July 11, 2003 WASHINGTON They are among America's larger companies: Verizon Communications, AT&T Wireless, Barnes & Noble booksellers and Dole Food Co. But in the government's contractor database they are listed as small businesses.

The mistaken designations, contained in records obtained by The Associated Press, mean the government has overstated the contract dollars that are going to small business at a time when the Bush administration has been pressing to give smaller firms as much federal work as possible.

"The numbers are inflated, we just don't know the extent," said David Drabkin, senior procurement officer for the General Services Administration.

Drabkin, whose agency maintains the records entered by contracting officials across the government, said the GSA is working to ensure accurate entries in the future but past errors are "not something we can clean up overnight."

Once a company's status is mischaracterized, it stays that way through the life of a contract -- which can be 20 years. That means smaller firms that the administration intended to help may be frozen out from fresh business by the bigger companies with the incorrect designations.

"This transition has led to the apparent diversion of contract dollars intended for small business," said Sue Hensley, a spokeswoman for the U.S. Small Business Administration.

One small businessman who is pushing to have the listings corrected says workers are paying in lost jobs.

"Most Americans work for small businesses and most of all the new jobs are created by small businesses. This certainly has a dramatic impact on job creation," said Lloyd Chapman, who formed the California-based Microcomputer Industry Suppliers Association.

The government defines a small business as one that is independently owned and operated and is not dominant in its field.

The Bush administration has set a goal of providing small business with 23 percent of all federal contracts, but has fallen about 3 percentage points short after awarding $53 billion to small companies.

Officials now acknowledge that the percentage was inflated by the erroneous database entries and that the true amount of federal business that went to small firms was smaller.

Investigators from Congress' General Accounting Office found no evidence that large companies had tried to manipulate the designations found in the database. Rather, they blamed the mistakes on federal contracting officials who either entered wrong codes for business size or re-entered outdated information.

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In the database

Some of the large companies that were incorrectly entered as small businesses in the government's contractor database:

* Verizon, the largest local phone company in the nation.

* Time Warner Entertainment, now-disbanded part of AOL-Time Warner.