For small businesses, tens of billions of dollars in government contracts are at stake each year.

Now who gets a shot at competing for the money?

Owners of small businesses in the Denver area, including Alma Araiza Rode of Chaos Control Systems, argue that too often the dollars flow to bigger rivals that don't deserve it. They also worry a wider group of companies could get a crack at the federal contracts, undermining a plan designed to help the little guy.

The government program was meant "to level the playing field," Araiza Rode said in a prepared speech, noting that her diminutive peers lack the political clout to get a piece of the pie. "But in reality, I cannot even get over the fence that surrounds the playing field, much less get on the field to compete."

Denver business owners debated the issue on Tuesday at a hearing set up by the Small Business Administration, which is seeking feedback in an effort to come up with a fair definition for a "small" business.

The prospect of a lucrative government contract has many companies seeking the status.

Carol McCallister, owner of Champion Business Services in Aurora, said only companies with fewer than 100 workers should be eligible.

But much mightier firms with far more employees such as Sabre Systems and Unisys have received contracts that she had sought.

"If large corporations are allowed to bid on small-business contracts, they are going to beat out my small business every single time," said McCallister, who employs only seven people.

As it stands, there are varying thresholds to qualify for the bidding process depending on the industry. For instance, a small manufacturing company is one with 500 or fewer employees, the SBA said.

Retail companies, meanwhile, are measured by their revenue. Gary Jackson, the SBA's assistant administrator for the office of size standards, said that a company in that sector with $6 million or less in annual revenue is eligible to bid.

The SBA is reviewing comments from business owners across the U.S. to work out a plan to simplify the rules and make them fair.

"Nothing is set in stone," Jackson said.

Small businesses are supposed to receive 23 percent of all federal contracts. That is a lot of money. In the latest fiscal year, U.S. government contracts awarded to all companies, big and small, came to roughly $325 billion, SBA officials said.

It also is an issue that resonates with many people. Small businesses, as one speaker on Tuesday said, are the "backbone of the economy."

About 98 percent of Colorado employers are small firms, with fewer than 500 workers, the most recent SBA figures showed.

Now critics who charge that the government mission to help small businesses is not being carried out effectively have new ammunition.

A December report by the Office of Advocacy of the SBA found that $2 billion in federal contracts that supposedly were awarded to small businesses in fiscal year 2002 actually went to large businesses.

The study said that 44 of the top 1,000 small-business contractors in that year should not have had that distinction.

Among the giants getting money earmarked for small businesses: Raytheon and Hewlett-Packard.

Dutch company Buhrmann NV, whose Corporate Express division is located in Broomfield, is another large player that has benefited.

"They have known about this for years," said Lloyd Chapman, head of the American Small Business League and an SBA critic.

The problem in some cases is that firms are able to keep the "small" label after being gobbled up by another company or growing rapidly.

The SBA, whose job is to strengthen the economy by promoting the interests of small businesses, must digest a number of differing opinions.

Some said the SBA should be more inclusive, not less.

Richard Duke, founder of privately held biopharmaceutical company GlobeImmune in Aurora, said companies like his cannot get the government money because they are controlled by venture capitalists.

Duke called it an "unnecessary exclusion," saying his company was "hamstrung by its own success" in attracting funding.

He may get his way. One of the changes under consideration is allowing small businesses whose major owners are venture capitalists to bid for the contracts.