Analysis: federal contracting not small biz-friendly

Wednesday - 7/13/2011, 9:40am EDT

Lloyd Chapman, president, American Small Business League

Download mp3

By Vyomika Jairam
Federal News Radio

The government is lying about how much federal contracting goes to small business. At least, that's what the American Small Business League is saying. Recently, the Small Business Administration reported that 22.7 percent of federal contracting dollars last year went to small businesses. That's just a hair shy of the federal goal of 23 percent. But the ASBL has done its own analysis. Lloyd Chapman, the president of the league spoke with the Federal Drive. Chapman says 61 of the top 100 small business awards last year actually went to large businesses.

"That's pretty much been consistent for about a decade," Chapman said, noting that the initial investigation was carried out by the GAO. "It's not something where the American Small Business League's has an opinion different than other people. The SBA Inspector General has said this is the number one challenge facing the Small Business Administration, for six consecutive years."

The SBA, Chapman said, does what it can to make it appear as if the government meets its goals. According to Chapman, there are many ways in which the SBA manipulates and inflates the data:

  • Small Business Eligible - term created by the SBA to "decrease the federal acquisition budget to a level, almost any level they want to make it look like the government is doing more," Chapman said. "It's commonly known that the real federal acquisition budget is about $1 trillion. They claim to have done just under $100 billion. In reality, the vast majority of that actually went to large businesses."

  • Inflating the volume of contracts to legitimate small businesses

  • Mis-coding and data entry errors. "Every year for a decade, the Small Business Administration has said that most federal small business contracts go to large businesses accidentally," Chapman said.

"The remedy would be to overhaul the Small Business Administration," Chapman said.