Commerce taps 29 for small-biz IT work

In an effort to funnel more government information technology work to small businesses, the Commerce Department last week awarded the first governmentwide IT services contract specifically for small businesses.

The department awarded 29 contractors pieces of the estimated $1.5 billion Commerce Information Technology Solutions (Commits) program, which will provide systems engineering, systems security, and systems operations and maintenance work. The winners were chosen based primarily on past performance.

Commits is an effort to reverse the recent trend of a declining share of the government's IT prime contracts going to small, disadvantaged businesses while the share of IT spending goes to large companies, said Robert Mallett, deputy secretary of the Commerce Department.

Small, minority and woman-owned IT businesses have had a difficult time competing for government work since procurement reforms changed the way that agencies can buy IT, including, for example, the use of blanket purchase agreements, which are based on the General Services Administration schedule, and the use of governmentwide acquisition contracts. "These are all good reforms, but in the end, we ended up with less - not more - opportunity spread across the contractor spectrum," Mallett said.

Commerce will monitor the task orders carefully to ensure that small businesses are not just serving as fronts for large companies that would act as team members, he added.

Commerce decided to pursue an IT contract for small, minority businesses because the IT industry is growing and lucrative. "Increasingly, IT is driving what's going on in federal contracting," said Alan Balutis, deputy chief information officer at Commerce.

Commits, along with efforts on the part of agencies such as the Patent and Trademark Office to contract with small businesses, should help drive more work to smaller firms, Mallett said. Of the winners, 50 percent are 8(a) companies; 20 percent are woman-owned firms; 15 percent are small, disadvantaged businesses; and 15 percent are other small businesses.

Meanwhile, PTO said it will spend the balance of this year's contracting dollars with small businesses.

As an incentive to attract agencies to use Commits, Commerce plans to keep the contract's fees low - as low as half a percent in some cases. In addition, agencies that buy from Commits will receive credits toward their small-business contracting goals.

Chip Mather, senior vice president of Acquisition Solutions Inc. and a participant in drafting the Commits solicitation, said Commerce plans to establish memorandums of understanding with other agencies to encourage those agencies to use Commits and small businesses for government projects of less than $5 million. In addition, Commerce plans to establish a board of directors made up of chief information officers and procurement executives to advise the department on Commits.

"The contract is bound to have an impact on small businesses," said Judith Roussel, associate administrator for government contracting at the Small Business Administration. "We hope this will serve as a model for future acquisitions."

It is usually difficult for small businesses to compete with large businesses on the same governmentwide contract, but Commits eliminates this challenge, Roussel said. "It gets [small businesses] in the ballgame. Marketing and showing their competitiveness is going to be the key" to getting work, she said. "They have their foot in the door, but the stronger companies will do best."