In a February 5, 2008 hearing on regulatory fairnesss, American Small Business League (ASBL) Communications Director Chris Gunn highlighted a need for greater enforcement of the regulations created to prevent the diversion of Federal small business contracts to large companies and their subsidiaries. As a result of this testimony, the Small Business Administration (SBA) Office of Government Contracting and Business Development will be conducting a high level review to determine whether or not large businesses are receiving small business procurement awards and agencies are receiving credit for these awards.

According to estimations by the ASBL, more than $100 billion in Federal small business contracts go to some of the largest corporations in the United States and Europe, instead of to legitimate small businesses. There have been no fines or penalties for these misrepresentations to date, despite regulations that allow for hefty fines and even imprisonment.

The ASBL believes that the SBA is not enforcing these regulations, and even claims that the SBA falsifies the small business goaling report to make it seem like goals are being met. Solutions like annual re-certification, the Fairness and Transparency in Contacting Act of 2008, and the enforcement of current regulations have been proposed to remedy this gross misconduct.

In a nutshell, this means more small businesses will have a chance to win contracts in the future that might otherwise have been slipped to large corporations. However, it becomes even more important now to make certain that companies contracting as small businesses are not in violation of any size standards. If you’re a small business looking for ways to get a piece of the Federal procurement pie, we’ll be happy to help.

Full Text: SBA National Ombudsman Mandates High Level Review of ASBL Testimony