Small businesses could suffer if fed contracting goes in-house

Federal small business officials want tougher regulations, a workforce that knows the rules, and a website to make contracting decisions more visible. The goal, they say, is to get more contracts awarded to small businesses.

Along with tougher procurement policies, the Interagency Task Force on Federal Contracting Opportunities for Small Businesses recommends that agency officials evaluate the consequences of their insourcing decisions on small firms. Officials want the Office of Federal Procurement Policy and the Small Business Administration to direct agencies’ senior acquisition officials to annually analyze how insourcing efforts are affecting small companies.

If agencies bring contracting work in-house, small-business owners say they will bear the brunt of the decision, the task force wrote in its document that lays out the proposals.

“Small-business contractors have voiced concerns that rebalancing efforts will not only limit new opportunities for small businesses but also take existing contracts away from them,” the task force wrote.

The task force gave the Obama administration 13 recommendations on small businesses and is also posting contracting information on the Small Business Dashboard, another of the growing number of transparency websites from the White House.

The recommendations will “ensure that all federal agencies continue to make progress in getting more contracts into the hands of Americans’ small businesses,” Karen Mills, SBA administrator, wrote Sept. 15 on the White House blog.

In April, President Barack Obama signed an executive order that established the interagency task force to help small businesses win more federal contracts. He said the government has continually struggled with its contracting goals and agencies should strive to exceed them.

To do that, the task force said, the acquisition workforce needs some attention, too.

The task force wants to use some pressure to make agency officials liable for their small-business contracting goals.

“Agency leadership is not held accountable when these goals are not met,” the task force wrote. Agencies have individual goals that contribute to the governmentwide goal of awarding 23 percent of federal contracting dollars to small businesses.

In fiscal 2009, the government missed its goal, awarding only 21.89 percent of contracting dollars to small companies.

Technology could be another means of assisting small contractors. The task force recommends improving Federal Business Opportunities and the Federal Procurement Data System websites. Officials would like FedBizOpps to be the central source for contracting information. They also want better quality of data by validating the information and integrating information systems that include contracting data.

In fiscal 2009, SBA identified potential anomalies in contracting data that totaled over $2 billion, some of which may be errors in coding, according to the task force.

Having made the recommendations, officials now face the real work.

“Implementing these new tools and recommendations won’t be easy,” Mills wrote.

About the Author

Matthew Weigelt is a freelance journalist who writes about acquisition and procurement.

Reader Comments

Thu, Nov 25, 2010

The intentions are good. However, someone needs to rein in the large prime contractors who continually take advantage of the government (read taxpayers)and abuse the system. Next some one needs to do a review of GSA and bring to light how inadequate and incompetent most of the staff are at this organization and how the rules and regulations currently in place there DO NOT help small business but hurt them with their burecratic red tape.

Mon, Sep 20, 2010 Jerry DeLacosta San Diego, Ca.

If the Government really wants to help small business they would STOP the practice of "Bundling" smaller contracts into larger "all inclusive" contracts that are awarded to their wealthy Campaign Reelection contributors where the work is outsourced instead of putting more American workers to work. Without jobs the economy will never recover and we will become a "third world country" Stop the outsourcing of jobs, STUPID.

Fri, Sep 17, 2010 James Aylward

Federal agencies would be well advised to take into consideration the "value added" that a competent contractor can bring to the table. Agency needs can frequently be met with greater cost efficiency when outsourced to small business.

Fri, Sep 17, 2010 Linda Joy Adams OK

What's a small business? Is it a subsidiary of an international conglomerate? That's who seems to be getting those govt contracts and flagrantly violating laws, regs and the constitutional rights of each of us. There's a need for some govt contractors but the biggest problem is that Congress passed laws that they can't be internally audited, investigated when complaints are filed or prosecuted when blatant theft and other crimes are committed. The truly small and honest business can't compete!Linda Joy Adams- well documented incidences for several years

Fri, Sep 17, 2010 SmallBizzy

All they need to do is pass "H.R.2568: Fairness and Transparency in Contracting" bill... would like to express my support for H.R. 2568, the Fairness and Transparency in Contracting Act of 2009

Since 2003, more than 15 federal investigations have found that every year billions of dollars in federal small business contracts are diverted to Fortune 1000 corporations and even many of the largest firms in Europe. (

Report 5-15, from the Small Business Administration (SBA) Office of Inspector General stated, “One of the most important challenges facing the Small Business Administration and the entire Federal government today is that large businesses are receiving small business procurement awards and agencies are receiving credit for these awards.” (

It is not reasonable for small businesses to have to compete with the likes of Wal-Mart, Home Depot, Microsoft, Xerox, Dell Computer, John Deere, British Aerospace (BAE) and Rolls-Royce for small business contracts. Additionally, I strongly believe this legislation could have a significant impact on our nation’s economy by providing our nation’s small businesses with billions of dollars in contracting opportunities every year.

I strongly urge you to support H.R. 2568, the Fairness and Transparency in Contracting Act of 2009.

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