May 8, 1990 EXTENSIONS OF REMARKS 9707 EXTENSIONS OF REMARKS SMAI.I. BUSINESS WEEK 1990 ness participation in Federal procaement In 1988, Congress passed Pubic Law 100- achieW!s parity with their contrbrtion to the 656. Section 502 mandates a gcwemmentwide HON. SB.VIO 0. CONTE gross national product. which is now 40 per­ smal business paticipation goaJ of not less OF ••ss•• HOS£IIS cent That parity or 8-percent increase shodd than 20 percent of the total value of al prime IB THE HOUSE OF BEPRESEllTATIVE come from prime COitbac&ig actions which I, contract awards for each fiscal year. In fiscal believe we can achieve by providing ~ year 89. DOO only acDeved 19 percent Tuem.a.11. May 8, 1990 opportunities and more cornpetitiolL DOO's actual first quarter 1990 sma1 business Mr. CONTE Mr. Speaker. , ~ the occa­ Consistent · that goal. I have authored pnne contracmg participation rate is an em­ sion of Smal ,Busmess Week, May 6-12. legislation in 1988 that became section 110 of barrassing 16 percent Qrrentty DOO is nego­ 1990. I rise to pay tri>ute to America"s small Pl.tiic law 100-590 changing the appeal timlg with the SBA oo its 1990 goaJ. Report­ busEesses. Ttis is the 26th year we have so process of Breakout f>roct6ement Center Rep­ ecly. they are offering orly a 17 percent goal honored smal business. The Iheme of small resentatives to mirror that of Tralitional Pro­ Mr. Speaker. I have a copy of a letter from busft!ss week this year is "Small Business: a.-ement Center Representatives. BPCR's are Mr. Horace Crouch, Chief SADBU, DOD oo Leamlg America into the 21st eenn.y.·· advocates of ~ in the procaement tis vesy issue. He lists a ruTtJer of reasons Over the years, much has been said and process. They identify and ..breakout" items why DOD cannot increase small business par­ printed about small busmess: How smal busi­ for competitiolL They also counsel and en­ ticipatioo--reasons No. 7 and No. 8 are im­ nesses employ 55 percent of all wodter5. eotnge small business to ~ for the portant so I wil quote <Iectly •7_ The consoi­ aeate 66 percent of all new jobs. provide 50 breakout last year. ireakou1s saved the gov­ dation of smaller construction requirements in percent of al major innovations. and produce ernment $260 million. They are cost effective the Army Job Orders Contract [JOC] f>rc¥am 40 percent of the gross national proWcl tt and eflC(Uage small business participatio11. and a similar A'I Force Program of Simplified has been said that American smaH business In the first session of this Congress, I au­ AcqUsilion of Base Enginee1ilig Reqt*ements produces so many goods and services that it thored H.R. 2274, lhe Small Business Protec­ [SABER] placing many of these COl .asoiclated can claim to be the worid's fotril geatest tion Act H.R. 2351. Women's Busi­ economic power. Indeed small business is in­ and the re<Prements beyond the capabilities of smaD construction firms to satisfy." and ~-a. The in­ dspellSable to a health economy and Ml em­ ness 8PlY Act Technically. H.R. 2274 axi­ pJoyrnent in this coootry. fies Federal Acquisition RegUlation 'smpart creased use of large single umbrella contracts I &1nly beieve that strong. sustained small 19..202-1 to enauage greater small business which aggregate many smaR tasks previously b.tsiness activity is the keystone to a healthy participation in acquisitions. It does this by pedouned by small business." DOD clearly economy. which is why I serve with pride on amending section 15(a) of the Small Business admits that consoidation wil adversely impact the SmaD Business Committee. I first joined Act to pr<Mde for a "smaJI business irf1>act upon small business prime contracting oppor­ the conntittee in 1965. From 1969 to 1978. I statement" whenever contracts anently seN­ turities. was the ranking minority member cbing which iced by small business are proposed for a pro­ SmaU business participation has already the cornmttee was upgraded from a select curement that would exceed economical or­ suffered as a result of title VII of Public Law ·committee to a permanent select committee dering and quantities conducive to small busi­ 100-656, the so-called Competitiveness Dem­ in 1971 to a standing committee in 1975. tt ness participation. In other words. the SmaJJ onstration Program. Further, as we cut back has been my great honor to serve with and Business Protection Act defends against "um­ on the defense budget. the procurement mix ~ my distinguished colleagues on a com­ brella" contracts-an agency practice that will undoubtedly change to favor buildups in mittee rich With history and accomplishments. combines several smaU contracts into one the non-small business areas. The time for As ranking minority on the Procurement Sub­ lar:ge multi-function contract action is now! The Small Business Act states committee. 