New Bill Could Rescue National Economy

June 29, 2011

Petaluma, Calif. – A new bill aimed at closing loopholes and ending fraud and abuse in federal small business contracting programs could rescue the national economy. The Fairness and Transparency in Contracting Act focuses on ending the diversion of federal small business contracts to large businesses, a problem preventing the creation of upwards of 1.8 million new jobs. Representative Hank Johnson (D-GA-04) is expected to introduce the bill later this year.

The bill targets ambiguous provisions within the Small Business Act of 1953 that have allowed publicly traded and foreign-owned firms to qualify as small businesses for the purpose of receiving federal small business contracts. This will help the federal government award contracts to legitimate small businesses and reach its congressionally mandated goal of awarding 23 percent of the total value of all prime contract dollars to small businesses.

According to the U.S. Census Bureau, small businesses create more than 90 percent of all net new jobs. Moreover, a recent study by the Kauffman Foundation found that since 1980 businesses less than five years old have created nearly all new jobs. However, based on government data, the American Small Business League (ASBL) estimates that every year up to $200 billion in federal small business contracts is diverted from the nation’s chief job creators—its 27 million small businesses—to some of the largest corporations in the U.S. and Europe. The new law would end this abuse.
(http://www.kauffman.org/research-and-policy/where-will-the-jobs-come-from.aspx)

Since 2003, a series of federal investigations have uncovered billions of dollars in fraud and abuse in small business contracting programs. In Report 5-15, the Small Business Administration Office of Inspector General (SBA IG) referred to the problem as, “One of the most important challenges facing the SBA and the entire federal government today.” For six consecutive years, the SBA IG has named the issue as the number one challenge facing the SBA.
(http://www.asbl.com/documentlibrary.html#5-15)

In Fiscal Year (FY) 2010 large companies like Lockheed Martin, Dell, Hewlett-Packard, General Electric, 3M and AT&T received federal small business contracts.
(http://www.asbl.com/documents/asbl_2010_dataanalysis.pdf)

“The Fairness and Transparency in Contracting Act is the most efficient, effective solution to job creation that has ever been proposed,” ASBL President Lloyd Chapman said. “It requires no new spending, no new taxes, and it is deficit neutral. Just take existing federal infrastructure spending, and direct it to the nation’s chief job creators; its small businesses.”

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Contact:
Brian Reeder
Public Affairs Analyst
American Small Business League
brianreeder(at)asbl.com
(707) 789-9575

Obama Administration Still Diverting Small Business Dollars to Corporate Giants

FOR IMMEDIATE RELEASE
June 28, 2011

Petaluma, Calif. –61 of the top 100 recipients of federal small business contracts for fiscal year (FY) 2010 were large firms, according to a new report from the American Small Business League (ASBL). These large firms received 62.5 percent of the dollars awarded to the top 100, or $8.8 billion. (http://www.asbl.com/documents/asbl_2010_dataanalysis.pdf)

The ASBL’s findings come in the wake of Small Business Administration (SBA) claims that the federal government narrowly missed its congressionally mandated 23 percent small business goal. On Friday, June 24, the SBA announced the government awarded $98 billion, or 22.7 percent of federal spending, to small businesses. (http://www.sba.gov/content/small-business-procurement-goaling-scorecards)

“The SBA claims the government nearly hit its small business goal, and yet the government’s own data indicates it awarded no more than 5 percent of federal work to small businesses,” ASBL President Lloyd Chapman said. “The SBA’s most recent claims are just more misleading smoke and mirrors.”

The ASBL maintains the Obama Administration has dramatically inflated the percentage of contracts awarded to small businesses by under-reporting the actual federal acquisition budget, and by including billions of dollars in contracts awarded to large businesses. The ASBL maintains, the actual federal acquisition budget for foreign, domestic, classified and unclassified projects is roughly $1 trillion. The Obama Administration’s goaling achievement is based on a number that is less than half of the actual federal acquisition budget.

According to the Obama Administration’s most recent small business data, recipients of small business contracts during FY 2010 included Lockheed Martin, Raytheon, L-3 Communications, Hewlett-Packard, and AT&T, among many others.

