Are Governmentwide Contracts Helping or Hurting Small Contractors? (House Small Business Committee hearing, June 14, 2022)

Summary

Transcript of the House Committee on Small Business hearing Are Governmentwide Contracts Helping or Hurting Small Contractors?, convened June 14, 2022 during the 117th Congress, Second Session, published as Small Business Committee Document Number 117-058 (GPO 47-847). Chairwoman Nydia Velázquez presided alongside Ranking Member Blaine Luetkemeyer. Witnesses were Amber Hart of The Pulse of GovCon LLC, Isaias "Cy" Alba IV of PilieroMazza PLLC, Lynn Ann Casey of Arc Aspicio, and Rebecca Askew of Circuit Media LLC, with an appendix statement from Daniel Chow of the Minority Business Development Agency. The committee examined how governmentwide contract vehicles affect small contractors, marketplace competition and new entrants.

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“Are Governmentwide Contracts Helping or Hurting Small Contractors? (House Small Business Committee hearing, June 14, 2022).” Original at www.govinfo.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/are-governmentwide-contracts-helping-or-hurting-small-contractors-hous-76a4ee02e3/, SHA-256 4d34cd03a0a1d8e9bdd5fba1a64be2a5ad86b5768ea703a13f32cef1172b8185.

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ARE GOVERNMENTWIDE CONTRACTS HELPING OR
HURTING SMALL CONTRACTORS?

HEARING
BEFORE THE

COMMITTEE ON SMALL BUSINESS
UNITED STATES
HOUSE OF REPRESENTATIVES
ONE HUNDRED SEVENTEENTH CONGRESS
SECOND SESSION

HEARING HELD
JUNE 14, 2022

Small Business Committee Document Number 117–058
Available via the GPO Website: www.govinfo.gov

U.S. GOVERNMENT PUBLISHING OFFICE
47–847 WASHINGTON : 2022
HOUSE COMMITTEE ON SMALL BUSINESS
NYDIA VELÁZQUEZ, 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
ANTONIO DELGADO, New York
CHRISSY HOULAHAN, Pennsylvania
ANDY KIM, New Jersey
ANGIE CRAIG, Minnesota
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

(II)
CONTENTS
OPENING STATEMENTS
Page
Hon. Nydia Velázquez ............................................................................................. 1
Hon. Blaine Luetkemeyer ....................................................................................... 2

WITNESSES
Ms. Amber Hart, Co-Founder & Co-Owner, The Pulse of GovCon LLC, Ster-
ling, VA ................................................................................................................. 5
Mr. Isaias ‘‘Cy’’ Alba, IV, Partner, PilieroMazza PLLC, Washington, DC .......... 7
Ms. Lynn Ann Casey, Chief Executive Officer & Founder, Arc Aspicio, Wash-
ington, DC ............................................................................................................. 8
Ms. Rebecca Askew, Chief Executive Officer & General Counsel, Circuit
Media LLC, Denver, CO ...................................................................................... 10

APPENDIX
Prepared Statements:
Ms. Amber Hart, Co-Founder & Co-Owner, The Pulse of GovCon LLC,
Sterling, VA ................................................................................................... 35
Mr. Isaias ‘‘Cy’’ Alba, IV, Partner, PilieroMazza PLLC, Washington, DC .. 43
Ms. Lynn Ann Casey, Chief Executive Officer & Founder, Arc Aspicio,
Washington, DC ............................................................................................ 52
Ms. Rebecca Askew, Chief Executive Officer & General Counsel, Circuit
Media LLC, Denver, CO ............................................................................... 56
Questions for the Record:
None.
Answers for the Record:
None.
Additional Material for the Record:
Statement of Daniel Chow, Senior Economist, Minority Business Develop-
ment Agency, Office of Policy Analysis and Development ......................... 63

(III)
ARE GOVERNMENTWIDE CONTRACTS HELP-
ING OR HURTING SMALL CONTRACTORS?

TUESDAY, JUNE 14, 2022

HOUSE OF REPRESENTATIVES,
COMMITTEE ON SMALL BUSINESS,
Washington, DC.
The Committee met, pursuant to call, at 10:01 a.m., in Room
2360, Rayburn House Office Building, Hon. Nydia M. Velázquez
[chairwoman of the Committee] presiding.
Present: Representatives Velázquez, Golden, Bourdeaux, Carter,
Evans, Houlahan, Kim of New Jersey, Craig, Luetkemeyer, Wil-
liams, Stauber, Meuser, Tenney, Garbarino, Kim of California, Van
Duyne, Donalds, and Fitzgerald.
Chairwoman VELÁZQUEZ. 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 will continue to apply dur-
ing 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 I will recognize that
Member at the next appropriate time slot, provided they have re-
turned to the proceeding.
With that, we are going to start with the hearing.
Ensuring access to federal contracting opportunities is one of this
Committee’s core priorities. Winning fair contracts allows small
firms to create jobs, grow their businesses, and invest in their com-
munities.
That is why the recent decrease in the number of small firms
doing business with the government is so concerning. From 2010
to 2019, the number of small companies providing common goods
and services to the federal government shrank by 38 percent. This
staggering decline not only hurts small businesses but it also leads
to less competition in our federal marketplace and less innovation
nationwide.
One of the primary causes behind this trend is the Category
Management Initiative. Since its implementation beginning in 2016
(1)
2

to 2019, the number of small firms serving as federal contractors
shrank by 17 percent.
Category Management is a nationwide procurement initiative
that involves buying common goods and services as a single enter-
prise. It tries to make government purchasing more efficient, less
redundant, and ultimately more cost-effective. However, the prac-
tice has produced many unintended consequences for small busi-
nesses.
One of the most troubling consequences of Category Management
is the reduction in the use of individual contracts in favor of gov-
ernmentwide contracts and those designated as best in class. These
larger contracts are structured to serve multiple agencies and re-
quire businesses to provide an extensive range of products and
services. As a result, many small businesses are at an inherent dis-
advantage when it comes to winning governmentwide contracts.
Yet the concerns do not end there. For example, these contracts
last many years and essentially lock out those small businesses
that are not included in them.
Also, the costs and resources needed to bid on these contracts are
substantial, and there are no assurances that the small business
will receive an award. In fact, the procurement itself may not even
come to fruition. This Committee has heard from numerous busi-
nesses that invested thousands preparing for a contract that failed
to materialize.
As if this was not enough, governmentwide and best-in-class con-
tracts are relying on a self-scoring evaluation process that rewards
those who come with vast experience, past performance, and certifi-
cations. Hence, only the biggest businesses or those that team up
to collectively become the biggest can successfully compete.
Given all the costs, hurdles, and uncertainty associated with
these vehicles, many small businesses have been left wondering
whether these are best-in-class contracts or worst-in-class.
Today, I want to take a close look at the challenges that govern-
mentwide contracts pose for small businesses and reforms Congress
can pursue to ensure attempts to improve federal procurement
aren’t at the expense of small firms.
I now would like to yield to the Ranking Member, Mr. Luetke-
meyer, for his opening statement.
Mr. LUETKEMEYER. Thank you, Madam Chair.
I think we both agree there are many important situations in the
federal procurement space that demand congressional attention.
The issue we are exploring today rises to among the very top.
Like Netflix disrupting the entertainment industry or Amazon
fundamentally changing the way we shop, the federal government’s
use of multibillion-dollar governmentwide contracts might be per-
manently altering the way the government buys goods and serv-
ices.
It is important to keep in mind that these contract vehicles are
not inherently good or bad. They are simply tools, and their use or
misuse is what determines their impact on the contractor base.
While I understand and even agree with the Office of Manage-
ment and Budget’s interest in maximizing cost savings and obtain-
ing administrative efficiencies, there must be a thorough weighing
of the balance. Choosing to procure with these vehicles must not
3

