The federal government awarded more than $119 billion in contracts to small business in 2004, a notable achievement -- if, in fact, the companies were truly "small".

But the president of the American Small Business League (ASBL) has his doubts. He's been trying for months to force the federal Small Business Administration to identify companies that won lucrative government business.

The agency recently spurned his request for the names under a federal Freedom of Information Act request, and now the ASBL President Lloyd Chapman is taking it up a notch. He says his group intends to sue the SBA to get the information.

"I am confident the information we obtain will prove the SBA and the [General Services Administration] have diverted billions in small business contracts to Fortune 1000 companies," he said in a statement.

DALLAS – In a nearly $3 trillion federal budget proposed by President Bush for 2007, $624 million to run the Small Business Administration seems like small potatoes.

But the tiny agency for small companies is getting a lot of attention right now, and little of it is good.

Small-business owners and Democrats in Congress say the agency is starved for funding and has been squeezed tighter in every budget President Bush has proposed since he took office, even though he touts small businesses as the engine of the American economy.

Outside groups say the skimpy spending is part of a larger goal to fold the SBA as a separate agency and eliminate federal small-business contracting requirements.

But the Small Business Administration points to the record number of small-business loans awarded in the past year as proof that smaller budgets don't mean reduced service.

"Is that a budget cut, or is that a savings?" said Mike Stamler, a spokesman for the agency. "When you do something more efficiently, I just don't understand people who say you shouldn't do it more efficiently."

And suggestions that the SBA is on the verge of being shut down are absurd, he said.

"It's ridiculous," Stamler said.

Cathy Dougherty, a smallbusiness owner in Richardson, Texas, said she has seen, though, how a smaller budget has resulted in fewer services for the small-business community.

"They're definitely stretched to the max," said Dougherty, president of Dougherty Sprague Environmental Inc. "They definitely don't have the personnel."

Dougherty's firm, which is helping with the Hurricane Katrina cleanup and identified hazardous chemicals after the Columbia space shuttle crash, was recently certified by the SBA's 8(a) program as a disadvantaged business.

The program is designed to help company owners who can prove they've suffered some form of prejudice or discrimination gain access to federal contracts.

But Dougherty, who won her designation because of gender discrimination, said the SBA doesn't seem to have the resources anymore to effectively administer the program.

"Since we've been involved just the last year and a half, the amount of 8(a) firms that one person has to care for has gone from 20 to about 80," she said. "So I see a very direct effect. They're supposed to mentor us and help us and alert us to bids. But for an entire year, I didn't hear from my person."

Steve Denson, an adjunct professor in the Cox School of Business at Southern Methodist University, said the SBA has a strong role to play.

"SBA is a great training tool, a resource, for emerging entrepreneurs, especially minority entrepreneurs and female entrepreneurs," he said. "Some of their greatest success is in leveling the playing field" for women and minorities.

But Denson, a self-described "rabid Democrat," said that cutting the agency's budget further could result in cutting back those training programs.

Last September, the SBA's Office of Inspector General released a report stating that the Small Business Administration needed to tighten its oversight of federal contracting.

"Flaws in the federal procurement process allow large firms to receive small-business awards and agencies to receive small-business credit for contracts performed by large firms," the report said.

Lloyd Chapman, president of the American Small Business League, which devotes most of its resources to tracking claims of fraud and abuse at the SBA, thinks President Bush's goal is to eliminate the SBA altogether and simultaneously drop the requirement that a certain portion of all federal contracts go to small businesses.

Even if that doesn't happen, the Small Business Administration clearly is operating with fewer resources.

Different groups tally the 2007 budget in different ways, but the overall trend is undisputed. In 2001, the agency had a discretionary budget of $900 million.

For 2007, the administration has proposed a budget of $624 million.

But critics argue that if disaster spending, which was not included in the 2006 budget, is removed from the 2007 budget, the total drops to $429 million, compared with $534 million in 2006.

But Stamler at the SBA said the 2006 number also includes $90 million in congressional earmarks that President Bush had not requested.

The Small Business Association has come in for a lot of criticism this year, with Administrator Hector Barreto Jr. taking most of the heat.

An internal investigation recently showed that after 9/11, a big share of its government-guaranteed loans went to companies that had nothing to do with the tragedy, including, it is alleged, a Texas golf course and a Nevada tanning salon.

Added to that were attacks in the press by American Small Business League President Lloyd Chapman, who claimed that billions in government contracts awarded by the SBA, supposedly to small businesses, have actually gone to such giants as Raytheon, Hewlett-Packard, Titan Corp., General Dynamics and Northrop Grumman.

Those calling for Barreto's resignation accuse him at the very least with a lack of oversight in making sure the SBA is pursuing its mission.

Barreto hasn't been taking it lying down, however. He told La Opinión newspaper in Los Angeles that (in 2005) "We gave guaranteed loans for more than $20 billion, more than double compared with four years ago; we approved over 100,000 loans, also more than double those of four years ago ... a third of the loans went to minorities."

The SBA administrator has found a champion in the United States Hispanic Chamber of Commerce.

"Under Administrator Barreto's leadership, SBA loans to small businesses grew 150 percent," the USHCC said in a statement. "Fully one-third of these loans, totaling $70 billion, went to minority- and women-owned businesses. The number of SBA loans to Hispanic entrepreneurs has more than doubled since 2001, providing more than $1.23 billion in capital essential to the growth and development of Hispanic enterprise."