[House Hearing, 117 Congress]
[From the U.S. Government Publishing Office]
SBA MANAGEMENT REVIEW: OFFICE OF
GOVERNMENT CONTRACTING AND BUSINESS DEVELOPMENT
=======================================================================
HEARING
before the
COMMITTEE ON SMALL BUSINESS
UNITED STATES
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTEENTH CONGRESS
SECOND SESSION
__________
HEARING HELD
JUNE 23, 2022
__________
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Small Business Committee Document Number 117-059
______
U.S. GOVERNMENT PUBLISHING OFFICE
47-840 WASHINGTON : 2022
Available via the GPO Website: www.govinfo.gov
HOUSE COMMITTEE ON SMALL BUSINESS
NYDIA VELAZQUEZ, New York, Chairwoman
JARED GOLDEN, Maine
JASON CROW, Colorado
SHARICE DAVIDS, Kansas
KWEISI MFUME, Maryland
DEAN PHILLIPS, Minnesota
MARIE NEWMAN, Illinois
CAROLYN BOURDEAUX, Georgia
TROY CARTER, Louisiana
JUDY CHU, California
DWIGHT EVANS, Pennsylvania
CHRISSY HOULAHAN, Pennsylvania
ANDY KIM, New Jersey
ANGIE CRAIG, Minnesota
SCOTT PETERS, California
BLAINE LUETKEMEYER, Missouri, Ranking Member
ROGER WILLIAMS, Texas
PETE STAUBER, Minnesota
DAN MEUSER, Pennsylvania
CLAUDIA TENNEY, New York
ANDREW GARBARINO, New York
YOUNG KIM, California
BETH VAN DUYNE, Texas
BYRON DONALDS, Florida
MARIA SALAZAR, Florida
SCOTT FITZGERALD, Wisconsin
Melissa Jung, Majority Staff Director
Ellen Harrington, Majority Deputy Staff Director
David Planning, Staff Director
C O N T E N T S
OPENING STATEMENTS
Page
Hon. Nydia Velazquez............................................. 1
Hon. Blaine Luetkemeyer.......................................... 2
WITNESS
Ms. Bibi Hidalgo, Associate Administrator, Office of Government
Contracting & Business Development, U.S. Small Business
Administration, Washington, DC................................. 4
APPENDIX
Prepared Statement:
Ms. Bibi Hidalgo, Associate Administrator, Office of
Government Contracting & Business Development, U.S. Small
Business Administration, Washington, DC.................... 31
Questions and Answers for the Record:
Questions from Hon. Luetkemeyer to Ms. Hidalgo and Answers
from Ms. Hidalgo........................................... 37
Additional Material Submitted for the Record:
None.
SBA MANAGEMENT REVIEW: OFFICE OF
GOVERNMENT CONTRACTING AND BUSINESS DEVELOPMENT
----------
THURSDAY, JUNE 23, 2022
House of Representatives,
Committee on Small Business,
Washington, DC.
The committee met, pursuant to call, at 10:02 a.m., in Room
2360, Rayburn House Office Building, Hon. Nydia Velazquez
[chairwoman of the Committee] presiding.
Present: Representatives Velazquez, Davids, Mfume,
Bourdeaux, Carter, Chu, Evans, Houlahan, Craig, Luetkemeyer,
Williams, Stauber, Meuser, Tenney, Garbarino, Young Kim of
California, Van Duyne, Donalds, and Fitzgerald.
Chairwoman VELAZQUEZ. Good morning. I call this hearing to
order.
Without objection, the Chair is authorized to declare a
recess at any time.
I would like to begin by noting some important
requirements. Standing House and Committee rules and practice
will continue to apply during hybrid proceedings. All Members
are reminded that they are expected to adhere to these rules
including decorum.
House regulations require Members to be visible through a
video connection throughout the proceeding, so please keep your
cameras on. Also, remember to remain muted until you are
recognized to minimize background noise.
In the event a Member encounters technical issues that
prevent them from being recognized for their questioning, I
will move to the next available Member of the same party and
will recognize that Member at the appropriate time slot
provided they have returned to the proceeding.
With that, let's start this hearing.
When a small firm wins a federal contract, it creates a
ripple effect that creates jobs, invests in communities, and
generally boosts the economy. The presence of small firms also
helps drive innovation nationwide and competition in the
federal marketplace.
Congress recognized these benefits in 1953, when they
created the Small Business Administration and tasked the agency
with ensuring that a fair proportion of contracts and
subcontracts are awarded to small businesses.
Today, SBA's Office of Government Contracting oversees this
mission and works to create an environment where small
businesses can compete on a level playing field in federal
procurement.
In addition to supervising governmentwide contracting
goals, the office is also responsible for administering
multiple programs like the 8(a) program, the Service-Disabled
Veteran-Owned Small Business program, the Women-Owned Small
Business program, and the HUBZone program. These initiatives
help create contracting opportunities for disadvantaged small
businesses and are instrumental in helping the government reach
its overall small business contracting goal.
Given its critical mission of maximizing small business
participation in the federal marketplace, we must take steps to
ensure the Office of Government Contracting and Business
Development operates as effectively as possible.
Today, I hope we can take a close look at the office's
challenges and actions Congress can take to alleviate them. For
instance, despite the federal government consistently meeting
its goal of awarding 23 percent of eligible federal contracting
dollars to small firms, small business participation has been
steadily declining. Last week, we held a hearing detailing the
severe impact of category management and governmentwide
contracting vehicles to small firms. I would like to hear what
steps SBA is taking to minimize these effects and safeguard the
small business base.
While the government has met the overall small business
contracting goal in recent years, the goals for programs like
HUBZone and the Women-Owned Small Business program were not
met. In fact, the goal for the Women-Owned Contracting Program
has only been met twice, and the HUBZone goal has never been
met. It is important that we address these shortcomings and
ensure that program participants are getting an adequate number
of opportunities.
I also want to discuss IT challenges. As reported by the
SBA's Office of Inspector General, SBA abandoned
Certify.SBA.gov alleging it was unsustainable in the long term
and intended to replace it. Given the importance of having an
IT platform that can successfully and efficiently service all
of the contracting programs, I am interested in examining SBA
plans and timelines related to this initiative.
These are just a few important issues we will cover today.
I would also like to hear more from our witness about staffing
resources, strengthening internal controls, and implementing
key legislation related to contracting programs.
When small contractors can thrive, our nation's small
businesses, government, and economy all benefit. I look forward
to hearing from Associate Administrator Hidalgo about the ways
Congress and the agency can work together to protect the role
of small businesses in the procurement process.
I would now like to yield to the Ranking Member, Mr.
Luetkemeyer, for his opening statement.
Mr. LUETKEMEYER. Thank you, Madam Chair. And thank you for
having this important hearing with the associate administrator
of SBA's Government Contracting and Business Development
Office.
Now, more than ever, small businesses deserve to hear from
agency officials that administer some of the most important
small business programs within the government, including
federal contracting programs. These are incredibly challenging
times for small businesses, their employees, and their
communities. Inflation is running rampant across the nation and
impacting nearly every product and service. In fact, the
Consumer Price Index is at a 40-year high, and wholesale
inflation is in the double digits. This is unacceptable for our
nation and for Americans.
Surging prices and runaway costs have direct and immediate
impacts on main street. Not only is inflation one of the top
concerns for small business owners, but also has direct effects
on the entire small business supply and demand ecosystem.
According to the most recent survey out of NFIB, nearly three-
quarters of all business owners are increasing prices. This
matches the highest percentage on record.
In addition to red hot inflation, the nation's smallest
firms continue to experience sharp supply chain issues and an
ongoing labor crisis that is hindering the busy summer season.
It is for these reasons why it is so important for this
Committee to hear from Treasury Secretary Yellen. This
administration has the ability to talk directly to small
business through one of the federal government's most important
cabinet-level agencies, the Department of Treasury. Despite
being legally required to testify before this Committee last
year and twice this year, Treasury Secretary Yellen is a no-
show. Small businesses employ approximately half of all workers
in America; yet, she cannot find the time to speak to us.
COVID programs, including the PPP, which the Treasury
Department assisted with by bringing in new lenders, is
currently in the loan forgiveness stage. Secretary Yellen
refuses to talk to us and talk directly to small business
owners. This continues to be unacceptable and a violation of
the law. It is my hope she stops ignoring the loss to small
businesses on this Committee and testifies soon.
When it comes to contracting, small businesses are a
critical player in helping to strengthen the nation's
industrial base. They act as prime contractors and
subcontractors on numerous projects that span the federal
government.
Billions of dollars are processed through federal
contracts, and small businesses have a significant role to
play. Unfortunately, their impact is waning and this Committee
must continue to study a balanced approach when it comes to
cost savings and consolidation.
I look forward to having a thorough conversation on this
very important topic. Additionally, I look forward to
discussing the federal government's practice of setting and
measuring goals within federal contracting, the role of
subcontracting, and various other issues related to small
businesses that participate in federal contracting programs.
As I mentioned, these are difficult times for small
businesses, their owners, and their workers, as well as the
nation's businesses that supply the federal government with
goods and services.
With that, Madam Chair, I yield back.
Chairwoman VELAZQUEZ. Thank you, Mr. Luetkemeyer. The
gentleman yields back.
I would like to take a moment to explain how this hearing
will proceed. Ms. Hidalgo, you will have 5 minutes to provide a
statement, and each Committee Member will have 5 minutes for
questions. Please ensure that your microphone is on when you
begin speaking and that you return to mute when finished.
With that, I would like to introduce our witness.