result in devastating impacts to the small industrial base—a base
which is, as this Committee has long documented, in decline at an
alarming rate.
The Department of Defense recently released a report coming to
the bold conclusion that contract consolidation in the defense in-
dustrial market is a national security threat, recommending that
the agency prioritize engagement with new entrants and small
businesses.
Unfortunately, one of the unintended consequences of the rising
use of governmentwide contracts is the exclusionary impact this
has on most small contractors and the ensuing negative ripple ef-
fects stemming from the loss of this critical cohort of business.
Only a limited number of small contractors are awarded spots on
these lucrative long-term contracts. This leaves the rest locked out
of the lion’s share of federal opportunities. No federal opportunity
means no incentive to remain in the federal marketplace.
The resulting loss of small contractors means less competition
and, ultimately, higher costs to the taxpayers, less innovation, and
risk of stagnation and may snowball into broader, more debilitating
concerns, such as threatening our national security and economy.
The high-stakes nature of these contracts also creates a whole
set of issues for small businesses themselves. For instance, small
businesses have only a limited pool of resources; thus, these re-
sources must be diverted either to create the best possible bid or
to meet other business needs.
Small businesses may further feel the need to expend even more
valuable resources protesting unfavorable contract terms or awards
in order to protect their sizable investments, with no guarantee
that the outcome will be in their favor.
On a similar note, because these contracts are so sweeping in
their requirements and highly competitive, many small businesses
feel forced to give up their independence, pressured to partner with
large firms via joint ventures for the best possible chance of win-
ning a coveted spot on these contracts.
This presents a whole host of issues, including that many large
businesses are essentially legally granted access to federal dollars
dedicated specifically to assist small businesses.
Unfortunately, it seems at this point the genie is out of the bot-
tle, and it is difficult to imagine a world returning to mostly indi-
vidual, direct contract actions. However, we can be wiser, more
thoughtful, and more intentional in seeking the appropriate bal-
ance.
I will end with this thought. In the struggle to simplify and man-
age federal spending, the federal government should not lose sight
of the importance of small businesses, nor should it disregard the
impact that increased use of governmentwide contracts may have
on the industrial base. The federal government must do more to en-
sure the majority of small businesses can thrive in this new envi-
ronment.
Briefly, on a separate topic, I would like to note that another
week has passed and Secretary Young continues to fail to fulfill her
statutory duty and appear before this Committee.
Madam Chair, with that, I yield back.
Chairwoman VELÁZQUEZ. Thank you, Mr. Luetkemeyer.
4

I would like to take a moment to explain how this hearing will
proceed. Each witness 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 speak-
ing and that you return to mute when finished.
With that, I would like to introduce our witnesses.
Our first witness is Ms. Amber Hart, who is the Co-founder and
Co-owner of The Pulse of GovCon, an advisory firm in Sterling, Vir-
ginia, that provides business intelligence information, tools, and
data to empower government contractors. Ms. Hart is a federal
business developer and has over 12 years of experience in all as-
pects of selling to the federal government. She is an active member
of the Professional Services Council, the president-elect of Women
in Technology, and sits on the advisory board for the Center for
Government Contracting at George Mason University.
Welcome, Ms. Hart.
Our next witness is Mr. Isaias ‘‘Cy’’ Alba, a partner with the law
firm PilieroMazza in Washington, D.C. Mr. Alba counsels clients on
a broad range of government contracting matters before govern-
ment agencies and federal courts, which includes overall regulatory
compliance with the Small Business Administration small-business
programs. He also represents small and midsize government con-
tractors looking to structure compliant teaming, joint venture, and
mentor-protege agreements.
Welcome, Mr. Alba. We greatly appreciate your expertise on to-
day’s topic.
Our third witness is Lynn Ann Casey, the Founder and CEO of
Arc Aspicio, a certified women-owned small business. Arc Aspicio
is a consulting and solutions company that solves problems by ap-
plying integrated capability and strategy design data, human cap-
ital behavioral science, and technology. Ms. Casey founded Arc
Aspicio in 2004 and has had a 29-year career driving innovation for
government agencies.
Welcome.
Now I will yield to the Ranking Member to introduce our final
witness.
Mr. LUETKEMEYER. Thank you, Madam Chair.
Our next witness is Rebecca Askew. Ms. Askew is the chief exec-
utive officer and general counsel for Circuit Media, and she is testi-
fying on behalf of the Women’s Procurement Circle.
Having been founded 16 years ago, Circuit Media is a govern-
ment-contracting small business that specializes in creative serv-
ices, staffing, and communications. With offices in Colorado and
Washington, D.C., Circuit Media and Ms. Askew are familiar par-
ticipants of the SBA’s contracting programs.
Ms. Askew, thank you for once again testifying before this Com-
mittee and for your participation today.
I would also like to thank all the witnesses for being here today
and joining us, and I look forward to your conversation and discus-
sion.
With that, Madam Chair, I yield back.
Chairwoman VELÁZQUEZ. Thank you, Mr. Luetkemeyer.
Ms. Hart, you are recognized for 5 minutes.
5
STATEMENTS OF AMBER HART, CO-FOUNDER AND CO-OWNER,
THE PULSE OF GOVCON, LLC, STERLING, VIRGINIA; ISAIAS
‘‘CY’’ ALBA IV, PARTNER, PILIEROMAZZA, PLLC, WASH-
INGTON, D.C.; LYNN ANN CASEY, CHIEF EXECUTIVE OFFICER
AND FOUNDER, ARC ASPICIO, WASHINGTON, D.C.; AND RE-
BECCA ASKEW, CHIEF EXECUTIVE OFFICER AND GENERAL
COUNSEL, CIRCUIT MEDIA, LLC, DENVER, COLORADO
STATEMENT OF AMBER HART
Ms. HART. Chair Velázquez, Ranking Member Luetkemeyer, and
Members of the Committee, thank you for the opportunity to testify
before you today.
My name is Amber Hart, and I am the co-founder and co-owner
of The Pulse of GovCon. The Pulse of GovCon is a self-funded,
women-owned small business focused on empowering government
contractors. We break down barriers across the contracting eco-
system and bridge the fundamental gaps surrounding federal pro-
curement.
Our day-to-day involvement has allowed us to not only observe
the impacts of governmentwide contracts on our small-business cli-
ents but to actively participate in the realities of strategic sourcing
and bear the brunt of its unintended consequences.
In a world of uncertainties, small businesses just want clarity by
way of clear, concise, and consistent regulations to ensure compli-
ance. However, mixed messages in the usage of these procurement
vehicles meant to simplify acquisition have resulted in increased
challenges for small businesses.
With limited resources and intense demands on time and money
in the bidding process, contract cancellations can be catastrophic to
small firms that have dedicated months and years to the process.
Vague contract vehicles with never-ending technical functional
areas often devolve into protests, with very little funding making
it to small businesses. This creates two distinct consequences.
First, the bundling and consolidation required by Category Man-
agement has required the industry to buy or be bought. Companies
now must acquire their competitor to scale at a meaningful pace
or buy into a sector to increase revenue. This increase in merger
and acquisition activity has certainly reduced the number of small
businesses eligible for prime contracts.
Second, in the end, it is likely that the same vendors will be on
GSA Polaris, HHS CIO-SP4, and GSA 8(a) STARS III due to little
to no difference between the focus areas of the vehicles. As a result,
the government will not gain access to a wide range of solutions
and services from the wider federal marketplace.
At its core, strategic sourcing initiatives minimize channels for
acquisition and reduce lanes where contractors can supply services
and products. Since its establishment in fiscal year 2016, Category
Management has resulted in a 26-percent decrease in small-busi-
ness utilization across best-in-class contracts. This is identical to
its precursor, which shrunk the office supplies industrial base by
26 percent over 6 years.
Furthermore, the number of small-business awards under best-
in-class contracts in Category Management has decreased by 22
percent over the past 6 fiscal years. Simply put, small-business dol-
6