Since 2003, a series of federal investigations have uncovered the diversion of billions of dollars a month in federal small business contracts to corporate giants. This diversion has lead to a significant shortfall in the volume of federal contracts actually going to legitimate small businesses. 2010 federal data indicates that once again the government missed its small business goal by a minimum of 18 percent. (http://www.asbl.com/documents/05-15.pdf)

In April 2010, Senator Mary Landrieu (D-LA), the Chair of the Committee on Small Business and Entrepreneurship estimated that, “Increasing contracts to small businesses by just 1 percent,” would create more than 100,000 new jobs. Based on the latest data, the ASBL estimates that ending this abuse would create upwards of 1.8 million jobs. http://sbc.senate.gov/public/index.cfm?a=Files.Serve&File_id=bc065833-dafc-46c5-9e6f-21209a532de2

“It is time for the Obama Administration to stop misleading the public, and start actually working to end billions of dollars in fraud and abuse in small business contracting programs,” Chapman said. “Ending this abuse would be a more effective economic stimulus than anything proposed by the Obama Administration to date.”

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Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn (at) asbl.com
(707) 789-9575

Senate Small Business Committee Discusses Fraud and Abuse in Small Business Contracting Programs

Hearings & Events - Home - U.S. Senate Committee on Small Business & Entrepreneurship

Senate to Hold Hearing on SBA Fraud and Abuse

FOR IMMEDIATE RELEASE
June 13, 2011

Petaluma, Calif. – On Thursday, June 16th, the Senate Committee on Small Business and Entrepreneurship will hold a hearing titled, “An Examination of SBA Programs: Eliminating Inefficiencies, Duplications, Fraud and Abuse.” Kevin Baron, Director of Government Affairs for the American Small Business League (ASBL), will testify before the committee regarding the continued diversion of federal small business contracts to corporate giants.

Since 2003, a series of federal investigations have uncovered the diversion of billions of dollars a year in small business contracts to large corporations. (http://www.asbl.com/documentlibrary.html)

In Report 5-15, the Small Business Administration Office of Inspector General (SBA OIG) referred to the issue as, “One of the most important challenges facing the Small Business Administration and the entire Federal government today.” The SBA IG has named the diversion of federal small business contracts to corporate giants as one of the most important challenges facing the agency for six consecutive years. (http://www.asbl.com/documents/05-15.pdf)

Government data shows that this trend continues. A recent ASBL analysis of the government’s contracting data found 61 large firms in the top 100 recipients of small business contracts. These large firms received $10.7 billion, or a staggering 64.5 percent of dollars intended for legitimate small businesses. (www.asbl.com/documents/ASBL_2009_dataanalysis.pdf)

The federal government has a congressionally mandated goal of awarding 23 percent of all government contracts to small businesses. The ASBL has estimated the diversion of small business contracts to corporate giants has lead to the government awarding no more than 5 percent of government contracts to small businesses; an 18 percent shortfall.

In April 2010, Senator Mary Landrieu (D-LA), the Chair of the Committee on Small Business and Entrepreneurship estimated that, “increasing contracts to small businesses by just 1 percent,” would create more than 100,000 new jobs. Based on an ASBL examination of government contracting data, and Chairwoman Landrieu’s estimation, ending this abuse would create upwards of 1.8 million jobs.
(http://sbc.senate.gov/public/index.cfm?a=Files.Serve&File_id=bc065833-dafc-46c5-9e6f-21209a532de2)

“Since President Obama was elected, unemployment has jumped from 7.6 to 9.1 percent. Ending the diversion of federal small business contracts to corporate giants would put more existing federal spending into the hands of our nation’s chief job creators than anything proposed by the Obama Administration to date,” ASBL President Lloyd Chapman said. “In February of 2008, President Obama promised to end this abuse. President Obama can honor that promise by passing the Fairness and Transparency in Contracting Act.” (http://www.asbl.com/documents/20081007_Obama_Promise_Website.pdf)


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Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn (at) asbl.com
(707) 789-9575

Obama Small Business Agenda Contains Major Hole

FOR IMMEDIATE RELEASE
May 19, 2011

Petaluma, Calif. – On Monday, May 13, the Obama Administration released what President Obama called “The Small Business Agenda: Growing America’s Small Businesses to Win the Future.” After carefully evaluating President Obama’s small business agenda, the American Small Business League (ASBL) was surprised to find that the plan ignores the diversion of billions of dollars a year in federal small business contracts to large corporations. (http://www.whitehouse.gov/the-press-office/2011/05/16/white-house-releases-small-business-agenda-growing-americas-small-busine)

Since 2003, a series of federal investigations have found that most small business contracts actually go to Fortune 500 firms in the U.S. and other large businesses around the world. (http://www.asbl.com/documentlibrary.html)

