OMB releases small biz strategy

A Strategy for Increasing Federal Contracting Opportunities for Small Business

The Office of Management and Budget released a strategy Oct. 30 that requires agencies to file quarterly reports outlining their small-business contracting plans, goals, milestones and metrics.

The strategy takes aim at contract bundling, is intended to increase opportunities for small businesses in the federal market and includes several measures to hold agencies accountable for making the increase happen.

The interagency task force that helped OMB put together the strategy is now working on detailed guidance for agencies on what information needs to be included in the quarterly reports, said Angela Styles, administrator of OMB's Office of Federal Procurement Policy.

This guidance, expected to be released in the next few weeks, will outline "what is success," Styles said.

The guidance will not include specific, governmentwide goals for the dollar amount or percentage of federal contracts that "should" be awarded to small businesses, Styles said. Any goals that are set will be specific to every agency, and will be put in place only after thorough discussion with each agency, she said.

"We want to get a good feel for the agency plans before we develop goals," she said.

The strategy also requires that OMB and the Small Business Administration complete several studies by Jan. 31, 2003, to define possible modifications to the Federal Acquisition Regulation (FAR) and SBA regulations.

The Bush administration's strategy is primarily focused on contract bundling - the practice of awarding multiple tasks as part of a larger contract. It starts with the premise that bundling hurts both companies and federal agencies by not taking advantage of the innovation and cost savings that small businesses could provide.

Several of the steps in the strategy will add requirements to the FAR and SBA regulations that agencies check to be sure that decisions to award multimillion-dollar bundled contracts are justified.

"[Bundling] has prevented small businesses from having the opportunities they deserve," said Hector Barreto, SBA's administrator.

Where it is determined that bundling is justified, new requirements are intended to enforce full use of small businesses as subcontractors, hopefully putting teeth into old rules by making subcontracting compliance a major part of companies' past performance evaluations, Styles said.

These additional requirements likely will slow down large procurements to a certain extent, but they are important to ensuring competition and efficiency, and they will not get rid of the efficiencies realized through procurement reform, Styles said.

"We really want to create a level playing field for small businesses in the procurement arena," she said.