Ms. Bibi Hidalgo is the Associate Administrator of the
SBA's Office of Government Contracting and Business
Development. In this role, Ms. Hidalgo oversees and reviews
procurement-related policy for small business contractors
hoping to work with the federal government. Before joining the
SBA, she was a co-founder of Future Partners, LLC, which
advised Fortune 500 corporate executives on procurement and
minority business strategy and created a model for how to
facilitate significant opportunity for both. She also served in
the White House where she managed a government-wide initiative
with 24 cabinet agencies to position the federal government to
meet the 23 percent small business goal for the first time in a
decade. Ms. Hidalgo has a Master's in Public Policy from the
John F. Kennedy School of Government at Harvard University.
Welcome, Ms. Hidalgo. You are now recognized for 5 minutes.
STATEMENT OF BIBI HIDALGO, ASSOCIATE ADMINISTRATOR, OFFICE OF
GOVERNMENT CONTRACTING AND BUSINESS DEVELOPMENT, U.S. SMALL
BUSINESS ADMINISTRATION
Ms. HIDALGO. Thank you, Chairwoman.
Good morning, Chairwoman Velazquez and Ranking Member
Luetkemeyer, and distinguished Members of the Committee. On
behalf of our Administrator, Isabella Casillas Guzman, and the
SBA, thank you for the opportunity to appear before you today
to discuss the important role that government contracting plays
in empowering small businesses across the United States.
The federal government is the largest purchaser of goods
and services in the world, leveraging its immense spending
power of over $500 billion annually on everything from
biopharmaceutical research to cybersecurity improvements to
green building architecture. And time and again, it is our
nation's small business contractors who are driving these
innovations, strengthening our supply chains, moving our
economy forward, and keeping our country secure.
For small businesses, there is real power that comes with
getting to say that the United States Government is one of
their clients.
Under the leadership of President Biden, we have seen an
overhaul in how federal agencies approach and promote small
business procurement. This administration has shown that it
believes in advancing small and socioeconomic business
contracting not only for the sake of our congressional goals,
but also for the health, security, and prosperity of our
industrial base. I am proud to be a part of the
Administration's work to ensure that innovative businesses can
engage in the federal marketplace.
By way of background, I am the daughter of Cuban exiles who
came to the United States after the Cuban Revolution. The day
of the Bay of Pigs invasion, the Cuban militia stormed into my
grandparents' house in Havana and took my grandfather, my mom,
who was only 17 years old, and her two sisters to prison.
Though my mom and her sisters were deprived of their freedoms
for 39 days, America soon offered an open door for a better
future, a future for my mom and dad to start their family,
raise five children, and teach each of us about grit and
determination. And based on our deep Ignatian faith, we were
taught the importance of working in service of others.
I have worked to promote small business interests under two
U.S. Presidents. I was a small business owner myself, starting
a business with my younger brother Patrick to serve Fortune 500
companies in developing strong supply chains. During this time,
I faced many of the same challenges that I hear about from
small business owners across the country, from making payroll
to landing that first contract.
And I faced devastating loss at the start of the pandemic.
My brother Patrick, who was my best friend and business
partner, passed away suddenly in March of 2020.
As Associate Administrator of SBA's Office of Government
Contracting and Business Development, I am deeply aware of the
impact the pandemic has had on small businesses. My team and I
work daily to widen the doors of access and opportunity by
monitoring the progress of all agencies towards the
congressionally mandated goals for small business contracting.
Collectively, these goals translate to almost $150 billion in
small business contracts per year.
As part of the Administration's commitment to equity in
procurement, SBA worked last year with the White House, OMB,
and our partner agencies to develop five major policy changes
for federal contracting to ensure that socioeconomic firms have
a strong footing on which to compete in the federal
marketplace. These changes included incorporating all
socioeconomic firms into Tier 2 credit of category management,
tracking all new entrants into the federal marketplace,
publicly releasing FY20 disaggregated contracting data, adding
small business goals to SES performance evaluations, and
increasing the small disadvantaged business goal to 15 percent
by 2025 with an initial goal of 11 percent for this fiscal
year.
At the same time, we have spent the past year working to
modernize our certification IT systems. These changes have come
in two forms. First, as client-facing improvements to the
system itself, such as making the application process easier to
navigate. And second, as staff facing system improvements that
have cut down on processing times.
Our reforms are making a difference. Across the board, SBA
is processing certification applications over 20 percent faster
than statute requires. And the new Veteran Certification
Program that Congress entrusted to us and is slated to begin at
SBA next year will be leading our technology-forward approach
across SBA. As we work to support a new generation of
entrepreneurs, it is more important now than ever to ensure
that small businesses can access the exceptional resources of
SBA and the opportunities afforded through federal contracting.
Thank you again Chairwoman Velazquez, Ranking Member
Luetkemeyer, and distinguished Members of the Committee for the
opportunity to appear before you today. I look forward to your
questions and our conversation today.
Chairwoman VELAZQUEZ. Thank you, Ms. Hidalgo.
I now recognize myself for 5 minutes. I am very sorry for
your loss.
Last Tuesday, we held a hearing here on category management
and the impact that it is having on small businesses, so it is
great that we have achieved the 23 percent small business goal.
That is a good thing. However, the overall participation of
small firms in federal contracts has declined significantly
over the past years, largely because of initiatives such as
category management.
My question to you is, based on the anecdotal data stories
that we have heard and the numbers that are showing a decline,
what is SBA doing to counter defects of category management?
Ms. HIDALGO. Well, thank you very much, Chairwoman, for
that important question. That is the top issue that the White
House and Administrator Guzman wanted us to address. And so
right out of the gate we started to meet with everybody across
the White House, OMB, and the largest contracting agencies to
figure out how we could reverse that trend, realizing that
category management was one of the biggest issues. And so as a
result, we negotiated with OMB and the White House to have all
the socioeconomic firms, that includes service-disabled
veterans, women-owned businesses, all place-based HUBZone
firms, and small disadvantaged businesses into Tier 2 of
category management, which is the rating system that they had
created. So that means that 33,000 more firms are part of that
higher level tiering category which will create more access for
contract opportunities.
Chairwoman VELAZQUEZ. So we have followed-up with OMB to
obtain more information about this change, Tier 2 Category. We
have not received a response. Do you have a sense of the impact
this change is having thus far, and would you please share with
them that we are awaiting a response?
Ms. HIDALGO. Absolutely, Chairwoman. I will share with them
that you are awaiting response. What I do with my team is check
initially for anecdotal information while we also track the
data, and we are seeing positive trends. We are hearing from
business owners that they have been contacted for the first
time in years. We are seeing an increase in new entrants, which
is one of the things that we are tracking to make sure that it
is not only an increase in dollars but that we are bringing
back the industrial base, that we are lifting it up.
Chairwoman VELAZQUEZ. In fiscal year 2020, the federal
government also failed to meet the 5 percent prime contracting
goal for the women-owned businesses program and the 3 percent
goal for the HUBZone program. In fact, the women-owned small
business goal has only been met twice as I mentioned in my
opening statement and the HUBZone goal has never been met. What
is SBA doing to ensure agencies make use of these programs and
meet the goals?
Ms. HIDALGO. Thank you for that great question, Chairwoman.
This is really important to us, and so now we have the
women-owned business goal and the HUBZone goal in the
performance evaluations of not just acquisition staff but all
senior executive program managers. So this is part of
essentially their KPIs. And so we are seeing a difference. They
are now reaching out more and more, the agencies. My staff was
just telling me this yesterday, across the board agencies are
reaching out to identify more businesses across all the
socioeconomic categories.
Chairwoman VELAZQUEZ. Are you optimistic that the 3 percent
and the 5 percent goal will be achieved?
Ms. HIDALGO. I am optimistic that we are approaching closer
to getting to the goal. I cannot say where we will be this year
but I am optimistic of the trend that we are seeing.
Chairwoman VELAZQUEZ. Okay. Let me ask you about an
important concern that I have, and that is that the agency now
has performed a strategic review of certified.sba.gov. Could
you please share with us what the plans are and associated
timelines to implement an IT platform that achieves this goal?
Ms. HIDALGO. Thank you, Chairwoman.
We are very pleased that the systems are fully functioning
and that was the number one thing I asked my team was to make
sure that it is functioning and that we gain small wins along
the way. Rather than doing an outright overhaul, we wanted to
see that it would become much more user friendly for the
customer. And I am pleased to say that we just recently
released a rollout----
Chairwoman VELAZQUEZ. Okay, so to be clear, will SBA have
one IT platform for all of the contracting programs or is the
plan to improve each of the existing certification applications
IT sees?
Ms. HIDALGO. Yes. We are working towards one contracting
platform. But in the meantime, we wanted to make sure that it
was fully functional, what we have, so that applicants are not
unduly burdened in the process.
Chairwoman VELAZQUEZ. My time has expired. Now I recognize
the Ranking Member, Mr. Luetkemeyer, for 5 minutes.
Mr. LUETKEMEYER. Thank you, Madam Chair. And thank you, Ms.
Hidalgo, for being here today. And for your compelling personal
story. It is always great to hear people's willingness to come
to this country and participate in our process. As a capitalist
and entrepreneur, you were able to take advantage of the
economic freedom this country presents and start your own
business and do well with it. I congratulate you and your
family on that.
Along those lines, as a small business owner, I am sure you
understand the effects of things that go on with regards to
what is going on right now with our economy, with inflation,
for instance, taxes and things like that. So in your position,
you know, the Consumer Price Index right now is at 8.6 percent,
and as I go home, that is the number one concern I hear from
small businesses. With regards to contracting, I have heard
from several businesses that seem to be stuck with a situation
where they signed a government contract pre-COVID and because
of runaway inflation and supply chain problems now they are
stuck. There is not enough flexibility in the contracts to be
able to recover the increased costs that are there due to
inflation or delays. So my question I guess is do the
government contracts have some type of clause or flexibility to
allow small businesses who more than likely do not have a large
cash flow to survive in these instances?
