WASHINGTON – The U.S. Small Business Administration is revising the format of the annual Small Business Procurement Scorecard to provide more clarity and transparency on the federal government’s performance in meeting its small business contracting goals. The revised scorecard will be based on an A through F letter grade system, as opposed to the previous red, yellow, green ratings.

“This revision to the Scorecard will provide greater clarity and transparency on how well each agency is doing in meeting its small business prime contracting goals,” said SBA Administrator Karen Mills. “Federal contracts provide critical opportunities for small businesses to grow and create jobs. This revision builds on our ongoing efforts to strengthen the integrity of the overall process for small business contracting, while also expanding opportunities for small businesses to compete for and win federal contracts.”

The revisions will appear when SBA issues its report later this year for federal contracting in fiscal year 2009. Over the past year, SBA has worked collaboratively with contracting and small business officials to develop the new system. The new system better reflects the unique needs of individual agencies while maintaining a focus on achieving the statutory small business contracting goals.

The overall small business prime contracting goals have been established by Congress to ensure that small businesses get their fair share of federal contracts. The government-wide goal for prime contracts to small businesses is 23 percent of total qualified contract dollars, with additional goals of 5 percent for small disadvantaged businesses, 5 percent for women-owned businesses, 3 percent for HUBZone small businesses, and 3 percent for service- disabled veteran-owned small businesses.

SBA negotiates individual goals for each agency, while ensuring that when combined they meet the overall statutory goals for the federal government. SBA’s small business procurement goal, for example, is 67.05 percent. While Scorecards will measure subcontracting activity, that information is not factored into the determination of whether the federal government meets the statutory small business prime contracting goals.

The new scorecard holistically assesses an agency’s entire small business procurement performance. An agency’s overall grade will be comprised of three quantitative measures: prime contracts (80 percent), subcontracts (10 percent) and its progress plan for meeting goals (10 percent).

The letter grades for prime contracting and subcontracting will show an A+ for agencies that meet or exceed 120 percent of their goals, an A for those between 100 percent and 119 percent, a B for 90 to 99 percent, a C for 80 to 89 percent, a D for 70 to 79 percent and an F for less than 70 percent.

In last year’s Scorecard rating performance for the FY 2008 contracting year, small businesses won 21.5 percent of contract dollars, or about $93.3 billion out of a small business-eligible base of about $434 billion. More than half of all agencies met their individual goals. The small business eligible base for FY 2009 was about $437 billion.

An example of the new Scorecard format can be accessed at http://www.sba.gov/idc/groups/public/documents/sba_homepage/score_card_mock_up.pdf

Proposed Budget Increases SBA funding by more than 20 percent

WASHINGTON, Feb. 1  – Senate Committee on Small Business and Entrepreneurship Chair Mary L. Landrieu, D-La., today praised the Small Business Administration (SBA) components of President Obama’s budget proposal. For the second year in a row, the President has proposed increasing funding for the SBA and its programs, taking decisive steps to rebuild the SBA after eight years of cuts. The request proposes to increase funding to the agency by $170 million from last year’s enacted level, to $994 million. This, along with new small business job-creating proposals the President outlined in his State of the Union address last week, show the Obama Administration’s strong support for small businesses.
“By requesting more money to help our small businesses succeed, President Obama’s budget proposal emphasizes that small business remains a top priority for the Administration and is central to the President’s efforts to create jobs,” Sen. Landrieu said.

“As part of his budget, the President again showed his support for increasing the caps on small business loans as a way to provide small businesses with immediate capital to grow and hire workers. This is a proposal I, along with Ranking Member Olympia Snowe, introduced last year. It has since gained even more bipartisan support and passed the Committee. It is my hope the proposal will be included in any job-creating measure introduced in the Senate.

“While this budget request shows the President’s strong dedication to small businesses, I will work to increase funding for critical counseling programs and restore funding for the Federal and State Technology (FAST) Partnership Program. The FAST program increases small business innovation opportunities and is vital for the growth of rural areas. The program received funding last year for the first time since 2004 and must not disappear.”

The President’s proposed budget:

Expands Access to Capital

• Supports the increase of the maximum 7(a) loan size from $2 million to $5 million, 504 from $1.5 million to $5.5 million and microloans from $35,000 to $50,000. Sen. Landrieu introduced, and the Committee passed, legislation that matches these increases;

• Supports more than $28 billion in small business financing, including $17.5 billion for the 7(a) loan guarantee program, $7.5 billion for the 504 loan guarantee program and $3 billion for the Small Business Investment Company (SBIC) program – which provides venture capital financing to small firms;

• Supports $25 million in microloans, allowing intermediaries to provide small loans to entrepreneurs and start-ups; and

• Provides $5.9 million for the SBA’s international trade and export promotion programs, allowing the Agency to support more than $1.1 billion in capital to small exporters and maintain their network of 18 export finance specialists.

Supports Counseling and Contracting Programs

• Provides $113 million to support about 900 Small Business Development Centers;

• Provides $14 million to support about 100 Women’s Business Centers;

• Provides $7 million to support about 370 chapters of SCORE, a mentoring program involving retired executives;

• Provides $2.2 million for the Historically Underutilized Business Zones program (HUBZones), which creates incentives for contracting with small firms to create jobs in underserved communities;

• Provides $3.4 million for the 7(j) technical assistance program, which provides small disadvantaged businesses with training in financing, business development, management, accounting and marketing;

• Provides $3 million to increase the reach of Emerging Leaders. Graduates of this program – often in distressed areas – have reported significant increases in revenues, government contracts, local hires, and access to financing; and

• Provides $11 million to support the job growth potential found in regional clusters of businesses. These clusters will involve public-private partnerships, which align federal resources with existing regional strengths and economic growth opportunities.

Provides Help for Those hit by a Disaster

• Supports $1.1 billion in direct disaster assistance loans, in line with the 10-year average;

• Includes a legislative proposal that would extend, from three to seven years, the maximum term for businesses that want an SBA disaster loan but have an existing line of credit with a bank or have enough cash on hand where they could get a conventional loan from non-SBA sources; and

• Requests $203 million to support for administrative expenses for the disaster program – an increase of $126 million from last year’s enacted level. These funds are critical in supporting SBA’s effort to efficiently and effectively service its $8.4 billion active loan portfolio.

Reduces Risk and Increases Oversight

• Provides $2 million to strengthen lender oversight and on-site reviews to ensure taxpayer dollars are going to those who need help the most;

• Provides $4 million to improve oversight of government contracting programs, including the HUBZone program, and to strengthen performance assessment and management of the Small Business Innovation Research program; and

• Provides $1.1 million to evaluate the SBA’s loan, counseling and other programs to optimize effectiveness.

SOURCE U.S. Senate Committee on Small Business & Entrepreneurship

Contact:
Vicki Ekstrom, +1-202-224-9431, Victoria_Ekstrom@sbc.senate.gov or Richard Carbo, +1-202-224-3655, Richard_Carbo@sbc.senate.gov, both of the Office of the U.S. Senate Committee on Small Business & Entrepreneurship