A bigger Voice for Small Business

Dear President Obama, Quit Cheating Small Businesses Out of Federal Contracts

by | Jun 18, 2010 | Press Release

Press Release

Dear President Obama, Quit Cheating Small Businesses Out of Federal Contracts

June 18, 2010

During your Presidential campaign you promised, "an end to business as usual in Washington," and "change we can believe in." You made several promises to small businesses. You promised to restore the Small Business Administration's (SBA) budget and staffing, restore the SBA Administrator to a cabinet level position, and implement the 5 percent set-aside contracting goal for women. You also released the statement, "it is time to end the diversion of federal small business contracts to corporate giants." You have failed to honor any of those campaign promises. (http://www.barackobama.com/2008/02/26/the_american_small_business_le.php)

YOU LIED!

The SBA's budget and staffing were larger during the Reagan Administration than they are today. The most recent data released by your administration reported that the largest recipient of federal small business contracts was, Textron, a Fortune 500 firm. Your administration included over $775 million in contracts to Textron as small business contracts. Other firms your administration included as small businesses were Boeing, Lockheed Martin, Northrop Grumman, Raytheon, General Dynamics, British Aerospace (BAE), Rolls-Royce, French firm Thales Communications, Ssangyong Corporation headquartered in South Korea, and Italian firm Finmeccanica SpA. (https://www.asbl.com/documents/20090825TopSmallBusinessContractors2008.pdf)

YOU LIED!

During your campaign you stated, "Let me say it as simply as I can: Transparency and the rule of law will be the touchstones of this presidency." (http://www.talkingpointsmemo.com/news/2009/01/remarks_by_the_president_welcoming_senior_staff_an.php) In reality your administration has moved to dramatically cut transparency in all areas of federal small business contracting programs. Your administration destroyed ten years worth of federal contracting data, which has been used by federal investigators to uncover billions of dollars in federal small business contracts that have been illegally diverted to corporate giants. Your administration has also refused to release a wide variety of public information on federal small business contracting programs, which indicates that billions of dollars a month in federal small business funds are being diverted to corporate giants.

YOU LIED!

Recently, the American Small Business League (ASBL) released a report that found 16 separate areas in which your administration broke campaign promises to small businesses or adopted anti-small business policies. (https://www.asbl.com/documents/20100526_ASBL_AnalysisObamaSB.pdf)

YOU LIED!

I don't know if any of your hotshot economic advisors have told you this, but 98 percent of all U.S. firms have less than 100 employees. These 27 million firms employ the majority of the private sector work force, and are responsible for virtually 100 percent of all net new jobs in America. Cheating small businesses is stupid if you are trying to stimulate the economy and create jobs. You might want to give former U.S. Treasury Secretary Robert Reich a call and have him explain it to you.

If you want to stimulate the economy, you direct more federal infrastructure spending to small businesses. You don't divert federal small business funds to corporate giants around the world.

I know you are going to try to adopt policies and legislation to divert even more federal small business contracts to your buddies and campaign contributors in the venture capital industry. I would not be surprised if you were stupid enough to try to dismantle federal small business contracting programs by breaking up the SBA or adopting more anti-small business policies, while attempting to convince the press and the public that you are trying to help small business and increase access to capital. If you sincerely wanted to increase access to capital for small businesses, you would have helped CIT. CIT was the nation's number one lender to small businesses, especially those firms owned by women, minorities and veterans but you didn't do that, did you?

In case you haven't heard, federal judges don't seem to like your anti-small business, anti-transparency policies. So far we have won federal lawsuits against the U.S. Department of Energy, NASA, the SBA and the U.S. Department of Defense. Our case against the General Services Administration (GSA) is looking good too. I have to admit, I'm looking forward to the fireworks when some unfortunate attorney from the Justice Department tries to convince the 9th Circuit Court of Appeals that the SBA does not have any phone records.

Good luck with your sham small business forum on June 28. Will this be another publicity stunt and photo op like the last small business forum you put on? I heard photographers outnumbered small business owners at that one. I think there were about a dozen actual small business owners at your last, "national small business conference."

Let me guess, are we going to hear from any of your contributors in the venture capital industry on how important it is to "increase access to capital for small businesses" by changing the long standing federal definition of a small business as being "independently owned." You and I know your venture capitalist buddies are really just interested in increasing their access to over $150 billion a year in federal small business contracts.

Allowing greedy venture capitalists to hijack billions of dollars in federal small business contracts is not going to go over well in the press. I can promise you that, and I always keep my promises.

