By J.D.
Harrison August 4
It’s
official. The federal government has for the first time in nearly a decade
upheld its promise to award nearly a quarter of all contracting dollars to
small businesses, according to a report released Friday.
“When we
hit our small business procurement target, it’s a win,” Maria Contreras-Sweet,
head of the Small Business Administration, said while making the announcement.
Did they
really, though? Did the government actually hit the target?
Only time
will tell, but there’s ample room for skepticism. Here’s why.
Once every
year, the U.S. Small Business Administration pulls data from a federal database
managed by the General Services Administration and issues a report indicating
what percentage of eligible government contracting dollars went to small businesses
during the previous year. By law, federal agencies are collectively supposed to commit 23 percent of all prime contracting
dollars to small companies.
On Monday,
SBA officials reported that the government eclipsed that mark last year,
funneling 23.39 percent of all federal work to small businesses. It’s the first
time the government has hit the target since 2005. Or rather, it
would be.
In the
fine print at the bottom of the federal database, however, GSA officials note
that the SBA’s annual reports are “generated by taking a snapshot of data from
the Federal Procurement Data System (FPDS) on a certain date.” They also point
out that “FPDS is a dynamic database, and agencies can change historical
information if the details of a contract have changed.”
However, unlike the government’s reports on,
say, job growth and gross domestic product, which reflect revisions when
necessary to previously issued estimates, the SBA does not go back and update
its future reports to reflect any changes in the numbers.
Question is, do those initial snapshots stand the test of time?
Without exception, the answer is no.
A comparison of the SBA’s reports and the
federal database reveal a disparity every year dating back to 2006, the first
year the agency started publishing its small-business contracting scorecards online. More
importantly, the variation follows a consistent pattern; that is, for every
year since 2006, the updated database numbers show that a smaller share of
government work actually went to small firms than what was originally reported.
Moreover, the gap between what was initially
reported by the SBA and what the updated numbers show widens over time. In
2012, for instance, the SBA reported that small businesses claimed 22.25
percent of work, based on the snapshot of the moment. Now two years later, the
database shows they claimed 22.17 percent, a 0.08 swing.
Going back a year earlier, the difference in
what was originally reported in 2011 (21.65 percent) and what the database now
shows for that year (21.54 percent) stands at 0.11 percent. The pattern
continues for other years, going back to 2006, when what SBA first reported
(22.83 percent) is now more than percentage point higher than what the database
now shows was actually awarded to small firms (21.73 percent).
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