[Congressional Record Volume 164, Number 158 (Tuesday, September 25, 2018)]
[House]
[Pages H8812-H8813]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
CLARITY ON SMALL BUSINESS PARTICIPATION IN CATEGORY MANAGEMENT ACT OF
2018
Mr. CHABOT. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 6382) to amend the Small Business Act to require the
Administrator of the Small Business Administration to report certain
information to the Congress and to the President, and for other
purposes, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 6382
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Clarity on Small Business
Participation in Category Management Act of 2018''.
SEC. 2. REPORTING.
Section 15(h) of the Small Business Act (15 U.S.C. 644(h))
is amended by adding at the end the following:
``(4) Best in class small business participation
reporting.--
``(A) Addendum.--The Administrator, in addition to the
requirements under paragraph (2), shall include in the report
required by such paragraph, for each best in class
designation--
``(i) the total amount of spending government wide in such
designation;
``(ii) the number of small business concerns awarded
contracts and the dollar amount of contracts within such
category awarded to each of the following--
``(I) HUBZone small business concerns;
``(II) small business concerns owned and controlled by
women;
``(III) small business concerns owned and controlled by
service-disabled veterans; and
``(IV) socially and economically disadvantaged small
business concerns.
``(B) Best in class.--The term `best in class' has the
meaning given to it by the Director of the Office of
Management and Budget.
``(C) Effective date.--The Administrator shall be required
to report on the information described by subparagraph (A)
beginning on the date that such information is available in
the Federal Procurement Data System, the System for Award
Management, or any successor to such systems.''.
The SPEAKER pro tempore. Pursuant to the rule, the gentleman from
Ohio (Mr. Chabot) and the gentlewoman from New York (Ms. Velazquez)
each will control 20 minutes.
The Chair recognizes the gentleman from Ohio.
General Leave
Mr. CHABOT. Mr. Speaker, I ask unanimous consent that all Members may
have 5 legislative days to revise and extend their remarks and include
extraneous material on the bill under consideration.
The SPEAKER pro tempore. Is there objection to the request of the
gentleman from Ohio?
There was no objection.
Mr. CHABOT. Mr. Speaker, I yield myself such time as I may consume.
I would like to thank Ms. Adams for leading this important piece of
legislation.
Category management is a procurement initiative that is currently
being rolled out across the Federal Government. It can be a positive
tool, allowing the Federal Government to better understand its
purchasing habits and identify cost savings where appropriate. However,
setting mandatory targets to manage agency spending may result in
unintended consequences.
Specifically, there is concern that this initiative may have the
effect of reducing competition to only a few select vendors. As we
continue to see increased use of these best-in-class vehicles by
Federal agencies, it is important to remember that it is not the job of
the government to pick winners and losers. We must be vigilant and
ensure that maximum opportunities are given to small businesses, even
as we continue to pursue cost savings across the Federal Government.
H.R. 6382, as amended, takes that critical first step by tracking the
potential impacts of category management on small businesses. The bill
requires the SBA to report exactly how much of these dollars spent
through best-in-class vehicles are awarded to small businesses.
Obtaining this data and identifying trends or patterns affecting small
businesses will become increasingly important as category management
continues to be used in years to come.
This is a commonsense piece of oversight legislation, and I urge my
colleagues to support the measure.
Mr. Speaker, I reserve the balance of my time.
Ms. VELAZQUEZ. Mr. Speaker, I yield myself such time as I may
consume.
I rise in support of H.R. 6382, the Clarity on Small Business
Participation in Category Management Act of 2018.
Our committee has long acknowledged small businesses' critical role
in
[[Page H8813]]
the $500 billion a year Federal marketplace. When small firms are
awarded Federal contracts, the result is a win-win.
While category management is billed as the strategy to get agencies
the lowest price, we have heard the contrary in our committee, in that
more contracts are being consolidated out of the reach of small
businesses.
By requiring that contracting activity under this new regime be
reported in the annual goaling report from agencies to Congress,
today's bill protects the industrial base by creating a mechanism for
much needed accountability.
I am proud to be a cosponsor of H.R. 6382, and commend Congresswoman
Adams for her work to provide accountability to the category management
regime.
I urge Members to support this legislation, and I reserve the balance
of my time.
Mr. CHABOT. Mr. Speaker, I have no further speakers, and I reserve
the balance of my time.
Ms. VELAZQUEZ. Mr. Speaker, I yield 5 minutes to the gentlewoman from
North Carolina (Ms. Adams), who is the sponsor of the bill and ranking
member of the Subcommittee on Investigations, Oversight and
Regulations.
Ms. ADAMS. Mr. Speaker, I rise in support of my bill, H.R. 6382, the
Clarity on Small Business Participation in Category Management Act.