1 am particularfy concerned with This practice of contract aggregation, also unequivocally that it is the policy of Congress small business Federal procurement opportu­ 'known as "'bundling" or "'bid consofldation" is, to insure that a fair proportion of the total pur­ nities. And I would like to address that issue by its very nature, inimical to small business ,ohases and contracts or subcontracts for today. participation in Federal contracting. Contracts property and services for the government be Mr. Speaker. in reviewing the statistics tor that are "bundled" effectively eliminate small placed with small business enterprise. H.R. fiscal year 1988, I note that small business business as prime contractors because only 22.7 4 is consistent with that intent Bid con­ firms accounted for $26 billion of the $174 bil­ Jarge businesses with the concomitant finan­ sotidation is not lion in all Federal prime contract purchases, or cial and technical resources can respond. While H.A. 2351, the Women's Business 15 percent of total prime contract procure­ The House Small Business Committee has Equity Act. is a multifaceted bilJ, several provi­ ment Fll1her, small business subcontractors been concerned about this problem since sions are .important from a procurement point won about $27 bilJion in awards from prime 1983, when it considered H.R. 2133, an omni­ of view. H.R. 2351 requires the head of each contractors on Federal projects. Jn addition, bus small business procurement bill. Unfortu­ Federal agency to establish goals for for those contracts under $25,000, Which to­ nately. because of other issues. that bilJ never Women's Business Enterprise participation. taled $21 billion, small business won $10 bil­ came to the floor. Bundling cropped up again Goals shall be jointty established by the SBA lion, or 46 percent The combined total of in 1985, when former chairman Mitchell sent a and the agency and shall be a realistic reflec­ small business ,participation in Government letter to then Secretary of the Army, John tion of WBE capabilities. Any goaling dis­ contract awards is $63 billion or 32 percent of Marsh, requesting that the Army suspend agreement shall be submitted to OFPP. The the $195 billion in total awards. ~his is a 1- seven consolidated contracts because they head of each agency shall strive to expand percent increase over Jast years 31 percent were unduly restrictive of competition, that is, WBE participation in each industry category Impressive as that figure is, I believe we need small business was being locked out In 1987, utilized by the agency. to renew our efforts to increase small busi­ the committee had a modicum of success H.R. 2351 reaffirms Federal procurement ness participation ·in Federal procurement. when it convinced the Appropriations Commit­ policy that .promotes maximum practicable op­ I firmly believe that small business will lead tee to report language on H.J. Res. 395, the portunities in contracts and subcontracts for America into the 21st century. Strengthening fiscal year 1988 continuing appropriation, ex­ WBE participation. It also requires prompt pay­ small businesses participation in Federal pro­ pressing concern about bid consoldation. H.R. ment from prime contractors to subcontrac­ curement will provide America with the neces­ 2274, therefore, continues and refines the tors. For contract purposes it defines WBE's sary competitive capability. As small business committees legislative effort to preserve small and requires awarding authorities to certify champions, we must ensure that small busi- business prime contracting opportunities. maximum opportunity for WBE's on subcon- • This "bullet" symbol identifies statements or insertions which are not spoken by a Member of the Senate on the floor. Matter set in this typeface indicates words inserted or appended, rather than spoken, by a Member of the House on the floor. 39-059 0-91-19 (Pt. 7) 9708 EXTENSIONS OF REMARKS May 8, 1990 tracting. H.R. 2351 further requires offerers/ For most of their work RTC acts as receiver or any other machines they make, machine bidders to describe WBE efforts and requires or conservator. Due to the uncertainty of the tools also reproduce themselves. Thus, at the the SBA to submit an annual subcontracting actual number of assets being taken over, heart of the industrial health of any nation is report to Congress on plans/ agencies not in RTC's procurement budget could reach over its machine tool industry, and for decades this compliance. Finally, H.R. 2351 requires each $1 billion. Approximately half of that amount is industry was the very badge of U.S. manufac­ agency to make affirmative efforts to identify expected to be for legal work and the remain­ turing prowess. The correspondence between and solicit offers from WBE's. H.R.