Thursday, August 27, 2009
Wednesday, August 26, 2009
Government Loophole Will Slow Economic Recovery for Middle Class America
FOR IMMEDIATE RELEASE
August 26, 2009
Petaluma, Calif. - A loophole created by the federal government is having a significant negative impact on the economic recovery of middle class America. The latest U.S. Census Bureau data shows that 98 percent of all U.S. firms have less than 100 employees. These firms employ over 50.2 percent of the private sector work force, create over 97 percent of all net new jobs and generate over 50 percent of the Gross Domestic Product (GDP).
Federal law stipulates that 23 percent of the total value of all federal contracts awarded each year shall go to small businesses.
With the annual federal acquisition budget hovering around $700 billion, the nation's 27 million small businesses should be able to count on approximately $161 billion a year in federal contracts being channeled into the middle class economy.
Unfortunately, the federal government has created colossal loopholes that have diverted the vast majority of federal small business contracts away from middle class America and into the hands of many of the largest firms in the world.
The federal government adopted a policy, which allowed large businesses to acquire a small business and retain that firm's small business status for 20 years. A reporter from CBS forced this out of an SBA official in a 2004 interview. In July of 2007, the Small Business Administration (SBA) implemented a rule change requiring 5-year recertification of small business status. This rule change "grandfathered" large businesses currently receiving federal small business contracts into the government's contracting data. As a result, the overwhelming majority of federal contracts intended for American small businesses will be diverted to Fortune 500 firms and thousands of large businesses around the world until the year 2012.
Last week, the Obama Administration released the latest data on federal contracts awarded to small businesses. The top recipient of federal small business contracts was Textron. Textron is a Fortune 500 firm with 43,000 employees and over $14 billion in annual sales. Their AAI division received $775,773,505 in small business contracts during fiscal year (FY) 2008. (http://www.asbl.com/documents/20090821Top100SBContracting%20Numbers2008.pdf)
Other firms receiving federal small business contracts included, British Aerospace (BAE), Lockheed Martin, Boeing, Raytheon, GTSI, L-3 Communications, Northrop Grumman, Booz Allen Hamilton, General Dynamics, 3M Company, Hewlett-Packard, AT&T, Dell Computer, Staples, Office Depot, Xerox, General Electric, Rolls-Royce and French firm Thales Communications. Finmeccanica SpA in Italy with more than 73,000 employees received $273,872,995 in small business contracts; Ssangyong Corporation in Seoul, South Korea received $254,149,950 in federal small business contracts. (http://www.asbl.com/documents/20090825TopSmallBusinessContractors2008.pdf)
The American Small Business League (ASBL) estimates that over $100 billion a year in federal contracts that by law should go to middle class firms are diverted to worldwide corporate giants. (www.asbl.com)
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Please click here to watch our response to the Obama Administration's small business contracting statistics: http://www.youtube.com/watch?v=oV0jeTrYPsM
Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575
August 26, 2009
Petaluma, Calif. - A loophole created by the federal government is having a significant negative impact on the economic recovery of middle class America. The latest U.S. Census Bureau data shows that 98 percent of all U.S. firms have less than 100 employees. These firms employ over 50.2 percent of the private sector work force, create over 97 percent of all net new jobs and generate over 50 percent of the Gross Domestic Product (GDP).
Federal law stipulates that 23 percent of the total value of all federal contracts awarded each year shall go to small businesses.
With the annual federal acquisition budget hovering around $700 billion, the nation's 27 million small businesses should be able to count on approximately $161 billion a year in federal contracts being channeled into the middle class economy.
Unfortunately, the federal government has created colossal loopholes that have diverted the vast majority of federal small business contracts away from middle class America and into the hands of many of the largest firms in the world.
The federal government adopted a policy, which allowed large businesses to acquire a small business and retain that firm's small business status for 20 years. A reporter from CBS forced this out of an SBA official in a 2004 interview. In July of 2007, the Small Business Administration (SBA) implemented a rule change requiring 5-year recertification of small business status. This rule change "grandfathered" large businesses currently receiving federal small business contracts into the government's contracting data. As a result, the overwhelming majority of federal contracts intended for American small businesses will be diverted to Fortune 500 firms and thousands of large businesses around the world until the year 2012.
