Last year, it came to light that the Small Business Administration had allowed hundreds of Fortune 1000 firms to receive billions in federal small business contracts. Companies such as AT&T, Lockheed, Boeing, Nike, Sprint and Hewlett Packard had erroneously received federal small business contracts through “miscoding” and “computer glitches,” according to SBA officials.
Obviously, many were upset and vowed action. The SBA’s Inspector General recommended an annual recertification policy in 2003 that would have stopped Fortune 1000 firms from receiving federal small business contracts. And, in 2006 the Senate Committee on Small Business and Entrepreneurship voted unanimously to adopt an annual recertification policy for all firms claiming small business status.
So, what’s happened? According to a press release from the American Small Business League (ASBL), the SBA Administrator Steven Preston has passed a policy set to go into effect in June 2007 that will allow these Fortune 1000 firms and hundreds of others to continue receiving billions in federal contracts earmarked for small businesses until the year 2012.
The ASBL estimates that if the new SBA policy is allowed to stand, U.S. small businesses will loose over $500 billion in federal small business contracts between 2002 and 2012.
Hopefully, Congress will step up to the plate and address this issue before more small businesses loose out on another potential source of financing for their business. Who needs it more? Nike? Sprint?« Return to all articles