PETALUMA, Calif., February 16, 2006 /PRNewswire/ -- In its semiannual report to Congress, the SBA's Office of Inspector General reported that in June 2005 it had recommended debarment of a major government contractor. The Inspector General found that the firm had misrepresented its status as small in order to illegally receive small business contract awards.
A Freedom of Information Act request from the American Small Business League to obtain the name of the firm was denied on February 10th. To date, the Small Business Administration has taken no action against the fraudulent contractor.

In a recent interview with the Dallas Morning News, SBA Administrator Hector V. Barreto rejected the existence of small business contracting fraud and claimed that there would be "serious repercussions" for any large business that was guilty of misrepresenting its size.

During Barreto's tenure, the SBA Inspector General, the General Accounting Office, and the SBA Office of Advocacy have reported numerous instances of fraud and abuse in small business contracting, however, no firms have been penalized in any way.

Lloyd Chapman, President of the American Small Business League had this to say, "Hector Barreto has a track record of protecting large corporations that are guilty of felony contracting fraud. His own Inspector General has uncovered numerous cases of fraud and abuse, but Barreto has refused to do anything to stop it. Instead, he has tried to convince Congress, the media, and the general public that these crimes are merely a matter of "miscoding."

"If the ASBL has to take the SBA to court again, we will in order to force them to disclose the name of the fraudulent contractor and ensure they are debarred and prosecuted to the fullest extent of the law," Chapman added.

Section 16(d) of the Small Business Act makes it a criminal offense to misrepresent in writing the status of any concern as a "small business concern" in order to obtain for oneself or another any prime contract. Violations of 16(d) are punishable by a fine of not more than $500,000 or by imprisonment for not more than ten years or both, and can result in certain administrative remedies, including suspension and debarment.

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.

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PETALUMA, Calif., February 15, 2006 /PRNewswire/ -- In a recent speech in the Gulf Coast, President Bush described the Small Business Administration as a "small agency" that had been "overwhelmed" by the disastrous hurricanes in the region. What he failed to mention in the address was that the SBA is small because he made it that way. In fact, Bush has cut the agency's operating budget for six consecutive years--more than any other agency. The President didn't even include disaster loan funding in his 2006 budget. Between the budget cuts and the staff reductions, the SBA has been rendered incapable of effectively managing any of its prime functions, including disasters.

Prior to the hurricanes and for cost-saving purposes, the SBA was in the process of re-organizing its Office of Disaster Assistance and centralizing all loan processing in Fort Worth. Unfortunately, the office had not even reached "start-up capacity" by the time Katrina hit. Coupled with the fact that the SBA had already lost or laid off experienced loan processors,
the agency had no alternative but to hire thousands of temporary employees to handle the workload.

Just last week, the SBA declared that it would be out of money by February 13th if it did not receive more funding from Congress. "Time and time again, the Bush Administration has not requested enough funding for small business or disaster loan assistance, leaving Congress to bail them out," stated Senator John Kerry, Ranking Member on the Senate Committee on Small Business and Entrepreneurship. In an extensive letter to the President, Kerry urged Bush to fully fund the SBA's disaster loan program.

With an estimated 400,000 jobs lost and 200,000 small businesses affected by Hurricane Katrina, Gulf Coast residents have to wonder if the current administration cares about them at all. Six months after the hurricane, 50% of homeowners and 35% of business owners are still waiting for their loan applications to be processed. "We are in limbo and on hold," stated Mayor C. Ray Nagin of New Orleans.

"SBA Administrator Hector Barreto has repeatedly declined additional funds and staffing from Congress claiming he could do more with less," stated Lloyd Chapman, President of the American Small Business League. "Barreto's incompetence has resulted in thousands of people waiting months for disaster assistance and thousands of businesses being forced into bankruptcy because the SBA has been financially decimated. Where is the compassion in this? It's totally unacceptable."

Gulf residents aren't the only ones who have been adversely affected by cuts to the agency's budget. After its regional offices were reorganized in 2005, SBA employee morale ranked dead last in a study of 30 Federal agencies and departments.

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.

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PETALUMA, Calif., February 14, 2006 /PRNewswire/ -- The American Small Business League has reviewed OMB projections for the next several years which show that the Bush Administration plans further cuts to the beleaguered SBA. Having already cut the agency in half since taking office, President Bush has recommended reducing it every year going forward through 2010.

In a detailed report on how the current Administration's tax policies affect small business, the Center on Budget and Policy Priorities shows that "the vast majority of small businesses receive no benefit whatsoever" from the tax cuts purported to aid entrepreneurs: the top marginal tax rate and the repeal of the estate or "death tax". Also according to the study, 51% of the tax cuts enacted since 2001 going to households with small business income accrue to only 8% of the households with incomes exceeding $200,000, whereas only 16% of these tax cuts are going to the 62% of households with incomes below $75,000.

Congresswoman Nydia Velazquez, Ranking Member of the House Small Business Committee called the 2007 budget an "attack on this nation's entrepreneurs." "This budget fails in every respect to provide entrepreneurs with the access to capital, entrepreneurial training, business development, and contracting opportunities they need to keep our economy strong," Velasquez said.

"Small business people need to realize this is not about politics, it's about survival," stated Lloyd Chapman, President of the American Small Business League. "The Bush administration has no interest in supporting the majority of businesses where most Americans work. Bush and the conservative Republicans would like nothing better than to reduce the SBA to the point where it will no longer be big enough to exist as a stand-alone agency. This looks like the end to Federal contracting programs and other services for small, women-owned, and minority-owned firms." Chapman added, "It's time for small businesses to fight back."

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 1951. 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.

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