- In Report 5-14, the Small Business Administration Office of Inspector General (SBA IG) found that the SBA itself awarded small business contracts to large corporations. The report stated, "The SBA awarded four of the six high dollar procurements, reported as small business procurements, to large companies at the time of the procurements." (http://www.asbl.com/documents/05-14.pdf)

- In Report 5-16, the SBA IG found that federal agencies had allowed large businesses to illegally receive federal small business contracts by making "false certifications," and "improper certifications." (http://www.asbl.com/documents/05-16.pdf)

- In Report 5-15, the SBA IG referred to the diversion of federal small business contracts to large corporations as, "One of the most important challenges facing the Small Business Administration and the entire Federal government today." (http://www.asbl.com/documents/05-15.pdf) The SBA IG’s office has continued to report the diversion of federal small business contracts to large businesses as the #1 challenge at the agency for six consecutive years.

The most recent data released by the Obama Administration shows recipients of federal small business contracts including: Boeing, Lockheed Martin, Northrop Grumman, Raytheon, Dell Computer, Xerox, SAIC, General Dynamics, Bechtel and John Deere. (http://www.asbl.com/documents/05-15.pdf; www.asbl.com/documents/ASBL_2009_dataanalysis.pdf)

President Obama acknowledged the magnitude of the problem during his 2008 presidential campaign when he released the statement, “It is time to end the diversion of federal small business contracts to corporate giants.” http://www.asbl.com/documents/20081007_Obama_Promise_Website.pdf

“The Obama Administration’s small business agenda is all smoke and mirrors. When you look at what he does, it is completely different from what he says. If you want to know what the truth is look at what the SBA Inspector General has said for six consecutive years; most small business contracts actually go to large businesses,” ASBL President Lloyd Chapman said. “If President Obama wants to help small businesses and stimulate the economy, all he has to do is keep his campaign promise to end the diversion of federal small business contracts to corporate giants.”

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Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575

Supreme Court Won’t Hear Small Business Administration Phone Records Case

FOR IMMEDIATE RELEASE
May 17, 2011

Petaluma, Calif. – The Supreme Court of the United States has announced it will not review an American Small Business League (ASBL) case against the U.S. Small Business Administration (SBA) over the agency’s refusal to release its phone records. The ASBL’s lawsuit was filed under the Freedom of Information Act (FOIA).

The ASBL filed a petition to the high court in January after the Ninth Circuit Court of Appeals found the SBA was not required to disclose phone records held by a third party. The small business advocate originally filed suit against the SBA after the agency refused to provide several years of telephone records for the agency’s press office director, Mike Stamler. (http://www.asbl.com/documents/20090312complaint.pdf)

The ASBL requested Stamler's phone records after a series of media professionals complained that Stamler attempted to defame ASBL President Lloyd Chapman, and deny the diversion of small business contracts to corporate giants.

Since 2003, a series of federal investigations have uncovered the diversion of billions of dollars a year in federal small business contracts to corporate giants. (http://www.asbl.com/documentlibrary.html) In Report 5-15, the SBA Office of Inspector General (SBA IG) described the issue as, “One of the most important challenges facing the Small Business Administration and the entire Federal government today.”(http://www.asbl.com/documents/05-15.pdf)

Throughout the course of litigation, the SBA has claimed that it does not have access to its own phone records, and is not required to supply that information under FOIA. Yet during 2010, the ASBL requested and received full and comprehensive telephone records from federal agencies like the U.S. Department of Interior (DOI) and the Social Security Administration (SSA).

The SBA has a track record of withholding documents that highlight its efforts to cover-up the division of billions of dollars in federal small business contracts to corporate giants. In February 2008, the SBA refused to release documents regarding the large recipients of small business contracts. In the court’s ruling against the agency, United States District Judge Marilyn H. Patel stated, “The court finds it curious the SBA’s argument that it does not ‘control’ the very information it needs to carry out its duties and functions.”

"The fact that the SBA was willing to go to the Supreme Court to withhold Mike Stamler's phone records shows just how damaging that information must be," Chapman said. "The SBA has played a pivotal role in allowing billions of dollars in fraud. We’ll continue to pursue this information until it is public and transparent."

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Contact:
Christopher Gunn
Communications Director
American Small Business League
cgunn@asbl.com
(707) 789-9575

The Mike Siegel Show - Lloyd Chapman talks jobs, the economy, and the Obama Administration