Thursday, December 18th, 2014

The Obameter

Change federal rules so small businesses owned by people with disabilities can get preferential treatment for federal contracts.


"Barack Obama and Joe Biden would direct the Small Business Administration to amend regulations under the Small Business Act that provide preferences in federal contracting to small businesses owned by members of socially and economically disadvantaged groups to include individuals with disabilities."

Updates

No sign of progress toward small business boost for Americans with disabilities

During the presidential campaign, Barack Obama said his administration "would direct the Small Business Administration to amend regulations under the Small Business Act that provide preferences in federal contracting to small businesses owned by members of socially and economically disadvantaged groups to include individuals with disabilities."

There is no indication today that this promise is being pushed ahead.

"To my knowledge, there is no discussion of creating a set-aside contracting program for people with disabilities," said Hayley Meadvin, the press secretary for the Small Business Administration.

That said, SBA is working on a related training-and-mentorship program that's designed to benefit small business owners with disabilities -- the Entrepreneurship Boot Camp for Veterans with Disabilities, or EBV. SBA had already been partnering with Syracuse University, the University of Connecticut, UCLA, Florida State University, Texas A&M and Purdue University. It is preparing to expand the program to Louisiana State University as well.

Meadvin said that so far under the program, more than 320 wounded veterans have graduated, launching a combined 150 businesses.

In the meantime, the SBA continues to grapple with allegations that an existing program -- the Service-Disabled Veteran-Owned Small Business program -- is not working correctly. On May 24, 2010, Gregory D. Kutz, managing director for forensic audits and special investigations at the Government Accounting Office, followed on several years of GAO criticisms about fraud and waste by testifying to Congress that "a complete fraud prevention framework is necessary in order to minimize fraud, waste, and abuse within the SDVOSB program."

Still, both this program and the Entrepreneurship Boot Camp are for veterans specifically, not for civilians who are disabled -- who were the target of Obama's original promise. With no sign of progress on the promise to give preferential treatment to the broader universe of small businesses owned by people with disabilities, we are moving our rating from Stalled to Promise Broken.

Sources:

Entrepreneurship Boot Camp for Veterans with Disabilities, home page, accessed Nov. 19, 2010

Government Accounting Office, "Service-Disabled Veteran-Owned Small Business Program: Fraud Prevention Controls Needed to Improve Program Integrity" (testimony), May 24, 2010

E-mail interview with Hayley Meadvin, press secretary for the Small Business Administration, Nov. 19, 2010

No broad-based effort yet on federal contract preferences for the disabled

During the presidential campaign, Barack Obama said his administration "would direct the Small Business Administration to amend regulations under the Small Business Act that provide preferences in federal contracting to small businesses owned by members of socially and economically disadvantaged groups to include individuals with disabilities."

Veterans with disabilities already receive assistance from the Small Business Administration. When we asked Hayley Matz, a spokeswoman with the Small Business Administration, whether anything had been done to advance this promise, she offered one specific initiative that's under way -- a three-year agreement to expand and deliver entrepreneurship training for service-disabled veterans of the wars in Iraq and Afghanistan. Under this initiative, the SBA"s Office of Veterans Business Development will support the expansion of the yearlong Entrepreneurship Bootcamp for Veterans with Disabilities, a training and mentorship program.

But this is a narrow program. In the meantime, the SBA is grappling with allegations that an existing program -- the Service-Disabled Veteran-Owned Small Business -- is not working correctly.

In October 2009, the Government Accountability Office concluded that 10 firms "received approximately $100 million from SDVOSB contracts through fraud or abuse of the program, or both." The GAO added that "firms found ineligible do not face real consequences, can be allowed to complete the contracts received, and are not suspended or debarred."

As far as the larger question of allowing disabled Americans who aren't veterans to receive preferences under the SBA, we haven't found any indication that this promise is advancing. So we're labeling this promise Stalled.

Sources:

E-mail interviews with Hayley Matz, spokeswoman for the Small Business Administration, November 2009 and January 2010

Government Accountability Office, "Service-Disabled Veteran-Owned Small Business Program: Case Studies Show Fraud and Abuse Allowed Ineligible Firms to Obtain Millions of Dollars in Contracts," October 2009

Internet and Nexis searches that produced no results