Petaluma, Calif. – President Barack Obama’s future plans for the Small Business Administration (SBA) are raising concerns within the small business community. The American Small Business League (ASBL) is sounding the alarm and expressing its concerns over President Obama's future plans for the SBA.  The ASBL is concerned that President Obama may try to follow through on Bush Administration plans to close the SBA by combining it with the U.S. Department of Commerce. 

A recent Obama Administration joint statement between SBA Administrator Karen Mills and Commerce Secretary Gary Locke has fanned the flames of concern over President Obama's plan.  ASBL points to the fact that President Obama has broken every campaign promise he has made to the small business community. 

During the 2008 presidential election cycle, President Obama promised to restore the SBA’s budget, restore the SBA Administrator to a cabinet level position, implement the 5 percent set-aside goal for women owned firms, and stop the diversion of federal small business contracts to corporate giants.  To date, President Obama has failed to honor these campaign promises.

In February of 2008, after accepting the endorsement of the ASBL, President Obama released the statement, "It is time to end the diversion of federal small business contracts to corporate giants."  (http://www.barackobama.com/2008/02/26/the_american_small_business_le.php)  

On Friday August 21, the Obama Administration released its 2008 small business goaling report.  An analysis of the data by the ASBL found that 8 of the top 10 recipients of small business contracts were large businesses, which received 85 percent of the total dollars awarded to those firms.  Large businesses also received 64 percent of the total amount of contract dollars awarded to the top 100 recipients of federal small business contract dollars. The largest recipient of federal small business contracts was Textron Inc., which is a Fortune 500 firm with 43,000 employees. (https://www.asbl.com/documents/20090825TopSmallBusinessContractors2008.pdf) 

"I don't trust President Obama.  He has lied to me, and he has lied to every small business in America by breaking every promise he has made to the small business community," ASBL President Lloyd Chapman said. "I am very concerned that he may try to dismantle all small business programs by combining the SBA with the Commerce Department."

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Please click here to watch ASBL President Lloyd Chapman discuss the ASBL’s concerns regarding the Obama Administration's small business plans: http://www.youtube.com/watch?v=HKLK7c_1vX4

PETALUMA, Calif., - The U.S. Hispanic Chamber of Commerce opposes legislation introduced in the House of Representatives, H.R. 2568; the Fairness and Transparency in Contracting Act. H.R. 2568 is the only legislation written to stop the flow of billions of dollars in small business contracts to Fortune 500 companies and foreign firms. (http://www.govtrack.us/congress/bill.xpd?bill=h111-2568)

Since 2003, over a dozen federal investigations have shown rampant fraud and abuse in federal small business contracting programs, which have allowed over $100 billion a year in small business contracts to go to some of the largest firms in the U.S. and Europe. Not only has the U.S. Hispanic Chamber never objected to these ongoing abuses, now they oppose the only legislation introduced to stop it. (https://www.asbl.com/media2.php)

H.R. 2568 was written in collaboration with American Small Business League (ASBL) President Lloyd Chapman; Professor Charles Tiefer, foremost legal scholar on federal contracting issues; Congressman Hank Johnson (D-GA-4); and Senator Barbara Boxer (D-CA). This legislation will prevent the federal government from continuing to report contracts to publicly traded firms as small business awards. The original Small Business Act stipulates that a small business must be "independently owned." Thus, firms that are publicly traded do not qualify as "independently owned." As written, H.R. 2568 will create millions of new jobs and do more to stimulate the economy than any of the stimulus bills we have seen. (http://www.youtube.com/watch?v=eTFg5_cEZfk)

Dozens of small business organizations and chambers of commerce nationwide have already endorsed the Fairness and Transparency in Contracting Act, leaving the U.S. Hispanic Chamber at odds with a majority of the nation's small business community, including some of its own members, like the California Hispanic Chamber.