Obama Small Business Conference Draws Criticism

by | Jun 17, 2010 | Press Release

Press Release

Obama Small Business Conference Draws Criticism

June 17, 2010

Petaluma, Calif. – On Monday, June 14, the Obama Administration suddenly announced that it will hold a small business forum in Washington D.C. on June 28.  Obama Administration officials claim the purpose of the forum is to collect public input on the administration's recently established Interagency Task Force on Small Business. (http://edocket.access.gpo.gov/2010/pdf/2010-14144.pdf)  

Small business groups and owners around the country are concerned about the short notice the Obama Administration has given members of the small business community regarding the meeting.  The American Small Business League (ASBL) believes the Obama Administration opted to hold the meeting in Washington D.C. on short notice to minimize comments from angry small businesses over the administration's failed small business track record.  (https://www.asbl.com/documents/20100526_ASBL_AnalysisObamaSB.pdf)  

During the 2008 campaign President Obama made a wide variety of promises to the small business community, including a promise to, "end the diversion of federal small business contracts to corporate giants." To date, President Obama has refused to honor those promises.
(http://www.barackobama.com/2008/02/26/the_american_small_business_le.php)  

In the most egregious example, President Obama has allowed the continued diversion of more than $100 billion a year in federal small business contracts to Fortune 500 firms and even some of the largest corporations in the world.  Since 2003, over a dozen federal investigations have uncovered the diversion of billions of dollars in small business contracts to corporate giants. (https://www.asbl.com/documentlibrary.html)  

The ASBL has launched a national campaign to rally small business groups and small business owners around the country to attend the meeting and send comments to the small business task force.   The public has until Monday, June 21 to register to attend the event and Wednesday, June 30 to submit comments.  (http://edocket.access.gpo.gov/2010/pdf/2010-14144.pdf)  

"I'm predicting that the Obama Administration will use its 'small business task force,' and this sham meeting on June 28, to push anti-small business policies like: changing the definition of small business to include larger firms, increasing small business size standards or dismantling the SBA by combining it with the U.S. Department of Commerce," ASBL President Lloyd Chapman said. "If President Obama really wanted to help small businesses he would quit diverting small business funds to Fortune 500 firms. Small business owners around the country need to prepare themselves to oppose any new Obama Administration policy that will actually weaken federal small business contracting programs under the guise of helping small businesses."

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NASA sued for failing to disclose contracting information

by | Jun 15, 2010 | ASBL News

News

NASA sued for failing to disclose contracting information

By Dawn Lim
Government Executive
June 15, 2010

In a bid to hold NASA accountable to meeting federally mandated goals for small business contracting, advocates demanded for the third time that the agency release contracting information for its space operations.

The American Small Business League filed a lawsuit on June 8 asking the U.S. District Court for the Northern District of California to require NASA to release subcontracting reports involving United Space Alliance LLC, a spaceflight operations company co-owned by defense giants Lockheed Martin Corp. and Boeing Co., and NASA's primary industry partner in managing the space shuttle and the International Space Station programs.

The advocacy group wants to know if United Space Alliance has complied with small business subcontracting goals under those contracts. The organization alleges that NASA violated the Freedom of Information Act by withholding agency records, while NASA claims the data was exempt from disclosure as "commercial or financial information obtained from a person which is privileged or confidential."

ASBL suspects NASA is withholding data that will prove it is allowing major prime contractors to falsify compliance with small business subcontracting goals, as well as inflating fulfillment of small business targets by counting "clearly large" firms as small, according to Lloyd Chapman, the group's president.

The federal government sets out to award 23 percent of the total value of all prime contracts to small businesses annually. The Small Business Administration negotiates individual objectives for each agency, ensuring that when combined they meet the overall statutory goals.

In 2007, SBA instituted requirements for long-term federal contracts to be recertified every five years and at every option point going forward. This would take into consideration the possibility of growth and ensure agencies receive credit for making contract awards to small businesses only as long as the firms remain small.

But advocates say instances of large corporations being listed as small businesses in federal contracting awards keep cropping up.

ASBL spokesman Christopher Gunn said large companies that showed up in data on small business awards in 2008 included Lockheed Martin, Boeing, Raytheon Co. and Northrop Grumman Corp.

Corporations that raked in billions of dollars in federal contracts and did not meet the criteria for being small were labeled as such in Washington Technology's top 2010 government contractors, a list compiled from government procurement data, said Guy Timberlake, chief executive officer of The American Small Business Coalition, which helps small businesses win federal contracts and strengthens their partnerships with the government.

Whether these cases resulted from mistakes in data entry or fraud remains a point of contention between the federal government and advocacy groups.

Timberlake said because federal contracting programs are such complicated bureaucratic exercises, some corporations exploit the loopholes and lack of oversight. They go "code shopping," seeking out industry codes that will identify them as a small business, even if the definitions do not apply to their actual operations, he said.

Whether a corporation meets the criteria of being coded as a small business depends on host of factors, including its subsidiaries, affiliations, primary industry, number of employees and annual revenues.

"Some out there may say, 'Uncle Sam is really bogged down right down, so they'll never notice me.' " Timberlake said. "In addition to deliberate efforts to scam the system, just as many corporations are simply not getting good information from various expert resources."

He added, "There is a level of enforcement with teeth that is needed" in a more competitive climate, but "additional scrutiny entails process, which entails costs." It is difficult to come up with extra money for oversight at a time when the government is tightening its belt, he said.

United Space Alliance, which received $1.5 billion in contracts from NASA in fiscal 2009, according to ASBL, said it has both large and small business as subcontractors. "Small businesses play a vital role in our efforts to support the nation's space program," said spokeswoman Tracy Yates, "and USA is absolutely committed to working with as many small companies as possible to meet that goal."

