Alabama Congressman Parker Griffith Wants Big Businesses to Get Federal Small Business Funds

Huntsville Alabama Congressman Parker Griffith (D - AL5) has introduced a new bill in the House of Representatives that will allow divisions of Fortune 500 firms and thousands of other large businesses to receive billions of dollars in federal contracts earmarked for small businesses.

Several Fortune 500 firms in Congressman Griffith's district such as Boeing, Northrop Grumman and British Aerospace (BAE) are currently receiving millions of dollars in federal small business contracts through loopholes in federal contracting law.

If H.R. 3558 becomes law, Boeing, Northrop Grumman, BAE and their subsidiaries could continue to receive federal small business contracts indefinitely. Boeing and Northrop Grumman are amongst Congressman Griffith's largest campaign contributors. (http://tiny.cc/JWuUg)

Currently, there are 5,126 small businesses registered to do business with the federal government in the State of Alabama, according to the Central Contractor Registration database. If H.R. 3558 is passed and signed into law, more than 99 percent of the small businesses in Alabama would be put at a significant competitive disadvantage.

In 2005, the Small Business Administration Office of Inspector General (SBA IG) referred to the diversion of federal small business contracts to corporate giants as, "One of the most important challenges facing the Small Business Administration and the entire Federal government today." (http://www.asbl.com/documents/05-15.pdf)

Since 2003, over a dozen federal investigations have found that Fortune 500 firms in the United States and some of the largest firms in Korea, Italy, Holland, France and England have received billions of dollars in federal small business contracts.

Another bill that has been introduced in the House of Representatives, "the Fairness and Transparency in Contracting Act of 2009," or H.R. 2568, is designed to close all of the loopholes, and halt the flow of federal small business contracts to large businesses.

H.R. 2568 was introduced by Congressman Hank Johnson (D - GA) and has 15 co-sponsors. Congressman Johnson's bill is backed by small business groups and chambers of commerce across the country.

Research by the American Small Business League (ASBL) estimates that legitimate small businesses are losing over $100 billion a year in federal small business contracts through various loopholes in federal contracting law and policy.

ASBL estimates that if H.R. 2568 becomes law, over $100 billion a year in federal small business contracts will be redirected to middle class firms nationwide. If Congressman Griffith's bill, H.R. 3558, becomes law billions of dollars in federal small business contracts will continue to be diverted to corporate giants.

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Please click here to watch a short clip about the ASBL's concerns regarding H.R. 3558: http://www.youtube.com/watch?v=KbGwwEaEGSM

Follow Lloyd Chapman on Twitter: www.twitter.com/LloydChapman

Comments

[Lloyd Chapman - Huffpost Blogger]

Funny how Mr. Harris still has not revealed his identity.

[Lloyd Chapman - Huffpost Blogger]

Thanks for proving me right Mr. Harris. I knew you would not tell anyone who you really are. I knew you were a slime ball anti-small business conman from Washington after reading your first post. I can’t blame you for being ashamed of who you are and what you do for a living. You should be ashamed of being a lying slime ball.

[love2dreambig]

We can all certainly assume Harris is not in favor of small businesses and does not himself own one neither affiliated with one. If he was, he would not be ranting about nothing and would be siding with the ASBL and Lloyd in trying to help small businesses and the economy. Looks like Harris is pulling a disappearing act....maybe he shouldn't be so obvious next time.

Good work Lloyd! Way to keep Harris in his place where he belongs...he obviously has no idea what these bills mean for small businesses.

[Scooby413]

Wow! Mr. Harris sure sounds like he's lobbying for something. I wonder what company's name is on the top of his paycheck... Keep up the great work, Lloyd!

[einstein10]

Lloyd Chapman, you are a hero! Keep up the good work!

[Lloyd Chapman - Huffpost Blogger]

It's interesting that Mr. Harris has not responded to my challenge. Again Mr. Harris, I challenge you to prove me wrong.

[Lloyd Chapman - Huffpost Blogger]

Part 3

#3. I challenge you to show me one federal investigation that points to the fact that it's a major problem that firms are outgrowing their small business size status with the federal government. Show me one investigation from the SBA Inspector General, the SBA Office of Advocacy, or the GAO. You can't do it because there has never been one. Less than 1/10th of 1 percent of small businesses in America are having trouble outgrowing their size status on federal contracts. The bottom line is that H.R. 3558 is a loophole that will allow firms that are not small businesses to get small business contracts. We do not need more loopholes from politicians like Congressman Parker Griffith, who are backed by Fortune 500 firms like Boeing and Northrop Grumman. If Congressman Griffith wanted to do something to help small businesses, he would have co-sponsored my bill, H.R. 2568, which will end the diversion of over $100 billion a year in federal small business contracts to some of the biggest companies in the world.