Last week, the Obama Administration released the latest data on federal contracts awarded to small businesses. The top recipient of federal small business contracts was Textron. Textron is a Fortune 500 firm with 43,000 employees and over $14 billion in annual sales. Their AAI division received $775,773,505 in small business contracts during fiscal year (FY) 2008. (http://www.asbl.com/documents/20090821Top100SBContracting%20Numbers2008.pdf)
Other firms receiving federal small business contracts included, British Aerospace (BAE), Lockheed Martin, Boeing, Raytheon, GTSI, L-3 Communications, Northrop Grumman, Booz Allen Hamilton, General Dynamics, 3M Company, Hewlett-Packard, AT&T, Dell Computer, Staples, Office Depot, Xerox, General Electric, Rolls-Royce and French firm Thales Communications. Finmeccanica SpA in Italy with more than 73,000 employees received $273,872,995 in small business contracts; Ssangyong Corporation in Seoul, South Korea received $254,149,950 in federal small business contracts. (http://www.asbl.com/documents/20090825TopSmallBusinessContractors2008.pdf)
The American Small Business League (ASBL) estimates that over $100 billion a year in federal contracts that by law should go to middle class firms are diverted to worldwide corporate giants. (www.asbl.com)
-###-
Please click here to watch our response to the Obama Administration's small business contracting statistics: http://www.youtube.com/watch?v=oV0jeTrYPsM
Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575
Tuesday, August 25, 2009
Obama Administration Juggles the Books to Shortchange Small Businesses Out of Billions
FOR IMMEDIATE RELEASE
August 25, 2009
Petaluma, Calif. – The Obama Administration released its latest small business contracting statistics on August 21, claiming that the federal government awarded 21.5 percent of federal contracts to small businesses. (http://www.asbl.com/documents/20090825TopSmallBusinessContractors2008.pdf)
The American Small Business League (ASBL) has uncovered information within the Federal Procurement Data System - Next Generation (FPDS-NG), which indicates that the government actually did closer to 7 percent with small businesses.
Since 2003, over a dozen federal investigations have found that federal officials consistently inflated the government's actual small business contracting data, and allowed billions of dollars in federal contracts intended for small businesses to be diverted to corporate giants.
One technique used by the government to misrepresent compliance with the congressionally mandated 23 percent small business contracting goal was to create the term, "small business eligible." Using this technique, government officials subtract larger federal prime contracts from the overall federal acquisition budget. Reducing the actual federal acquisition budget significantly inflates the percentage of all federal contracts awarded to small businesses.
The ASBL points out that excluding large contracts as not being "small business eligible" is not supported by any statute of the law, and is contrary to the actual language of the Small Business Act which states, "The Government-wide goal for participation by small business concerns shall be established at not less than 23 percent of the total value of all prime contract awards for each fiscal year." (http://www.sba.gov/regulations/sbaact/sbaact.html) The ASBL estimates that the actual federal acquisition budget for 2008 was approximately $700 billion. The SBA used a figure of $434 billion to arrive at the 21.5 percent number. (http://www.sba.gov/idc/groups/public/documents/sba_homepage/fy2008official_goaling_report.html)
Another technique, uncovered in federal investigations and used by government officials to misrepresent the actual percentage of federal contracts awarded to small businesses, is to include billions of dollars in contracts to Fortune 500 firms and hundreds of other large businesses as small business awards.
Some of the firms Obama officials used to reach the government’s 21.5 percent figure included Lockheed Martin, Textron, Boeing, Raytheon, L-3 Communications, Northrop Grumman, Dell Computer, General Dynamics, Office Depot, Xerox, 3M, Staples, GTSI, General Electric, AT&T, Hewlett-Packard, British Aerospace (BAE), Rolls-Royce, French giant Thales, Ssangyong Corporation headquartered in Seoul, South Korea and Finmeccanica SpA which is located in Italy with 73,000 employees.
In response to the SBA's release of its 2008 small business goaling report, the ASBL conducted a detailed analysis of small business contracting data obtained from FPDS-NG. By excluding the large recipients of federal small business contracts and using the actual federal budget from fiscal year 2000 forward, the ASBL has estimated that legitimate American small businesses have lost an average of approximately $100 billion a year in government small business contracts.
A new bill titled the "Fairness and Transparency in Contracting Act," or H.R. 2568 has been introduced into the House of Representatives would redirect billions of dollars in federal small business contracts back to legitimate American owned small businesses.
