AARON L. LOVEJOY
President, The Black Chamber of Commerce of Orange County; Board Member, Minority Business Council of Orange County
When Aaron L. Lovejoy is not busy managing Ultratech Resources Inc., a Santa Ana computer consulting firm he started in 1983, he assists the county’s minority-owned businesses. Besides leading the county’s Black Chamber of Commerce, he serves as finance officer for the Minority Business Council, a group composed of the officers of the county’s Vietnamese, Korean, Chinese-American, Hispanic and black chambers of commerce. Lovejoy recently spoke about problems facing minority firms with Times staff writer Cristina Lee.
Q. Could a situation like the Los Angeles riots happen in Orange County?
I think many of our leaders and the news media misread what happened in Los Angeles. What was reported as a lawless riot was in actuality a rebellion. It was a rebellion against injustice, against inhuman treatment, against having no hope in the richest country in the world.
One only needs to read your newspaper each morning to see that the same conditions exist here in Orange County. Unemployment is increasing, affordable housing is virtually nonexistent, and crime is increasing. Despair, hopelessness and frustration are the ingredients which make up social unrest.
We must begin to help create jobs to help reduce the unemployment and the potential tinderbox that joblessness creates.
So, can it happen here? The answer is an unequivocal ‘yes.’
Q. Is anything being done to prevent this?
The biggest preventive measure is communication. The Minority Business Council of Orange County was created some four years ago as the vehicle for effecting communication among our diverse business groups.
We meet monthly to discuss areas of concern and contention. For example, during our meeting last month, a Korean delegate spoke about his culture to show the differences between varying cultures and how these nuances can cause misunderstanding. Without this forum, there would be a huge void. The council also has started a series of business mixers for business people of all ethnic groups.
The Orange County Chamber of Commerce and the council plan to sponsor an employee training program where a consortium of minority and non-minority employers can finance a training program to improve the skills of minority employees. This would help keep people employed and make employers more competitive and profitable.
The council is also working with the chamber’s Small Business Executive Council on a mentor/protege program, which matches a small, minority firm with an established and larger non-minority firm for about a year, during which time the minority firm is given both technical and management tips.
Q. How important are minority companies in Orange County?
U.S. Census Bureau figures show that nearly one-third of all businesses in the county are owned by minorities, but we find that these businesses employ only approximately 1.4% of the county’s work force.
If a chain is no stronger than its weakest link, can the same hold true for a community?
Our minority communities are taxing the social system because they are economically weak. With unemployment running at double-digit figures among the county’s minorities and our jails bursting at the seams, would it not be cheaper to assist minority businesses that can employ minorities, rather than to make social service payments to the unemployed?
Q. Are current government programs adequate to assist the county’s minority businesses?
It is an appropriate time to give the programs a hard look.
Most of the current programs are designed to assist the established minority businesses and not the newly created businesses. Also, most career government employees charged with delivering the services of these programs are not adequately trained in the rudiments of business.
The federal programs have been matched by increasing interest and support from the private sector.
These programs don’t work. In spite of this support, minority firms are continuing to fail at an alarmingly high rate. Few new ventures show potential for long-range survival unless major changes are made.
For example, the state certification process to become designated as a minority business is fraught with excessive paperwork and may, in fact, discourage more minority firms from taking advantage of a state program that encourages large corporations to do business with them.
A recent study commissioned by the U.S. Department of Commerce’s Minority Business Development Agency recommended that new strategies must be formulated to let minority firms play a larger role in restoring economic and social stability in the nation’s inner cities and in the national economy.
Q. As a small-business owner and advocate for small and minority businesses, what solutions do you suggest to help these companies?
To create jobs, you must first create new businesses. This requires an innovative effort of marshaling sufficient capital pools for minority firms. I’m planning a program that calls for the institution of a mortgage-backed security for minorities firms, much like the Government National Mortgage Assn. (Ginnie Mae) and the Federal National Mortgage Assn. (Fannie Mae), which are federal agencies which buy pools of mortgages from lenders and sells interests in them by offering securities to the public.
This would allow private sector investment in low-risk securities to support minority businesses.
I hope to present this plan to Orange County Business leaders later this month.
This would establish a permanent equity capital base that can provide a means to attract greater funding, which can provide a greater degree of flexibility for the financing of minority business start-ups and expansions.
Debt burdens any business. My solution goes beyond loans and includes the type of assistance and access to capital that would make minority firms viable and productive in the future.
On the riots and instances of civil unrest in Los Angeles. . . .
“The events in . . . Los Angeles and the rest of the country is a wake-up call for Orange County.”
On minorities and Orange County’s economy. . . .
“To ensure that Orange County continues as an economic leader in the state, it must take stock in its minority communities and its minority-owned businesses.”
On the goals of minority businesses. . . .
“Our goal is to ensure the best use of (Orange County) resources . . . and ensure that opportunities are open to all.”
On the future success of minority businesses. . . .
“Social prejudices still impose barriers to opportunities. As long as potential entrepreneurs are discouraged by perceptions of reduced business opportunities because of prejudice, it is a limiting factor for the growth of minority firms.”
