News From the
Committee on Small Business
Nydia M. Velázquez, Chairwoman

For Immediate Release
April 21, 2007

CONTACT: Kate Gilman/ Austin Bonner,  (202) 225-4038

Committee Adopts Legislation to Open Federal Marketplace to Greater Small Business Participation

WASHINGTON –While small firms make up nearly 99.7 percent of companies, they continue to face numerous challenges that prevent them from receiving their fair share of the $340 billion dollar federal marketplace.  The House Small Business Committee unanimously adopted legislation, H.R. 1873, the Small Business Fairness in Contracting Act, to increase small firms’ access to federal contracts.

“Access to the federal marketplace has proven to be an important catalyst for growth for many small businesses,” said Chairwoman Nydia M. Velázquez. “The legislation we passed today takes important steps to remove the barriers between entrepreneurs and federal projects.”

Though the federal marketplace continues to grow at record rates, small businesses’ contracting opportunities are dwindling. For the past six years, the federal government has failed to meet its 23 percent contracting goal – an inaction that cost small businesses nearly $4.5 billion in lost contracting opportunity last year alone.  Small firms also face challenges as the government continues to combine work into contracts that are too large for entrepreneurs to bid on, making the work less accessible to small businesses.  Over the past few years, small businesses have also lost out on opportunities as contracts intended for small businesses were awarded to large corporations.  These factors have all resulted in lost contracting opportunities for this nation’s small firms.   

“It is clear from testimony that this committee has heard, and our earlier investigations, that the federal government is simply not doing all it can to work with this nation’s small businesses – in fact, many times they are only exacerbating the problems, making it more difficult for small firms to access contracts,” said Chairwoman Velázquez. “Working with small businesses is not only good for the economy – but it also yields the best value for the taxpayer dollar.  It is time that we put an end to these tactics and enact policies that will guarantee our entrepreneurs have the opportunities they deserve to work with the federal government.”

To address these challenges, the committee approved H.R. 1873, the Small Business Fairness in Contracting Act, introduced Wednesday by subcommittee Chairman Bruce Braley.  The legislation tackles the major problems driving agencies’ low achievement by making changes to ensure more contracts are available to small firms, raise the federal small business government-wide contracting goal from 23 to 30 percent, and fight fraud in the contracting process. HR 1873 also expands contracting opportunities for small businesses by opening up opportunities overseas and increasing enforcement on subcontracting goals. HR 1873 implements changes that will address a number of the barriers facing small businesses in the federal marketplace today.

“This bill is good for small businesses in America,” Congressman Braley said.  “When government contracts are bundled together into billion-dollar super contracts, small businesses just cannot compete on a level playing field.  By making it harder for government agencies to create these super-contracts, more small businesses will have the opportunity to benefit from earning government business.  Furthermore, this bill requires the SBA to reach out to small businesses regarding the opportunities to compete for government contracts.  At the end of the day, that means more opportunities for small businesses in the U.S.”

The committee highlighted that the legislation adopted today opens up contracting opportunities for small businesses, and continues the ongoing work to reform federal contracting practices. Click here to download a summary of the Small Business Fairness in Contracting Act.

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