Ms. HIDALGO. Thank you, Ranking Member, first of all for
your acknowledgement of my family's story. We are so proud to
be in this country and my parents taught us that all our lives,
to be proud of being able to become and be American citizens.
This issue is top of mind for me and so as a result I met
with all of my Procurement Center Representatives to ask them
what can we do to solve these challenges for our businesses?
Contracting affords an incredible opportunity to contract with
the largest purchaser in the globe and so we realize that this
helps to serve as a strong buffer during these challenging
times. And apart from that, I have been asking my team how we
can adjust for inflation, and they have been giving me a number
of recommendations, some of which we are working into our
regulations now to provide additional relief to small business
contractors.
Mr. LUETKEMEYER. I asked this question last week of one of
our witnesses and they said that there was some flexibility in
some of the contracts. They were making changes to allow that
to happen. I know that I have got some of my constituents who
are working to try to get that done because there apparently is
not any flexibility in theirs. So the reason for the question I
guess is it does not seem to be consistent across the board and
do you find that there is flexibility? And if not, are you
working to try to fix the problem immediately so that they can
exist? Otherwise, it is going to run the small businesses out
of business.
Ms. HIDALGO. Yes, thank you. So fortunately, given that
small business contracting is a big priority of the President,
we are in constant conversations with the Office of Federal
Procurement Policy that issues guidance to address
systematically all of these issues. And so together with OFPP,
the White House, and the largest seven contracting agencies, we
are trying to find ways to make sure that we can be consistent
across the board in our guidance and allow for more variability
in the costs associated with the contracts.
Mr. LUETKEMEYER. One of the things that the Government
Accountability Office and SBA's Inspector General originally
criticized the SBA for their lack of controls on these programs
leading to potential fraud risks. Can you tell us what new
measures you have implemented or plan to implement to combat
the fraud risks? There seems to be a lot of problems with it,
and from the IG report, there does not seem to be a lot of
concern.
Ms. HIDALGO. So we are pleased that we have closed out many
of those reports. We do have a couple of management challenges
which we have been addressing and have proposed to the IG now
to move them to green. So making sure that we have all the
firms that Congress intended for us to have in the program. And
I am really pleased to share that our Size Protest program
issues a formal size determination when contractors' size is
questioned by another bidding firm or a contracting officer.
And in fiscal year 2021, because of these reviews, GCBD, or my
office, was able to identify 66 companies that were not
legitimate small businesses.
Mr. LUETKEMEYER. I have got one real quick question for
you. How many of the recommendations from GAO and IG are still
outstanding?
Ms. HIDALGO. We have two that are outstanding from the IG.
Mr. LUETKEMEYER. Okay.
Ms. HIDALGO. And those are what we are working on right
now. One, of course, is on business development for 8(a) firms
which we are pleased to be working on that and really
strengthening----
Mr. LUETKEMEYER. Do you have a date where you think you
will get those fixed or can be compliant with?
Ms. HIDALGO. We are working diligently with IG daily. I
actually hired a top team to address these issues and as you
know, the Administrator has increased vigilance through the
Fraud Risk Management Board of which we are very much a part in
it.
Mr. LUETKEMEYER. Thank you. My time has expired.
Thank you, Madam Chair.
Ms. HIDALGO. Thank you, Ranking Member.
Chairwoman VELAZQUEZ. The gentleman yields back. Now we
recognize the gentlelady from Kansas, Ms. Davids, Chairwoman of
the Subcommittee on Economic Growth, Tax, and Capital Access.
Ms. DAVIDS. Thank you, Chairwoman Velazquez and Ranking
Member Luetkemeyer for holding this hearing today. And thank
you, Ms. Hidalgo for testifying before us today.
The SBA is charged with ensuring that a fair proportion of
contracts and subcontracts for the federal government are
placed with small businesses, which we have been discussing.
And while the federal government has met its overarching goal
of awarding 23 percent of contracts to small businesses, as we
have been talking about there has consistently been a failure
to meet the contracting goals for the Women-Owned Small
Business program and HUBZone program. And one of the things
that I have been made aware of more recently in part because
the Kansas 3rd happens to have a really strong entrepreneurial
ecosystem, is that the federal contracts we are seeing are
largely going to small businesses in concentrated areas. Forty-
three percent of the contracts went to around 17 congressional
districts, 12 of which are located in Maryland and Virginia.
And I, of course, want to make sure that all the amazing
businesses that we have in Kansas that could absolutely provide
the services and expertise that federal contracts require are
able to do that.
So I am curious if you are aware of or can speak to some of
the factors that have lead to this kind of high geographic
concentration as it relates to these small business contracts.
Ms. HIDALGO. Thank you, Congresswoman, for that very
important question.
We are deeply concerned about the issue of contract
bundling and it favors companies that tend to be larger or that
are working with larger corporations, and so as a result, that
is part of the reason why we are seeing that concentration as
well as with category management. And so, we are quite often
looking at, studying the maps, including in your district to
figure out what we can do to unleash more opportunity. And that
is part of the reason why we are now tracking new entrants and
we are hearing from agencies constantly what they can do to
connect with new small businesses or small businesses that have
not been contracting with the federal government. And recently,
I signed a rule that also provides a lot more NAICS codes for
set-asides for women-owned businesses. So now 92 percent of all
federal spend can qualify as a set-aside for women-owned
businesses. So we are hopeful that that will have an impact on
women-owned business contracting as well.
Ms. DAVIDS. Thank you. That is really good to hear and I am
sure our office will follow up so we can figure out if there
are ways that we can be helpful in making sure that
geographically diverse small businesses are able to access the
government contracting.
I am curious if you could talk a little bit about the $5
million funding, most recent funding request for HUBZone and
8(a) and the Women-Owned Small Business program for staffing
resources. Can you just share with us a little bit about how
you hope to use that funding to increase the effectiveness and
efficacy of those programs?
Ms. HIDALGO. Yes, definitely. Thank you for that question,
Congresswoman.
When I arrived, there were historic lows in some of our
staffing, particularly around the Procurement Center
Representatives who monitor the contract awards as well as the
Commercial Market Representatives who monitor subcontracts. So
this is one of the areas where we want to make sure we can get
back to more historic levels of staffing. Each one of the PCRs,
I asked my team to give a ballpark figure of what that
represents in the return and value on contracts to small
businesses. Each one represents about a billion dollars in
additional contracts for small businesses. So we will leverage
that $5 million in staffing to be able to increase significant
opportunity for small businesses.
Ms. DAVIDS. Thank you. And we will follow up about that as
well. Thank you for your time today and Madam Chair, I yield
back.
Chairwoman VELAZQUEZ. The gentlelady yields back.
Now we recognize the gentleman from Texas, Mr. Williams,
Vice Ranking Member of the Committee, for 5 minutes.
Mr. WILLIAMS. Thank you, Madam Chair. And thank you for
being here. I appreciate it.
You probably know the president. Well, you do know the
president much better than I do. You probably see him or you do
see him more than I do. I am a small business owner. Tell him a
couple things. Tell him that he needs to quit talking about tax
increases. He needs to be fixing inflation. Okay? And he also
needs to quit burdening small business owners with regulations
through adding to compliance costs that are destroying profits
in small business. If you would tell him that I would
appreciate it.
And thank you again for being here. And as a small business
owner for over 50 years--actually 52 years now--I still have my
business. I employ about 330 people back in Texas. I can tell
you that the Biden administration is completely out of touch
with Main Street America. Main Street America is what this
country is about and small businesses across the country are
concerned with supply chain disruptions that are leaving
storage shelves empty. And in my personal situation, I have no
cars to sell on my lot. I cannot get cars. Excessive government
regulations cause an increase in compliance. We just talked
about. And the inability to find qualified workers and the
constant threat of tax increases coming from Democrats in
Washington are really hurting small business.
However, when I talk to my business owners back in Texas,
they are most concerned about the out-of-control inflation we
are all experiencing. And instead of taking and faking steps to
bring down energy costs and bring relief to families and small
businesses, the only thing the Biden administration is doing is
making excuses. The best I have ever seen. They have switched
between blaming the Russian invasion of Ukraine to corporate
greed as the main cause of inflation but I can tell you, Texas
are not buying that. And Americans see the reckless government
spending and the hostile posture towards our energy companies
as the main factor in these record levels of inflation that are
killing small businesses and owners who must drastically alter
their operations.
So we have talked a little bit about this but I would say
what is your office doing to help small businesses struggling
with inflation. We talked about that earlier. But has
Administrator Guzman asked you to examine inflation's impact on
the federal contracting? Now, you did talk about the impact but
you did not have the answer to the problem. And you mentioned a
focus group I think that give you ideas and so forth but we
have not talked about what are they saying? What are they
saying that you need to do to fix this problem?
Ms. HIDALGO. Well, thank you----
Mr. WILLIAMS. You have got the problem and then you have
got to have the fix.
Ms. HIDALGO. Thank you very much, Congressman, and I really
deeply appreciate your perspective as a very successful small
business owner.
So this is top of mind for the Administrator and the White
House. And so as a result, that is why I met with all of my
team members that are very much on the ground working with
small businesses every day to get contracting opportunities to
say what can we do to alleviate any of these challenges. So
allowing for more variable price adjustments is one of the
issues that we are looking at. Looking at thresholds to match,
adjust for inflation are other areas. And so we are meeting
regularly as a team to put together a package of fixes that
will help to alleviate challenges----
Mr. WILLIAMS. Well, that's good. I hope you have some small
business owners giving you some real world experience to help
you do that.