lars have increased but have been consolidated into a shrinking
competition pool of fewer vendors and even less contract opportuni-
ties.
Under Category Management, governmentwide acquisition con-
tracts serve as the motivating force through the utilization of best-
in-class solutions. One of the most important pieces of the best-in-
class criteria is having rigorous requirement definitions and plan-
ning processes. However, most best-in-class contracts are now
being created to support the broadest spectrum possible, resulting
in requirements gymnastics for small-business bidders.
For example, GSA Polaris contract is supposed to serve as GSA’s
future small-business GWAC to deliver complex IT services. Many
performance areas laid out in the final RFP do encompass these
types of requirements, including cloud services, cybersecurity, and
system design. However, the RFP also lists out ancillary support
services, including construction, which does not constitute complex
IT.
Standardization of best-in-class criteria, how it is managed, and
how small-business contractors get a seat on these vehicles is of
critical importance. This includes establishing individual defini-
tions for the federal, civilian, and defense markets.
Current best-in-class contracts are all over the map when it
comes to important small-business factors like size standard recer-
tification, bid requirements, experience qualifications, ramping
timelines and procedures, and how set-asides are tracked.
These collective initiatives have resulted in less access and trans-
parency into government procurement activity and opportunities
and has increased requirement bundling, vendor consolidation, and
market uncertainty. The unintended consequences of strategic
sourcing and governmentwide contracts impact the critical ele-
ments that sustain the industrial base—competition, innovation,
and economic stimulus.
Surviving in this marketplace is not easy for any vendor, but it
is made especially difficult for a small business who could prove
real value to our country. The move to Category Management, fur-
ther contract consolidation, shrinking contracting offices, bundling
of requirements, and a strict focus on socioeconomic spending,
versus the quality of the small-business requirements being com-
peted, has had a significant impact on small businesses.
The U.S. economy is firmly dependent on a healthy market com-
petition. Competition for federal contracts breeds innovative solu-
tions and passes on cost savings to the taxpayer. To increase com-
petition, there must be equal opportunity to contribute to each
agency’s unique missions.
If the federal government wants small businesses to thrive, we
need to rethink how new, innovative, and qualified players can
enter the market, while structuring vehicles that allow agencies to
procure the right solutions that truly fit their mission needs. With-
out these considerations, small businesses may flounder in the
wake of large business conglomerates.
On behalf of The Pulse, I thank you for your attention on this
important issue, and I look forward to answering your questions.
Chairwoman VELÁZQUEZ. Thank you.
Mr. Alba, now you are recognized for 5 minutes.
7
STATEMENT OF ISAIAS ‘‘CY’’ ALBA IV
Mr. ALBA. Thank you. Chair Velázquez and Ranking Member
Luetkemeyer, Members of the Committee, thank you for this oppor-
tunity.
My name is Cy Alba, and I am partner of the law firm of
PilieroMazza, with offices in Washington, D.C.; Annapolis; and
Boulder, Colorado. We serve clients that operate throughout the
United States and around the world, spanning virtually all indus-
tries, but we have historical focus on government contractors.
That said, my testimony today represents my own views and not
those of PilieroMazza clients or the firm. I greatly appreciate the
opportunity to share my thoughts with the Committee on changes
that can better serve the small-business community, who make up
the foundation of our economy.
As the federal contracting landscape is difficult to traverse, com-
panies of all sizes must invest a great deal of time and money to
ensure compliance with applicable laws and regulations. For small
businesses, this difficulty is only exacerbated by the mandated use
of best-in-class contracts and large governmentwide acquisition
contracts.
Many of our clients have seen work vital to their businesses
swept up into these large vehicles outside of their reach, their in-
cumbent small-business work being consolidated with other re-
quirements, forcing them to team with companies or become sub-
contractors, where their fate is dictated by a prime contractor with
whom they have never worked and may not trust.
That being said, it is important to note that GWACs and best-
in-class contracts are not inherently problematic. Indeed, obtaining
work on these contracts is a critical component of many small busi-
nesses’ growth strategies, as companies can continue to qualify for
task-order awards even after they have organically outgrown their
size standards, instead of being unceremoniously thrown into the
unrestricted space.
These contracts can be used to help these companies survive long
enough to learn the rigors of unrestricted procurement, which can
include higher compliance challenges and lower profit margins.
This struggle is very real, as even being 1 cent over your size
standard means that your company must now compete with firms
that may have revenues of $100 million, $100 billion, or more.
There is no limit.
Given this, we have to find a better way of using GWACs and
best-in-class contracts to support small-business growth and devel-
opment.
For instance, GWACs and best-in-class contracts should have
more frequent on-ramps, perhaps even every year or two. This
would allow small businesses to participate and not lose out on 5-
or 10-year vehicles based merely upon their status or ability to
compete as of the date of the initial solicitation.
On-ramps would greatly reduce the stress on companies to secure
a spot on these large contracts, thereby reducing the incredibly
high stakes of these procurements, reducing bid costs for small
businesses, and avoiding locking out firms who come into existence
mid-contract, outside of the on-ramp period.
8

Additionally, prohibit removing requirements that have been pre-
viously set aside for small businesses onto these large vehicles
without first performing some impact analysis of how the incum-
bent contractor and the small-business community would be
harmed by the move. I cannot count the number of times I have
had small-business owners beg for help when requirements their
companies had performed for sometimes over 20 years are suddenly
moved into IDIQ vehicles that they do not possess.
Third, it should be made clear that the Rule of Two, which re-
quires contracts to be set aside for small businesses when two or
more such firms can perform the work, applies to task orders
issued under IDIQ contracts pursuant to FAR Part 16 as well as
GSA Schedule Contract task orders under FAR 8.4. Otherwise, con-
tracting officers will continue to exploit this loophole to strip small
businesses of procurement opportunities while enriching the largest
companies.
In addition to the ability for small businesses to survive the
struggles of graduating to a midsize company, the SBA’s Mentor-
Protege Program is also an extremely important tool for growing
the industrial base. The SBA’s Mentor-Protege Program allows
mentor firms to help proteges grow and develop using small-busi-
ness set-aside contracts while allowing these teams protection from
being affiliated and incentivizing larger businesses to truly mentor
the small-business participants. This program is not without its
faults, but with proper oversight by SBA, it can truly help build
the next generation of our supply chain for the federal market.
Many of these issues surrounding large contracts are due to
shortsighted decisions by agencies to force Category Management
upon the market without thinking about the negative consequences
on small businesses. As a result, our entire industrial base is im-
pacted, and it becomes increasingly difficult for new companies to
enter the federal market.
Every small-business federal contractor must be protected, and,
as a nation, we cannot afford to lose more of our critical industrial
base—a very real risk noted by the Department of Defense this
past February and as noted earlier today.
I applaud the Committee for holding this important hearing
today to address these ongoing issues. Thank you for the oppor-
tunity to testify, and I look forward to answering any other ques-
tions.
Thank you.
Chairwoman VELÁZQUEZ. Thank you, Mr. Alba.
Now we recognize Ms. Casey for 5 minutes.

STATEMENT OF LYNN ANN CASEY
Ms. CASEY. Chairwoman Velázquez, Ranking Member Luetke-
meyer, and the Members of the Committee, thank you for this op-
portunity to testify on behalf of small businesses as our govern-
mentwide contractors and contracts.
I am the CEO and founder of Arc Aspicio, a women-owned small
business. We do have governmentwide vehicles, including the
Human Capital and Training Solutions contract with GSA. And we
made our way up to that by first subcontracting, then winning our
9

initial contracts on Multiple Award Schedules before being able to
compete on a large GWAC.
We are also a small-business mentor to protege 2ndWave in the
Mentor-Protege Program. And as a small business that helps other
small businesses, we find it rewarding to help them grow as well.
While Category Management broadly helps the federal govern-
ment increase procurement efficiencies, our company has seen it re-
duce the number of small businesses and the type and number of
opportunities that are available for small businesses, including us,
to compete on. This reduces innovation that the small businesses
can offer.
Like other small businesses, we absolutely love to work for the
government, and we simply want the opportunity to compete. Gov-
ernmentwide vehicles shift small-business opportunities to very
small pools of winning contractors rather than fostering competi-
tion among diverse companies under the GSA MAS schedules or
other contracts. This reduces opportunities for newer small busi-
nesses who seek their first opportunities as a prime contractor.
It also reduces opportunities for established small businesses
who were high performers on incumbent contracts, essentially
pushing these recompete opportunities to best-in-class vehicles and
not allowing great small businesses to recompete for their current
work. This actually places burden not only on the small business
who can’t recompete; it provides extreme additional administrative
burden to the government, who has to transition and is forced to
transition to new contractors, and this puts the mission at risk.
Small businesses should be allowed to compete on their follow-
on contracts. And the Committee can explore innovative best prac-
tices, such as permanent legislation rather than frequently chang-
ing policies at the agency level about these topics and mandates.
This will spur competition, lower prices, and foster innovation.
Another issue for the Committee to consider is the incredible cost
to pursue governmentwide contracts. Arc Aspicio estimates that it
costs us somewhere between $60,000 and $100,000 for each pro-
posal for a governmentwide vehicle.
In addition, we have to pay costs to get quality certification, such
as the Capability Maturity Model and ISO 9000. And while these
are great quality certifications, these certifications cost $60,000,
$70,000, $80,000 and require annual audits.
In addition, award timeframes and protests really delay any in-
vestment we make. We would love the Committee to consider the
GSA Multiple Award Schedules and expanding use of these, help-
ing companies to get their first opportunities at prime contracts.
Based on our experience—and we have 18 years in the federal
government—Arc Aspicio does not want to cede control of our work
and enter into a joint-venture prime contract with a large firm. We
have built our experience and really want to win on our own. How-
ever, this puts us at a disadvantage when competing with other
small businesses who are backed by and often controlled by large
businesses of a $100 billion or more. We want fair opportunities
against other non-joint-venture small businesses.
We look forward to the Committee exploring incentives for more
established small businesses to help other small businesses grow.
This might take the form of grants or encouraging the use of addi-
10

tional evaluation credit on task-order bids when a small business
mentors a protege and they bid together.
In conclusion, I want to thank the Committee and ask them to
consider additional ideas to regrow the small-business base and
help them recover from the unintended consequences. Thank you
so much for your time.
Chairwoman VELÁZQUEZ. Thank you, Ms. Casey.
Ms. Askew, you are now recognized for 5 minutes.

