PETALUMA,Calif., Sept. 9, 2014 /PRNewswire-USNewswire/ -- The HouseSmall Business Committee is holding a hearing on Wednesday,September 10, titled Small Business Administration: Management and Outlook. Thehearing will be held at 1:00 PM in Room 2360 of theRayburn House Office Building.

Theonly witness scheduled is new SBA Administrator MariaContreras-Sweet. Administrator Contreras-Sweet could facesome tough questions on a series of controversies at the SBA.

Everyyear since 2005 the SBA Office of Inspector General has named the diversionof federal small business contracts to large businesses as the number oneproblem at the SBA. ABC, NBC, CBS, CNN, MSNBC, CNBC, Fox News and RTTV haveall reported on the issue.

TheSBA has consistently refused to adopt any policies to halt the rampant fraud andabuse. To the contrary the SBA recently concluded taking public comment on anew "safe harbor from fraud penalties" policy that manypeople believe will encourage even more fraud in federal small businesscontracting programs.

Over90 percent of the comments the SBA received on the "safe harbor from fraudpenalties" policy were opposed to it. 

On August 1, Administrator Contreras-Sweet announced the federal government had awarded $83 billion in federal contracts to small businesses. TheSBA claimed that amounted to 23.39 percent of all federalcontracts. Since the announcement on August 1, ithas been reported the SBA included billions of dollars in contracts to Fortune 500 firms and their subsidiaries in the $83 billion the SBA claims was awarded to smallbusinesses.

Federallaw requires a minimum of 23 percent of all federal contracts be awarded tosmall businesses.  To reach their 23.39 percent number, the SBA used apolicy that has no basis in federal law they created called "smallbusiness eligible dollars". For fiscal year 2013 the SBA claims the "small businesseligible dollar" amount was a mere $355 billionout of a total federal spending for that year of $3.5 trillion.

Arecent legal opinion by Professor Charles Tiefer,one of the nation's leading experts on federal contracting law, states there isno basis in the law for including any contracts to large business in smallbusiness contracting data. He also concluded a more accurate federalacquisition budget number that should be used in calculating the percentage ofaward to small businesses is over one trillion dollars.

TheAmericanSmall Business League estimates that if the more accurate one trillion dollar federal acquisition budget numberwere used and no contracts to Fortune 500 firms or other large businesses wereincluded, legitimate small businesses probably received no more than 5 percentof all federal contracts and not the 23.39 percent claimed by the SBA.  

Questionsfor the SBA can be directed to SBA spokesman TerrySutherland
(202) 205-6919 | terrence.sutherland@sba.gov| www.terrysutherlandinfo.org

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