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One San Francisco Small Business Snags Federal Stimulus Money

New America Media, News Report , Erik Fowle Posted: Aug 29, 2009

Traduccin al espaol

Editors Note: Yerba Buena Construction is the only Hispanic-owned business in San Francisco to receive a federal contract as a result of the $787 billion American Recovery and Reinvestment Act (ARRA).

SAN FRANCISCO -- Miguel Galarza wasnt surprised to learn that his is the only Hispanic-owned company in San Francisco to a receive federal stimulus contract, which is helping some small businesses stay afloat.

Galarza, owner of San Franciscos Yerba Buena Construction, has recently received three federally funded construction contracts. Miguel Galarza, owner of Yerba Buena Construction

The 48-year-old man of Puerto Rican descent was brave enough to apply for stimulus funding, but unfortunately, many small businesses are reluctant to do that because their owners are worried about repercussions that might occur if they make mistakes on government forms, which contain a lot of confusing language.

Galarza's contracts, for example, are Indefinite Delivery/Indefinite Quantity (IDIQ), or task-order, contracts.

This means the government contracts a company for a set period of time, but money isnt allocated until a specific project is budgeted. The Travis Air Force Base project is based on Yerba Buenas 8A status a selection by the government based on its past performance.

Not only are small businesses afraid to begin federal paperwork, the Web sites offering information to them dont show the inside scope, Galarza said, and the Small Business Administration, that should help you get to the next level, is under-funded and worn out. Even with SBA assistance, too many small businesses are unprepared to jump into the federal contracting pool.

Galarza has lived in San Francisco his entire life. He has been working in the construction business for as long as he can remember.

From the day I was born it seems, he said, I was meant to work construction.

Indeed, some of his memories include digging ditches for $1 an hour when he was 13. Growing up, he took an apprenticeship with a carpenter and tried to enter unions but found nepotism much more prevalent than it is today.

Galarza today is a far cry from that ditch-digging teenager.

His construction company has been in operation since 2002. At its peak, Galarza said, the company employed about 70 fieldworkers. Now, though, because of the recent downturn, he is limited to 40 to 45 employees at the actual project sites. The count might even be fewer were it not for the recent acquisition of federal contracts.

Small companies like Galarzas thrive on small projects, like those the federal stimulus package has funded. Before the stimulus money, there was no funding for small businesses, and the smaller projects were being accepted by larger companies who could take them at cost.

Galarza advises other small businesses to start the process for a second stimulus package, which he believes will be coming. Unfortunately, he says, in order to get through the paperwork and bureaucracy, someone has to teach you how to do this, show you the ropes. There are mentors SBA approved firms -- that help less financially stable small businesses. But, Galarza says, this only works if you find the right mentor. The underlying theme, Galarza says, is you are out there on your own.

And if your business doesnt already belong to the Central Contractor Registration, he adds, you can forget about getting paid.

Will the stimulus package help Yerba Buena Construction succeed in the future?

Succeed? Galarza asked. Right now were just talking about surviving.

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