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

For Immediate Release
January 16, 2008     

CONTACT: Erin Donar / Jaime Zapata,  (202) 225-4038

House Committee on Small Business Finds Bush Administration Unwilling to Help Women Entrepreneurs
SBA Admits Proposal Would Not Result in Meeting 5% Contracting Goal Set by Law

WASHINGTON, D.C. —The Bush Administration continues to resist the implementation of a program created in the mid 1990’s to expand access for women-owned small businesses to federal contracts.  Today, the House Committee on Small Business examined a rule proposed for the Women’s Procurement Program by the Small Business Administration (SBA).  The congressional panel found this rule to be exceedingly restrictive.

“There are more than 10 million women-owned small businesses across the nation, and their needs cannot be ignored by government.” said Chairwoman Nydia Velázquez.  “Seven years is a long time to wait for implementation, especially when the result is a proposed program that shuts out most of the entrepreneurs it was specifically designed to help.”

Committee members heard testimony from SBA Administrator Steven Preston and from Elizabeth Papez of the U.S. Department of Justice.  The testimony underscored one simple fact:  under the proposed rule, fewer than 3% of women-owned small businesses would be considered eligible for federal contracts.  To make matters worse, only those businesses in such obscure industries as cabinetmaking and engraving would be given access to the federal marketplace.  The Committee strongly urged the Administration to go back to the drawing board to craft a rule that accurately reflects the face of American small businesses.

“The SBA’s proposal should be scrapped because it does not embody the program that Congress envisioned,” said Chairwoman Velázquez.  “If the rule becomes final, women entrepreneurs would be unjustly kept out of the federal market place. This Committee will not allow that to happen.” 

The Bush Administration has never met the women’s small business contracting goal of 5%.  During the hearing, Preston admitted that the SBA will not meet the goal this year and that his agency’s proposal would not result in a significant increase in contracts to women’s entrepreneurs. Chairwoman Velazquez pointed out that for the goal to be met; the 1,247 businesses designated as under-represented and eligible to participate in the program each would have to receive a contract worth nearly $4.4 million—ten times the average amount for a small firm’s contract. 

“Numbers don’t lie.  It is time the federal government complies with the law and shows women entrepreneurs the respect they deserve,” said Velázquez. 

The Women’s Procurement Program was crafted by Chairwoman Velazquez and enacted by Congress as part of the Equity in Contracting for Women Act of 2000.  SBA’s proposed rule comes only after several Congressional inquiries, numerous studies, and a lawsuit that was filed by women’s business groups.  Last year, the House of Representatives approved Chairwoman Velázquez’s H.R. 3867, the Small Business Contracting Improvements Act, to mitigate the impact of the SBA’s continued foot-dragging.

Click here for video clips of the hearing

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