October 18, 2011
Petaluma, Calif. – Rep. Hank Johnson (D-GA-04) introduced a bill Thursday aimed at channeling hundreds of billions of dollars in existing federal infrastructure spending to the nation’s middle class. H.R. 3184, “The Fairness and Transparency in Contracting Act,” will prevent the federal government and contracting officers from reporting contracts awarded to Fortune 500 corporations and other publicly traded companies as small business contracts.
“Large companies need to stop masquerading as small businesses to get government contracts,” said Johnson. “Especially given how many small businesses are struggling in this economy, H.R. 3184 will go a long way in helping stop this abuse.”
H.R. 3184 is the result of more than 15 federal investigations, originally prompted by American Small Business League (ASBL) President Lloyd Chapman, that have all uncovered hundreds of billions of dollars in federal small business contracts being awarded to some of the largest companies worldwide. In Report 5-15, the Small Business Administration Office of Inspector General (SBAIG) described the abuse as, “One of the most important challenges facing the Small Business Administration and the entire federal government today.”
In February of 2008, President Barack Obama acknowledged the magnitude of the problem when he stated, “It is time to end the diversion of federal small business contracts to corporate giants.”
The bill is based on current provisions of the Small Business Act, which define a small business as a company that is "independently owned," which would exclude any publicly traded company. Chapman estimates that H.R. 3184 could redirect more than $100 billion a year in federal small business contracts back to middle class firms.
The ASBL conducted a review of the top 100 small business contractors for FY 2010 and identified 61 large companies. Among these were Lockheed Martin, ManTech International Corporation and Italian defense conglomerate Finmeccanica.
“H.R. 3184 is a deficit-neutral and permanent economic solution that will create more jobs than anything President Bush or President Obama ever spoke of,” said Chapman. “The diversion of federal small business contracts to corporate giants has gone on for over a decade. Now is the time to pass this legislation as a means of boosting the middle class economy.”