The Small Business Administration isasking a judge to throw out a lawsuit claiming it uses "creativeaccounting" for federal contracting benchmarks.

SBA filed a motion to dismiss thelawsuit, which was filed in May by the American Small Business League,related to the agency's annual goaling report.

"SBA's requirement to publish agencyremediation plans stems directly from the Small Business Act," SBA counselstated in court documents. "Though the implementation of this requirement istied to the outcomes published in the goaling reports, it is the statute — notthe reports — which binds SBA to act. Moreover, the alleged legal consequencesfor [ASBL] are speculative and result not from SBA's actions but fromindividual contracting decisions across multiple federal agencies."

ASBL in a statement called the motion adodging of fraudulent policies.

"The SBA has obviously sidestepped therelevant issues of this case because their policies are undeniably in directconflict with the Small Business Act," said Robert Belshaw, an attorney forASBL. "The SBA is trying to deny any legal obligation to give an accuratereport on the true level of small business participation as the statutesrequires."

SBA in March released its annual report card on smallbusiness federal contracting. As a whole, the government received an "A"on its report card for fiscal 2015.

For the first time the governmentreached its 5 percent women-owned small business [WOSB] contracting goal since the bar was setin 1996. The government spent $17.8 billion working with WOSBs, accordingto the report.

The government also passed its 23percent overall small business procurement goal by spending 25.75 percent, or$90.7 billion on small business contracts.

SBA explained in its motion that "eachagency submits a report to the SBA Administrator at the end of each fiscal yearindicating whether the agency achieved its goals, any justifications forfailure, and a remediation plan."

The business league takes issue withwhat it says is the SBA practice of excluding certain contracts in away to "misrepresent and fabricate" compliance with those goals, resulting inFortune 500 companies being awarded small business contracts.

In a May interview with Federal NewsRadio, SBA's associate administrator of Government Contracting and BusinessDevelopment John Shoraka said the agency's exclusion process was both a work inprogress and a holdover from the previous administration.

"When we came in as an administration in2009, we wanted to be able to continue to measure apples to apples to apples,to see if we're actually progressing," Shoraka said. "We kept those exclusionsas they stood when we arrived, to make sure we weren't accused of sort offiddling with the numbers and making it look like we were having success."

A request for comment from SBA was notimmediately returned.

In SBA's motion, the agency makesthree arguments for tossing the lawsuit. One argument isthat the agency's goaling report is not equal to a rule or order.

"The criteria used to determine whichcontracts qualify as small business, and which contracts qualify as goalingexclusions, are already determined by existing laws and policies that governthe SBA and other agencies," court documents state. "Though SBA is alsodirected by statute to publish the information found in the goaling reports,the reports themselves do not 'implement' the law."

Another argument is that the reportingdoes not directly impact legal rights.

"Whatever legal consequences mightaccrue to [ASBL] would be the result of further contracting decisions byother federal agencies, not the goaling reports or agency remediation plans,"the motion states. "The data contained in the goaling reports does not createSBA's responsibility to publish remediation plans, which already exists underthe Small Business Act."

The third argument rests on what SBAsays is a lack of "final agency action," which ASBL needs to be able to file alawsuit under the American Procedure Act.

"The APA permits suit against an agencywhen a person has suffered a 'legal wrong because of agency action' or has been'adversely affected or aggrieved by agency action within the meaning of arelevant statute,'" the motion states.

"SBA's reporting of small businesscontracting achievements is not final agency action within the meaning of theAPA, and thus cannot be challenged in federal court. While SBA is required bystatute to report these achievements and agency remediation plans, the reportsthemselves do not affect the law or SBA policy, nor impose direct, legalconsequences for either party."

A hearing on the motion is scheduled forSept. 29.

To view full article, click here: http://federalnewsradio.com/contractsawards/2016/08/sba-fights-back-contracting-goals-lawsuit/