law, guaranteed
their jobs back when they return. Yet their business-owning brethren enjoy
no such assurance of continued livelihood.
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- And the financial hit they take is considerably bigger,
if a November 2003 study by the Marine Corps is any guide. About 27 percent
of reservists who are self-employed, which accounted for 8 percent of the
Marines surveyed, said their businesses were "irreparably damaged"
by their absence during Operation Iraqi Freedom. That compares with 8 percent
of employed reservists who reported financial losses exceeding 50 percent
of their annual income.
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- When Col. McConnell was in the Middle East between February
and October 2003, his 80-person company, The McConnell Group Inc. of Dublin,
Pa., failed to win any new contracts. That's a disaster for a company -
which specializes in everything from veterinarian services to distributing
laboratory supplies - that normally signed at least one new deal a month.
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- Not only that, but some clients and rivals took advantage
of the situation. "People who owed me money weren't paying on time
because they knew I wasn't around," he recalls. And competitors whispered
to potential clients, "'Irving is overseas in the war, and no one
knows when he's coming back,'" he says.
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- As it turned out, Col. McConnell, 52 years old, who serves
in the 358th Civil Affairs Brigade based in Norristown, Pa., returned to
the U.S. early because of health concerns. Although he wasn't released
from active duty for another six months - just last month - he resuscitated
his business from his Fort Bragg, N.C., base via cellphone and e-mail.
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- Government assistance for reservists and guardsmen who
are small-business owners is limited, despite more frequent call-ups and
long deployments since Sept. 11 that have kept many of them away for one
or two years, a potentially business-killing absence.
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- "If they don't do something very quickly to help
reservists, I think they're going to lose reservists," says Robert
J. Broody, who has served in the Army reserves for more than 20 years.
He didn't see deployment once in his first nine years, but since 1991 he's
been sent to Iraq, Haiti, Bosnia and back to Iraq.
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- When he went to Bosnia, retired Major Broody, 50, a self-employed
chiropractor who serves in the same reserve brigade as Col. McConnell,
was able to hire someone to care for his patients. Even so, he estimates
his practice shrank by half. Ahead of his recent deployment to Iraq, he
wasn't able find a suitable replacement, so he closed shop and referred
his 1,274 patients, the fruit of 10 years labor, to another chiropractor.
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- Maj. Broody reopened his practice in early June, and
he expects it will take two years to rebuild. He laments the lack of support
for reservists who own businesses, noting that just having health insurance
would be a big help. "Some of these guys are really hurting,"
he says.
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- Today, their primary resource is the Small Business Administration's
low-interest, "disaster" loan program, an option available to
companies that are suffering because an essential employee has been called
up for active duty. Since it began offering loans in August 2001, the SBA
has approved 176 totaling $15.6 million. The loans have 30-year terms and
interest rates of 2.75 percent.
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- The SBA's Niagara Falls, N.Y., office, which covers 13
East Coast states, Washington, D.C., the Virgin Islands and Puerto Rico,
has accepted 21 loan applications since October 2003, when its current
fiscal year began, already double the 10 applications it accepted during
the previous fiscal year. Area Director William Leggiero Jr. says the jump
is probably the result of longer-than-expected tours.
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- Col. McConnell is one of the people the Niagara Falls
office helped this year. He took out a loan for $104,800, which he is using
to make payroll while he drums up business. Things are looking up: He recently
won a large contract to manage military working dogs at an Air Force base
in San Antonio.
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- The SBA granted Yvonne Beasley, owner of Silty Lady Inc.,
of Portsmouth, Va., a $128,800 loan to rescue her roadside-fence company
after her husband, Earl, an Army reservist, was called up in November 2001.
Mr. Beasley's absence, which was expected to last six months but was extended
to a year and then two years, kept the company from taking on big jobs
he would have overseen.
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- Although Mr. Beasley remained in the U.S., assigned to
a base in Norfolk, Va., "he wasn't accessible to me," Mrs. Beasley
says. "It was pretty much catastrophic on the business."
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- Annual revenue dropped to about $480,000 in two years
from more than $1 million. To cope, the Beasleys took out a $40,000 second
mortgage on their home, took pay cuts and froze their employees' salaries.
Mrs. Beasley says the SBA money will be used to consolidate debt.
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- "In 18 years of business, we've never borrowed,"
she says. "It's probably going to take us two years to get to a place
where we're in the black and not in the red."
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- Reservists and guardsmen also can take advantage of resources
available to former military members who are small-business owners. Veteran's
Corp., a nonprofit based in Alexandria, Va., was created by Congress to
help veterans start and expand small businesses. It offers assistance in
securing low-interest, SBA-backed bank loans as well as discounted liability
and health insurance and corporate credit cards.
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- Veterans Chief Executive Marty Berkowitz admits the menu
is measly in the face of longer and more-frequent deployments in recent
years. "I think right now we're all playing catch-up on this issue,"
he says. "None of us is ahead of the curve." Mr. Berkowitz says
his organization would like to provide additional services, such as preparing
reservists' businesses ahead of mobilization and securing business-continuation
insurance. He cited Veteran's small budget, $4.3 million in fiscal 2003,
including $3.3 million from Congress, as the key obstacle to doing so.
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- One initiative in the works is from Senator John Kerry,
D-Mass., the ranking Democrat on the Senate small-business committee. He
introduced an amendment to the Jobs Act, which passed the Senate in May,
that would give both small and large companies tax credits of up to $15,000
for each employee called to active duty.
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- http://www.starbanner.com/apps/pbcs.dll/article?AID=/20040
623/NEWS/206230321/1009/BUSINESS
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