Federal lawmakers crafting a bill to support ex-inmates starting their own small businesses heard last week from three former prisoners who touted self-employment as a weapon against recidivism, especially for drug offenders, and highlighted obstacles to education and seed funding.

Returning citizens who don't get a steady job quickly are much more likely to return to prison, the witnesses told the House Committee on Small Business on Wednesday, yet the stigma of incarceration keeps many people out of the workforce even as more jurisdictions "ban the box," limiting when employers can ask about criminal history.

Starting a small business is often the only viable route to employment, experts including a bank robber turned Georgetown law professor told Chairwoman Nydia Velázquez, D-N.Y., and other legislators. Along with recommendations on training and funding, the witnesses shared their personal stories of struggle and redemption.

"I cannot recall a more moving hearing that we have conducted throughout my 27 years serving on this committee," Velázquez said.

Shon Hopwood became a jailhouse legal expert during his 11 years in federal prison for bank robberies; he now teaches criminal and constitutional law at Georgetown University Law Center.

Jerry Blassingame won a scholarship to an architectural training program but started dealing drugs as crack cocaine swept into South Carolina in the mid-1980s. He committed to Christianity in prison, got out in 1999 and built a program to help other "returning citizens."

Blassingame's organization, Soteria Community Development Corporation, has employed dozens of former prisoners in landscaping, recycling and demolition businesses. He recently started training workers to fashion handmade furniture out of discarded lumber.

"We're reclaiming wood and we're reclaiming lives," he told lawmakers.

Former stockbroker Gary Wozniak described how drug addiction led him to steal money from his clients in the 1980s. After three years behind bars, he looked for a job. He got an interview with Enterprise Rent-a-Car but got turned down for an entry-level clerk position because of his felony conviction. He gave up on the job hunt and cobbled together money from relatives and former clients to open a pizza-chain franchise.

Thirty years later, Wozniak runs RecoveryPark, a Detroit nonprofit that employs people out of prison on small farms growing specialty produce for local restaurants. He also teaches entrepreneurship classes in Michigan prisons.

"You need to capture people [while they're incarcerated] and keep them motivated to do good things when they get out," he told lawmakers.

He urged more training programs such as those encouraged by last year's First Step Act, which also contained sentencing reforms — a change that Hopwood suggested as the single biggest way lawmakers can reduce recidivism, since longer sentences disconnect people from society.

Wozniak told Law360 that Michigan gives employers a $5,000 tax credit for every ex-prisoner they hire. He suggested the federal government give preference to contractors who have formerly incarcerated workers.

He also told lawmakers that even three decades after his conviction, he still can't qualify for a Small Business Administration loan. Similarly, drug offenders generally cannot receive Pell grants for higher education or vocational training.

The witnesses said that people with drug convictions — who account for 45% of the 175,000 federal inmates, according to the Bureau of Prisons — may have a natural affinity for entrepreneurship.

"Those of us who have been in the drug dealing business, we have a business acumen, we just need to clean it up," Blassingame said.

"They have the inner motivation," Hopwood added. "Some of them are risk-takers. Most of what they need are just educational opportunities in prison and some support when they get out."

He highlighted a program in his home state of Nebraska that facilitates startup loans of up to $5,000 and an entrepreneurship course in Texas, which has pioneered some recent prison reforms despite its lock-'em-up reputation.

Rep. Marc Veasey, D-Texas, asked about soft skills.

The witnesses said that even motivated and focused former prisoners may find their social skills deteriorated in the highly structured and often tense environment of incarceration, especially if they didn't get outside visitors or educational opportunities. Training programs behind bars can nurture soft skills along with hard skills like bookkeeping.

Blassingame said conflict resolution is the biggest challenge in his transitional houses, so he has incorporated it into his one-year reentry program.

"If you can't resolve conflict, you can't keep a job," said the prisoner-turned-pastor.

Though Democrats set the agenda for the hearing, GOP lawmakers also expressed interest in "prison to proprietorship" programs.

Oklahoma Rep. Steve Hern, one of the committee's top Republicans and a longtime business owner, praised some recent reforms such as "ban the box" for facilitating employment and thus curbing recidivism.

"I'm probably guilty, like a lot of entrepreneurs and business owners out there, of saying you would be the employee of last choice," he told the witnesses. "I think all our hearts have changed dramatically. ... You shouldn't have [convictions] held over your heads the rest of your lives."

Hern gave the caveat that there might not be interest in helping "sexual predators," although Hopwood pointed out that sex offenders make up 10% of federal inmates and often were convicted of nonforcible crimes such as possessing child pornography.

Rep. Tim Burchett, R-Tenn., addressed the country's tough-on-crime tendencies: "It's easy to beat up on people that are in jail, but eventually 95% of them are going to get out."

Staffers are currently drafting two "prison to proprietorship" bills that would direct SBA partners to mentor and train people both in prison and after reentry, according to a memo from the committee chairwoman. Programs in prison would be modeled on the agency's Boots to Business program.

Velázquez said she anticipates support from across the aisle and also across the Capitol in the upper chamber. She cited the rare event of a Senate staffer at a House hearing, in this case from the office of Sen. Ben Cardin, D-Md.

As for funding, Velázquez told Law360 after the hearing her committee has authorized more funding for SBA-supported business development centers, though the boost from $175 million to $300 million awaits final approval from congressional appropriators nailing down the details of next year's federal budget.

During the hearing, the bank robber turned law professor addressed the concerns of fiscal and social conservatives who might question the fairness of spending money on convicts.

"Why would we give these free programs to people who broke the law?" Hopwood asked rhetorically. "But that is so short-sighted. This saves a lot of money on the back end ... when we don't have to pay for re-prosecution and re-incarceration."

--Editing by Brian Baresch.

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