Hanna Subcommittee Explores How The Obama Administration’s Federal Strategic Sourcing Initiative Is Affecting Small Contractors

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Washington D.C., Jun 13, 2013 | comments

House Small Business Subcommittee on Contracting and Workforce, under the chairmanship of Rep. Richard Hanna (R-NY), today held a hearing on recent changes to the Federal Strategic Sourcing Initiative (FSSI) and how it’s affecting the competitive viability of small contractors.

The FSSI is a procurement program created in 2005 to encourage cross-government collaboration by allowing federal agencies to aggregate requirements, streamline processes and leverage its buying power.  In December 2012, President Obama’s administration changed the operation of the FSSI by establishing a new Strategic Sourcing Leadership Counsel, which embraces new philosophies like moving towards strategically sourcing professional services and making use of strategic sourcing vehicles mandatory. Today’s hearing showed that the administration’s attempts to strategically source professional services undermines future competitions, creates more complex challenges, and makes it more difficult for small businesses to compete.

“When it comes to federal contracting, the government should act in a way that promotes the best interests of the taxpayers,” said Chairman Hanna. “This includes utilizing small business contractors in a way that promotes a healthy industrial base.  The Federal Strategic Sourcing Initiative should work toward leveraging the buying power of the government to enhance competition, driving down prices and capitalizing on all that small businesses have to offer in order to achieve long term savings, rather than focusing on short term savings at the expense of small businesses. I hope the administration reconsiders its approach to the Federal Strategic Sourcing Initiative and considers embracing a philosophy of full and open competition.”

Notable Quotes:

The Honorable Stan Z. Soloway, President and CEO of Professional Services Council in Arlington, VA said, “[W]e do have concerns that too rapidly expanding the FSSI can, and likely will, have deleterious impacts on both government and its supplier base, prominently including small business. Done right, strategic sourcing can be a win-win; done wrong, it is more likely to be a lose-lose.”

Trey Hodgkins, Senior Vice President of Global Public Sector at TechAmerica in Washington, DC said, “[C]omplex and specialized goods and services, like the ones small business can deliver, do not lend themselves well to strategic sourcing.” 

Roger Waldron, President of The Coalition for Government Procurement in Washington, DC said, “The Coalition is concerned that moving towards a mandatory use model for GSA blanket purchase agreements (BPAs) will have the unintended, long-term consequences of reducing opportunities for small businesses.”

Robert A. Burton, Senior Partner of Venable LLP in Washington, DC said, “GSA's proposed strategic sourcing initiatives are antithetical to strategic sourcing’s goal so increased small business participation, more harmful to small businesses that the currently strategically sourced contracts, and counterproductive to strategic sourcing’s emphasis on value.”                                                       


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