And small business contractors are some of the hardest hit
businesses by runaway price increases. And if a contractor's
resource costs are rising each month, their margins will get
smaller and smaller. And additionally, every business I speak
to has told me how hard it is to find workers. We talked about
that. Everyone knows that. And this is delaying the timelines
on projects when they can be completed and then the project
drags out. And with high inflation the cost goes up. So
unfortunately, there is rarely any flexibility within these
contracts to ensure they can still get the job done at a
reasonable cost when these economic factors outside of their
control are biting into their margins. So how is your office
working with small businesses that have been awarded a federal
contract? Before inflation, employers' shoulders were
calculating the original bid. And I think one of the biggest
things, too, is payment terms. Are you all paying them on time?
How long does it take to get payment from the federal
government?
Ms. HIDALGO. So we are actually----
Mr. WILLIAMS. That is one of the biggest things you can do
right now to help. My experience with the federal government
has been pretty much a slow pay.
Ms. HIDALGO. And we are working now to get back to during
the Obama era where we fast-tracked payment. And so with the
Prompt Pay Act, it is a 30-day requirement and we are trying to
get that back to 15 days so that businesses will have more of a
capital flow during these circumstances. And we are continuing
to look at all the tools that are available at our disposal to
ensure that small businesses can compete and that is where our
strong relationship with OFPP and the White House has been
critical in allowing us to provide those recommendations.
Mr. WILLIAMS. Thirty-day pay is good. Ninety-day is bad.
Thank you for being here. I appreciate it.
Ms. HIDALGO. Thank you, Congressman.
Chairwoman VELAZQUEZ. Time has expired.
Now we recognize the gentlelady from Pennsylvania, Ms.
Houlahan, for 5 minutes.
Mr. HOULAHAN. Thank you, Madam Chair. Just making sure you
can hear me okay. Can you hear me?
Chairwoman VELAZQUEZ. Oh, I am sorry. Yes, Ms. Houlahan, we
can hear you.
Mr. HOULAHAN. Excellent. Excellent. And thank you so much,
Administrator Hidalgo, for your really compelling testimony
today.
And as a women entrepreneur myself, increasing
opportunities for government contracting and business
development for women-owned businesses is obviously
particularly important to me and it very much informs my work
on this Committee. I also happen to be a systems engineer and
so I really believe in measuring what matters, and I am
grateful to hear some of your KPIs and some of your emphasis on
systems and systems change.
My Women-Owned Small Business Program Transparency Act, or
the WOSB Transparency Act, passed the house earlier this month
with very strong bipartisan support which would allow Congress
and the SBA to gather necessary data that would improve this
really important program that we have been talking about. I
look forward very much to continuing to work with your office
on ways to make sure that the SBA is able to reach their 5
percent prime contracting goal for women-owned small businesses
and I am really pleased that the Chair and also Representative
Davis have also highlighted this really important goal that has
only bee met twice in history in their remarks.
I am particularly interested in hearing more from you about
how the certification process for that program can be improved
because as I understand it, according to the latest data from
the SBA's Office of the Inspector General, SBA initially
received 15,000 applications for that WOSB program and 12,000
were screened apparently and returned to the applicant for more
information. Do you know what the primary reasons were that so
many applications were, in fact, return. And what actions is
the SBA able to take to improve this process so that applicants
can get to this process, get this process correct from the
beginning?
Ms. HIDALGO. Well, thank you very much, Congresswoman, for
that important question. And also, for your perspective as well
as a business owner.
This has been top of mind for me since day one. We need to
get women-owned businesses in the pipeline certified as soon as
possible so that they can get access to set-asides. And so this
is partly why immediately I asked my team to figure out what is
going on in the system that leads to incomplete applications.
And I will give you an example. We learned that the way it
was set up is they would ask applicants for all of their
documents at once. But it turns out if they did not upload them
individually, then it would only accept one of the documents.
So I said, this is unacceptable and we need to fix this right
away. And my team got right on it, fixed it to at least inform
the business owner that they needed to upload one at a time.
And as a result, we are seeing differences like that are having
an impact. We have now certified well over 5,700 firms. We are
on pace to certify over 6,000 this year. Any incomplete
applications, I have my pre-screeners working directly with the
applicants to make sure that their application is not rejected
and that they can work towards a complete application as soon
as possible.
Mr. HOULAHAN. I look forward to learning more of kind of
the reason codes for why those things are happening and that is
a really obvious glitch that you are talking about that I have
experienced personally myself in submitting paperwork for
health care as an example.
With what remains of my time, similarly, I am really
interested in exploring the proposals that exist to benefit
economically disadvantaged women-owned small businesses. While
there are clearly requirements to participate in the
Economically Disadvantaged Women-Owned Small Business
contracting program or the very easy to remember EDWOSB such as
income and net worth requirements, there really does not seem
to be currently a separate and dedicated contracting goal that
is EDWOSB's which would likely further maximize the utilization
of such firms. Given the administration's commitment to these
kinds of causes, I am wondering how the SBA is working to
increase contracting opportunities for Economically
Disadvantaged Women-Owned Small Businesses. For instance, do
you believe a separate contracting goal might be beneficial?
Ms. HIDALGO. Thank you very much, Congresswoman, for that
question and concern for EDWOSB firms. Fortunately, a lot of
the firms will benefit from the President's emphasis on
increasing Small Disadvantaged Business contracting and my team
negotiated with all 24 agencies so we can get to 11 percent for
fiscal year 2022. And so between that and the recent rule that
I signed that allows for a significant number of more NAICS
codes to be used for women-owned and economically-disadvantaged
women-owned set-asides, as I mentioned, 92 percent of federal
spend now falls under those NAICS codes. So we are hopeful that
we will see an increase in both EDWOSB as well as WOSB set-
asides.
Chairwoman VELAZQUEZ. Time has expired.
Mr. HOULAHAN. Thank you. I have run out of time, Madam
Chair. I appreciate it and I yield back.
Chairwoman VELAZQUEZ. Thank you.
Now we recognize the gentleman from Pennsylvania, Mr.
Meuser, Ranking Member of the Subcommittee on Economic Growth,
Tax, and Capital Access, for 5 minutes.
Mr. MEUSER. Thank you very much, Madam Chairwoman. And
thank you, Ms. Hidalgo for being with us and testifying today.
I am very concerned about the health of our small
businesses. I am sure you folks at SBA are quite concerned and
have a sense of alarm and urgency because small businesses are
facing this tattered economy and the repercussions of it
certainly more than large businesses. Now, first, gasoline
prices, fuel in general, diesel, heating oils as you well know
are doubling in people with homes anyway, and so businesses,
instead of paying $3,000 or $2,000 a year, they will be paying
$4,000 a year. Gasoline is costing $5,000 more a year. Diesel,
many businesses are concerned diesel is going to be rationed. I
mean, it is that bad. And yet, the Secretary of Energy just
yesterday very alarmingly said what we need to do is go to EVs
and renewables which the administration should know that even
if every country in the world hit its carbon reduction targets
over the next 10 years, it still will only account to about 25
percent of the energy needs of the country and the world. And
at increased demand, we need more of the current energies that
we produce here domestically in 10 years. So it really was an
unfortunate, I think, thing to say and kind of foolish. Because
it is simple math on how that works. And so for the energy
secretary administration to say something like that I think
that raised a lot of fear in small businesses and certainly to
our economy as a whole.
Small businesses are dealing with workforce issues, right,
as well know. Access to capital. Supply chain disruptions. I
mean, it is crazy. You go into a small business and they are
waiting on things. They will have excess inventory or too
little inventory and that is what throws off their cashflow to
much. Regulations, taxes.
You know, it was disappointing when I asked Administrator
Guzman a few meetings ago, Committee meetings ago, what she
thought if she goes to the president and asks, informs him as
the advocate for small business, that raising taxes is not a
good thing. And she said she does not deal with taxes. You
know, taxes are very important, keeping them as low as
possible. We need to be a competitive nation. And you know,
when you increase taxes, you reduce revenues, not just for the
business but for Treasury, for government. Or inflation will do
that. But you are reducing their net income. So therefore, you
will be receiving less revenues and particularly with
inflation.
Now, I went through that whole list and then let's just
talk about inflation, which is definitely, as you know, the
number one concern and problem small businesses are facing. And
you did not mention anything about that in your opening. So I
just have a couple of questions on that.
When businesses are dealing with, and why it should be very
relevant to you, inflation, when businesses are paying more for
goods and abiding by the contracts that they have with the SBA,
they therefore, are squeezing their margins, their
profitability. Are you in kind in the process of raising the
contracted prices by 8.6 percent, the highest level of
inflation in 40, 50 years, whatever it is? Are you doing that?
Ms. HIDALGO. Thank you very much, Congressman, for that
question. And we are actually studying the data to figure out
where we can provide relief for small business contractors.
Fortunately, what is amazing about these congressionally
created programs is that it is close to $150 billion a year
that is contracted through small businesses which helps, has a
significant impact on the well-being of contractors and firms,
small businesses around the country during uncertain economic
times. And so we are looking to see where we can adjust
thresholds working with the Office of Federal Procurement
Policy to issue guidelines, as well as adjust any of our rules
or regulations that will provide relief on inflation for small
businesses and our contractors.
Mr. MEUSER. I have limited time. I was going to ask about
the technology contract that you are engaged in. I am sure that
is a lot of fun. But good luck with it and I will have follow-
up questions on that in writing. Thank you.
