Most Agencies Exceed Small Business Goals, But Woman-Owned and 8(a) Firms Lag Seventeen of the 22 largest federal departments and agencies exceeded the goal set by Congress of awarding 23% of their prime contract dollars to small firms in fiscal 2002. But the government as a whole fell just short of the goal. GSA’s Federal Procurement Data Center reported that 22.6% of federal prime contract dollars went to small firms during the year, down from 22.8% in fiscal 2001. It was the third straight year the goal was missed. Woman-owned firms received 2.9% of the dollars, far below the congressionally mandated goal of 5%. Only five agencies exceeded the goal. Small disadvantaged businesses, including 8(a) firms, won 6.75%, above the 5% goal. Awards to 8(a) firms fell to 2.39%, from 2.86% the year before. HUBZone and service-disabled veterans’ companies each received less than 1% of the dollars. (See table, page 5) Eleven of the 22 agencies increased the share of contracts flowing to small firms over their 2001 performance. Democratic members of the House Small Business Committee gave the government a grade of “D” in their annual Scorecard report. “Last year the president issued a small business agenda,” said the committee’s ranking Democrat, New York Rep. Nydia Velazquez. “What has happened to it one year later? Nothing. Nothing has changed. Nothing has been accomplished.” Governmentwide, contracts for small businesses totaled $53.25 billion, up 6% from the previous year. Total federal procurement grew 7%. But the number of small business contract actions fell by 14%, indicating that contracts are getting bigger. The Federal Procurement Data Center’s figures are the official ones, and are collected from individual departments and agencies. But the General Accounting Office has found that the figures overstate small business contracting to an unknown extent, because many businesses are still counted as small after they have outgrown the government’s size standards. (SAA, 5/16) The figures do not include subcontracts. That hurts the rankings of such agencies as Defense, Energy and NASA, which spend the majority of their money on large hardware or management contracts. The Defense Department, which accounts for nearly two-thirds of government procurement, awarded 21.2% of its dollars to small firms, up from 20.5% in 2001. The Small Business Committee Democrats’ Scorecard gave “F’s” to the departments of Energy and Education and the Agency for International Development. No agency received an “A.” Agriculture and Interior were graded “B.” The grades are based on goal achievements and on the Democratic staff’s opinion of whether an agency’s goals were set sufficiently high. Rep. Velazquez said contract bundling is a major obstacle to small firms. She said she will propose legislation giving the Office of Management and Budget authority to break up bundled contracts. Under current law, she said, “the agency that bundles the contract is the judge and the jury.” The Bush administration has proposed new rules to combat unnecessary bundling, including requiring that agencies submit written reviews and justifications of any bundled contract above certain dollar amounts. (SAA, 2/7) OMB officials have said they expect the final rules to be issued by the end of the summer. Rep. Charles Gonzalez (D-TX) said agencies that fail to meet socioeconomic goals should have part of their budgets withheld. “If their budgets are in jeopardy, you will see compliance,” he said at a news conference June 25.