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Senators, Administration Back Parity Bill

Two senators have introduced legislation providing parity in set-aside contracts for all federal small business programs.

The Small Business Parity Programs Act, S. 3190, would overturn a ruling by the Federal Court of Claims, which said HUBZone programs are first in line for set-asides. The bill is sponsored by Senate Small Business Committee chair Mary Landrieu, D-LA, and Sen. Dick Durbin, D-IL.

SBA has told its field offices that the parity rule remains in force because the court decision applies only to a single contract that was the subject of a bid protest. However, Jonathan Swain, assistant administrator for communications and public liaison, acknowledged, “This could cause a flood of protests in any non-HUBZone procurement, paralyzing the procurement process and making litigation-avoidance a primary contracting objective.”

Swain said the Obama administration supports congressional action to provide parity. “An absolute HUBZone preference could have a devastating economic impact upon thousands of non-HUBZone 8(a), SDVOSB and [woman-owned] firms that currently participate in government contracting, and the hundreds of thousands of jobs they provide,” he wrote in the March 16 memo.

The Senate passed a parity amendment last year as part of the Defense Authorization bill, but the provision was dropped in a conference committee with the House.

Sen. Landrieu said, “It is well past time to provide more equality and greater opportunities for the thousands of small business owners who wish to do business with the federal government. This simple, yet effective, bill is a good step toward opening those doors, fixing current law and having an immediate and positive impact on small businesses seeking equal access to federal contracts.”

The chief judge of the Court of Federal Claims, Emily Hewitt, said the HUBZone program is first in line for set-asides because the HUBZone law says a contract “shall” be set aside for those firms under the rule of two. Laws creating the 8(a) and service-disabled veterans programs say contracts “may” be set aside.

“Congress did not explicitly provide for parity between the HUBZone and 8(a) programs,” she wrote. (SAA, 3/19)


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