Small-Biz Panels Step Up SBA Oversight

February 1, 2011

The leaders of the U.S. Senate Committee on Small Business and Entrepreneurship and the U.S. House Committee on Small Business recently have communicated their intention to conduct extensive oversight of the U.S. Small Business Administration (SBA) during the upcoming Congress. They have expressed a desire to identify duplicative or ineffective programs within the agency and to root out fraud and abuse.

NSBA welcomes efforts to make the SBA a more efficient and effective organization and obviously encourages the elimination of instances of fraud and abuse, especially in regard to improper small-business designations being used to obtain federal contracts. NSBA stresses that these efforts must be in good faith, however, and not simply mechanisms to undermine or gut a critical small-business agency.

Senate

Sens. Mary Landrieu (D-La.) and Olympia Snowe (R-Maine), the chair and ranking member, respectively, of the Senate Committee on Small Business and Entrepreneurship, last week sent letters to Karen Mills, administrator of the SBA, and Peg Gustafson, inspector general of the SBA, requesting recommendations for SBA programs that could be eliminated or streamlined without hampering the agency’s ability to fulfill its mission.

In their letter to Mills, the senators wrote: “Like the American people, Congress must continue to evaluate and determine what spending is necessary to meet current needs and demands while identifying and eliminating needless spending. Accordingly, we take this responsibility seriously and will dedicate time and effort in this Congress to determine the best path forward.”

With the intention of holding a hearing (or more) on the subject in the near future, Landrieu and Snowe requested that recommendations be provided by Feb. 10, 2011.

Please click here to view the full letter to Mills.

House

Rep. Sam Graves (R-Mo.), chair of the U.S. House Committee on Small Business, recently outlined his “Oversight Plan of the Committee on Small Business” in a letter to Rep. Darrell Issa, chair of the U.S. House Committee on Oversight and Government Reform. He indicated that the plan was “drafted in consultation” with Rep. Nydia Velázquez (D-N.Y.), ranking member of the Committee on Small Business, and had been approved by voice vote during the committee’s organizational meeting.

In his letter, Graves emphasized that he was looking for duplicative or ineffective programs and/or offices. In keeping with Republicans’ avowed intent to reduce spending, Graves also signaled that he hoped to reduce unnecessary spending and programming. He indicated that he intended to recommend eliminating offices that, in his view, do not promote the interests of small business or protect the federal government, noting such offices such as the SBA’s Office of Policy, its regional administrators, and the Office of Advocacy’s regional advocates. He also declared his intent to examine the nascent Small Business Lending Fund at the U.S. Department of Treasury, of which he has been an outspoken critic.

Graves indicated that the committee would assess the reassignment of some employees “to more critical functions at the SBA, such as positions as procurement center representatives.” Graves also expressed his intent to examine overall government contracting. He specifically denoted the committee’s intent to investigate “whether fraud or other problems exist in the federal government contracting programs overseen by the SBA including 8(a), HUBZone, service-disabled veteran, women-owned contracting program, and the Small Business Innovation Research program.” While he indicated that he intended to explore whether the programs actually were helping small firms get involved in the federal marketplace, he also noted that the committee would focus on “uncovering abuse and misuse of the small business designation to obtain federal government contracts.”

Please click here to view the full letter.

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