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When Large Government Contractors Punch Down

GTThe WBJ headline reads ‘SAIC CEO urges lawmakers to address pressures from small business‘ and in the article SAIC CEO Tony Moraco is found complaining to Congress about current and future lost real estate for his company. Moraco wants to further skew agency small business goal programs into something that more efficiently puts the screws to America’s Small Businesses, their families, employees and communities.

— Guy Timberlake, The Chief Visionary

SAIC’s Tony Moraco wants to trim the size of the small business community’s slice of Uncle Sam’s pie, considerably. Instead of ‘manning up’ and going toe-to-toe with other large companies, or trying to take work away from mid-tier companies, he and others have opted to go for what I’m sure they consider the ‘soft target’ of small business dollars.19844222_m

This is nothing new, it’s been happening for as long as I can remember. That’s part of the ‘gaming the system’ that goes on at this level when you can put an army of lobbyists to work for you to sway the often already bad judgement of many members of Congress.

So what are the ‘pressures’ Moraco is urging lawmakers to address? The pressures of agencies finally moving in the direction of doing what they say when it comes to small business goals. Don’t get me wrong, I’m not always a proponent of the goals system because it breeds entitlement and abuse and sometimes forces agencies to act in a way that’s not always in keeping with their best interests or that of taxpayers like me. But that’s just sometimes. In most cases, the small businesses agencies engage are the real deal and deliver well, many times better, faster and more on-point than companies like SAIC. And the capacity of the small business community continues to grow which is one of the reasons why Moraco is seeking Congressional assistance. He wants Congress to in effect serve as SAIC’s ‘Large Business Administration’ in order to protect the interests of SAIC profits and shareholders. Sorry, they don’t deserve it.

“Moraco said the main remedy that his company and others in the industry are proposing is for federal agencies to score subcontracting dollars against agency goals of 23 percent. Currently, only prime dollars count toward that tally.”

Here’s the situation. Far more dollars are awarded to small business concerns each fiscal year through subcontracting than through socioeconomic set-asides and sole-source buys. By leaving the overall goal intact and adding subcontract dollars to the mix creates three situations, none of which is good for small business. First, agencies would actually meet their contracting goals totally removing any incentive to award to small business concerns. Second, small businesses would be even more beholden to large companies than ever before.Third, total dollars to small businesses would decline because of the checks and balances that are not in place to validate subcontract dollars getting to small business.

Did I mention the ‘achieved goals’ for the last few years includes more than half of the dollars won by small businesses without the assistance of set-asides or sole-source awards?


If this really bad idea is something seriously being considered by the Hill, small businesses need to find a way to get the overall goal raised to 60 percent to ensure more ground is not lost through actions like these.


Guy Timberlake, The Chief Visionary (bio)
http://www.theasbc.org | @theasbcguy | @govconguy

“The person who says it cannot be done should not interrupt the person doing it.”

About Editor-in-Chief Visionary

Go-To-Guy Timberlake is the Editor-in-Chief Visionary of GovConChannel and oversees the creation and curation of relevant and timely 'News And Information That Matters To Small Government Contractors.'


6 thoughts on “When Large Government Contractors Punch Down

  1. thanks for this article – definitely something to monitor – I can see how in this environment Large companies can say using the subcontract dollars to meet the goals will save Congress $ and shut out small businesses from the pie.


    Posted by Helen | September 21, 2016, 10:11


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