Federal Contracting to Small Business Increasing...Or is It?

A report unveiled by the federal government late last week illustrates that nearly 23% of all federal contracting dollars last year went to small business, said the U.S. Small Business Administration (SBA). However, one trade association characterized the findings as misleading, if not insulting.

The new federal "Scorecard" on small business contracts for FY2010 included statistical findings that nearly $100 billion, 22.7% of all federal contracting dollars, went to small businesses. SBA says, combined with findings from 2009, it is the largest two-year increase in contracts being routed to small businesses to date. The federal government's goal for 2010 was 23%.

SBA said the progress was largely attributable to an "administration-wide commitment to collaboration and transparency."

"Never before has the White House itself taken such a direct leadership role on this issue. Every quarter, we've met with President [Barack] Obama's Senior Advisor Valerie Jarrett and top leaders from each agency to report on the progress they're making," said SBA's Joe Jordan.

However, the American Small Business League (ASBL) effectively is claiming to see right through said transparency. In fact, the ASBL alleges that 61 of the top 100 recipients of the so-called small business federal contracts in 2010 were, in reality, large firms. The association calls the Obama Administration's assertions "dramatically inflated" and alleges some of the "small business" recipients in FY2010 included Lockheed Martin, AT&T and Hewlett-Packard.

"The SBA claims the government nearly hit its small business goal and yet the government's own data indicates it awarded no more than 5% of federal work to small businesses," said ASBL President Lloyd Chapman. "The SBA's most recent claims are just more misleading smoke and mirrors...It is time for the Obama Administration to stop misleading the public and start actually working to end billions of dollars in fraud and abuse in small business contracting programs. Ending this abuse would be a more effective economic stimulus than anything proposed by the Obama Administration to date."

Brian Shappell, NACM staff writer