Statement of the
Honorable Nydia M. Velázquez on the
2001 Small Business Reauthorization Act
The final fiscal year 2001 Small Business
Reauthorization Act was the result of long hours and
hard work by Members and Staff of the House and Senate
Small Business Committees.
The 2000 SBA Reauthorization Act funds
the Small Business Administration agency at record levels
while at the same time improving and expanding such
tried and true programs like the Small Business Innovation
Research Program, Small Business Investment Company
Program and the Certified Development Company/504 Loan
Program. In addition, the 2001 Small Business Reauthorization
maintains the integrity of the vital 8(a) Business Development
program which provides for the continuing growth of
minority businesses throughout the nation.
I am especially pleased the two new pieces
of legislation that I have authored, the New Markets
Venture Capital Program and the Equity in Contracting
for Women Act, were included as part of the 2001 Small
Business Reauthorization. The New Markets Venture Capital
Program, or NMVC, will bring valuable equity investments
into low-income areas. The Equity in Contracting for
Women Act, or ECWA will create a program that allows
for government contracts within certain under-represented
industries to be reserved for competition only by women
business owners.
The legislation will also further address the rampant
practice of contract bundling within the federal government.
Contract bundling is a process by which agencies consolidate
several smaller contracts into one large contract. As
a result, the newly consolidated contract becomes too
large for small business to compete. In a study I released
on this issue in July of 2000, it was quite clear this
practice is costing small businesses federal government
contracting opportunities with absolutely no demonstrated
savings to the taxpayer. The House included a provision
in their version of the 2000 Small Business Reauthorization
Act which took the first step towards solving the problem
of bundling. This language, which was included in the
final bill, requires the SBA to collect specific data
regarding bundled contracts including their taxpayer
savings and their impact on small businesses.
Another provision included by the House
would have given the Small Business Administration,
for the first time, the power to prevent federal procurement
contracts from going forward if the following criteria
were not met: 1.) a bundled contract did not demonstrate
clear evidence of taxpayer savings or; 2.) the federal
agency showed that the bundled contract would not have
significantly harmed small businesses. These changes
would have provided increased fairness for small businesses
in the federal procurement marketplace. Unfortunately,
the Chairman and Ranking Democratic Member of the Senate
Armed Services Committee yielded to the pressures of
federal government bureaucrats and big corporations
who insisted that this provision be dropped or significantly
scaled back. In the end, the interests of Corporate
America were put ahead of America's taxpayers and small
business owners.
However, this fight for equity in the
federal contracting process is far from over. This issue
will be a priority for Democrats in the 107th Congress.
