Kerry seeks SBA audit

Sen. John Kerry (D-Mass.) wants Small Business Administration officials to examine the systems by which they ensure federal contracts go to small businesses, and take necessary steps to ensure their data on small business contracting is accurate.

Kerry, who is the ranking Democratic member of the Small Business and Entrepreneurship Committee, also called on SBA Inspector General Harold Damelin to investigate 39 large companies and five other organizations that got money intended for small businesses in fiscal year 2002, as revealed in a report SBA officials released in December 2004, for possible deliberate violations of small business rules.

Kerry asked SBA Administrator Hector Barreto to audit the official small business federal contracting numbers for fiscal year 2003. Kerry expressed concerns about inaccurate data and poor enforcement of rules intended to enhance small business contracting opportunities.

"The Bush administration is quick to make boisterous claims about its support for small business," Kerry wrote to Barreto. "However, reports of small-contractor abuse, small businesses being overlooked, bait and switch tactics being used by large prime contractors, and reporting of inaccurate small business utilization data continue."

In his letter to Damelin, Kerry referred to a study that the agency released in December detailing contracts recorded as small business deals that really benefited large companies.

"Unfortunately, this report is just another example of the SBA's failure to effectively advocate on behalf of small businesses attempting to do business with the Federal government and the shortage of effective leadership and influence at the Agency," Kerry wrote.

He said that the agency may not be enforcing laws that penalize large companies that misrepresent their status to get contracts meant for small companies.

"I am aware of no evidence that a single firm has ever been penalized for misrepresenting themselves as a small firm over the past four years," he wrote.