Government Executive reports that In testimony before the Small Business and Entrepreneurship committee of Congress, the Small Business Administration reported that roughly 26% of all Federal stimulus package related contracts had been awarded to small businesses.
This is about $4 billion out of $16 billion in stimulus package money awarded so far by federal agencies. As we point out in our report on the stimulus package, the majority of stimulus money is allocated to the states who then spend the money. A relatively small share is spent directly by the feds.
The Department of Defense awarded the highest percentage of stimulus package money to small businesses - 58% of their stimulus package spend. This is because DOD spent most of their stimulus money on construction related projects. Small businesses employ roughly 85% of all U.S. construction workers, so money spent on construction tends to flow to the small business sector.
Federal agencies are expected to spend around $60 billion in total stimulus package money. If they continue to allocate this money as before, around $12 billion worth of additional contracts will be awarded to small businesses in the coming months.
Currently small innovative firms are shut out of technical and professional contracts subject to pressure of large firms. Consider the specific poignant example of ten-year $100 million contract for patent legal listed at the link below.
http://ott.od.nih.gov/faqs/patent_legal_services.aspx#2
A $100 million ten year contract was issued for patent legal services with a subcontracting plan signed by the SBA PCR which precludes use of small law firms (i.e., subcontracting of hourly services)The SBA ignored the pleas of nearly a dozend small firms advocate and signed off on subcontracting waivers and pressure from large firms and NIH. (PCR's Vinny Rice, David Loines) PCR Vinny Rice signed off on this contract signing despite the existence of a nearly two dozen small firms and four 8(a) firms listed on CCR (many of whom are doing patent legal service work for other federal institutions and have clear past performance histories and clear qualification). Mr. Rice signed off on the subcontracting waive on the day of his employment before retirement to avoid the obvious controversy and repercussion, and his boss, David Loines, simply ignored the outcry by small, qualified firms. He assured small firms a "Form 70" had been filed months before to prevent issuance of the contracts without small business participation then told the firms the form had been "lost" and he had to refile it the day the contracts were issued. The protest filed by the small firms was denied, and is now subject to a motion for reconsideration while the contracts to the large law firms went forward. The SBA watched this ten-year contract issue, and failed to question or enforce any goals or set-asides. Since each patent application is a discrete project or unit of legal work, NIH had to work very hard to "bundle" these contracts -- the justification being that it was too administratively difficult to follow the practice of other agencies in scaling contracts for small businesses. It remains to be seen whether the nine option years will be excercised without subcontracting goals under the watch of the current administration. Goals can and should be implemented at any time, but they cannot be when the SBA continues to ignore the existence of a large number of qualified small firms and to properly advocate for them as the law requires.
One cannot help but wonder what the role of the SBA and the PCR's really is. Small business contract advocates or gate keepers for large firms and NIH? Do small firms stand a chance in breaking into professional/technical service fields without SBA advocacy?
Posted by: jill welytok | February 04, 2010 at 05:33 AM