Looming large: are small-business contracts really going to the big guys? - Capitol Issues


Looming large: are small-business contracts really going to the big guys? - Capitol Issues

By Stephen Barlas
September 1, 2003

SIZE COUNTS. OR AT LEAST IT SHOULD WHEN IT COMES to the federal government's vendor database, Pro-Net/CCR. Too many big businesses are listed there as "small," allowing them to be awaked "an alarming percentage" of small-business set-aside contracts, according to Lloyd Chapman, president of the Microcomputer Industry Suppliers Association.

The General Accounting Office (GAO) backed up Chapman's complaint in a recent report. David E. Cooper, contracting issues director at the GAO, told the House Small Business Committee that five large companies received $460 million in small-business contracts in fiscal year 2001. He wasn't able to provide the total large-business bite out of the small-business pie, however. Federal law says small business should get 23 percent of federal prime contract dollars, which totaled $50 billion in fiscal 2001.

Many big companies listed as "small" in Pro-Net/CCR started out below the SBA small-business-size ceiling, which differs from industry to industry. But they eventually outgrew that designation, a fact that was not reflected, in the database. "Over the past six months, more than 600 businesses have been removed from Pro-Net because they are not small businesses," says the SBA's Fred C. Armendariz.

The SBA has had trouble keeping Pro-Net/CCR data accurate,because Congress did not allocate funds for the SBA line-item appropriation for Pro-Net/CCR in fiscal 2002 and 2003. In fiscal 2001, the SBA had $500,000 to run the database. Negotiations to move the database from the SBA to a better-funded agency, such as the Defense Department, are underway.



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