Dept. of Ed Falls Short of Small-Business Goal

Though a recent report on contract awards for 2004 indicated many federal departments are meeting small-business goals, the Department of Education came in way short--missing its goal by 70 percent.

Federal agencies are required to establish goals that will collectively result in 23 percent of all federal-procurement awards going to small business. While results of subcontract spending with small businesses have not been released, a recent report by Input, a Reston, Va.-based research firm, examines the performance of the 15 cabinet-level departments in achieving the prime-contracting small-business goals set by the Small Business Association in 2004.

"Most are making progress," says Jennifer Geurin, senior analyst of federal profiles at Input. "Probably most impressive was the Department of Homeland Security, which managed to pull ahead after falling short in 2003."

While vendors still say the DHS can be challenging to work with--given the sheer size of contract awards and the internal changes that continue to take place--the department exceeded its prime small-business goal by 65 percent. Other front-runners include the Department of Housing and Urban Development, which exceeded its goal by 92 percent, and the Department of Labor, which exceeded its goal by 35 percent.

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Departments not meeting goals include Defense, Interior, Transportation, Energy and Education. Year after year, the DoD misses its goal by 1 or 2 percent with little explanation, Geurin says. The Department of Energy, which missed its goal by 20 percent, points to its many contracts with universities and nonprofit organizations, which are automatically deemed large businesses, regardless of actual size.

"But really worst off was education," Geurin says. "Really, all departments not meeting goals need to look at those that are to see how it's done, and conduct heavy market research to identify small businesses. Of course, that can be very difficult because these departments have small staffs devoted to small-business objectives."