STATEMENT OF REBECCA ASKEW
Ms. ASKEW. Thank you. Chair Velázquez, Ranking Member
Luetkemeyer, and Members of the Committee, thank you for the
opportunity to testify before you today.
My name is Rebecca Askew, and I am the owner and general
counsel of Circuit Media, based in Denver, Colorado. I am testi-
fying today on behalf of the Women’s Procurement Council, which
advocates for policies that strengthen women-owned companies
that do business with the federal government.
Women fought for 11 years to get the Women-Owned Small Busi-
ness Federal Contracting Program in place and an additional 2
years to get sole-source authority. Yet the federal government has
only met its 5-percent goal for contracting to women twice since
1994.
As a new participant in governmentwide contracts, I hope to pro-
vide insight into the resources required to adequately respond to
these opportunities.
I started Circuit Media out of my basement with a focus on pro-
viding clear and concise communications to law and government.
Circuit Media has since grown into a strong supplier of goods and
services to local, State, and federal governments. With a diverse
background in communications, creative services, and staffing, Cir-
cuit Media assists clients in creating cost-effective and compelling
deliverables.
Circuit Media had the opportunity to participate in SBA’s 8(a)
Business Development Program. This program allowed us to learn
and develop expertise in the federal contracting arena.
As we entered the transitional stage of the program, our plan for
growth focused on differentiating our company through the contin-
ued use of set-asides and attempting to obtain slots on government-
wide contracts.
For a small business to respond to an IDIQ, it takes significant
time, money, and human capital. The response consist of hundreds
of pages over multiple volumes and dozens of pricing categories. At
Circuit Media, we dedicate at least one proposal writer and one fi-
nancial analyst to manage the bulk of the submission. This re-
moves these individuals from their normal work responsibilities
and requires others to double up work.
There are always multiple amendments and changes to the origi-
nal solicitation, which demands extraordinary attention to detail
and record-keeping, as errors or omissions are deductions.
Winning a slot also in no way guarantees a company will win
work with a federal agency. It only allows you to compete for the
opportunities released on the IDIQ. I liken it to getting a fishing
11

license. You can throw your line into the water, but no catch is as-
sured.
I would like to discuss our recent experience responding to GSA’s
staffing IDIQ, HCaTS. As Circuit Media provides staffing services
to the government, we felt it was necessary to respond.
We spent weeks preparing our submission. Our final proposal
was hundreds of pages and included 168 different pricing cat-
egories. It had to be physically mailed to New York City and was
only accepted on DVD disc. We submitted our response on March
20, 2020, the day we closed our offices to the pandemic.
After submission, our first communication with GSA occurred 9
months later. Because of the significant lapse in time, GSA
changed components of the evaluation criteria, which they applied
retroactively. This subjective post-submission change in evaluation
resulted in our company missing the award cutoff by 100 out of
28,470 points.
Agencies fail to realize that delays in contract award and
changes in midstream can be seismic shifts for a small business,
making or breaking their ability to win work.
My experience points to the need for simplification on the agency
front. Congress can assist women in being more successful in secur-
ing government contracts by adopting the following actions pro-
posed by the Women’s Procurement Circle.
Number one, increase awards to women-owned business, includ-
ing increasing EDWOSB goals and raising the WOSB goal to 10
percent.
Maximize WOSB awards on governmentwide contracts.
Number three, expand sole-source contract opportunities for
WOSBs.
Number four, eliminate EDWOSBs to have access—allow
EDWOSBs to have access to business development tools to grow
and thrive.
Number five, eliminate double counting for contract awards.
And, number six, require agencies to fully utilize Made in Amer-
ica products.
The federal government’s acquisition practices are geared to-
wards large companies competing on enormous government buying
vehicles. Congress rightfully continues to require agencies to buy
from small business. Over 90 percent of all women-owned busi-
nesses are small. Therefore, women are major stakeholders in
these policy actions.
Thank you for the opportunity to testify today, and I am happy
to answer any questions.
Chairwoman VELÁZQUEZ. Thank you, Ms. Askew.
Now I recognize myself for 5 minutes.
Ms. Hart, so what you described in your opening statement, as
well as the other witnesses, is consolation at its best, at the ex-
pense of small businesses, at the expense of taxpayers and innova-
tion.
GSA tracks small-business utilization through the Category
Management Dashboard. What does the dashboard show regarding
small-business utilization in more recent years?
Ms. HART. Thank you for your question, Chair.
12

So the GSA GWCM small-business utilization dashboard, which
is under the dashboard you just referenced, shows 30-percent utili-
zation consistently from fiscal year 2018 to today, which is about
the only thing that is tracked.
When compared to industry-wide, that is about consistent of
about 29 percent. So it seems to be consistent with how industry
is tracking. But there is very small—but you can see it—decrease,
actually, in that utilization that is beginning to track.
Chairwoman VELÁZQUEZ. If the small business space has de-
creased substantially, how could you explain the federal govern-
ment still meeting the small-business goals?
Ms. HART. So the key statutory tracking for agencies is to actu-
ally focus on the small-business dollars, which has increased; we
are all aware of that. However, the number has to be carefully
looked at, because within each socioeconomic category, numbers
can be counted double or triple, depending on the socioeconomic
category.
So that is how they are able to keep the numbers rising as well.
So the business report can kind of exist for different vendors’ trans-
actions, and obligations can be counted triple times.
One example of this metric could be the number of unique ven-
dors receiving small-business dollars is how that really could be
fixed, if we actually look at the number of vendors, unique vendors,
getting that——
Chairwoman VELÁZQUEZ. Thank you.
Ms. HART.—those dollars.
Chairwoman VELÁZQUEZ. Thank you.
Mr. Alba, not only are requirements being consolidated into a
few best-in-class contracts, but these contracts use a self-scoring
evaluation process that has its own set of unique challenges.
What are some of the challenges the self-scoring evaluation proc-
ess poses for some businesses?
Mr. ALBA. Yeah. Thank you.
I think the main thing with the self-scoring is, like has been
talked about, a lot of businesses are just looking to tick boxes be-
cause you have to. That is the way the system is set up, right? And
so companies are looking for either the large-business mentor; or
they are looking for 10 or 15 different companies to joint-venture
with; or if it is allowed by subcontractors, they do that.
And they are forced to go after, not the best companies to do the
job, but the companies to maximize the point scores—one person
with a $7 million contract; one likely big guy who has an approved
purchasing system; one person who has this skill; one person who
has that skill set. So you get this ‘‘jack of all trades, potentially
master of none’’ scenario instead of, I think, the best procurement
for the best companies.
Chairwoman VELÁZQUEZ. Thank you.
Ms. Casey, so you are a company that has served as a mentor
for another small contractors. Can you please talk to us about the
benefit to a small business of being mentored by a larger small
business?
Ms. CASEY. Absolutely. We mentor a company called 2ndWave.
They are an 8(a) and service-disabled veteran-owned company.
13

