Think small business when buying small things

The Obama administration is pushing agencies to think small when making small purchases—small business, that is.

According to analysis of federal data, agencies are not awarding many of their purchases of $25,000 or less to small companies. Those small firms aren’t getting the orders even where there are enough of them to compete, two top procurement officials wrote in a memo June 6.

“This suggests that opportunities for small businesses are being lost,” Small Business Administration Administrator Karen Mills and Office of Federal Procurement Policy Administrator Joe Jordan wrote in their joint memo.

Agencies are required to automatically set aside work for small businesses that is below the $150,000 Simplified Acquisition Threshold unless the contracting officer cannot find two capable small companies.

Mills and Jordan are requiring agencies report to the Office of Management and Budget on their internal controls related to small business awards for orders below the threshold. They also want to know how they have worked to send more of these types of orders to small companies, and, if they’ve done nothing, why not.

They provided a draft memo for agencies to send to their acquisition offices. They memo tells officials to automatically set aside work under the threshold for small businesses, but if there are none available, explain why in the contract file.

SBA officials will have analysis for agencies of their contracts falling under the threshold that have not been awarded to small businesses.

The small business memo is the first action on the part of Jordan in his new role as OFPP administrator. He was confirmed by the Senate May 24. As the former associate administrator for government contracting and business development at SBA, Jordan said small businesses will get his attention.

“One of my priorities as the newly confirmed OFPP administrator is to continue these ‘win-wins’ for our taxpayers and small businesses,” he wrote June 7 on the OMBlog.

The memo from Mills and Jordan emphasizes small business set-asides for the small-dollar purchases, as well as awards under multiple award contracts.

About the Author

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

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