Ms. HIDALGO. Thank you.
Mr. MEUSER. I yield back, Madam Chair.
Chairwoman VELAZQUEZ. The gentleman yields back.
Now we recognize the gentleman from Louisiana, Mr. Carter,
for 5 minutes. Mr. Carter?
The gentleman from Pennsylvania, Mr. Evans will be
recognized for 5 minutes.
Mr. EVANS. Thank you, Madam Chair.
In the latest budget request, SBA is sort of thumbing--for
a new initiative known as the Manufacturing Hub proposal. Could
you please expand on the scope of this issue and how SBA
envisions it will work?
Ms. HIDALGO. Thank you very much, Congressman, for that
question.
The president has been very focused on increasing
manufacturing within the United States, and he and our
Administrator see small business manufacturers as being the
pioneers in bringing back manufacturing to our shores. And so
as a result, this is why we responded with the proposal to
create a Manufacturing Hub office focusing more of our
technical assistance and outreach to manufacturing firms,
understanding some of their challenges and ways that we can
leverage, for example, some of the contracting tools so that
they can get the much needed supplies that they need to partner
with our federal agencies. And so basically, our proposal is
taking a laser focus on the ways that we can support our
nation's pioneers in manufacturing and ensure that more of our
products are made right here in America.
Mr. EVANS. Contracting vehicles have only gotten larger and
more complex in recent years. What is SBA doing to make sure
that these vehicles are not hurting small businesses and
chances of winning contracts?
Ms. HIDALGO. This is an excellent question, Congressman,
and it is top of mind for us every day. Most recently, we saw
an award, a bundled contract that was going to be a total of
$7.7 billion without any small business set-asides. And so my
office immediately negotiated with the agency, was very
steadfast, and as a result, we were able to negotiate $2.85
billion within that bundled contract just for small business
set-asides. But the reality is this is our PCRs and our
government contracting team and policy teams were critical to
the success but the PCRs are so critical for monitoring
contracts like these and if we are able to be able to get an
increase in staffing, we will be able to have more of the PCRs
monitoring these contracts across the government to ensure that
there will always be a large amount of set-asides for small
businesses and that we continue to adhere to the Rule of Two
across the federal government in setting aside contracts for
small businesses.
Mr. EVANS. How is SBA working to make sure agencies hold
larger contracts accountable to the subcontracting plans and
how is SBA supporting small businesses especially new entries
as they work as subcontractors?
Ms. HIDALGO. Thank you for that great question. It is
something that we know needs to change as far as ensuring more
accountability around subcontracting plans. With limited
resources, we are trying to figure out administratively what we
can do to ensure more of that accountability from having, for
example, potentially firms indicate to the small businesses if
they included them in their subcontracting plan, to having
potentially, for example, I just recently met via satellite
with a number of contractors in Guam who suggested that they be
able to indicate what the cost involved was for them to help
support a bid proposal and be able to attach that to those
plans.
So we are looking at all the administrative tools that we
have to make sure there is more accountability. The ESRS
system, unfortunately, does not allow for real-time data
analysis and that would be of significant support if we were
able to find a way to enhance that system operated through one
of our partner agencies to be able to track in real-time
whether or not major contractors are following through on their
subcontracting plans.
Mr. EVANS. Thank you. I yield back the balance of my time.
Thank you, Madam Chair.
Chairwoman VELAZQUEZ. Thank you. The gentleman yields back.
Now we recognize the gentlelady from California, Ms. Kim,
Ranking Member of the Subcommittee on Innovation,
Entrepreneurship, and Workforce Development for 5 minutes.
Ms. YOUNG KIM. Thank you, Chairwoman Velazquez, and Ranking
Member Luetkemeyer, for holding this important hearing. And I
want to thank you, Ms. Hidalgo, for joining us and testifying
before our Committee. And also for sharing your inspiring
story.
Like you, I am an immigrant from South Korea, and I can
tell you that America has also opened the door for me for, you
know, a better future for me and my family now. And I am a
grandma, so I am working really hard to ensure that we leave
America better for our future generations. So I hope we can
work together to preserve that American dream for all
Americans, but especially for small businesses to prosper and
succeed because small businesses are the backbone of our
economy as we heard this millions of times.
But unfortunately, according to the National Federation of
Independent Businesses survey, small business owners, their
expectation for better business conditions over the next 6
months are at their lowest in nearly 50 years. And small
business owners are increasingly pessimistic about the economy
because of the increasing costs, rising inflation, supply chain
disruptions, and chronic workforce shortages. As a Ranking
Member on that Subcommittee on Innovation, Entrepreneurship,
and Workforce Development, this is really a critical and
important issue for me.
And given the economic headwinds main street is facing, it
is extremely important that SBA is laser focused in fulfilling
existing mandates and providing business development assistance
in a timely manner.
There was an IG report February 2022, this year. The 8(a)
program found that SBA has regularly misused mandated deadlines
to report to Congress on program performance because the data
reliability issues would certify. Additionally, the report also
states that SBA does not have established standardized
procedures for business opportunity specialists to use to
monitor program participants.
So, have you met with the inspector general to discuss the
findings of that report?
Ms. HIDALGO. Thank you very much, Congresswoman, for those
important questions. Business development is really top of mind
for our team, our dedicated team of civil servants and everyone
across the agency. And I am very grateful for the plus-up that
we received in 7(j) technical assistance funding from Congress.
We have requested additional resources as well for fiscal year
2023 so we can continue to enhance our technical assistance and
business development.
But that said, as you mentioned with the data and the
report to Congress, given that there was a conversion from
paper to digital in 2018, now our team has been catching up in
their data analysis and we are on track to catch up with the
reports this year.
Ms. YOUNG KIM. Is that the reason for the delay in coming
up with a solution, conversion from paper to digital?
Ms. HIDALGO. That is one of your questions in terms of
reports, you know, reporting out to Congress, that was the
reason for the initial delay was that conversion. And now we
have actually addressed that and the team is on track to catch
up on our report to Congress on business development for 8(a)
firms.
And then apart from that, the wonderful issue that you
mentioned of Business Opportunity Specialists, we see that
there is a great opportunity there. And this is top of mind for
Administrator Guzman. And so my team just recently met with the
leads of all 68 offices around the country to develop an
approach for more training with Business Opportunity
Specialists to support our small business contractors.
Ms. YOUNG KIM. Thank you. You know, I am also hearing that
SBA's service to small contractors may be falling. For
instance, the 8(a) small business was referred to the wrong
specialist, an economic development specialist, rather than
business opportunity specialist when seeking contracting
assistance. District offices also may be more preoccupied with
SBA's other programs like its lending programs. Failing to
realize they also have a duty to offer business development
assistance to small businesses. So my question is, are you
aware of these issues?
Ms. HIDALGO. We are very aware that over time there has not
been as much emphasis at the district level on business
development and more on compliance. And so we would like to
strike more of a balance to ensure that across the board there
is more support for business development. And connection with
our PCRs and CMRs. So we are making sure that there is that
streamlined communication across offices.
Chairwoman VELAZQUEZ. The gentlelady's time has expired.
Ms. YOUNG KIM. Thank you. My time is up. I yield back.
Chairwoman VELAZQUEZ. Now we recognize the gentleman from
Louisiana, Mr. Carter, for 5 minutes.
Mr. CARTER. Madam Chair, thank you very much for the
opportunity.
Ms. Hidalgo, can you share with me the percentage of
African-American contractors in the 8(a) program?
Ms. HIDALGO. So, in terms of percentage, we have well over
1,000. About 1,500, I believe, African-American firms owned in
the 8(a) program.
Mr. CARTER. And can you share with me the percentage of
contracts that are awarded to these African-American
contractors?
Ms. HIDALGO. So for the first time in history, we released
disaggregated data on race and ethnicity. And of all federal
contracts, 1.67 percent are awarded to small businesses that
are African-American owned.
Mr. CARTER. How many have you lost? My understanding is
that the program has been somewhat diminished and there has
been a decrease in the amount of African Americans that
actually participate in the 8(a) program. Can you share with me
some light on that?
Ms. HIDALGO. We are trying to make sure that across the
board small businesses can compete in federal contracting. So
the programs that Congress has created, the five contracting
goals are really important for ensuring that all small
businesses can participate, including African-American owned
firms. And so as a result, we are making sure that we are doing
outreach across the board in urban areas, as well as in rural
areas. We are trying to figure out ways that individually owned
businesses can participate in more of these ordering vehicles,
the contract vehicles. Our work in trying to dismantle contract
bundling also has an impact on African-American owned
businesses, and especially African-American women-owned
businesses in being able to compete for these opportunities.
But what we wanted to do is have transparency and establish
a baseline so that we have an understanding of where we are and
where we need to go to ensure that there is access across the
board for all small business contractors.
Mr. CARTER. And forgive me. I do not want to appear to cut
you off but we have limited time, so if I do, please forgive
me. It is not being rude.
Share with me very quickly what plans you have or what you
are doing to increase African-American participation not only
in the program but for those that are in the program to ensure
that they are getting a fair share of contracting
opportunities. What are your aggressive steps or marketing
efforts?
Ms. HIDALGO. Well, part of it is certainly marketing but
also it is providing more assistance to applicants across the
board, making sure, I have asked to make sure that our pre-
screeners work with all the businesses. So if we receive any
incomplete applications, rather than being rejected, we are
having our prescreening and screening team work with them to
make sure that they can get all the important documents in for
the application.
