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

For Immediate Release
October 18, 2007   

CONTACT: Erin Donar,  (202) 225-4038

Committee Approves Bill to Improve Contracting Opportunities for Small Firms

WASHINGTON – Today Chairwoman Nydia M. Velázquez gave the following opening statement at the markup for H.R. 3867 “The Small Business Contracting Program Improvements Act”:

This is an important bill – and one that is long overdue.  Primarily, it has two main missions – to update the Small Business Administration’s (SBA) contracting programs and to ensure that taxpayer dollars are protected.  The Act makes critical changes that will open up new opportunities for small businesses.  It will serve to spur entrepreneurial activity across a wide spectrum of industries and lead to a more competitive procurement marketplace and ultimately a better value for our taxpayers. This legislation has bipartisan support within this committee and includes the input from a number of Members. 

The legislation will assist veteran entrepreneurs – including those who are service-disabled.  When the men and women serving our nation in Iraq and Afghanistan return home, many hope to start a small business.  This can be especially true for those injured veterans recovering at medical facilities such as Walter Reed.  Our hope is that this bill will provide the tools to start a new endeavor and begin a new life. To do this, we propose placing veteran small business owners at the top of the list for receiving federal contracts.  This will eliminate the barriers that veterans face in receiving non-competitive contracts. We are also requiring the SBA to fulfill its obligations under Executive Order 13360 – which will give veterans access to procurement assistance.  It is important that we act on this legislation so that all veterans can become – if they so choose – successful entrepreneurs.

The 8(a) program has not been modernized in 20 years and we will be taking minimal – but important – steps to allow it to operate in the current business environment. Foremost, the net worth standard is increased to a level consistent with inflation. This change will ensure that we do not penalize companies for success, and then wonder why they fail when they leave the program.  These provisions – while seemingly technical and without cost – will have make a great difference for program participants. Similarly, the SBA has taken too much time to implement the Women’s Procurement Program. This bill will provide agencies will sufficient information to immediately begin competing contracts among women business owners. Women have been waiting nearly seven years for this – they have lost tens of billions of dollars in contracting opportunities – and they will not have to wait any longer.

To combat fraud and taxpayer waste, the legislation takes several steps. Safeguards and business integrity standards are incorporated that will make sure criminals are not squandering taxpayer dollars. To better promote self-policing, any small business can challenge an individual program award. Further steps are taken to require on-site reviews by SBA personnel to verify eligibility for the HUBZone program prior to a contract award. This provision requires certification only once – before a second contract. This is a common sense approach, and is sorely needed as SBA has been aware of problems for at least four years. 

The legislation also takes steps to standardize SBA’s contracting programs. All procurement initiatives will have both prime and subcontracting goals. Each program that has non-competitive contracts as a benefit, will have the same threshold – increased and indexed for inflation – above which will require competition. This will ensure contractors, including service-disabled veterans, have access to higher dollar contracts.

Together, these changes bring SBA’s contracting initiatives into the 21st century, by raising the profile of veteran entrepreneurs and rooting out fraud and taxpayer waste in SBA’s contracting programs.  There is remarkably broad support on this legislation, ranging from the National Black Chamber of Commerce to the National Federation of Independent Business and the Associated General Contractors of America.   Also supporting the legislation are the American Legion, the Veterans of Foreign Wars, and AMVETS.  The United States Hispanic Chamber of Commerce, the U.S. Women’s Chamber of Commerce, the National Defense Industrial Association and the Aerospace Industries Association also support this bill.

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