The U.S. Hispanic Chamber is joined in their opposition of H.R. 2568 by Chair of the House Small Business Committee, Nydia Velazquez (D-NY-12), who is currently quarterbacking legislation through the House that will give billions of dollars in small business contracts to some of the nation's wealthiest investors. Chairwoman Velazquez and the U.S. Hispanic Chamber have withheld their support of the Fairness and Transparency in Contracting Act in favor of supporting contracting reform legislation that might be introduced sometime later this year or next.

Petaluma, Calif. - President Barack Obama is rolling out his latest program to create jobs and stimulate the economy, the "Roadmap to Recovery." Like all of President Obama's previous economic stimulus plans, this plan continues to ignore the latest U.S Census Bureau data, which indicates that small businesses create over 97 percent of all new jobs in America. (http://www.inc.com/news/articles/200708/data.html)   

According to the most recent U.S. Census Bureau data, 98 percent of all American firms have less than 100 employees and those firms are responsible for more than 97 percent of all net new jobs. These firms employ over 50.2 percent of the private sector workforce, and are responsible for over 95 percent of all U.S exports and over 90 percent of all technical innovations and patents. Conversely, Census Bureau data indicates that large businesses have not created one net new job in America since 1977.

As opposed to immediate economic stimulus programs, the "Roadmap to Recovery" focuses on long-term infrastructure improvements to 107 national parks, 98 airports, 90 veterans medical centers and more than 1,500 highways. No provision in the new plan requires any portion of the recovery funds to be specifically allocated to small businesses. Absent any pro-small business provisions, the vast majority of the funds will likely go to large businesses.

Like all of President Obama's previous economic stimulus plans, the "Roadmap to Recovery" continues to allow Fortune 500 firms to receive federal contracts specifically allocated to small businesses.

Since 2003, over a dozen federal investigations have found that Fortune 500 firms receive billions of dollars in government small businesses contracts every month.

Investigative reports by ABC, CBS and CNN have found the recipients of government small business contracts to include Wal-Mart, Dell Computer, Verizon, Xerox, Sherwin-Williams, John Deere, Raytheon, General Dynamics, Home Depot, British Aerospace (BAE), Rolls-Royce and Dutch corporate giant Buhrmann NV. (ABC, https://www.asbl.com/abc_evening_news.wmv; CBS, https://www.asbl.com/cbs.wmv; CNN, https://www.asbl.com/showmedia.php?id=1170)   

An extensive investigative report by the Washington Post found Fortune 500 firms alone had received approximately 38.5 percent of all federal small business contracts. (http://www.washingtonpost.com/wp-dyn/content/article/2008/10/21/AR2008102102989.html)   

In a recent interview on CNN's Wolf Blitzer Show, Dr. Laura Tyson acknowledged the most effective method to stimulate the economy and create jobs would be to direct existing federal infrastructure spending to small businesses. Dr. Tyson is the former Chair of President Clinton's Council of Economic Advisors and is currently an economic advisor to President Obama. (http://www.youtube.com/watch?v=36Z0Kz0Xa8E)

Petaluma, Calif. - The Obama Administration is moving closer to new legislation and policy that will allow many of President Barack Obama's wealthiest contributors in the venture capital industry to take federal contracts meant for small businesses.

President Obama has already appointed two of his chief campaign fundraisers from the venture capital industry to top positions at the Small Business Administration (SBA). New York venture capitalist, and heiress to the multi-billion dollar Tootsie Roll Company, Karen Gordon Mills was appointed to head the agency. During her confirmation hearing, Mills voiced her support for new federal policy that would divert billions of dollars in federal small business contracts to wealthy venture capitalists.

