Q&A With Top Lawyer at SBA Office of Advocacy

Tom Sullivan is packing up his office. The chief counsel to the Small Business Administration's Office of Advocacy has decided to move on after six-plus years on the job. On Thursday, his office hosted a packed reception for him at SBA headquarters in Washington, D.C., where he was toasted and roasted for being an "affable lawyer" who "always spoke his mind."

I spoke with Tom last week about his tenure as the top lawyer at the agency that acts as a watchdog for small firms around the country. Here are highlights from our conversation:

Small Business Blog: In your own words, describe what the office does.

Tom Sullivan: We are an independent entity within the Small Business Administration that's been given the responsibility to be an advocate for the interests of small business across the federal government. We are free to take positions contrary to the rest of the SBA or even contrary to the rest of the administration.

SBB: What are the office's responsibilities?

Sullivan: To advocate on small entities and small municipalities before the White House, Congress, agencies and state governments.

SBB: The Office of Advocacy recently released a report saying the top five most pressing issues for small business owners are: the economy, taxes and regulation, health insurance, a quality workforce and global competition. Have these issues remained the top issues during your tenure there?

Sullivan: From an economic cycle, workforce challenges change a little bit depending on the unemployment rate, but other issues have not really changed. Health care has remained at the top of the priority list for longer than I've ever seen it and I've been in the small business policy world for about 15 years. (Editor's note: Before joining the SBA, Sullivan worked at the National Federation for Independent Business). Usually nationally the big issues are taxes and health care, but depending on economic cycles you do see them switching from number one to two, or vice versa. Health care has remained -- it's good news it's still a top issue, but bad news that we haven't been able to solve it.

SBB: Health care is an enormous issue to tackle, but why has it been so difficult to find workable solutions?

Sullivan: Part of it is learning on the job and we've learned that there's no silver bullet solution. We see health savings accounts as one tool that could help but it's not just one tool in the toolbox that is going to solve the problem. The idea of allowing a small business in Virginia to join with another small business in Massachusetts to buy health insurance at a lower rate -- I fail to see how that would not get costs down.

SBB: What are the obstacles to getting your message out about health care options?

Sullivan: There are some health insurance companies that have such tremendous market share in individual states and they don't want anything to eat into that market share. Some companies that have certain business models don't want those business models to change.

SBB: As a watchdog agency, you are able to take positions against administration policy. Although it doesn't happen often -- does that complicate your relationship with the SBA?

Sullivan: Yes, it does complicate my relationship with SBA. When my office was critical of a presidential proposal on prescription drugs -- pointing out how it could devastate small pharmacies, Chairman Bill Thomas of the Ways and Mean Committee agreed. But when calls from the White House came to [former SBA Administrator] Hector Barretto, I don't think he was too pleased to get those calls...It's those instances -- because Advocacy's small business views diverge from the administration's -- that have been the toughest part of my job.

SBB: You have said that the Office of Advocacy should be moved out of the SBA. Why and where should it be housed?

Sullivan: What I've tried very hard to do unsuccessfully is to have a transparent and distinct budgetary line item that covers the budget of the Office of Advocacy as we've tried to become directly responsive to the interests, needs and concerns of small business...Our budget is wrapped into the SBA budget as part of the administrator's discretionary funds and that doesn't match the requirements of our office.
I've gotten along very well with [all of the SBA administrators I've worked with] and they've had complete hands-off policies. Our office has worked with the same budget year after year, but it strikes me that that's not the type of transparent accountability that we should have to be directly accountable...We've been extremely effective with the smallest number of staff ever...It's a point of pride.

SBB: What are your greatest lessons learned during your tenure as Advocacy's chief counsel?

Sullivan: There's been a sign above my door so that when you close my door I see it and it has the word "listen." It wasn't up there for my first three years at Advocacy, but over time I've learned to listen. I lead a group of highly talented crusaders for small business. I'm lucky they haven't shied away from telling me when I'm about to make a stupid decision.

SBB: Have you made an impact?

Sullivan: The idea that we can be critical, but we have the respect from different government agencies is important. Agencies -- whether the Food and Drug Administration or the Environmental Protection Agency -- are coming to us for help in grappling with tough issues. I see that as a success that they want to engage the small business community. We have a state model bill initiative and at last count 22 states have enacted state regulatory flexibility laws. We've gone past just passing a bunch of laws to building community that's sharing best practices. The attorney general office in Austin, Texas -- who's in charge of small business -- is not talking with an AG in Richmond, Va., to find out what they've done.

SBB: Do you have a new job yet?

Sullivan: I'll be working for a law firm in Washington, D.C., and helping companies navigate through regulatory policy.

SBB: Are you taking any time off?

Sullivan: The week of Halloween I plan to have a ball with my 3-year-old and my two-year-old...The costumes they chose are Spider-Man with a Darth Vader mask and Scooby Doo.

By Sharon McLoone |  October 27, 2008; 10:11 AM ET Q&A , Watchdogs
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