Because we have recently been a smaller company, yet we have
18 years of experience, we understand the challenges of newer en-
trants and newer and smaller small businesses.
Our executives have the time to take to actually spend time with
our protege company. We have done off-sites with them and helped
them create strategies to pursue new business. We have pursued
new business with them. We have helped build up their proposal
process so they can actually compete. And they have since won
more contracts.
This idea of more established small businesses working with
newer small businesses is a wonderful idea, because we have re-
cently lived through it; it is very rewarding for me, as a CEO, to
work with another small business. And small businesses are great
both advocates and resources for other smalls who are newer en-
trants to the market.
Chairwoman VELÁZQUEZ. Thank you.
Ms. Askew, in 20 seconds, in your perspective, what are some of
the areas that must be improved?
Ms. ASKEW. Thank you for the question.
In my opinion, the areas that must be approved is clear and con-
cise communications and standardization. If you are applying to
one of the governmentwide contracts, that you can actually under-
stand what the rules are and how they are being applied to you,
as well as, you know, looking at opportunities for women-owned,
other types of opportunities within those GWACs so that everyone
can have a level playing field.
Chairwoman VELÁZQUEZ. Thank you.
Now I recognize the Ranking Member.
Mr. LUETKEMEYER. Thank you, Madam Chair.
Ms. Askew, it seems the goal of these governmentwide contracts
is to reach administrative efficiencies and cost savings through con-
tract consolidation. This is something I agree with, but it seems to
hinder small-business growth.
Do you think it is possible for the government to find both effi-
ciencies and save taxpayer dollars while also building a robust and
healthy small-business base?
Ms. ASKEW. Thank you for the question.
In my estimation, it has been difficult to be able to balance both
of those. It is sort of you throw the baby out with the bath water.
You are trying to do consolidation, but that leaves small businesses
in the lurch and unable to respond or even to be on the playing
field.
That example of us trying to respond to a governmentwide con-
tracting opportunity really displayed that capability. You know, we
put all of our resources towards that opportunity and still came up
short.
So I think that, you know, when you are looking at the best way
to manage, you know, the balance between the two, I think it is
best to realize that, being a small business, you aren’t going to
have that equal playing field, and there needs to be some kind of
measurement for that.
Mr. LUETKEMEYER. Thank you for that.
14

Just a quick question with regards to the things that are going
on in society today and how it is affecting your ability to bid on
contracts here.
With additional inflation and supply-chain problems and the reli-
ability of the supply chain, do you have something built into your
contracts to be able to allow the bidder to—is there flexibility in
there with regards to inflationary costs, inability to, you know, to
weather some of the supply-chain disruptions? How do you manage
that situation?
Ms. ASKEW. That is the $24 million question, actually.
You know, when you enter into a contract and when you, you
know, enter into a contract with the government, you are con-
tracting at that moment in time, and there is not any kind of addi-
tional remedies that can occur.
You know, an example of that is Juneteenth. We moved from
having that not be a holiday to that being a federal holiday. And
all contracts—you know, you needed to be flexibility during that
period of time.
So, you know, I——
Mr. LUETKEMEYER. Okay. The question, I guess, is: Is there
enough flexibility in the contracts to allow you to be able to adjust
and be able to—you know, if you are sitting there guessing at what
inflation is going to be down the road, you don’t have any firm com-
mitments from people who are your suppliers, with supply-chain
problems, how—is there enough flexibility in the contracts to be
able to allow you—or do you have to bid up significantly higher in
order to be able to, you know, be able to run the risk of not having
enough built into there to be able to make some money on it?
Ms. ASKEW. That is a great question. Actually, you know, with
LPTA or some of the contracts where they look at lowest price or
best value, you end up—your margins become pretty slim, they be-
come pretty small, because you want to be competitive with all the
other businesses. And so, you know, there isn’t a ton of flexibility,
to be honest.
Mr. LUETKEMEYER. Well, one of the problems, it would seem
to me, is the length of time some of these contracts take for you
to be able to fulfill the contractual obligation. And so it may be
weeks, months, years to be able to fulfill a contract. So how do you
project out?
I know I have some constituents that are stuck in the situation
here where they bidded and now, with this runaway inflation that
we have, they are going to be—you know, unless the government
is willing to come back and help them arbitrarily, they are going
to be in big trouble here, because they are not going to have
enough income or enough equity in that contract to be able to sur-
vive. They are actually going to wind up losing money out of the
deal.
So I would think there needs to be some sort of clause or flexi-
bility in there to allow the small businesses, who are probably not
flush with tons and tons of cash—otherwise, they would be bigger
businesses—to be able to survive.
Ms. ASKEW. I think that is very astute. And I would say that
it is a difficult problem. And I am not sure I have the solution.
15

I would say that, you know, there are brief increases that occur
every year with the contract. But, once again, you have to measure
that increase with the ability or the need to win one of those con-
tracts to continue to compete.
Mr. LUETKEMEYER. Ms. Hart, did you—you heard my ques-
tion. Do you want to—I mean, that is part of what you do, is con-
sulting on these contracts. Would you have a comment on that?
Ms. HART. Absolutely.
So I believe there was a recent EO on inflation from the adminis-
tration allowing flexibility, for at least defense contractors to take
that into consideration.
And then there are some IDIQ vehicles and GWACs that are now
allowing you to compete at the task-order level on pricing, which
means you don’t submit pricing at the umbrella level, if you will,
and——
Mr. LUETKEMEYER. So—I am sorry to interrupt, but I am out
of time here—just a clarification here. So the executive order al-
lows enough discretion by the agency to be able to work out a deal
with the contractor, then, to make sure they don’t go under?
And, then, if they go under, they may not be able to actually pro-
vide the service or product. Although they probably have a bond to
make sure that works. But we don’t want to lose people in this
process.
Ms. HART. It is not my area of expertise, but, from what I un-
derstand, it does allow some flexibility for contractors to bring in
inflation.
Mr. LUETKEMEYER. All right. Thank you very much.
I yield.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now we recognize the gentleman from Louisiana, Mr. Carter, for
5 minutes.
Mr. CARTER. Madam Chair, thank you very much for the oppor-
tunity.
I have a general question that any of you who would like to can
address.
We know that, during COVID, there was an extension for indi-
viduals that were 8(a) contractors to theoretically make up for the
loss of opportunity because of [inaudible] that year there was an
extension. It actually turned out to be less than a year.
What value, if any, do you believe that extension gave? And how
could we be able to perhaps grant even additional time for people
who may have met on the time out, running out of time with the
certification [inaudible] didn’t fully get in the amount of time.
Could someone share with me their views on how we can do bet-
ter, how that worked, and your thoughts?
Mr. ALBA. Yeah, I would be happy to answer that. I am a mem-
ber of the board of the Bowie Business Innovation Center, which
has an 8(a) accelerator program, in a historically black college and
university, the only in the country, and so I deal with these issues
often.
And this is one of those things that I have heard repeatedly,
where the companies have sort of begged to get an additional year.
Given the way that COVID has extended itself out, they have not
been able to meet with contracting officers as often. The events are
16

only just starting to happen, conferences and whatnot. And so it
has been difficult to interface with individuals in market.
And that has been, I think, a major factor, in a lot of the 8(a)s
that I have been talking to and who we work with in our program,
in getting new contracts and growing, especially those who are to-
wards the end and are looking to maybe get on some new contracts
to weather this next challenging storm.
Mr. CARTER. Ms. Casey?
Ms. CASEY. I would say as mentor to an 8(a) company, since
things are really only starting back, they would love an additional
year to be able to build up their business. COVID has really hurt
the opportunity to sell to the government.
Mr. CARTER. So I think, more than them just loving to have an
additional year, I think there is a case to be made that they did
not get the full complement of what the program is designed to do,
because even though there was an extension, the extension wasn’t,
in fact, a full year.
But the effects of COVID and the supply-chain crises is very
much still in effect, so people are still suffering. So I just wanted
get your observations and your thoughts on that. I am happy to
hear that it is consistent with what I hear from my constituents.
And, Madam Chair and Ranking Member, I would like to ask
that we include this in our further due diligence as we move for-
ward on how we can really make these individuals whole who have
suffered greatly at the hands of something that is beyond all of our
control, COVID and supply chain.
Quickly, pivoting from that, I would like to ask a question about
the Mentor-Protege Program. What obstacles, if any, have you had
in really getting to businesses that are out there that would benefit
but aren’t aware of the various resources?
Mr. ALBA. Yeah, I am happy to take that too.
So, you know, dealing with small businesses all over the country
and things, I think it is—there is a disparity in information, I
think, depending on where you are. So some places in the country,
like around here, around the Beltway, there is a lot more knowl-
edge of these programs, whereas when you go in other places—and
I have a number of clients in the Huntsville area and things of that
nature—they have fewer and fewer resources available to them,
and there isn’t as much, I think, outreach.
Potentially, SBA could have more sessions in some of these areas
and explain the benefits of the program with potentially all these
great small-business mentors, like we heard about earlier, who are
willing and offering this type of help.
Mr. CARTER. Let me ask you real quickly before my time runs
out. So this is something I hear from my constituents quite often,
is some of the mentorship-protege programs, while they work fi-
nancially, they don’t always work in the vein of giving that protege
a true opportunity to learn the business and really perform.
How do we overcome the relationship that becomes one more of
a financial partnership and less a partnership with that protege to
actually learn the business to become a mentor to someone else?
Mr. ALBA. So I would say there are already a number of rules
in place that we could just do a better job of enforcing.
17

