Senators push for more small-business contracts

New legislation would require agencies to consider small businesses and reconsider bundled contracts

A new Senate bill aims to change how agencies consider small businesses when awarding federal contracts.

Agencies would be required to start setting aside part of their multiple-award contracts for small companies and reserve portions of multiple-award contracts for subcategories of small business. Agencies would have to hold back for small companies one or more contracts for multiple full-and-open competitions, according to the new Small Business Contracting Revitalization Act, which was introduced today.

The legislation also deals with consolidated or bundled contracts, which are often too large for a small business to compete for. However, those contracts many times could be split into several smaller individual contracts. Under the bill, agencies must post online a list of their bundled contracts and the rationale for why they are bundled.

Furthermore, agencies would have to post their anti-bundling policies online, and the bill would require officials to decide whether those polices actually give small businesses enough of a chance to become prime contractors and subcontractors.

The bill would also close many loopholes that give large companies an unfair advantage, and it would add protections for small firms and subcontractors.

An underlying reason for the bill is aiding small business in today’s economy, said Sen. Mary Landrieu (D-La.), chairwoman of the Senate Small Business and Entrepreneurship Committee.

“Government contracts are perhaps one of the easiest and most inexpensive ways the government can help to immediately increase sales for America’s entrepreneurs, giving them the tools they need to keep our economy strong and create jobs,” said Landrieu, who introduced the bill with Sen. Olympia Snowe (R-Maine), the committee’s ranking member.

Both Landrieu and Snowe say small-business contracts represent job growth.

“Yet the ability of these companies to earn federal contracts is frequently stunted by the egregious and repeated failure of federal agencies to meet their statutory 23 percent small-business ‘goaling’ requirements,” Snowe said.

Agencies have an annual goal of awarding 23 percent of their contracting dollars to small companies. In 2008 — the latest data available — the government as a whole missed the 23 percent mark, according to the Small Business Administration.

About the Author

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

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Reader comments

Thu, Feb 18, 2010 CG

Small businesses are the backbone of our nation's economy. Statistically, small businesses create a vast majority of net new jobs. That said, economists like Laura Tyson and even Robert Reich have agreed that the best way to stimulate America's middle class economy is to infuse it with federal infrastructure dollars. The concept that that a dollar invested with small business will do more for job creation than a dollar invested with a large business is not a new concept, and it is fact.

Fri, Feb 12, 2010 Bad math

I would sure like this Congresswomen to explain her statement "By increasing contracts to small businesses by just 1 percent, we can create more than 100,000 new jobs—and today, we need those jobs more than ever." How doesgiving a contract that requires for example 100 man-years of work to a small business rather than giving the same 100 man-years of work to a large business create one extra job?

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