And then I asked my team to think about Certify in the same
way that you would when you get your iPhone and it guides you
through the process in setting it up. So they should not have
to----
Mr. CARTER. Ms. Hidalgo, could you share with us in writing
the percentages that I asked in question, if you can submit
them to the Committee for our review, the percentages of
African-Americans and other minorities that are in the program
against what percentage of contracts are being awarded to them,
that would be very helpful.
Lastly, before my time elapses, I mentioned this before.
8(a) program was disrupted greatly during the pandemic. I know
there was a restoration of theoretically a year. That year was
actually truncated. It was not a full year. We know that the
impacts of COVID still exist and it hurt 8(a) contracts. I have
consistently asked for some relief that we consider how we can
yet again advance and grant additional time to those 8(a)
contractors so they can enjoy the full complement of their term
of an 8(a) contractor.
Can you share with me any actions that are being taken
along those lines and your thoughts?
Ms. HIDALGO. Thank you very much, Congressman. That is a
very important question and I am asked all the time by small
business owners if we will extend it an additional year. We
would welcome that opportunity to extend it. I have asked my
team if there is anything we can do administrative, and
unfortunately, we cannot. It would need to be by statute. And
so we welcome any opportunity to extend it an additional year
and we would be pleased to work with your office or with any of
the Members of the Committee here for that purpose.
Mr. CARTER. I would love to visit with you on that and to
work with our Chair and our Ranking Member to come up with a
bipartisan measure that will give us the opportunity to extend
it to make up for the tremendous loss that many of our small
and emerging businesses had to suffer at the hands of something
that was beyond any of our control, COVID>
Thank you very much.
Chairwoman VELAZQUEZ. The gentleman yields.
Mr. CARTER. If you could get back to us with that
information, particularly those areas of interest relative to
contracting opportunities and percentages, I would greatly
appreciate it.
Ms. HIDALGO. I would be happy to. I will have my team
circle back with you promptly, Congressman.
Chairwoman VELAZQUEZ. The gentleman's time----
Mr. CARTER. As well as the (8)a opportunity extensions.
Thank you so much.
I yield back, Madam Chair. Thank you.
Chairwoman VELAZQUEZ. The gentleman from Florida, Mr.
Donalds, is recognized for 5 minutes.
Mr. DONALDS. Oh, my apologies, Madam Chair. Thank you so
much.
Ms. Hidalgo, thanks for being here. We really do appreciate
it here in the Committee. I also commend you on everything you
have done personally in your life. You know, this country, I
think people sometimes think that success is easy. Success is
really, really hard. It requires a ton of sacrifice. So that is
a credit to you and to your family. But it also requires an
environment that allows for these sacrifices to come to
fruition. And it is crystal clear that examining the globe, it
is just not possible in so many other places the way it is
possible here in the United States. So it is really a credit to
you, your family, and it is a credit to the bedrock of our
society here in America.
Obviously, dealing with governmental contractors, can you
speak to some of the inflationary pressures that the
contractors are having to face right now considering the fact
that I think it was said earlier in the hearing that the
contracts are what they are from the federal government. Yet,
business owners have to procure product or deliver services,
whether that is procuring employees to do the work, whether it
is procuring other products to assemble for the federal
government to use. Can you speak to the inflationary pressures
that the contractors are faced with today?
Ms. HIDALGO. Thank you very much, Congressman, for that
important question and for your initial comments. I much
appreciate it regarding my family and their coming here to this
country.
So this is very top of mind for us and we have been looking
at any which way that we can provide relief for our small
business contractors.
I will give you an example of a firm that, for example, is
having trouble getting retractor bags and they are on the
cutting edge of fighting super bugs, a small business. And the
costs are high. And so one of the requests we got is, are there
ways that we can look to using some of the schedules, even
though they have impacted the small businesses, but could we
use some of the schedules to get supplies at lower costs for
small businesses, particularly since they are part of our
government contracting portfolio. So we are looking across the
board at all types of solutions to address any type of
inflationary pressures that businesses are facing at this time.
Mr. DONALDS. Have you guys had an opportunity to engage the
administration to talk about potential regulatory relief,
frankly, in the economy overall. I understand the purpose of
this hearing is with governmental contractors but, you know, if
it works for a government contractor, it will work for any
other business in the United States. Have you guys had an
opportunity to engage the White House about proposals on
regulatory relief which would actually really open up a lot of
these issues that businesses across the country are facing?
Ms. HIDALGO. Yes, definitely. Thank you. That is a great
question. And that is one of the reasons why I met across the
board with our PCR team and other staff to figure out how we
can use regulations to provide relief to businesses. And we are
working now on that and hope to be having relief sometime soon
working with OMB to provide relief on some of the thresholds.
Mr. DONALDS. Switching gears, back under Section 1683 of
the NDAA from fiscal year 2013, the SBA has to submit a report
on suspension and disbarment to Congress. What is the status of
that report? How come that report still has not been provided
to Congress? Is there any discussion within SBA about that
report actually getting to the Hill?
Ms. HIDALGO. Yes. We are right now working on updating all
of our reports. It is top of mind for the Administrator and me
to make sure that we follow through on our duty to Congress to
report back. And so the team has been working extremely hard in
updating and getting our reports to you and being timely going
forward. That is of utmost importance to me and the leadership
at SBA.
Mr. DONALDS. Final question and I will turn you back over
to the Committee, I guess.
The 2019 OIG audit of SBA's suspension and disbarment
process found that SBA had not established sufficient
guardrails to prevent ineligible entities from participating in
small business programs. What is happening right now at SBA to
address the OIG's findings?
Ms. HIDALGO. Thank you, Congressman. This is really
important to us and to the Administrator. And I will give you
an example. Because of our reviews in fiscal year 2021, we were
able to ensure that $5.28 billion in contracts were redirected
to legitimate small businesses because of some small businesses
that were no longer legitimate small businesses. So this is an
example of the kind of work we are doing to make sure. And I
have a top team in place that is very focused on this to make
sure we have the controls in place, working with the Fraud Risk
Management Board that Administrator Guzman also recently
created, to make sure that the businesses that Congress
intended to benefit from these programs are, in fact,
benefitting from the programs.
Mr. DONALDS. All right. Thank you.
Thank you, Madam Chair.
Chairwoman VELAZQUEZ. Time has expired.
Now we recognize the gentlelady from California, Ms. Chu,
for 5 minutes.
Ms. CHU. Ms. Hidalgo, from 2010 to 2019 we saw a steady
decline in the number of firms participating in the 8(a)
program. That was under the previous administration. And I
asked your predecessor what steps the office was taking to
address this decline. However, since then, data does show that
under the Biden administration, the SBA was able to reverse
this downward trend in 2021. And for the first time in 10
years, increased the number of small businesses in the program.
So Ms. Hidalgo, can you talk about what factors contributed
to last year's growth? And what steps your office is taking to
ensure that we keep up that growth and continue to bring more
firms into the program?
Ms. HIDALGO. Thank you very much, Congresswoman. This is
such an important issue, and we are all working, the dedicated
team of civil servants and staff are working diligently to try
to reverse this trend. And so, by tracking new entrants, we now
have a requirement across the federal agencies to track new
entrants. And as a result, we are seeing results. The agencies
are reaching out to us on a regular basis asking for lists of
firms that are new to the federal marketplace. We want to make
sure that we are being welcoming to firms that want to contract
with the federal government because of the opportunity it
provides contracting with the largest purchaser in the globe.
And so by tracking and also putting the goals and performance
evaluations, the KPIs of our senior executives across all 3,000
buying offices, that is where we are seeing a whole of
government approach to ensuring that we do not only increase
the dollars but we also increase the number of businesses that
can benefit. That is what is so extraordinary about these
programs is just the impact that it can have on our small
businesses across the country in communities and our nation.
Ms. CHU. Well, thank you for that because it has truly made
a turnaround. But however, I did want to ask about other
programs. I know under the previous administration the federal
government failed to meet the subcontracting goals for three
programs--the Small and Disadvantaged Business Program, the
Service-Disabled Veteran-Owned Small Business Program, and the
HUBZone program. These subcontracting goals are so critical to
ensuring these underserved small businesses have a fair shot at
competing for federal contracts. And I had asked your
predecessor under the previous administration what they were
going to do to remedy this. Now, I do not know what the current
results are for those goals under the current administration.
Nonetheless, what do you know about whether you are meeting the
subcontracting goals for these three areas and what steps your
office is taking to make sure that we do meet these goals going
forward?
Ms. HIDALGO. Thank you very much, Congresswoman. We are
trying to figure out what we can do to have more accountability
with the major primes' subcontracting plans. And we have
limited resources in terms of direct monitoring, so we are
looking at ways to issue more administrative guidance on this
front. And we are working closely with the White House and
office of Federal Procurement Policy now to take a more laser
focus on subcontracting in particular. If we were able to track
in real time through the ESRS system, whether or not primes are
following through on their subcontracting plans, that would
make quite a significant difference. But my understanding is
that system would need a lot more additional resources in order
to be able to do real tracking. And I think if we were able to
do that we would see an increase in billions of dollars going
to our nation's small business subcontractors.
Ms. CHU. Well, in fact, I know that the SBA requested an
additional $5 million to be divided between 8(a), HUBZone, and
Women-Owned Small Business programs for staffing resources. Can
you explain the purpose of this and how this funding would be
divided between three programs and whether you think it will
increase participation in these programs.
Ms. HIDALGO. Yes. Thank you very much. And definitely, we
want to make sure----
Chairwoman VELAZQUEZ. Ms. Hidalgo, time has expired. Will
you please send a written answer to the Committee in response
to that question?
Ms. HIDALGO. Yes, I would be happy to follow up on that,
Congresswoman. Thank you.
