Democrats Propose Changes in 8(a)Program Democrats on the House Small Business Committee proposed an overhaul of the 8(a) program, including raising the ceiling on sole-source contracts to $10 million. The bill would also increase the government’s small business contracting goal to 30%, from the current 23%. The committee chairman, Rep. Donald Manzullo (R-IL), proposed no changes in the goal or the 8(a) program in his bill to reauthorize SBA programs, H.R. 5352. Sole-source awards under the program are currently limited to $3 million, or $5 million for manufacturing. The Democrats’ proposal would order SBA to recalculate the $750,000 net-worth limit for 8(a) business owners by setting a different limit for each industry based on the capital required for that industry, according to a staff summary. The Democrats want to end SBA’s delegation of authority for awarding 8(a) contracts to other agencies. Currently all major agencies determine which contracts should go into the program without consulting SBA. The Government Accountability Office reported that neither the contracting agencies nor SBA is adequately overseeing 8(a) contracts. (SAA, 4/7) The Democrats’ bill is similar to the Minority-Owned Venture Empowerment, or MOVE, Act, introduced last year by Rep. John Barrow (D-GA). (SAA, 12/23/05) They say the 8(a) program has not been updated since 1988. The Federal Procurement Data System reported 8(a) firms received 2.8% of federal contract dollars in fiscal 2004, down from 3.6% the year before. Democrats say that drop cost 8(a) companies $2.4 billion in lost revenue The committee’s ranking Democrat, Rep. Nydia Velazquez (NY) said she hopes to work with Chairman Manzullo to craft a bipartisan bill. “The committee has a history of working in a bipartisan way,” she said. Both the Democrats and Manzullo proposed increasing the maximum amount of SBA loans. Manzullo’s bill would raise the maximum under the flagship 7(a) program to $3 million, from the current $2 million, and would increase the guarantee limit to $2.25 million, from $1.5 million. The Democratic and Republican bills each propose changes that they say would strengthen SBA disaster loan programs. Manzullo rejected several of the Bush administration’s proposed changes in SBA programs. He did not include proposals to convert disaster loans to adjustable interest rates or to impose new fees on the loan programs. His bill would continue the Microloan program and several other programs that the administration wanted to kill. Manzullo set a committee vote on the reauthorization bill for May 17, too late for this issue of Set-Aside Alert.