White House Begins Implementing Reforms to Increase SDB Procurement

The Biden-Harris administration announced a set of reforms on Thursday to increase the federal government’s contracting rates with small and disadvantaged businesses.

Source : POTUS

December 3, 2021

Author : Alex Bustillos

The White House released a fact sheet on Thursday detailing five reforms as “the first step towards meeting the President’s goal of ensuring that 15 percent of federal contracts go to SDBs by 2025.”

As we reported in June, President Biden is hoping to increase “the share of contracts to SDBs by 50 percent by the year 2026,” which would result in a $100 billion injection into small and disadvantaged businesses.

On Thursday, the White House announced that it is asking federal agencies to increase their SDB procurement goals to 11 percent, up from the current statutory goal of five percent.

They have also announced that they will be releasing for the first time “disaggregated data of federal contracting spend by race/ethnicity of business owner,” calling it a “powerful transparency and management tool.”

This data can be viewed here.

Previously, the federal government has “relied on topline data to benchmark contracting spend to small businesses,” the fact sheet states. “This data, while insightful, offers only a partial illustration of performance in reaching certain groups.”

The disaggregated data shows that of the $559 billion in eligible dollars for small businesses, black-owned small businesses got just 1.7 percent and hispanic-owned just 1.8 percent.

The fact sheet also claims that major changes will be made to the federal governments use of “category management” to “boost contracting opportunities for underserved small businesses.”

What this means is that the 24 federal agencies will be encouraged and scored on their contracting. As a separate statement from the Small Business Administration explains it, “this system… has favored major corporations and made far too many contracts out of reach for small businesses.”

Another “action” listed: “increasing the number of new entrants to the Federal marketplace and reversing declines in the small business supplier base.”

Finally, the White House says they will be “adopting key management practices to drive accountability and institutionalize achievement of small business contracting goals.”

In 2022, the White House says they will also update goals for other business categories including women-owned small businesses, service-disabled veteran-owned small businesses, and HUBZone businesses.’

“President Biden issued a powerful challenge in Tulsa earlier this year to harness the buying power of the U.S. government—the largest purchaser of goods and services in the world—to invest in equity and open doors of opportunity to America’s 32.5 million small businesses and innovative startups, including many more underrepresented entrepreneurs and small businesses in underserved communities,” SBA Administrator Isabel Guzman said.

She added: “Today’s historic release of federal contracting data disaggregated by race, ethnicity, and geography, and our corresponding reforms to federal strategic sourcing strategies known ‘category management,’ will help guarantee greater transparency and accountability in federal contracting and put more small businesses in a position to start doing business with the United States government.”

Category : Disabled Veteran Businesses Disadvantaged Business Enterprises Historically Underutilized Businesses Minority Business Enterprises Minority Women Business Enterprises Small Business Enterprises Veteran Business Women Business Enterprises Federal Government Small Business Administration Procurement

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