U.S. small businesses received a record $69.23 billion in federal prime contracts last year, according to the U.S. Small Business Administration.

The agency said that 23.09 percent of all contracting dollars went to small firms in fiscal year 2004, surpassing the government's small-business procurement goal of 23 percent.

"The report shows that the government not only matched its own statutory goal, but it broke records by awarding more contracting dollars to America's small businesses than ever before," said Hector Barreto, SBA administrator.

However, the government fell short of its procurement goals for small businesses owned by women. Small women-owned firms received $9.1 billion in prime contracts. That set a record but, at 3 percent of all contracting dollars, fell short of the goal of 5 percent.

"We are pleased that the trend is moving in the right direction, but we have more work to do before reaching the 5 percent goal that was mandated by Congress," said Barbara Kasoff, co-founder of Women Impacting Public Policy, a nonprofit group advocating on behalf of women in business.