Nice try, but no cigar. The bottom line is that we don't need more loopholes to allow more large corporations to steal more federal small business contracts from America's middleclass.

It is no coincidence that a Congressman who's top contributors include Boeing and Northrop Grumman, just happens to put forth a bill that will allow their subsidiaries to continue to receive federal small business contracts. Give me a break.

[Lloyd Chapman - Huffpost Blogger]

Part 2

#2. The truth is that this bill would allow divisions of Fortune 500 firms that are currently being counted as small to continue to be counted as small indefinitely. Since 2003, there have been over 15 federal investigations that found that Fortune 500 firms, their subsidiaries and some of the biggest firms in Europe and Asia are getting small business contracts. That's a fact. In 2005, the Small Business Administration Office of Inspector General referred to the problem as, "One of the most important challenges facing the Small Business Administration and the entire Federal government today." (http://www.asbl.com/documents/05-15.pdf) During February of 2008, even President Obama said, "It is time to end the diversion of federal small business contracts to corporate giants." (http://www.barackobama.com/2008/02/26/the_american_small_business_le.php)

This is the problem that needs to be addressed. The diversion of over $100 billion a year in federal small business contracts to some of the largest corporations in the world.

See Part 3

[Lloyd Chapman - Huffpost Blogger]

Part 1

#1. Mr. Harris, tell us who you are. You know who I am, and where to find me. Tell us who you are… Tell us your full name, where you work and what you do. My guess is that you are a lobbyist or an employee of a Fortune 500 firm. I doubt very seriously that you are just a concerned citizen. You are trying to hide the fact that you are most likely affiliated with Congressman Griffith's office or one of his Fortune 500 campaign backers. So prove me wrong, and tell us who you are, and what you do for a living.

See Part 2

[gbharris]

PART III

There are rules in place regarding a company's certification of small business status at the time a small business set aside contract is awarded. If Chapman really believes there has been a misrepresentation of small business status made by someone, he should report it to the various inspector generals for the agencies involved. But that issue is not addressed in H.R. 3558, and the bill does not create the panacea for big business that Chapman describes; for him to state or imply otherwise is disingenuous at best.

Or as said above - just wrong.

[gbharris]

PART II

During the past week, Chapman has apparently sent releases to numerous chambers and media outlets, each time failing to accurately state what H.R. 3558 does. Significantly, the releases and media statements fail to address the single most important aspect of the bill - the change to existing law is in sub paragraph (a)(2) (the rest of the HR3558 is existing law). This new provision limits the applicability of the bill to those companies that can meet two criteria:

(1) the incumbent contractor was a small business at the time of the initial award; and (2) will revert to being a small business if the incumbent is not awarded the proposed contract.

Those companies used as an example by Chapman - Boeing, Northrop Grumman and British Aerospace (BAE) - are not the incumbent contractor on a small business set aside contract now, and even if they somehow were, they will not "revert to being a small business if not awarded the proposed contract." So how do they benefit? They don't.

The bill benefits small business, not big business. And the benefit is the right to compete - nothing guarantees an incumbent contractor will maintain a contract. it must be selected like any other small business.

See Part III below

[gbharris]

Two words describe Mr. Chapman's rantings about H.R.3558 - just wrong.

One wonders if he has even read the bill. H.R. 3558 creates none of the mischief Chapman alleges. Indeed, it would maintain the ability of small business to grow without artificial ceilings currently in place. The shrinking market share of mid-market business – meaning those that are outside of the small business standards (about 500-1500 employees), but aren’t large enough to compete with the big business about which Chapman screams - is often worsened by the instability of companies this size; growth affiliated with obtaining a contract set aside for small businesses can and does sometimes push the company over the size threshold -and artificially strips them of the ability to maintain business obtained while it seeks to grow generally.

These mid-market businesses often get bought out by big business, or they often go out of business. Some small businesses manage below the threshold, limiting growth on purpose, to avoid facing full and open competition with businesses with tens or hundreds of thousands of employees and resources well beyond that of the company recently defrocked of its small business status. This reduces competition, and increases costs to the taxpayer.

See PART II below

[GrimJack]

It is great to see that "Change We Can Believe In" actually does translate to "Business As Usual"

[SBBeliever]

Once again, federal legislation is being sold to the highest bidder....going once....going twice. SOLD! And small business loses again.

[Radar423]

This issue fascinates me. The odds are so against the little guy in this issue it makes me wonder why people keep trying to fight.

I guess it is like my Grand Pappy used to say, "All it takes is one. Even a virgin camel has at least 1 good hump in his life.?"