Parity Among Small Businesses?

By Robert Brodsky

It looks like Congress is ready to settle a growing dispute between the Obama administration and the Government Accountability Office.

On Friday, the Senate approved an amendment to the fiscal 2010 National Defense Authorization Act which would place three small business programs -- HUBZone, 8(a) and service-disabled veterans - on an equal footing when competing for contracts. The amendments were sponsored by Sens. Mary Landrieu, D-La and Olympia Snowe, R-Maine, the chairwoman and ranking member, respectively, of the Senate Committee on Small Business and Entrepreneurship.

"With the passage of this amendment small businesses will be given a more equal chance to compete," Landrieu said. "This is a victory for small firms competing for a government contract because it levels the playing field within these important programs."

In a July 10 memorandum to agency heads, Office of Management and Budget Director Peter R. Orszag called into question recent GAO protest decisions and accompanying recommendations, which stated that the Federal Acquisition Regulation require agencies to award contracts to a historically underutilized business zone company if the contracting officer has a reasonable expectation that two qualified HUBZone businesses will submit offers at a fair market price.

The GAO decisions -- issued in favor of two HUBZone companies, Mission Critical Solutions and International Program Group Inc. -- cite the FAR in stating that agencies must contract with HUBZone companies when certain criteria are met, essentially creating a preference for contracting with HUBZone companies rather than other groups, such as firms owned by socially or economically disadvantaged individuals, or service-disabled veterans.