Sales through GSA schedules grew only 2% in 2008, the newspaper Federal Times reported. It is the fourth consecutive year of marginal growth after years of double-digit gains.

GSA says it is taking steps to bring customers back with technological improvements, including electronic processing of contract modifications and electronic distribution of RFPs.

Rep. Hank Johnson, D-GA, has introduced the Fairness and Transparency in Contracting Act (H.R. 2568), which is designed to stop large corporations from being counted as small in federal procurement reports.

The bill, backed by the American Small Business League, would establish penalties for companies that misrepresent their size status and prohibit the award of small business contracts to subsidiaries of publicly traded companies.

A number of investigations have found that large companies are frequently counted as small in the government’s contracting data, artificially inflating small firms’ market share.

Both the House and Senate small business committees have begun steps to reauthorize the Small Business Innovation Research, which will sunset on July 31 without congressional action.

The Senate panel held a roundtable with stakeholders in preparation for drawing up legislation. The House committee’s subcommittee on contracting and technology has held a hearing and was planning to mark up legislation.

Last year the House voted to allow SBIR grants to companies controlled by venture capital firms. The Senate committee proposed a compromise that would allow limited VC participation.

“The SBIR program is one of those government programs that actually works,” said House subcommittee chairman Aaron Schock, D-VA. “Some of the greatest technological innovations come from small business owners experimenting in their workshops. This program provides these innovators with an opportunity to grow their ideas into practice, provide jobs, and improve our economy.”