The government's successin meeting mandatory small business contracting goals two years running is duelargely to White House focus and new requirements that program managers in theSenior Executive Service pay greater attention to the acquisition process, theObama administration's small-business development chief said on Tuesday.

Many call set-asides for small business "not a handout but a hand-up, but Isay it's a matter of survival for the federal government as a whole," said JohnShoraka, associate administrator of government contracting and businessdevelopment at the Small Business Administration. He spoke to contractorsgathered for American Express OPEN's all-day summit with agency acquisitionofficials working with small businesses that are women- or minority owned oreconomically disadvantaged.

Outlining the government's efforts to institutionalize the success ofmeeting the goal of steering 23 percent of contract dollars to small business,Shoraka said, "I've told my staff I could write a book saying that America'ssecret weapon is small business procurement -- when small business is engaged,the industrial base is preserved. It's win-win, because companies hireemployees, which has impact on the economy."

The industry veteran and political appointee said, "The government as awhole is interested in casting a broader net to make sure small businesses canplay" in winning $80 billion or more of the $400 billion-plus annual purchaseof goods and services, the world's largest.

The SBA itself, Shoraka said, contributes through its "three C's and one D,"meaning contracting, capital (through loan guarantees) and counseling (inpartnership with academe and women's centers), followed by direct loans incases of disaster.

But he credited the White House for impressing upon program offices -- whichweren't putting special emphasis on small business goals -- that achieving thegoals should be part of annual performance reviews and for requiring eachagency's Office of Small and Disadvantaged Business Utilization to reportdirectly to deputy secretaries. "A real-time dashboard" of progress incontracting set-asides for qualified small businesses "is generating a lot ofinterest and elevating the OSDBU," he said.

Shoraka said he also feels pressure from Capitol Hill to exceed goals and,for example, to clarify how small businesses owned by disabled veterans canwork with the Veterans Affairs Department, which requires eligibilitycertification, and the rest of the agencies, which do not.

The small business set-aside program in the past few years has implementedseveral policy changes, including an end to caps on the size of contractswomen-owned businesses can bid on; allowing small businesses to count smallbusiness subcontractors in their work percentage requirement; new third-partycertification requirements for businesses billing themselves as woman-owned;and a new requirement that agencies such as the State Department be measured onthe percentage of their overseas work that goes to small business.

Shoraka has sought to streamline the "bureaucratic" application process forsome set-asides, reducing 57 elements on one form to 27.

He lauded the new mentor-protégé program in SBA's 8A business developmentprogram. "A small firm may need a larger partner or management expertise, sothey team up in a joint venture to go after larger projects," Shoraka said ofthe program scheduled to take effect at the end of 2015.

Asked whether such a program might be abused by large companies seeking topoach some of the set-asides, he said, "SBA will do an annual review of thisprogram, with lots of oversight, to make sure dollars are flowing to theintended recipients. If it's a joint venture, we make sure they're gettingtheir fair share and is not a front," he said. Congress is pressuring him forfast implementation, he said, but "we're doing it methodically."

Critics, such as the AmericanSmall Business League, regularly accuse large companies, particularlydefense contractors, of horning in on small business turf.  But Shorakatold Government Executive he "challenges that methodology. Data can bemassaged a lot of different ways. If in a full and open contracting process,say, Raytheon gets the award but is coded as a small business or a set-asidefor women or 8A," that could be a clerical error, he said. Such mistakes "dohappen," he said. But that doesn't happen with actual set-asides because "thesecond-ranked bidder would file a protest.

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