June 28, 2010
The American Small Business League (ASBL) has released the first analysis of the government’s fiscal year (FY) 2009 small business contracting data. http://www.asbl.com/documents/ASBL_2009_dataanalysis.pdf
The ASBL conducted a review of the top 100 recipients of federal small business contracts for FY 2009. Within its sample, the ASBL identified 61 large firms, which received 64.5 percent of the total dollars the government claimed to have awarded to small businesses.
The ASBL also identified a series of Fortune 500 corporations and other large firms in the government’s 2009 contracting data. Recipients of small business contracts included: Lockheed Martin, Boeing, Raytheon, L-3 Communications, British Aerospace (BAE), Northrop Grumman, General Electric, Booz Allen Hamilton, Thales Communications, General Dynamics, and Dell Computer.
In addition to large corporations in the government’s 2009 small business contracting numbers, the ASBL also uncovered gross discrepancies in the volume of contracts awarded to some companies. In a sampling of the data, the ASBL uncovered several examples in which the volume of contracts awarded to legitimate small businesses was dramatically inflated. This appears to be an intentional attempt by the government to misrepresent the actual volume of contracts awarded to small businesses. Another technique the ASBL has uncovered is the exclusion of billions of dollars in large prime contracts from the government’s small business calculations, which further inflates the percentage of federal contracts the government claims to have awarded to legitimate small businesses.
The ASBL recommends the Obama Administration take the following steps to increase the volume of federal contracts awarded to small businesses:
- Issue an executive order to stop the government from reporting awards to publicly traded companies as small business awards.
- Abolish the Comprehensive Subcontracting Plan Test Program, which currently allows prime contractors to avoid any reporting or penalties for non-compliance of small business subcontracting goals.
- Implement the 5 percent set-aside goal for women-owned firms for all industries.
“FY 2009 marks the tenth consecutive year that the government has diverted federal small business contracts to corporate giants,” ASBL President Lloyd Chapman said. “The SBA has gone from telling us that the diversion of federal small business contracts was a ‘myth’ to telling us that it’s the result of ‘simple human error.’ It is time for President Obama to honor his campaign promise, when he said, ‘It is time to end the diversion of federal small business contracts to corporate giants.’ ” (http://www.barackobama.com/2008/02/26/the_american_small_business_le.php)