July 11, 2003 WASHINGTON They are among America's larger companies: Verizon Communications, AT&T Wireless, Barnes & Noble booksellers and Dole Food. But in the government's contractor database, they are listed as small businesses.

The mistaken designations, contained in records obtained by the Associated Press, mean the government has overstated the contract dollars that are going to small business at a time when the Bush administration has been pressing to give smaller firms as much federal work as possible.

"The numbers are inflated - we just don't know the extent," said David Drabkin, senior procurement officer for the General Services Administration.

Drabkin, whose agency maintains the records entered by contracting officials across the government, said the GSA is working to ensure accurate entries in the future, but past errors are "not something we can clean up overnight."

Once a company's status is mischaracterized, it stays that way through the life of a contract - which can be 20 years. That means smaller firms the administration intended to help may be frozen out of fresh business by the bigger companies with the incorrect designations.

"This transition has led to the apparent diversion of contract dollars intended for small business," said Sue Hensley, a spokeswoman for the U.S. Small Business Administration.

One small businessman who is pushing to have the listings corrected says workers are paying in lost jobs.

"Most Americans work for small businesses, and most of all the new jobs are created by small businesses. This certainly has a dramatic impact on job creation," said Lloyd Chapman, who formed the California- based Microcomputer Industry Suppliers Association.

The disclosure of errors in government contracting came as no surprise to Joe Massaro, owner of the Oakhurst, N.J., computer services and equipment firm Computer Data Source.

Massaro said he recently landed a multimillion-dollar government contract, but only after challenging an initial award to a competitor on the grounds it didn't qualify as a small business.

"Every day, we see big companies bidding on contracts that are supposed to go to small business," Massaro said.

The government defines a small business as one that is independently owned and operated and is not dominant in its field. Size standards change from one industry to another, based on either the number of employees or revenues.

Among the contractors designated as small businesses in the records obtained by the AP were:

Verizon, the largest local phone company in the nation, and Verizon Wireless, the company's joint venture that is the largest U.S. wireless provider.

Barnes & Noble, the top U.S. bookseller, with superstores in 49 states and the District of Columbia, plus mall stores.

Dole Food, the world's largest producer of fresh fruits and vegetables.

Parsons, Brinckerhoff, Quade, one of the top U.S. transportation engineering firms, with projects around the world.

The Bush administration has set a goal of providing small business with 23 percent of all federal contracts, but has fallen about 3 percentage points short after awarding $53 billion to small companies.

Officials now acknowledge the percentage was inflated by the erroneous database entries and the true amount of federal business that went to small firms was smaller.

Investigators from Congress' General Accounting Office found no evidence that large companies had tried to manipulate the designations found in the database. Rather, they blamed the mistakes on federal contracting officials who either entered wrong codes for business size or re-entered outdated information.

Large companies said they never intended to be listed as small businesses.

"We work with a variety of small businesses in going after federal business. We hope that businesses are properly categorized in accordance with federal regulations," said Kevin Irland, a spokesman for Verizon.

AT&T Wireless spokeswoman Rochelle Cohen voiced similar support for small business, adding the company was unaware that it was mischaracterized on the database.

Massaro, the owner of Computer Data Source, said that, in some cases, he has submitted lower bids for government contracts, but the contracting officer for the federal agency decided to stick with the existing supplier.