-###-
Please click here to watch our response to the Obama Administration’s small business contracting statistics: http://www.youtube.com/watch?v=oV0jeTrYPsM
Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575
August 25, 2009
Petaluma, Calif. – The Obama Administration released its latest small business contracting statistics on August 21, claiming that the federal government awarded 21.5 percent of federal contracts to small businesses. (http://www.asbl.com/documents/20090825TopSmallBusinessContractors2008.pdf)
The American Small Business League (ASBL) has uncovered information within the Federal Procurement Data System - Next Generation (FPDS-NG), which indicates that the government actually did closer to 7 percent with small businesses.
Since 2003, over a dozen federal investigations have found that federal officials consistently inflated the government's actual small business contracting data, and allowed billions of dollars in federal contracts intended for small businesses to be diverted to corporate giants.
One technique used by the government to misrepresent compliance with the congressionally mandated 23 percent small business contracting goal was to create the term, "small business eligible." Using this technique, government officials subtract larger federal prime contracts from the overall federal acquisition budget. Reducing the actual federal acquisition budget significantly inflates the percentage of all federal contracts awarded to small businesses.
The ASBL points out that excluding large contracts as not being "small business eligible" is not supported by any statute of the law, and is contrary to the actual language of the Small Business Act which states, "The Government-wide goal for participation by small business concerns shall be established at not less than 23 percent of the total value of all prime contract awards for each fiscal year." (http://www.sba.gov/regulations/sbaact/sbaact.html) The ASBL estimates that the actual federal acquisition budget for 2008 was approximately $700 billion. The SBA used a figure of $434 billion to arrive at the 21.5 percent number. (http://www.sba.gov/idc/groups/public/documents/sba_homepage/fy2008official_goaling_report.html)
Another technique, uncovered in federal investigations and used by government officials to misrepresent the actual percentage of federal contracts awarded to small businesses, is to include billions of dollars in contracts to Fortune 500 firms and hundreds of other large businesses as small business awards.
Some of the firms Obama officials used to reach the government’s 21.5 percent figure included Lockheed Martin, Textron, Boeing, Raytheon, L-3 Communications, Northrop Grumman, Dell Computer, General Dynamics, Office Depot, Xerox, 3M, Staples, GTSI, General Electric, AT&T, Hewlett-Packard, British Aerospace (BAE), Rolls-Royce, French giant Thales, Ssangyong Corporation headquartered in Seoul, South Korea and Finmeccanica SpA which is located in Italy with 73,000 employees.
In response to the SBA's release of its 2008 small business goaling report, the ASBL conducted a detailed analysis of small business contracting data obtained from FPDS-NG. By excluding the large recipients of federal small business contracts and using the actual federal budget from fiscal year 2000 forward, the ASBL has estimated that legitimate American small businesses have lost an average of approximately $100 billion a year in government small business contracts.
A new bill titled the "Fairness and Transparency in Contracting Act," or H.R. 2568 has been introduced into the House of Representatives would redirect billions of dollars in federal small business contracts back to legitimate American owned small businesses.
-###-
Please click here to watch our response to the Obama Administration’s small business contracting statistics: http://www.youtube.com/watch?v=oV0jeTrYPsM
Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575
Monday, August 24, 2009
Obama Administration Small Business Data Includes Billions to Corporate Giants
FOR IMMEDIATE RELEASE
August 24, 2009
Petaluma, Calif. - On August 21st, the Obama Administration released its latest statistics on the volume of federal contracts awarded to small businesses. Federal law requires a minimum of 23 percent of the total value of all federal contracts to be awarded to small businesses. Federal statute defines a small business as being "independently owned," which excludes publicly traded firms.
The Obama Administration is claiming the government awarded $93.3 billion in contracts to small businesses or 21.5 percent during fiscal year (FY) 2008.
According to information from the Federal Procurement Data System - Next Generation (FPDS-NG), of the ten largest recipients of federal small business contracts, 85.4 percent of the contracts went to large businesses. Eight of the top ten recipients of small business contracts were large businesses.
The top recipient of government small business contracts was Textron, which received $775.7 million. Textron is a Fortune 500 firm with 83,000 employees and over $25 billion in annual revenue.
