There are still reasons to doubt whether thegovernment is meeting its contracting goals for small businesses, despite theSmall Business Administration's report that 25 percent of federalprocurement dollars went to small companies in fiscal 2014.

"Large firms continue to receive contracts thatare counted toward small business goals," the SBA's inspector general concludedin its annual report on theagency's most serious management challenges.

The Small Business Administration'sinspector general says the agency needs to take… more

Under a goal set by Congress, small businessesare supposed to receive 23 percent of the federal government's contractingdollars.

Some big businesses may be misrepresentingtheir size to the government, but other cases of inaccurate reporting of smallbusiness contracting data may be due to mistakes by procurement officials, theinspector general concluded. In either case, small businesses are harmedbecause they lose out on contracts that should have gone to them, and the SBA'scredibility is damaged.

The inspector general's report identifiedseveral specific areas that should be addressed in order to make small businesscontracting data more accurate:

• Procurement officers should no longer beallowed to count contracts awarded to businesses that have left the 8(a)program or the Hubzone program toward those programs' contracting goals.They're able to do so under current SBA regulations, the inspector generalsaid. That inflates the numbers for the 8(a) program, which helpsminority-owned businesses, and the Hubzone program, which helps businesseslocated in low-income areas.

• The SBA needs to make more progress inaddressing weaknesses in the 8(a) mentor-protege program that allow agencies tocount contracts where large businesses do most of the work as small businesscontracts.

• The SBA should require that women-ownedbusinesses be certified by the federal government, states or an SBA-approvednational certifying entity in order to receive contracts set aside for women-ownedbusinesses. That was supposed to happen under a law passed by Congress lastDecember, which also gave contracting officials the power to award sole-sourcecontracts to women-owned businesses.

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Both major political parties in the U.S. often tout smallbusinesses as the backbone of the nation's economy. A new report, though, suggeststhat government spending on economic development doesn't necessarily reflectthat rhetoric.

The study released Tuesday from the taxpayer watchdog groupGood Jobs First finds that between 80 and 96 percent of state economicdevelopment awards in the last five years went to large corporations ratherthan small business, even though the awards were supposedly available to bothsmall and large companies. The group analyzed more than 4,200 economicdevelopment grants in 14 states and found "a profound bias against smallbusinesses" -- which it defined as locally owned enterprises with fewer than100 employees.

This isn't the first analysis that has tracked how taxpayerlargesse disproportionately flows to major corporations, and not to smallbusiness.

GovernmentExecutive reported that the American Small Business League found in 2013"that of the top 100 companies receiving the highest-valued small businessfederal contracts" from the Small Business Administration, "79 were largecompanies that exceeded the SBA's small-business size standards, five wereanomalous and 16 were legitimate small businesses." The watchdog group's analysisin 2014 found "over 160 Fortune 500 firms were the actual recipients offederal small business contracts" in 2014.

Corporategroups and officialsat the Export-Import Bank, which provides credit for foreign purchasers of U.S.goods, have touted the government-supported bank as a major supporter of smallbusinesses. But researchers at George Mason University's MercatusCenter have documented that "less than 20 percent of all Ex-Im Bank fundinggoes to small business" and that the bank's support "backs less than 0.3percent of all small business jobs and less than 0.04 percent of all smallbusiness establishments."

Reutersalso reported that the bank "has mischaracterized potentially hundreds of largecompanies and units of multinational conglomerates as small businesses." Thenews service discovered that "companies owned by billionaires like WarrenBuffett and Mexico's Carlos Slim, as well by Japanese and Europeanconglomerates, were listed as small businesses" by the bank.

To view full article, click here: http://www.ibtimes.com/political-capital/taxpayer-subsidies-flowing-mostly-big-business-not-small-business-report-2147705