Brooklyn's Progress
August 2003

By the Office of Congresswoman Nydia M. Velázquez

Federal government misses its small business goals for third year in a row.

WASHINGTON – Congresswoman Nydia M. Velázquez (D-N.Y.), Ranking Democratic Member of the House Committee on Small Business, joined her Democratic colleagues and small business owners on June 25 to release the fourth annual Scorecard report, entitled Federal Agencies: Closed to Small Business, which evaluates 21 federal agencies, accounting for 96 percent of federal procurement, on their mandated small business goal achievement.

“We all know the economy is hurting right now.  Many companies are buying less, laying off workers, and trying to cut costs” said Congresswoman Velázquez.  “But the federal government isn’t.  In fact, from 2001 to 2002, federal procurement dollars rose 7 percent, from $220 billion to $235.4 billion, yet small business opportunities declined.  Even though the government bought more last year, it still failed to meet a single one of its small business goals for the third straight year.”

The government missed its statutory small business goal of 23 percent and its 5 percent goals for both women-and minority-owned businesses.  This failure cost small businesses an estimated $13.8 billion in federal contracting opportunities.  The grades are also the worst they have ever been – out of the 21 agencies examined, there were no A’s, 4 B’s, 5 C’s, 9 D’s and 3 F’s.  The overall grade given to the federal government in Scorecard IV was a D.

The release of Scorecard IV comes more than a year after President Bush promised to take steps to fix the broken procurement system in his small business agenda.  Given the results of Scorecard IV, the Bush plan has failed to give small businesses more opportunities in the federal procurement arena.

“This move is typical of an administration that has said one thing and done another,” Congresswoman Velázquez said.  “When the president had the chance to live up to his rhetoric during the creation of the Department of Homeland Security, rather than ensure that strong protections for small businesses were in place, the administration removed them.  Then it relaxed current procurement policies, making it even less likely that small businesses will get equitable treatment.”

Scorecard IV proposes several reforms for opening up the federal marketplace to small businesses.  They include stronger action to fight contract bundling, modernizing and implementing programs for women- and minority-owned businesses, allocating adequate and necessary resources to ensure increased small business participation, and greater commitment from the Small Business Administration (SBA) in fulfilling its role as a small business advocate in the federal procurement arena.

“Small businesses just need a chance – a foot in the door so they can show federal agencies what they can do.  After all, small businesses are the lifeline of the American economy.  I know that, you know that.  Now we just need the federal government to figure it out.”