Chairwoman VELAZQUEZ. Thank you.
The gentleman from Minnesota, Mr. Stauber, is recognized
for 5 minutes.
Mr. STAUBER. Thank you, Madam Chair, and Ranking Member
Luetkemeyer for holding this. Ms. Hidalgo, thanks for being
here and presenting your testimony.
I think you have a very tough job to try and defend this
disastrous administration with the inflation and materials,
increase in materials pricing for small businesses that are
being devastated today.
Do you know how many billions of dollars of additional
regulations the Biden administration has put on small
businesses last year alone?
Ms. HIDALGO. Congressman, thank you very much for your
question and for your support of the programs. I do not----
Mr. STAUBER. I can answer that for you. It is $201 billion
of additional regulations that you put on small business. That
is just unacceptable.
So in the fiscal year 2022 National Defense Authorization
Act, I was able to successfully add an amendment that will help
reduce fraud in government contracting programs. The amendment
requires firms to update their status in SAM within 2 days if
they have received a final adverse decision against their
status. If they do not, SBA is required to update it.
Could you tell me how the implementation of this provision
is going thus far?
Ms. HIDALGO. Thank you very much, Congressman. We have
implemented that and my team has briefed me on that. Exactly as
you said. They have 2 days, and if they do not put the
information in SAM.gov then my team does.
Mr. STAUBER. I appreciate that.
What other controls have you put in place to reduce the
number of government contracts from going to ineligible firms?
Ms. HIDALGO. So as I mentioned, I hired a team that is very
focused on this issue in particular. We are pleased that most
of the IG audits and GAO audits on any of this have been closed
out. And as I mentioned, the Administrator created the Fraud
Risk Management Board so that we are cohesive as an agency in
addressing any issues related to fraud. And I am pleased that
in fiscal year 2021, we were able to redirect $5.28 billion in
contract dollars to legitimate small businesses that had been
previously awarded to businesses that were not legitimately
small.
Mr. STAUBER. One of the things that I hear from small
businesses back home, again, as I said, the regulations and the
frustrations of government interference, and to me it is
unacceptable having been a small business owner myself for 31
years.
Do you actively seek out feedback from small contractors on
the regulations which are holding them back?
Ms. HIDALGO. Thank you, Congressman. That is very important
to me. I have met with many small businesses around the United
States. And asked them regularly for their feedback on what we
have been doing, how we can provide relief. For Administrator
Guzman, it is very important that any regs we adopt are not
overly burdensome for our firms, and that is what she often
asks us to look at, how we can relieve any burdens for the
businesses.
Mr. STAUBER. And do you have a list of those that you can
send the Committee here----
Ms. HIDALGO. A list of----
Mr. STAUBER.--the recommendations that the small businesses
around the country that you spoke to?
Ms. HIDALGO. I am happy to circle back with you,
Congressman, to see what I can provide to you. Yes.
Mr. STAUBER. So when you circle back, what timeframe would
you be circling back?
Ms. HIDALGO. I am happy to get you any additional
information on ideas that we have heard from businesses
sometime in the next few weeks.
Mr. STAUBER. Few weeks?
Ms. HIDALGO. Mm-hmm.
Mr. STAUBER. Okay. I appreciate that.
And the last thing is, on the regulations, when you are
listening or hearing the small business feedback on the
regulations that are opposite of what this administration has
put forward, for example, the WOTUS rule. Are you pushing back
on behalf of small businesses?
Ms. HIDALGO. I am sorry, Congressman----
Mr. STAUBER. Waters of the United States rule, are you
pushing back on behalf of small businesses?
Ms. HIDALGO. We are looking at, the President wants to make
sure that all of our regulations are fair and balanced. And so
we are looking across the board at making sure that whatever we
do, the regulations are reflective of being fair and balanced
to all of our small businesses.
Mr. STAUBER. We are seeing that WOTUS is one rule that is
definitely disastrous for farmers and small businesses.
Madam Chair, I yield back.
Chairwoman VELAZQUEZ. The gentleman yields back.
Now we recognize the gentlelady from New York, Ms. Tenney,
for 5 minutes.
Ms. TENNEY. Thank you, Madam Chair and Ranking Member
Luetkemeyer. I really appreciate--I am over here. I am live
over here. Yeah, thank you much. I want to just echo the
sentiments of my colleague. Your personal story is really
compelling and as Americans, we love freedom, and we love the
idea of entrepreneurship in the small business community and
what they bring. And I am a small business owner as well. And
we have seen just incredible issues facing our small business
community in light of the pandemic.
And I also have to echo the sentiments of Mr. Stauber. I
cannot imagine trying to explain what you have to explain for
this administration. I understand that you have got to defend
it but, I mean, our small businesses are suffering under
incredible inflation. And that is the biggest tax that you can
have on any business right now, the inflation that we are
seeing at such a high percentage. Among the highest that we
face is our sales tax burden in the State of New York. But the
inflation rate is now even higher than our sales tax burden. So
that is even a bigger tax on us.
We also have supply chain issues. Energy is a huge issue
for our business, especially my cousins in farming and others
are suffering under the huge costs of fertilizer who is also
affected by that.
But also, you know, we are talking about taxes, inflation,
excessive burdens that are put on small businesses that cannot
afford to bear the costs of government and compliance like the
big competitors have. So when it comes to government
contracting, you know, we see the small business at a huge
disadvantage.
And one of the questions I wanted to ask you about on the
small business contracting side is often these small businesses
do not end up getting the higher value contracts. They get the
smaller contracts. What is your plan for trying to get these
small businesses that are now overburdened by inflation, supply
chain problems? How do we get them access to higher value
federal contracts? Is that something you are specifically
working on? If you could give me one or two ways that the
administration is doing that so I can get an opportunity to
actually be in this ecosystem.
Ms. HIDALGO. Thank you, Congresswoman, for that excellent
question.
We are often discussing ways that through competition--so
for example, the limitations on the 8(a) program, the sole
source cap, if it is competed through an ordering vehicle, then
they are able to qualify for a higher value contract award. I
also understand that Congresswoman Salazar has introduced
legislation on increasing the cap on the 8(a) sole source
award. And so we welcome the opportunity to work with the
Committee in ushering or providing any technical assistance on
that legislation. But higher value contracts are really
important to ensure that we not only increase small business
contacting but that the businesses themselves can continue to
generate wealth and employ people in more meaningful jobs. And
contract bundling is another issue that really impacts the
question that you have stated of higher value contract awards.
When contracts are no longer set aside for small businesses and
bundled, that decreases the opportunity for the firms. And so
we are every day on the frontlines monitoring these contracts
and trying to make sure that the agencies are following the
Rule of Two.
Ms. TENNEY. Okay. While I say that I want to just also ask
you, you stated in your testimony that the top priority of the
Small Business Administration is to boost the number of
certified small businesses receiving federal contracts behind
the current goal of 23 percent. Are you concerned at all that
by expanding this goal, it may cannibalize contracting
opportunities for some of the medium-sized businesses and also
some of the growing emerging businesses that are also in
competition for those as we continue to try to make sure that
we always talk about quality and the ability of these companies
to do those contracts.
If you just answer quickly because I have one follow-up
question on that for you.
Ms. HIDALGO. Thank you, Congresswoman.
We want to make sure that all businesses have the
opportunity to continue to grow and compete. Given that we are
the largest purchaser in the globe with over $500 billion in
opportunity each year, we feel that there is significant
opportunity for all businesses that want to compete. And so,
you know, we feel that we want to continue to see the firms
grow. We also recently released our 5-year review of the NAICS
codes, so that 59,000 small businesses are eligible for small
business set-asides. So we are doing----
Ms. TENNEY. I want to just say one thing because I know you
have got to go back to the president of the United States and I
would just wish he would please, to our small business
community which provides 94 percent of the jobs in our
community, stop playing the blame game. Help us out. We are
paying record high gas prices, inflation. It is affecting
everyone across our agro communities, our small business
community, and every sector. Let's solve these problems. And I
think SBA can be part of the solution but stop blaming these
small business owners. We are struggling just like everyone
else.
And thank you. I appreciate your testimony.
Chairwoman VELAZQUEZ. The gentleman from Wisconsin, Mr.
Fitzgerald, is recognized for 5 minutes.
Mr. FITZGERALD. Thank you, Madam Chair.
Ms. Hidalgo, the Small Business Act requires the SBA to
compile an annual report on the government-wide bundling and
its impact on small businesses. But what we are hearing is that
the SBA has indicated that the report is either difficult to
compile or is oftentimes incomplete due to the challenges in
and around getting this information. A lot of times either the
agency is just flat out declining to compile this information
and provide it. So, let me ask you this first. Is this
accurate? I mean, is this really happening? And if it is, what
I would like the Committee to do and I am working on a bill to
force them to actually compile this and provide it for SBA.
Ms. HIDALGO. Thank you very much, Congressman. This is
critical to ensuring that more contracts are set aside for
small businesses. And I have asked the White House if we can
make sure that we take an even more laser focus now that we
have issued the reforms on category management on contract
bundling. And what would make a significant difference is if
our PCRs and the OSDBU offices are on the front end of these
contract ends rather than the back end. Otherwise, we are given
30 days' notice to contest any bundled contracts. However, if
we are on the front end before any of the bundling takes place,
we are going to be able to negotiate quite significantly much
more opportunity for small businesses. And so I welcome to work
with you and your team to ensure that we have more
accountability around this and that we get more opportunity to
the small business contractors.
Mr. FITZGERALD. So Madam Chair, I would suggest, I think it
is a laudable thing for the Committee to work on and probably a
pretty simple bill to just once again put a directive in place
that all that information should be provided.