So SBA looks at reports that proteges give every year as to how
the mentor-protege relationship is going, but I haven’t personally
seen them do much with it. So potentially the SBA could take a
closer look at these issues, go through the mentor-protege agree-
ment, make sure the promises that are in that agreement are being
met, specifically—not just joint-venturing, not just contracting.
SBA says all the time that it is to develop your business, it is
not a business development program. And to take that to heart and
move that forward, I think, is what we need to do.
Chairwoman VELÁZQUEZ. The gentleman’s time has expired.
Mr. CARTER. Thank you very much. I yield back.
Chairwoman VELÁZQUEZ. The gentleman from Texas, Mr. Wil-
liams, Vice Ranking Member of the committee, is recognized for 5
minutes.
Mr. WILLIAMS. Thank you, Madam Chairwoman and Ranking
Member Luetkemeyer and witnesses, for being here——
[Audio interruption.]
Chairwoman VELÁZQUEZ. Can you please, the Members that
are hybrid, mute yourself?
Thank you.
Mr. Williams, yes, I will give you more time.
Mr. WILLIAMS. Thank you, Madam Chairman. This why we
need everybody here and quit this nonsense we got going.
Thank you all for being here today.
And before I address small businesses’ role in government con-
tracting, I would like to take a minute to address the current state
of our economy.
I am probably one of the few—maybe Ranking Member Luetke-
meyer—that was a small-business owner in the 1980s. I still own
the same business I had in the 1980s, in 1981 and 1982, where we
saw so many of the same issues we are facing today. If we keep
going the way we are going, there are not going to be any mentor
programs, I am just telling you.
Let’s go back to 1981. In 1981, we had inflation out of control.
We had leadership that had no idea what to do about it except con-
demn our country. So we had inflation out of control; the federal
reserve was raising interest rates. We had 20-percent interest—20-
percent interest. So, if you were a small-business owner, you went
to bank and you borrowed at 19 percent—19-percent interest. And
if you had any money, you had a CD. Ranking Member
Luetkemeyer’s banks were paying 19 percent on 2-year CDs, if you
can imagine that.
So interest rates were out of control, and principal balances were
so much different. Today, everybody is concerned about 6 percent,
which we should be. We are paying 6-percent interest on—I am in
the automobile business, and in 1981 you could buy a car from me
for 3,000 bucks and finance it at 20 percent. But that same car now
is $50,000, $60,000, $70,000, $80,000, you can finance it at 6 per-
cent, and the principal balances are so much higher. It is just cre-
ating one heck of a problem for us.
And homes, we see what is happening with homes. Homes you
could buy for $40,000 now you buy for $400,000.
Chain disruptions, we didn’t have that in 1980. The one thing we
had 1980 was product. We could sell our way out of it; we could
18

claw our way out of this problem. But now there is no product.
There is no—I don’t have any cars to sell. There is no nuts and
bolts and hardware stores. It is a mess. We have chain disruptions
like we have never seen before. So at least we had debt.
So 20-percent interest paved (ph) the 6-percent interest. That is
a real problem. I have a concern for our economy. Our economy is
in a serious, serious issue.
And you all talk about growth and getting the government out
of small business and talk about competition. That is what it is all
about, but we don’t have that now, you see. We need to get out of
this by quit spending money we are printing that is worthless. And
we need to let main street compete and be able to help get our-
selves out of this mess.
But we all need to have our eyes open of the situation we are
in right now. We have the best workers in the world, and we are
paying them to sit on the sidelines. So we need to make it easier
on main street, we need to cut taxes, we need to reduce regula-
tions, and we need to let the private sector and small business get
us out of this mess. I am for that. I think all of you are, too, from
what I hear with your testimony.
So, with that, before I move into my other question, Ms. Askew,
what is your general take on the economy? And how is it impacting
your small business and the businesses you represent?
Ms. ASKEW. Thank you for the question.
At the end of the day, revenue is the driver that makes any
small business successful. And, you know, obviously, no one wants
higher taxes or inflation——
Mr. WILLIAMS. Thank you for saying that.
Ms. ASKEW. That is—I think we would all agree to that. And
so trying to figure out——
Mr. WILLIAMS. Not everybody.
Ms. ASKEW. Well, trying to figure out a way in which you can
manage that and still grow your business is really a challenge.
Mr. WILLIAMS. Well, it is.
And all American small businesses deserve an opportunity to
compete, as we talked about, for government contracts against
their larger counterparts. However, the current bidding process, we
hear, is extremely resource-intensive and prevents small busi-
nesses from even attempting to break into this potential revenue
stream.
Businesses are having to make the decisions to commit signifi-
cant resources to secure a spot for these federal contracts or take
one more additional growth opportunity like hiring that additional
employee or investing in new equipment. These two options should
not be an either/or scenario. So every qualified small business
should be able to have their opportunity to secure a contract with-
out it being prohibitively expensive.
So, again, Ms. Askew, you have experienced the same frustra-
tions firsthand. Can you elaborate on the decisions your business
had to make to decide to break into the contracting world? And
what recommendations do you have that would allow smaller busi-
nesses with less resources the opportunity to compete?
Ms. ASKEW. Thank you for the question.
19

It is a day-by-day decision-making process that we go into at Cir-
cuit Media, trying to decide: There is this opportunity. How is that
going to impact us? Who do we have to pull off of—the opportunity
to respond, just, you know, to respond, to get, you know, that op-
portunity to perhaps win? And how are we going to manage that
with our current workload?
And so it is a day-by-day decision-making process that my team
and I go through to try to figure out—you know, it is, do we rob
Peter to pay Paul? How do we manage that?
Mr. WILLIAMS. Trying to figure out how to beat the government
is tough.
Thank you for being here. Appreciate it.
Ms. ASKEW. Thank you.
Mr. WILLIAMS. I yield back.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now we recognize the gentleman from Pennsylvania, Mr. Evans.
Mr. EVANS. Thank you, Madam Chairperson.
Ms. Casey, to what extent has engaging in joint ventures become
necessary for small businesses to successfully navigate the federal
procurement space, and why?
Ms. CASEY. Well, we are an established small business, and we
decided to enter into being a mentor to a smaller small business
to be able to help them compete on additional contracts. Certainly
we do get a benefit if we win any of those contracts, but that is
really helping grow a small business.
On the other hand, though, we have decided not to enter into a
mentor-protege program with a large business.
Arc Aspicio really likes to control our own destiny, manage con-
tracts, and deliver on our contracts. And we have the experience
to do that with the federal government and have worked on more
than 150 projects.
The current business environment, though, is pushing us to al-
most be forced into a joint venture with a large business in order
to continue to be able to compete on contracts. And that is a big
challenge for us, because we would like to not have to compete with
joint ventures that are backed by hundred-million-dollar compa-
nies, because we can perform the work on our own.
Mr. EVANS. Given the shift towards governmentwide contracts
and best-in-class vehicles, what would be your number-one rec-
ommendation for new businesses interested in becoming federal
contractors?
Ms. CASEY. That is a great question.
What helped us when we started out was the support of other
small businesses. I think networking among small businesses will
really help newer entrants navigate the complexities of today’s
business environment and the challenges of governmentwide con-
tracts—networking to gain experience and knowledge of how to
write proposals, how to get subcontract opportunities that lead to
prime contract opportunities on things like GSA Schedules so that
when the time comes you are ready to bid on a governmentwide
contract.
But it is a journey, and you can’t just jump to a governmentwide
contract. And I think smaller businesses can help other new en-
20