President Obama has now appointed another major campaign contributor from the venture capital industry to the other top spot at the SBA, the Chief Counsel for the SBA Office of Advocacy. Winslow Sargeant, Ph.D., will fill that position. Prior to his appointment, Sargeant was a managing director of the Wisconsin-based venture firm, Venture Investors LLC. He is a proponent of changes in federal policy that will divert federal small business contracts to well-heeled venture capitalists and even many of the nation's top venture capital firms.
(http://blogs.wsj.com/venturecapital/2009/05/22/obamas-sba-nomination-nods-in-favor-of-vcindustry/, http://wistechnology.com/articles/3310/)

The Obama Administration is currently allowing Fortune 500 firms and thousands of other clearly large businesses to take federal contracts earmarked for legitimate small businesses. Investigative stories by ABC, CBS and CNN have reported firms receiving federal small business contracts include: British Aerospace (BAE), Rolls-Royce, Xerox, John Deere, Wal-Mart, Home Depot, Sherwin-Williams, Dell Computer and Dutch giant Buhrmann NV. (ABC, https://www.asbl.com/abc_evening_news.wmv; CBS, https://www.asbl.com/cbs.wmv; CNN, https://www.asbl.com/showmedia.php?id=1170)

Congresswoman Nydia M. Velázquez (D - NY) is leading the Obama Administration's efforts in the House Committee on Small Business to pass legislation to divert federal small business contracts to some of the nation's most successful investors. Velázquez has already passed two bills through her committee, and is expected to pass a third in the near future that would divert billions of dollars a year in federal small business contracts to firms owned and controlled by venture capitalists.

Velázquez has been one of several key members of Congress who has received significant campaign contributions from the National Venture Capital Association (NVCA), its members and the venture capital industry as a whole. (http://www.allbusiness.com/company-activitiesmanagement/business-climate-conditions/9077284-1.html)

Velázquez has also been a vocal opponent to the new Fairness and Transparency in Contracting Act that was written to stop the diversion of federal small business contracts to Fortune 500 firms and other large businesses. (https://www.asbl.com/documents/hr2568.pdf)

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Petaluma, Calif. – On Thursday, May 21, Georgia Congressman Hank Johnson (GA-04) introduced a bill into the House of Representatives that could redirect billions of dollars in federal small business contracts back into the hands of legitimate small businesses.  If passed into law, the bill will create millions of new jobs and provide one of the most significant economic stimulus plans ever proposed. 

Bill H.R. 2568 is titled, “the Fairness and Transparency in Contracting Act of 2009.” The new bill is the only legislation ever introduced in Congress to halt the diversion of over $100 billion a year in federal small business contracts to Fortune 500 firms and thousands of other large businesses.

Congressman Johnson worked with the staff at the American Small Business League (ASBL) for several months to get the bill into its final form before he introduced it into the House of Representatives on May 21. (http://www.house.gov/apps/list/press/ga04_johnson/05_26_09_small_biz.shtml) 

Current federal law based on the original Small Business Act requires a minimum of 23 percent of the total value of all federal contracts and subcontracts be awarded to small businesses. Since 2003, over a dozen federal investigations have been released, which found Fortune 500 firms and even some of the largest corporations in Europe were the actual recipients of most federal small business contracts.

In Report 5-15, the Small Business Administration Office of Inspector General (SBA IG) described the problem as, "One of the most important challenges facing the Small Business Administration and the entire Federal government today…" (http://www.sba.gov/IG/05-15.pdf)

President Barack Obama acknowledged the magnitude of the problem when he released the statement, "It is time to end the diversion of federal small business contracts to corporate giants." (http://www.barackobama.com/2008/02/26/the_american_small_business_le.php) 

The Fairness and Transparency in Contracting Act prevents the federal government from continuing to report contracts to publicly traded firms as small business awards. The original Small Business Act stipulates that a small business must be "independently owned." Firms that are publicly traded are publicly owned, and do not qualify as "independently owned."

The latest U.S. Census Bureau statistics indicate 98 percent of U.S. firms have less than 100 employees and create over 97 percent of net new jobs in America. During the 2008 election cycle, President Obama stated that every billion dollars spent on federal infrastructure projects could create up to 40,000 jobs. Based on this estimation, H.R. 2568 could create up to 4 million new jobs.

"It's unconscionable that some large corporations are the beneficiaries of small business contracts," Congressman Johnson said. "Especially given how many small businesses are struggling in this recession. H.R. 2568 will go a long way in helping correct this egregious error."

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