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Bloomberg Government: Small-Business Advocates May Gain Clout in Several U.S. Agencies

Washington, Nov 1 -

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Small-Business Advocates May Gain Clout in Several U.S. Agencies
By Nishad Majmudar, Bloomberg Government
November 1, 2011

A Congressional panel that subpoenaed officials of four U.S. agencies accused of not complying with small business contracting rules has delayed a scheduled hearing, saying that three of the departments have agreed to reforms.

The House Small Business Subcommittee on Contracting and Workforce postponed the hearing set for today after officials the departments of Agriculture, Justice and State said they would comply with a federal mandate that each agency’s small-business promotion office report directly to the department’s top executives, committee spokesman Darrell Jordan said.

The subcommittee subpoenaed officials from the four after a U.S. Government Accountability Office report concluded their respective Offices of Small and Disadvantaged Business Utilization, or OSDBUs, which advocate for increasing federal spending on small-company contracts, didn’t have direct access to secretary or deputy secretary-level officials.

Jordan said the three agencies “expressed a desire to comply and change their reporting structure in order to guarantee the OSDBU access to the deputy secretary or secretary.”

The Treasury department was still in discussion with the committee, Jordan said in an e-mail yesterday. A Treasury spokesman, Matthew Anderson, declined to comment.

Justice Department

The Justice Department’s small and disadvantaged business director “will be evaluated by the senior career official in the Office of the Deputy Attorney General” and keep “his own budget and staff,” Ronald Weich, assistant attorney general for legislative affairs, wrote in an Oct. 27 letter to subcommittee Chairman Mick Mulvaney, a Republican representative from South Carolina.

The State and Agriculture departments didn’t respond to requests for comment.

The U.S. agencies weren’t in compliance with a 1978 amendment to the Small Business Act that requires the head of the small and disadvantaged business offices to report directly to their agency head or deputy, the Government Accountability Office said in a June report. Doing so improves the visibility of small business interests among top decision-makers, according to the report.

Other agencies faulted in the report, including Interior, and Social Security, have already agreed to institute changes to come into compliance, Jordan said. He said talks are still going on with the Commerce Department, where a new secretary was recently sworn in.

Federal agencies awarded $97.9 billion to small businesses in the fiscal year that ended September 2010, or 22.7 percent of the $432 billion for which they were eligible, according to the U.S. Small Business Administration. Small businesses are generally defined as those with $7 million or less in annual revenue or fewer than 500 employees.