Feds earn low grades from SBA

Half of all agencies received failing marks on first rating of small-business contracting

Most agencies did not fare well on the Small Business Administration’s new score cards for rating their progress on meeting small-business contracting goals. In fact, half of the agencies received the lowest possible grade.

On the score cards released Aug. 17, SBA gave 12 of 24 departments the lowest rating: a red. Those agencies included the Defense Department and the General Services Administration — the federal government’s biggest buyers. SBA issued five yellow scores, and seven agencies earned the top score of green. SBA’s scoring system is based on the President’s Management Agenda score card.

SBA’s score card will bring attention to small-business contracting, said Steven Preston, SBA’s administrator, during a teleconference with reporters.

“Sticking a big red on an agency that’s not hitting their target…is an important motivator,” he added.

An agency earns a red score if it misses its goal for awarding a certain overall percentage of contracts to small businesses or if it doesn’t reach companies in at least two out of four socioeconomic categories, such as woman-owned and veteran-owned businesses.

An agency receives a yellow score if it achieves its overall goal and hits its target for two of the four socioeconomic categories. An agency earns a green score if it achieves its overall goal and its target for three of the four socioeconomic measures. SBA will issue score cards every six months.

Experts applauded SBA’s effort, but some say they are concerned about the accuracy of the data.

“These numbers should still be viewed with caution,” said Sen. John Kerry (D-Mass.), chairman of the Small Business and Entrepreneurship Committee, in a statement.

Kerry and other experts said their concerns stem from SBA’s use of the Federal Procurement Data System, which many have criticized as unreliable.

Through various directives, the Office of Federal Procurement Policy is pressuring agencies to validate their information and ensure that data is coded correctly when it is entered into the system.

Accurate data is of vital importance for the score cards, Preston said. “Transparency is a huge motivator in getting data right,” he said, adding that there has never been this level of scrutiny in the past.

The large number of clerical workers who key in data are not as careful as they should be, Preston said. “I think it’s carelessness and a lack of focus at the lowest level,” he said.

The score card’s visibility could get some agency leaders’ attention, said Anthony Martoccia, director of DOD’s Office of Small Business Programs. He recently transferred to DOD after working on the score card project at SBA. Getting senior-level support for small-business initiatives is important, he added.

One question people have is “how will SBA help the agencies meet their goals and eventually hit green,” said Scott Denniston, director of the Veterans Affairs Department’s Office of Small and Disadvantaged Business Utilization. “What do we do with it now to move forward?”

Preston said the score cards will raise the profile of agencies’ small-business representatives so they can openly discuss the small-business issue with agency executives.

Rep. Nydia Velázquez (D-N.Y.), the Small Business Committee’s chairwoman, said the government must address the heart of the problem: the lack of opportunity in the federal marketplace for small businesses.

About the Author

Matthew Weigelt is a freelance journalist who writes about acquisition and procurement.

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