Fuzzy Math of SBA Goals

The Small Business Administration (SBA) is again under fire for how the determine the success of agency small business programs. SBA has claimed victory in achieving the 23% goal given them by Congress – the claim is that 23% of federal contracts are awarded to small businesses.

Their vocal challenger is the American Small Business League (ASBL), based in San Francisco.

At issue are two factors:

• The numerator. The total contract award value to small businesses includes contracts awarded to large companies with small subsidiaries.
• The denominator. The total federal contract portfolio excludes certain very large contracts, skewing the percentage upward. According to House testimony in 2015, the total exclusions are up to 20% of total awards. (We covered in this blog.)

As reported by Government Executive, the current issue is the numerator.

The SBA has defended their position judicially, so far with success... but ASBL is not giving up.

Small businesses bring unique solutions, flexible program management, and cost-effective strategies. This is not charity – it is sound decision-making.

But come on, SBA? What about the intent? Could the ASBL have a point, one worthy of addressing, with regard to the intent of the goal? Can you stop defending and start getting transparent with your formulas?

Meeting the goal with tricky math is a hollow success.