Graves Wants to Increase the Percentage of Federal Contracts Awarded to Small Business

government contracts for small businesses

U.S. Rep. Sam Graves wants to raise the federal government’s goal for the amount of government contracts that must be awarded to small businesses.

Graves, who heads up the House Small Business Committee, introduced the Greater Opportunities for Small Business Act of 2014. The bill calls for the federal government to award 25 percent of its prime contract work to small businesses.  That’s 2 percent more than the federal government’s current goal of setting aside 23 percent of government contracts for small businesses.

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New data shows the federal government is finally meeting its quote of awarding 23 percent of its contracts to small businesses, according to Bloomberg BusinessWeek. If  true, it’s the first time the federal government has hit its goal since 2005.

Last year, we reported that the federal government fell short of its 2012 goal by about $3 billion.

But data available through the Small Business Administration shows that the federal government awarded $83.2 billion to small businesses for the year ending in September 2013, about 23 percent according to Bloomberg.

The additional two percent proposed by Graves may sound small, but the numbers are large.  It could mean up to $10 billion more in federal contracts for small businesses nationwide, according to a statement from the Congressman.

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Graves also wants to award more subcontracted federal government work to small businesses. Right now that quota is at 35.9 percent. The new bill would raise that goal to 40 percent.

In addition to the call for higher award goals, Graves also introduced legislation that aims to hold the federal government more accountable in the way it reports the money awarded to small businesses, the Contracting Data & Bundling Accountability Act of 2014.

In a statement, Graves  (R- Missouri) said:

“These two pieces of legislation will go a long way towards increasing opportunities for small companies who want to grow and create jobs by doing business with the federal government. By increasing the federal-wide goal for contracts to small businesses, and requiring greater accuracy, transparency and accountability in contract bundling and consolidation, we make it easier for small businesses to enter this marketplace and compete for contracts. The federal government spends nearly half a trillion dollars on contracted goods and services, therefore, we must ensure that the money is being spent efficiently, and small businesses have proven that they can do quality work cheaper and often faster.”

Small Business Administration administrator nominee Maria Contreras-Sweet was asked about government contracts to small businesses during her recent confirmation hearing.

Contreras-Sweet pledged to work toward getting government agencies closer to their quotas. She said the SBA must do more to help smaller companies bid for this work. Sweet also said that the federal government must work to “debundle” larger contracts that often go to larger companies.



Joshua Sophy Joshua Sophy is the Editor for Small Business Trends and the Head of Content Partnerships. A journalist with 20 years of experience in traditional and online media, he is a member of the Society of Professional Journalists. He founded his own local newspaper, the Pottsville Free Press, covering his hometown.

5 Reactions
  1. I love the intent, but I hate that we have to mandate this. Why don’t more small businesses go after government work? Might have something to do with the difficulty of the processes.

  2. Shawn Hessinger

    Hi Robert,
    I think it’s that exactly. It would be lovely to believe all businesses compete on an even playing field for this. But even a casual glance at the process shows that isn’t the way it works.

    • This is true. They have to consider other factors when they implement this. I think it would help if they met with real business owners so that they can pitch in their own ideas.

    • Shawn,

      I think we can agree that it’s even difficult for a lot of small businesses to compete for local government work. The bidding process, alone, requires a lot of time and effort. I can’t imagine how difficult it is to compete for bigger, federal contracts.

      When that work and time you invest stops or never pays off, you just stop trying.

      Having some help in getting bids in for these contracts would be a help to a lot of small businesses at any level of government. The mandate had to develop over time simply because small businesses weren’t getting the work and the federal government wasn’t even considering them.