SBA to Congress: Drop health care provision

The Small Business Administration is urging Congress not to renew a provision in the fiscal 2005 Defense Appropriations Act related to small-business health care coverage for employees. SBA asserts that the Section 8014a provision harms the ability of small businesses to compete for Pentagon contracts.

Under the 8014a language, the Department of Defense may not hire a small business contractor if that contractor lowered the cost of its bid while either failing to provide health insurance to employees, or contributing less to employees' health insurance costs than does the Pentagon for its own civilians.

SBA Administrator Hector Barreto wrote a letter to Rep. Jerry Lewis (R-Calif.), chairman of the House Committee on Appropriations, asking Lewis to oppose renewing the provision in the upcoming appropriations bill for the Pentagon for 2006.

"Its implementation will have the unintended consequence of limiting small businesses' ability to compete for DoD contracts, which make up the largest percentage of federal contracting opportunities," Barreto wrote.