The Small Business Administration (SBA) may have been established
to support the nation’s SMEs, but a lawsuit against the government group is
accusing it of doing the opposite.
Reports from Federal
News Radio on Thursday (May 5) said that the SBA was hit
with a lawsuit earlier this week by the American Small Business League (ASBL).
The ASBL is accusing the SBA of awarding small business contracts to Fortune
500 firms, yet still falsifying records to suggest that it is meeting
government-mandated quotas for small
“As has been the case in all previous years in which the SBA has
released an annual goaling report, the SBA’s assertion that the percentage of
the total value of all prime contract awards awarded to small businesses met or
exceeded the congressional mandate of 23 percent is false,” court documents
stated, according to reports.
The SBA is also accused of working to “fabricate the
government’s compliance with the small business goals by using a much lower
acquisition budget,” documents said.
“SBA can only make this statement by creating, through agency
fiat, a class of government contracts which are, solely in the view of the SBA,
subject to exclusion from being considered as part of ‘the total value of all
prime contract awards’ as stated in the Small Business Act,” the documents
continue. “Although the language of the statu[t]e is crystal clear, every year,
the SBA redefines ‘total value’ as meaning total value minus the contracts SBA
decides to exclude from the equation.”
The Small Business Administration released its annual SME
federal contracting report card
earlier this year, finding a record number of SME contracts. The administration
said it surpassed its goal of allocating 23 percent of procurement spend to
small business suppliers, instead allocating 25.75 percent — worth $90.7
In response, SBA Associate Administrator of Government
Contracting and Business Development John Shoraka said the group’s exclusion
rules are constantly being updated and are, in fact, being updated to be more
inclusive for small businesses.
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