Makes One Wonder About the Veracity of Small Business Contracting Achievements

There was a question and answer posted to DoD's "Ask A Professor" yesterday that got us to wondering whether double counting is going on with respect to the Government's tally of awards to small business entities.

Each year, the SBA (Small Business Administration) establishes goals for awarding contracts to Small Businesses, Women owned Small Business, Small Disadvantaged Businesses, Service Disabled Veteran Owned Small Businesses and HUBZone small businesses. It gave themselves an "A" for fiscal year 2016 for exceeding its goals in three of the five categories and almost meeting its goals in the other two.

We know very little about the source of the data for these performance reports. Someone originates the data and enters it into a database somewhere. So this brings us back to the "Ask A Professor" question:

Are prime contractors permitted to use a company that qualifies as two or more socio-economic groups, and received (sic) credit in each group?

The question was premised on a contractor who claimed nine million dollars in small business subcontracts but when the individual socio-economic groups were tallied, they totaled $14.5 million.

DoD answered as follows:

Yes, a prime contractor is permitted to use a company that qualifies as two or more socio-economic groups and receive credit in each group as there are many small businesses that qualify for the different socio-economic programs. Neither the FAR or SBA regulations restrict this practice and in fact it is a smart way to help reach all of the goals in a subcontracting plan. 

We don't think its smart at all. We think its dishonest. Doubling up like that means that small businesses are not getting nearly the amount of contracting dollars that are being reported.

A minority disabled-veteran woman owned business in a HUBZone would get counted four times.