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New SBA Policy Will Divert Billions to Big Business

November 15, 2006

PETALUMA, Calif., November 15, 2006 / A new policy proposed by the Small Business Administration (SBA) and the Office of Federal Procurement Policy (OFPP) will allow the government to continue reporting awards to large companies as federal small business contracts.

Even though the SBA's own Inspector General has urged the agency to implement annual recertification of business size status to prevent fraud and abuse in small business contracting, the SBA has consistently refused to implement it. Instead, the agency has adopted a policy that will allow companies to retain their small business status for up to five years. Issued under the guise of improving federal contracting opportunities for small business, this recertification policy will allow the government to continue including contracts to some of the nation's largest companies toward their small business contracting goals.

"This policy should be evaluated by asking one question," stated Lloyd Chapman, president of the American Small Business League (ASBL). "Will this policy allow the government to report contracts to Fortune 1000 companies as small business awards? The answer is yes and I'm against it. SBA Administrator Steven Preston and OFPP Administrator Paul Dennett are being deceptive. This policy was designed to help the government, not small firms."

Chapman added, "For over three years the SBA Inspector General has recommended annual recertification of small business size status. This would truly increase contracting opportunities for legitimately small firms by forcing the government to eliminate large businesses from its small-business contracting database. When the federal government hits its small business goals by reporting contracts to Fortune 1000 firms as small business awards, America's small businesses lose out on billions. This is totally unfair and it has to stop."

About the ASBL

The American Small Business League was formed to promote and advocate policies that provide the greatest opportunity for small businesses - the 98% of U.S. companies with less than 100 employees. The ASBL is founded on the principle that small businesses, the backbone of a vital American economy, should receive the fair treatment promised by the Small Business Act of 1953. Representing small businesses in all fields and industries throughout the United States, the ASBL monitors existing policies and proposed policy changes by the Small Business Administration and other federal agencies that affect its members. See www.asbl.com.


Contact: Lloyd Chapman
American Small Business League



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