SBA declined to be quoted for this story. A NASA spokeswoman said the agency is looking into the matter, but has no further information to provide at this point.

Source:  http://www.govexec.com/story_page.cfm?articleid=45501&oref=todaysnews

General Services Administration Officials to be Deposed in Lawsuit Over Contracting Data

by | Jun 10, 2010 | Press Release

Press Release

General Services Administration Officials to be Deposed in Lawsuit Over Contracting Data

June 10, 2010

Petaluma, Calif. – On Wednesday, June 9, United States District Court Judge William Alsup denied the American Small Business League's (ASBL) motion for a preliminary injunction against the General Services Administration (GSA).  The ASBL originally filed the motion in response to GSA actions to remove information from the federal government's contracting database.  Historically, the information has been used to uncover billions of dollars in small business contracts flowing to Fortune 500 firms. (https://www.asbl.com/documents/order_Denying_prelim.pdf)  

Investigations by the Small Business Administration Office of Inspector General (SBA IG), U.S. Government Accountability Office (U.S. GAO) and inspector generals from a series of other federal agencies have used the field, "small business flag," to identify large companies masquerading as small businesses to receive federal contracts.

Since 2003, these investigations have uncovered billions of dollars in federal small business contracts actually ending up in the hands of Fortune 500 firms and some of the largest businesses in Europe and Asia.  The most recent data released by the government indicates that the recipients of federal small business contracts have included: Lockheed Martin, Boeing, Raytheon, General Dynamics, Ssangyong Corporation headquartered in South Korea, and Italian firm Finmeccanica SpA. (https://www.asbl.com/documents/20090825TopSmallBusinessContractors2008.pdf)   

In response to the court's ruling, the ASBL intends to pursue a permanent injunction against the GSA to prevent the destruction of the field on all future and historical data available to the public.

In the court's ruling, Alsup stated, "In the present action, plaintiff has not shown that the deletion of the search fields was a significant revision.  Nevertheless, it should be given opportunity to do so by obtaining discovery on the pedigree of the change." In accordance with Alsup's ruling, the ASBL will subpoena emails and other materials within the GSA.  The ASBL believes the information will show that the destruction of the  "small business flag" was in fact a "significant revision," in that it will make it difficult, if not impossible, for federal investigators to uncover billions in fraud and abuse in small business contracting programs. 

"We are looking forward to deposing senior GSA officials, and issuing subpoenas for their internal documents.  I am confident that we can prove the removal of the small business flag is not in the public interest," ASBL President Lloyd Chapman said. "It is obvious the GSA is attempting to reduce transparency, and hide the fact that the Obama Administration is diverting billions of dollars a week in federal small business funds to corporate giants."

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NASA Sued For Refusing to Release Contracting Data on United Space Alliance

by | Jun 9, 2010 | Press Release

Press Release

NASA Sued For Refusing to Release Contracting Data on United Space Alliance

June 9, 2010

Petaluma, Calif. –  On Tuesday, June 8, the American Small Business League (ASBL) filed suit against the National Aeronautics and Space Administration (NASA) in Federal District Court, Northern District of California. The case was filed under the Freedom of Information Act (FOIA) after NASA repeatedly refused to release subcontracting reports for contracts issued to United Space Alliance, LLC, a joint venture between defense giants Lockheed Martin and Boeing. (https://www.asbl.com/documents/20100608_NASA_USA_Complaint.pdf)
 
The ASBL originally requested information on United Space Alliance's compliance with small business subcontracting goals on NASA contracts awarded to the contractor. During fiscal year (FY) 2009, United Space Alliance was awarded over $1.5 billion in contracts from NASA.
 
Tuesday's suit is the third lawsuit filed by the ASBL against NASA. In February of 2007, the ASBL prevailed in its first suit against NASA, forcing the agency to provide detailed information proving that it falsified its small business contracting statistics by including contracts to a variety of Fortune 500 firms and other large businesses.
 
Since 2003, more than a dozen federal investigations have uncovered billions of dollars a month in federal small business contracts actually flowing into the hands of Fortune 500 corporations and other clearly large businesses. Large recipients of federal small business contracts have included: Lockheed Martin, Boeing, Raytheon, Northrop Grumman, Dell Computer, British Aerospace (BAE), Rolls-Royce, French giant Thales Communications, Ssangyong Corporation headquartered in South Korea, and the Italian firm Finmeccanica SpA. (https://www.asbl.com/documents/20090825TopSmallBusinessContractors2008.pdf)     
 
"We believe that NASA is withholding data which shows that the agency is inflating the achievement of its congressionally mandated small business goals by including Fortune 500 corporations and other clearly large businesses. We also believe that NASA is withholding data that will prove that they are allowing major prime contractors to falsify compliance with congressionally mandated small business contracting goals," ASBL President Lloyd Chapman said. "It is disappointing to see that President Obama's promise of increased transparency was just another broken campaign promise." (https://www.asbl.com/documents/20100526_ASBL_AnalysisObamaSB.pdf)  
 
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