trants navigate that complex environment and build a business
strategy that is lasting and could help these new entrants succeed.
Mr. EVANS. Thank you, Ms. Casey.
I yield back, Madam Chairperson, the balance of my time.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now we recognize the gentleman from Pennsylvania, Mr.
Meuser, Ranking Member of the Subcommittee on Economic
Growth, Tax, and Capital Access.
Mr. MEUSER. Thank you very much, Madam Chairwoman, and
I thank the Ranking Member.
And I certainly thank the witnesses for being here on a not nec-
essarily complicated but interesting set of circumstances, where
you can see the benefits for these government contracts on the side
of the purchaser, the government agencies, and you can certainly
understand your point, because being on such government con-
tracts is referred to as ‘‘winning a golden ticket.’’ That is not good.
So, you know, the governmentwide contracts, you know, the ben-
efits: less contracts—I mean, I was in State government; you know,
none of them makes life easier, but it allows you to analyze things
more so perhaps—less work, less contracting overall. The idea of
consolidating purchasing, you have to appreciate that. That could
create lower prices overall.
The double-counting issue was misguided. I have a bill, actually,
if you take a look at it, 7685, the Truth in Small Business Con-
tracting Credit Act. So take a look at that. Maybe you could weigh
in on the committee, Republicans and—both sides, and see if that
is something you think that we should get behind and endorse.
But, in the meantime, you know, solutions: you know, the joint
venture. Okay. Latch on to someone who is already on a GWAC
and then just reapplying.
Now, Mr. Alba you mentioned the challenges in reapplying, but
let me just start with Ms. Askew.
So, if you are not on these GWACs and you do fit well but you—
on one particular agency and you are active, to gain additional
business, additional contracts, is that a virtual impossibility be-
cause the GWAC is already confined for a 5-year period?
Ms. ASKEW. Thank you for the question.
It is difficult, it is definitely difficult, as a small business when
we are working within an agency, you know, trying to increase our
exposure or our opportunities within that agency.
You know, I think one of the other witnesses mentioned the fact
that there is no way to communicate our market to those agencies
really now going forward, because of the fact that everything is vir-
tual and, you know, you aren’t having an opportunity to really
meet with anyone that could assist you.
In my experience, trying to, you know, increase our exposure or
our opportunities within a contracting vehicle or on a GWAC is dif-
ficult because, you know, you are out in the void; you are trying
to respond to opportunities that you aren’t aware that they are
even coming.
Mr. MEUSER. Yeah. And I was on the private-sector side, as
well, trying to get contracts for a number of years, and there is no
question, even though you work hard towards it and you have the
right price point and right product, you feel almost lucky to get it
21

in the end. It is like you are happy that you felt so fortunate that
you spoke to the right person and they reviewed things right.
So, being that is still the case, or maybe even worse—because I
am going back a good 10 years—what could each of you tell me,
maybe the one thing that—or two things if you would like—that we
really need to zero in on here? Because the goal is small busi-
nesses, women-owned businesses, diversity, but, at the same time,
the highest quality and best price.
So maybe, I don’t know, Ms. Hart, if you want to start.
Ms. HART. Sure, I can start. I can give two recommendations.
I think we need to formally and legally define best-in-class con-
tracts. Currently, it is a very objective five-point standard that is
not really followed, and it is not in the FAR, and so it is very hard
for small businesses to understand and comply.
My second recommendation would be creating governmentwide
IDIQs with explicit technical focus. As I mentioned, GSA Polaris
has construction on there as a requirement, and that is not atypi-
cal. That is a very typical thing that you see now.
Mr. MEUSER. And, Mr. Alba, to you. And, then, is there a par-
ticular agency that is the most difficult, that needs to really pick
up their game?
Mr. ALBA. I mean, CIO-SP4 was somewhat of a mess. I think
I have written a lot about that. So that would be one, the NITAAC
folks.
But I think, just generally, if you could have these GWACs and,
instead of this jack-of-all-trades idea, to narrow it down and maybe
allow you to bid on different pools—each, like, contract line-item
number or section of the contract—to get the best people for that
section, as opposed to having to award someone who can do every-
thing, because I don’t think you get the best product that way.
Mr. MEUSER. Thanks.
I yield back, Madam Chair.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now we recognize the gentleman from Maine, Mr. Golden, Chair-
man of the Subcommittee on Underserved, Agricultural, and Rural
Business Development.
Mr. GOLDEN. Thank you.
Ms. Hart, under the mentor-protege joint venture, as you know,
a small business has to perform at least 40 percent of the work.
Is that the appropriate share of the workload, in your opinion?
And, if so, why? If not, why not?
And if you think there should be changes, so if these joint ven-
tures should be modified so that small businesses take home more
of the work, what is the right mark? And what might be the pros
and cons of increasing that?
Ms. HART. That is a great question.
So, in order to perform under these IDIQs or even task orders,
the prime has to perform 51 percent of the work. So I do believe
that increasing it from 40 percent to a little bit higher makes a lot
of sense.
I do understand that that puts some burden on small businesses,
but I think you do get a better product and a better vendor out of
that that is a little bit more qualified and maybe one that is a little
22

bit more established to take advantage, as the witnesses have also
said, of the large business offering those support services.
So I would definitely take a look at increasing that. I think that
that could definitely help.
As the Mentor-Protege Program has kind of been taken advan-
tage of over the past few years with these governmentwide con-
tracts, people are just kind of forming them in order to compete.
So I think to bring it back to an actual technical focus would be
a good idea.
Mr. GOLDEN. Thank you. I appreciate that.
Ms. Askew, in your testimony, one of the things that really got
my attention the most was when you said that you had to send in
your application by mail, and then, of course, you had to wait 9
months, you said, to get any kind of a contact, even, from the enti-
ty that you were submitting your application to.
So it seems like, in general, through the Q&A here, that what
you have highlighted: One is that, for your business, even choosing
whether or not to compete, there are a lot of staff hours that are
going to go into even figuring out if it is the right move for your
company, a lot of staff hours obviously into what is often, you
know, a pretty burdensome application process, and then probably
some significant challenges, just knowing that it could take a very
long time before you even know if you are going to get the award
and move forward.
So, with that in mind, just knowing that you are here in front
of the Committee and small businesses will be watching this: If you
were in a situation where you were meeting with another business
who was thinking about getting involved in best-in-contract-type
work for the first time, what would your advice be to them on how
to best prepare for that and what the challenges would be that
they need to consider?
Ms. ASKEW. Thank you so much.
I think we have highlighted most of the significant challenges—
the money, the time, and the resources. And when you are
repurposing your resources, you are not doing the other work that
you need to do in order to continue to have your business thrive.
My advice to an organization, a company that might be inter-
ested in going after these larger vehicles is—you know, our position
at Circuit Media is that that is where the opportunities are. And
I would not be telling the truth if I told someone, Don’t go after
it because, you know, it is too much work or it is too hard. It is
where the opportunity is, and I would be remiss to tell someone not
to do that.
Mr. GOLDEN. That is helpful.
Do either of you two have any followup to that?
Mr. ALBA. I will say—this might be a sad comment, but I would
tell people to read the solicitation very carefully and just tick the
boxes. And I think that is the biggest problem of all of this, but
that is all you need to do. Read it very carefully, and find someone
to tick every single box you can.
Ms. HART. I would chime in on that, as a saying that we have
is ‘‘compliance is king,’’ and if you are not compliant, it doesn’t
matter if you are compelling, in order to compete.
23

Mr. GOLDEN. In general, where do you see small businesses try
and fail?
Mr. ALBA. I would say, when it comes to unclear language, I
think a lot of companies are afraid to ask questions because they
want to try to take advantage of any ambiguity, not really under-
standing, through the protest process and the laws that currently
exist, if you don’t get your questions answered, you lose the oppor-
tunity to challenge those things or deal with it.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now we recognize the gentleman from Wisconsin, Mr. Fitzgerald,
for 5 minutes.
Mr. FITZGERALD. Thank you, Madam Chair.
I am over here, you guys, over in the corner.
Ms. Askew, can you go back to—there was kind of a general dis-
cussion about the costs associated with just making the application.
And this is not the first time we have kind of skirted around the
discussion about, you know, is there the wherewithal, first of all,
for a small business to kind of just come up with, not only the re-
sources available through their own labor force, but being able to
pull this stuff together. And I think you said there was, like, a
$20,000 figure just imposed during the IDIQ.
Can anyone talk about the costs associated with that?
Ms. ASKEW. Yes. Thank you.
Our costs—every time you decide to go after one of these con-
tracts, you have to make a decision: Am I going to hire out or have
a consultant assist me so that I know which boxes to tick? I think
Mr. Alba had an interesting comment that, yes, in fact, it is really
hard as a small business to try to figure out which boxes do you
try to check off.
And so, whether you are using a third-party vendor that can
come in and say to you, here are the 18 boxes or, in our situation,
you know, hundreds of boxes that you need to check, that really be-
comes a financial decision. You know, am I going to utilize my in-
house staff—and we might not be as well-versed or as capable as
a vendor might be able to help us.
And that is where the money really comes in, whether you are
choosing to hire someone to help you or whether you are doing it
internally.
Mr. FITZGERALD. The other thing—and any one of the panel-
ists can talk about this, I guess—is, can you elaborate on the con-
tracting officer’s subjectivity and just how that plays into whether
or not you get the contract as well?
Go ahead, Ms. Askew.
Ms. ASKEW. Sure. I can provide an example in our HCaTS op-
portunity.
From the period of time that we submitted our application to
after that period of time that we got our first response, they
changed the evaluation criteria. And, in my situation, one of the
things they evaluated were your reviews, your company reviews.
They are called CPARs.
And, in my situation, the CPARs—we had a change in con-
tracting officer, who made a decision that they would not give ‘‘ex-
ceptional’’ CPARs; they would only give ‘‘very good’’s. It had noth-
24