Small businesses are the heart of American enterprise, and we must
ensure a level playing field for all of them to compete for Federal
contracts. My legislation is the first step to addressing the many
concerns of the small business community regarding the current
administration's efforts to expand the use of category management.
Although category management has been billed as the procurement
strategy that can get Federal agencies the lowest price, the actual
numbers tell a very different story. In fact, the data shows us that
small business vendors on the Multiple Award Schedule continually
provided agencies with lower prices than those offered by category
management contract holders.
However, due to the changes under this administration, many Federal
agencies and contracting officers can no longer take advantage of
increased competition and lower prices because some category management
vehicles are the only option available.
Unfortunately, the current trend of this administration is to
increase the number of agencies heading in this misguided direction.
This will result in wasteful spending of taxpayer dollars because a
reduction of competing vendors means Federal agencies will pay more
than necessary for goods and services.
Furthermore, the harmful effect of the use of the category management
business model could mean further exclusion of minorities, women,
veterans, and other already disadvantaged small business owners in the
Federal marketplace.
My bill requires the Small Business Administration to include in
their annual report information on best-in-class contractors, which are
the companies that largely benefit from category management.
This bill would also provide lawmakers with information on whether
category management is reducing the role of small firms, women-owned
firms, minority-owned companies, and veteran-owned enterprises in
Federal contracting.
I am also proud to say that my bill is endorsed by the National
Defense Industrial Association, an association whose 1,600 corporate
members and over 85,000 individual members are 70 percent small
business. NDIA works to help small companies grow and remain a strong
part of the defense industrial base.
The ability for Congress to see this data allows us to determine the
effectiveness of such contracting vehicles for small firms and to make
needed changes where appropriate.
{time} 1800
Mr. Speaker, I urge Members to support this legislation. I thank very
much our chairman and our ranking member for their support.
Ms. VELAZQUEZ. Mr. Speaker, I want to thank the gentlewoman from
North Carolina (Ms. Adams) for introducing this important piece of
legislation to provide much needed oversight of small business
participation in the streamlined acquisition strategy known as category
management.
Mr. Speaker, I urge all the Members to support this important piece
of legislation.
Mr. Speaker, I yield back the balance of my time.
Mr. CHABOT. Mr. Speaker, I yield myself such time as I may consume to
close.
Mr. Speaker, I would like to thank Ms. Adams for her leadership on
this measure and congratulate her for its passage here shortly.
This legislation raises the profile of this important issue and
requires that the SBA keep track of how much Federal spending is made
through best-in-class vehicles. I applaud the administration for
looking for ways to ensure taxpayer dollars are utilized in the most
efficient ways possible.
At the same time, we must be watchful to safeguard small businesses'
proper importance and place in the Federal marketplace. Enacting this
legislation will help ensure that the correct data is collected and
reported to help maintain that balance.
Mr. Speaker, I urge my colleagues to support this bipartisan
legislation, and I yield back the balance of my time.
Ms. JACKSON LEE. Mr. Speaker, I rise in support of H.R. 6382, the
``Clarity on Small Business Participation in Category Management Act of
2018''.
H.R. 6382 amends the Small Business Act to require the Administrator
of the Small Business Administration to report certain information to
the Congress and to the President.
This bill directs the administrator of the Small Business
Administration to report to congress on: the total amount of spending
government wide in such designation; the number of small business
concerns awarded contracts and the dollar amount of contracts within
such category awarded to each of the following--
1. HUBZone small business concerns;
2. Small business concerns owned and controlled by women;
3. Small business concerns owned and controlled by service-disabled
veterans; and
4. Socially and economically disadvantaged small business concerns.
More than 99 percent of Houston's businesses are considered small.
In 2016, roughly seven businesses in the Houston District received a
loan averaging $500,000 each weekday.
Small businesses are the lifeblood of our economy in Houston and
across America.
Small business was key for the nation's recovery from the recession.
Between the middle of 2009 and the middle of 2013, 60 percent of the
jobs created were from small businesses.
I am committed to producing tangible results in suffering communities
through legislation that creates jobs, fosters minority business
opportunities, and builds a foundation for the future.
Studies have shown that supporting small businesses is good for the
American economy. For every $1 invested, small businesses will
contribute $7 to the economy.
Every American deserves the right to be gainfully employed or own a
successful business and I know we are all committed to that right and
will not rest until all Americans have access to economic opportunity.
The SPEAKER pro tempore. The question is on the motion offered by the
gentleman from Ohio (Mr. Chabot) that the House suspend the rules and
pass the bill, H.R. 6382, as amended.
The question was taken; and (two-thirds being in the affirmative) the
rules were suspended and the bill, as amended, was passed.
A motion to reconsider was laid on the table.
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