Let me just switch quickly to in my district, the 5th
District in Wisconsin, DoD is in the middle of that
implementation on the cybersecurity maturity model. And along
with that, what I am hearing from some of the DoD contractors
or those that participate in that process, that what they are
finding is that the compliance costs are so astronomical that,
especially those that are on the smaller end of the scale, are
almost throwing up their hands saying it is not worth it
because it is such an abstract kind of program and they are
having difficulty in not only participating in the program but
also, you know, kind of getting across the finish line saying
we have done everything we have been asked to do. So is this
something you are aware of? And is it something that you are
working on?
Ms. HIDALGO. Yes. Thank you very much, Congressman. This is
so critical for our small business contractors. And the
Administrator has talked with the Deputy Secretary of Defense,
and I talk regularly with the head of the small business office
to make sure that whatever is ultimately implemented is fair
and supportive of our small businesses and the costs associated
with this. So my understanding is DoD has been taking quite a
strong look at ensuring that ultimately whatever is adopted
does not unfairly hamper the businesses. And they are also
getting additional resources to support them on these costs
associated with these requirements.
Mr. FITZGERALD. So Madam Chair, once again, I think it is
another issue that this Small Business Committee could deal
with. And if my office is getting a steady stream of these
contacts, I am sure there are other Members of Congress that
are getting the same thing. So I would hope it would be
something that we could take a look at related to small
business. And I yield back.
Chairwoman VELAZQUEZ. The gentleman yields back.
Now we recognize the gentlelady from Texas, Ms. Van Duyne,
Ranking Member of the Subcommittee on Oversight,
Investigations, and Regulations.
Ms. VAN DUYNE. Thank you very much, Madam Chairwoman.
So I want to follow up on those questions about the
cybersecurity maturity model certification. You said that they
were working on it. That they were taking steps. Can you give
us more detail? What steps are they taking?
Ms. HIDALGO. Thank you very much, Congresswoman.
We have talked extensively with DoD about how this could
unfairly burden the small business owners. We have been hearing
from them as well, their concerns directly. And so DoD has
promised to keep us apprised of any ultimate steps that they
are going to take. But one, they are well aware of the costs
involved and are trying to figure out ways to alleviate those
costs and where they can provide extensions on implementing the
program to make sure that ultimately it does not unduly burden
the businesses but that we continue to keep national security
top of mind. And so----
Ms. VAN DUYNE. And I appreciate that. I appreciate that.
But what can we do to expedite that? Because they cannot wait
years. I mean, some of these companies are already coming off,
you know, the pandemic, 2-1/2 years of, you know, falling
revenues. They cannot wait that long. What can we do to be able
to expedite that?
Ms. HIDALGO. Well, one of the things DoD has done is
contracted with a firm to provide free training to any small
business contractors on this issue, and so part of it is
getting the word out on those resources and the training that
the DoD is providing. And then additional technical assistance
for the firms would make a significant difference. So any
resources that Congress can provide on that would have an
impact on ensuring that the firms are CMMC ready.
Ms. VAN DUYNE. Okay. According to NFIB's May Jobs Report,
the labor shortage continues to be a challenge for small
businesses with over half of them reporting job openings that
they could not fill. And I have seen this directly in my
district up in North Texas. This is up four points from April.
Can you tell me what the SBA is doing to address this growing
labor shortage?
Ms. HIDALGO. Thank you very much, Congresswoman.
It is really important for our small business contractors
to continue to create very meaningful jobs. And as a result in
the increase that we are seeing in contracting and new
entrants, they are able to create more meaningful job
opportunities and so that is very top of mind because we know
that this incredible resource through congressional goals has
an impact on ensuring that more small businesses can employ and
provide meaningful job creation in districts all----
Ms. VAN DUYNE. I appreciate that you saw it but I want to
make sure, we have a very short time, what are the steps that
you are doing? I see that you understand the problem but what
exactly are the steps that SBA is doing to address the labor
shortage?
Ms. HIDALGO. Well, thank you, Congresswoman. This is a very
important issue for the Administrator and for the President. We
want to make sure that small businesses have the support they
need to be successful.
Ms. VAN DUYNE. And I appreciate that. But what are the
steps that you are taking?
Ms. HIDALGO. We are looking at everything from where we can
focus on rules and administrative guidance to provide relief to
small businesses. Every day it is top of mind that we use the
vast resources that Congress has provided us to provide support
and technical assistance to our firms.
Ms. VAN DUYNE. And I appreciate that. But when I get calls
from, you know, our businesses, what can I tell them that you
are doing?
Ms. HIDALGO. So we have very much focused on creating the
opportunities that lead to more meaningful job creation, and as
a result, allows for the businesses to provide excellent
opportunities for their employees. And that----
Ms. VAN DUYNE. So we have the jobs. The jobs are available.
It is not job opportunities. It is actually the labor shortage
that we are looking. We have got a number of job openings. The
problem is filling those.
Ms. HIDALGO. Yes. And that is why government contracting is
so critical because as the labor market is looking for
meaningful opportunity, that is what government contractors
provide.
Ms. VAN DUYNE. Okay. Thank you very much.
Chairwoman VELAZQUEZ. The gentlelady's time has expired.
Now we recognize the gentleman from New York, Mr.
Garbarino.
Mr. GARBARINO. Thank you, Chairwoman, and the Ranking
Member for holding this hearing. Thank you for the witness for
her testimony.
I will follow up on Ms. Van Duyne's questions. I would love
to actually find out what SBA is doing to help. I am hearing
from every different aspect, every small business and they are
all having the same problem. And this is where I think the SBA
needs to help them. So if you actually do have a list of things
that you are doing and I can send them to your office for that
would be very helpful. So I want to thank my colleague for
asking those questions.
Last hearing, the witness was questioned whether pursuing
access to the SBA's contracting programs was worth it. And in
light of her observation that an increasingly higher proportion
of small business opportunities are found through
governmentwide contracts rather than individual set-aside
opportunities. What is your response to her observation?
Ms. HIDALGO. We see that the increasing reliance on these
governmentwide vehicles does have an impact on small
businesses' ability to compete because as you heard in the
hearing last week, it's fewer and fewer firms that are able to
get onto these contract award vehicles. We are working closely
with GSA to figure out if there is a way to have more frequent
onramps, which is another issue that you heard last week. And
so that more small businesses can participate in these ordering
vehicles.
And then apart from that, by our success in getting all the
socioeconomic firms onto Tier 2 of category management. So as
these agencies are rated in their performance, it includes
contracting with small businesses that are separate from the
ordering vehicles.
Mr. GARBARINO. Okay. So you heard what she said and you
guys are actually coming up with issues to address it. So I
appreciate that.
Another question, according to payroll data, head counts at
companies with fewer than 50 employees declined in 3 of the
past 4 months. In your opinion, why do you believe this decline
is happening and what can the administration do to reserve the
decline?
Ms. HIDALGO. We are very focused on making sure that we
leverage all the tools that we have at our disposal, from the
socioeconomic programs to the small business set-aside to our
technical assistance programs, to make sure that the small
businesses can compete and they have the employees and staff
and resources to do that. And fortunately, because of these
programs and the enormous impact it has on the U.S. economy.
They are able to create meaningful jobs. And these jobs are
key, are critical in addressing the labor shortage.
Mr. GARBARINO. I mean, the jobs are there, and my colleague
made this point before. It seems the employees are not. The
jobs are there. There are signs everywhere, you know, jobs
available. So, I mean, what, again, this goes back to my
previous colleagues, why are people leaving the companies? Why
are the headcounts going down and what is the administration
doing to change it? Is it a payroll problem? I mean, what is
the issue. The jobs are there; it is the employees that are
not.
Ms. HIDALGO. Right. And I think part of it is when I am
talking about or referencing meaningful jobs that the firms are
able to provide more competitive opportunities to employees and
that makes a difference in being able to hire and find top
quality talent.
Mr. GARBARINO. All right. I appreciate your answer.
One last question. I am concerned that the rising use of
joint ventures for the SBA's Mentor-Protege Program is creating
a dependency among small businesses on them to be competitive.
It is a problem since up to 60 percent of the work performed by
a joint venture and corresponding revenues can be obtained by a
large mentor. These are dollars specifically designated for
small businesses that large businesses can now easily access.
Please share your own assessment of the Mentor-Protege Program
and the formation of joint ventures' impact on these small
businesses.
Ms. HIDALGO. Well, it is definitely an important tool for
our small businesses to be able to partner with other companies
to go after contract opportunities and create more value. We
have seen a marked increase in applicants to the Mentor-Protege
Program thanks to the All Small Mentor-Protege Program. We are
now tracking regularly the impact that it is having and we are
seeing a significant increase in revenue for the small
businesses as a result. So it is yielding outcomes and we are
continuing to monitor all the rules and regulations to ensure
that ultimately the small business benefits most from this
important resource that the SBA is able to provide.
Mr. GARBARINO. I appreciate it. I am out of time.
Chairwoman VELAZQUEZ. Time has expired.
I would like to thank Associate Administrator Hidalgo for
appearing here today.
Strengthening the ability of small businesses to compete
for and win federal contracts is one of this Committee's top
priorities. A robust Office of Government Contracting and
Business Development is integral to achieving this goal. Today,
we have covered issues facing the office, and we will work on a
range of potential solutions to help the office operate more
efficiently and effectively.
Without objection, Members have 5 legislative days to
submit statements and supporting materials for the record.
If there is no further business to come before the
Committee, without objection, we are adjourned. Thank you.
[Whereupon, at 11:44 a.m., the committee was adjourned.]
A P P E N D I X
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]