For the first time since 2005, the U.S. government hit its target of spending 23 percent of all prime federal contracting dollars on small companies, according to the Small Business Administration.
SBA administrator Maria Contreras-Sweet released the FY2013 Small Business Procurement Scorecard, an annual tally of how well federal agencies meet their small-business contracting goals. The 2013 scorecard showed that 23.39 percent of all prime federal contracting dollars went to small firms, up from 22.25 percent in 2012. The government often defines small companies as those with 500 or fewer employees, though definitions vary by industry.
The government gave itself an “A” for its overall 2013 performance.
“When we hit our small business procurement target, it’s a win,” Contreras-Sweet said in a news conference at the NASA Goddard Space Flight Center in Maryland. “Small businesses get the revenue they need to grow and create jobs, and the federal government gets the chance to work with some of the most responsive, innovative and nimble companies in the U.S. while the economy grows.”
Congress passed legislation in 2003 mandating that federal agencies aim at least 23 percent of all prime and subprime contracting dollars at small businesses. However, the government has continually missed that target—albeit, by just slightly in some years.
Delving deeper into the 2013 scorecard, however, many opportunities for improvement are revealed. Women-owned businesses are supposed to get at least 5 percent of all contracting dollars, but they only received 4.32 percent in 2013. Small businesses are supposed to receive 36 percent of all federal subcontracting dollars; however, they only received 34 percent last year.
Moreover, certain federal agencies didn’t come anywhere close to meeting their individual goal. At the Department of Energy, only 5.71 percent of work went to small businesses (even though the agency has an already low goal of 7 percent). The agency received a failing grade (“F”). Other agencies including the Department of Health and Human Services (A) and the Department of Transportation (A+) exceeded their goals.
Despite the inability of federal agencies to meet their small-business contracting goals in recent years, some lawmakers want to raise the bar even higher. House Small Business Chairman Sam Graves (R-Missouri) introduced a bill earlier this year that would require that small businesses receive 25 percent of all federal contracting dollars and 40 percent of all subcontracting dollars.
“The federal government spends nearly half a trillion dollars on contracted goods and services,” Graves said in a news release, adding: “We must ensure that the money is being spent efficiently, and small businesses have proven that they can do quality work cheaper and often faster.”
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