SBA advocacy office hires controversial economists

      The SBA Office of Advocacy is being criticized for awarding a $136,000 research contract to two economists whose previous work was discredited by the US Congressional Research Service and others.

      The SBA recently contracted with Nicole V. Crain and William Mark Crain to produce a study on the costs of regulation for small businesses.

      The previous Crains’ study that was found to be of questionable validity by CRS also was a study of the costs of regulation, performed in 2010.

      CRS devoted a report to pointing out the flaws in the Crains’ methods, resulting in unreliably high estimates of regulatory costs. The SBA also issued a statement “clarifying” the findings of the Crain’s previous study. The Crains maintained their analysis was correct.

      Regarding the recent contract, Bloomberg reported that only two bids were received.

      An SBA advocacy official told Bloomberg that proper contracting procedures were followed for the contract.

     The Coalition for Sensible Safeguards is accusing the SBA of potentially generating “fake news” if it contracts for research with economists whose methods previously were shown to be unreliable.

      The Crains were not immediately available for comment.

More information: CRS 2011 study: http://goo.gl/KCqd6U
Coalition for Sensible Safeguards release: http://goo.gl/h4zyqi
Original SBA Office of Advocacy posting: http://goo.gl/DRdMYd

Shoraka’s tips on JVs

      John Shoraka, SBA’s former associate administrator for government contracting and business development, is offering a few tips on using joint ventures and other methods to help maintain your small business size status.

      “Revenues generated by a joint venture only count toward the size of a small business in proportion to the work performed by the small business in the joint venture” Shoraka, now with PilieroMazza PLLC, pointed out in a recent blog.

      He also discussed how a company that has grown large in one industry possibly can remain small in another industry.

More information: PilieroMazza update: http://goo.gl/M2wRt4

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