Two other top ten recipients of federal small business contracts were Ssangyong Corporation, which is headquartered in Seoul, Korea and received over $254 million and Finmeccanica SpA, which is headquartered in Italy with 73,000 employees and received over $283 million in contracts.
The 14th largest recipient of federal small business contracts is listed as "Miscellaneous Foreign Contractors" with $210 million in government small business contracts.
Other firms included in the Obama Administration's small business data were Lockheed Martin, Boeing, Raytheon, Northrop Grumman, General Dynamics, AT&T, 3M Corporation, Xerox, Dell Computer, Booz Allen Hamilton, Hewlett-Packard, General Electric, Staples, Office Depot, British Aerospace (BAE), Rolls-Royce and French firm Thales.
Since 2003, over a dozen federal investigations have found that legitimate small businesses have lost billions of dollars in federal small business contracts, which have been diverted to many of the largest firms around the world. In 2005, the SBA Inspector General referred to the diversion of federal small business contracts to corporate giants as, "One of the most important challenges facing the Small Business Administration (SBA) and the entire federal government today." (http://www.asbl.com/documents/05-15.pdf)
In February of 2008, President Obama promised to halt the rampant abuses when he released the statement, "It is time to end the diversion of federal small business contracts to corporate giants." (http://www.barackobama.com/2008/02/26/the_american_small_business_le.php)
To date, President Obama has taken no actions to honor his campaign promise, and corporate giants continue to dominate government small business contracting programs.
The American Small Business League (ASBL) estimates that during the first six months of the Obama Administration, legitimate small businesses have lost over $50 billion in federal small business contracts to corporate giants. (www.asbl.com)
-###-
Please click here to watch our response to the Obama Administration's small business contracting statistics: http://www.youtube.com/watch?v=oV0jeTrYPsM
Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575
August 24, 2009
Petaluma, Calif. - On August 21st, the Obama Administration released its latest statistics on the volume of federal contracts awarded to small businesses. Federal law requires a minimum of 23 percent of the total value of all federal contracts to be awarded to small businesses. Federal statute defines a small business as being "independently owned," which excludes publicly traded firms.
The Obama Administration is claiming the government awarded $93.3 billion in contracts to small businesses or 21.5 percent during fiscal year (FY) 2008.
According to information from the Federal Procurement Data System - Next Generation (FPDS-NG), of the ten largest recipients of federal small business contracts, 85.4 percent of the contracts went to large businesses. Eight of the top ten recipients of small business contracts were large businesses.
The top recipient of government small business contracts was Textron, which received $775.7 million. Textron is a Fortune 500 firm with 83,000 employees and over $25 billion in annual revenue.
Two other top ten recipients of federal small business contracts were Ssangyong Corporation, which is headquartered in Seoul, Korea and received over $254 million and Finmeccanica SpA, which is headquartered in Italy with 73,000 employees and received over $283 million in contracts.
The 14th largest recipient of federal small business contracts is listed as "Miscellaneous Foreign Contractors" with $210 million in government small business contracts.
Other firms included in the Obama Administration's small business data were Lockheed Martin, Boeing, Raytheon, Northrop Grumman, General Dynamics, AT&T, 3M Corporation, Xerox, Dell Computer, Booz Allen Hamilton, Hewlett-Packard, General Electric, Staples, Office Depot, British Aerospace (BAE), Rolls-Royce and French firm Thales.
Since 2003, over a dozen federal investigations have found that legitimate small businesses have lost billions of dollars in federal small business contracts, which have been diverted to many of the largest firms around the world. In 2005, the SBA Inspector General referred to the diversion of federal small business contracts to corporate giants as, "One of the most important challenges facing the Small Business Administration (SBA) and the entire federal government today." (http://www.asbl.com/documents/05-15.pdf)
In February of 2008, President Obama promised to halt the rampant abuses when he released the statement, "It is time to end the diversion of federal small business contracts to corporate giants." (http://www.barackobama.com/2008/02/26/the_american_small_business_le.php)
To date, President Obama has taken no actions to honor his campaign promise, and corporate giants continue to dominate government small business contracting programs.
The American Small Business League (ASBL) estimates that during the first six months of the Obama Administration, legitimate small businesses have lost over $50 billion in federal small business contracts to corporate giants. (www.asbl.com)
-###-
Please click here to watch our response to the Obama Administration's small business contracting statistics: http://www.youtube.com/watch?v=oV0jeTrYPsM
Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575
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