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Bills to Assist Small Businesses Approved by Committee

A bill (H.R. 4897) to help increase the number of federal contracts awarded to women-owned businesses was approved, by voice vote, by the House Small Business Committee on July 27.

In 1994, Congress enacted a five percent procurement goal for women-owned businesses under the Federal Acquisition Streamlining Act (P.L. 103-355). However, that goal has never been met. According to government numbers, 2.4 percent of all federal contracts were awarded to women-owned businesses in FY1999.

In May, the President issued an executive order establishing an Office of Women’s Procurement at the Small Business Administration (SBA). The order directed the new office to create remedial action plans for those departments and agencies that are failing to meet the five percent goal. In addition, nonbinding resolutions (S. Res. 311, H. Res. 15) in favor of meeting the five percent goal were approved by the Senate and the House on May 23 and April 7 respectively.

During the mark-up, ranking member Nydia Velazquez (D-NY), the sponsor of H.R. 4897, said: “Women are the new CEOs of America, starting businesses at record rates. This bill ensures that the federal government gives them a place at the table when it comes to the billions of dollars in federal contracts.”

Under the bill, the SBA would conduct a study to determine the industries wherein women-owned businesses are awarded the least number of federal contracts. The measure also would require that contracts be offered to women-owned businesses in certain cases where two or more women-owned businesses are able to present competitive bid estimates.

Two measures (H.R. 4890, H.R. 4945) related to the practice of bundling were also approved by the committee. Government departments often “bundle” a group of smaller contracts together, purchasing a broad package of goods and services from one bidder in an effort to save money. Small businesses, including those owned by women, face difficulty in competing with corporations for bundled contracts, as the small businesses are unable to guarantee the delivery of goods or services on a large scale.

H.R. 4890, sponsored by Rep. Velazquez, would require the SBA to review possible contract bundles. Departments would analyze the savings likely to be produced by bundling the contracts in question. The SBA would then review the analysis and approve or disapprove the bundle before the department could proceed. In addition, the SBA would be required to deny bundling requests for departments with no record of contracting with small businesses.

Under H.R. 4945, sponsored by Committee Chair Jim Talent (R-MO), the SBA would create a new database to track the federal government’s contract bundling, as well as the number of small businesses denied prime contracts as a result of the practice. The SBA also would be required to make an annual report to Congress on bundling and its potential benefits.

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