ing to do with the quality of our work. It was just a subjective deci-
sion by the contracting officer.
And so, in that situation, our points actually dropped because we
were—although same work, same company, we were evaluated dif-
ferently during that period of time.
Mr. FITZGERALD. And, again, any one of you can jump in on
this. Because I know that, at some level, in the higher DOD con-
tracting, you almost have this situation where sometimes those in
charge on the technical level will become somewhat imbedded with
the corporation, so there is a back-and-forth, that that exchange
can develop into something that happens on a regular basis.
How much contact was there with those that were overseeing,
kind of, the process? Was there any exchange on a regular basis?
Ms. ASKEW. I could respond to that. We had no exchange.
Mr. FITZGERALD. Okay.
Ms. ASKEW. The first contact we had was at 9 months, where
they said: We are changing the criteria, and can you respond based
on this new criteria?
Mr. FITZGERALD. Yeah.
So maybe a suggestion for you, Madam Chair. It would be inter-
esting to see, like, at what level some of those, you know, ex-
changes start to happen.
Because, obviously, at some point, there are many different re-
sources being poured in by the government to develop these strate-
gies, especially when they have to determine what kind of inclina-
tion or escalation, I guess—a better word—in labor force you would
need to meet the needs of the contract.
So I think it would be something great for the Committee to dig
into and see if we can’t get some better answers on that.
But thank you very much for being here.
I yield back.
Chairwoman VELÁZQUEZ. The gentleman yields back.
Now we recognize the gentlelady from New York, Ms. Tenney, for
5 minutes.
Ms. TENNEY. Hi. Am I on?
Chairwoman VELÁZQUEZ. Yes, you are.
Ms. TENNEY. Oh, thank you. Thank you, Madam Chair. I great-
ly appreciate it.
It is a very interesting hearing. And thank you to the witnesses.
Because I think this is something that a lot of people don’t under-
stand, how complicated government contracting is, and the amount
of money that we spend of taxpayer dollars, and how important it
is to make sure that money is distributed in a way—or awarded
in a way for contracts with reliable vendors and reliable people
that are going to live up to the standards that we set by this code.
But it is really interesting to show how—just listening to you all,
it has been very interesting just to hear an awful lot of alphabet
soup of terms that I think a lot of people don’t understand.
And I wanted to just go to Ms. Askew first, if I could, and just
elaborate on what Representative Fitzgerald was getting into.
And you are talking about the $20,000 that you needed for an
IDIQ. And I am just going to say, this is an indefinite-delivery, in-
definite-quantity type of contract, which may make somebody in
25

business like me go, ‘‘Agh.’’ You know, how do you have a contract
that isn’t clearly defined?
And I just wondered if you could talk about that $20,000 being
a barrier to entry and getting new businesses, like your business
and smaller ones, involved in the process and why that is sort of
an undefined concept.
Ms. ASKEW. Yes. Thank you.
In our situation, being able to respond—and you might say, in
the large scheme of things that $20,000 might not be a lot of
money. But that only allows you to get on the—if you win and if
you are successful, it only allows you to get onto the vehicle. You
then have to respond to every one of the subsequent opportunities.
You don’t win anything. You just win, as I was saying, a li-
cense——
Ms. TENNEY. You just get to be in the bidding; that is it.
Ms. ASKEW. That is——
Ms. TENNEY. Are there additional fees that you have to pay
after that initial $20,000? Because this looks—I mean, am I inter-
preting this wrong? This looks like sort of an open-ended contract
situation, because you are not reacting to a defined bid. It is just,
you are in a situation where bids will emerge, and then you will
eventually—you know, you are in the system. And then, if it is un-
defined, you know, there could be more coming up that would be
available.
Ms. ASKEW. Right. I mean, you do have that opportunity to re-
spond. I just approximated $20,000 because that is how much it
cost for us to use third-party assistance so that we wouldn’t—we
perhaps could win. You know, when we have done it ourselves, it
is internal time, you know, which probably actually equals more
than $20,000.
But, for us, you know, once again, when we are looking at those
opportunities out there, these best-in-class vehicles are where ev-
erything is going. And so you have to—you know, if I am going to
continue to be a viable business, that is a decision we have to
make.
Ms. TENNEY. Yeah. It is interesting. I think, you know, for any-
one watching this that is not a government contractor, just the idea
that it is so complicated makes it look like there is room for subjec-
tivity, and, therefore, the best contract is maybe not getting award-
ed. It is a contract being awarded based on, maybe, somebody with
an inside relationship—which would be developed, obviously. If a
contractor works with someone, they are going to end up getting
a good relationship.
But I wanted to ask—so, Ms. Hart, you mentioned something
about defining ‘‘best in class.’’ And I just wondered if you could
elaborate a little more. I didn’t quite catch what you were saying
about that.
When you say ‘‘best in class,’’ what do you mean? And how can
we legislatively make that easier so that contracts are more avail-
able to small businesses and they could break through some of the
barriers that we are seeing with them getting into this?
Ms. HART. So that is a great question.
In my written testimony, I do expand upon this, on how GSA and
OMB, currently, they define best-in-class contracts. But the ques-
26

tion you just asked, what does this mean, is actually what industry
is currently asking all the time, what best-in-class contracts are. It
is very subjective, and it is very open-ended. And there is no legal
definition in the FAR or anywhere that says, this is what a best-
in-class contract is.
So GSA very much gets to kind of make their own decisions on
what that constitutes and what those definitions mean and then
apply that to industry. And we have to adjust and pivot and basi-
cally be at that whim in order to respond.
So, in summary, there is no definition of that currently.
Ms. TENNEY. Right.
So what would we—if we are legislators, we are supposed to be
making laws, what would you say—how should we define ‘‘best in
class’’ in legislation if we were to propose it?
Ms. HART. Well, that is a really large question. I would have to
probably think on that and get back to you, but the way that I
would look at that is: Having a one-size-fits-all approach to pro-
curement is not sustainable for the federal government or to meet
their mission needs, and a one-size approach even for defense
versus civilian is not a right way to approach this.
I mentioned looking at creating governmentwide IDIQs with ex-
plicit technical focuses or looking at standalone contracts that have
more of an incentive in order to use that. I think that that might
be a better approach in looking at that, rather than trying to define
what a best-in-class contract is, because I do think that that could
easily be taken advantage of, and we might find ourselves sitting
here again with the exact same problem in a few years.
Ms. TENNEY. Yeah. Thank you.
No, I can—the frustration—I know people in government con-
tracting from the DOD side and a number of other areas where it
is just a very frustrating process. And taxpayers don’t really under-
stand it as well. It is so confusing, and they are worried that, you
know, everything is an inside deal.
And I would just like to see it be more objective so that we can
get good small businesses in that can provide excellent services at
a lower cost and better quality to our government. And, obviously,
that is the mission of our inquiry today.
But thank you again to the witnesses, to the Chairwoman, and
the Ranking Member. I appreciate the time. I yield back.
Chairwoman VELÁZQUEZ. The gentlelady yields back.
Now we recognize the gentlelady from California, Mrs. Kim,
Ranking Member of the Subcommittee on Innovation, Entrepre-
neurship, and Workforce Development.
Ms. YOUNG KIM. Thank you very much, Chairwoman
Velázquez and Ranking Member Luetkemeyer, for holding this im-
portant hearing to discuss many different ways [inaudible] con-
tracting opportunities for small businesses.
And I want to thank the witnesses for joining us today.
Ms. Casey, let me start with you with my first question. I am
concerned that the rising use of joint ventures in SBA’s Mentor-
Protege Program is creating a dependency among small businesses
on them to be competitive.
27

So what is your assessment of the Mentor-Protege Program and
the formation of joint ventures and their impact on small busi-
nesses?
Ms. CASEY. So I think that the Small Business Mentor-Protege
Program, at its heart, has the spirit of intending to grow small
businesses and help small businesses get their feet on the ground
and get a good start.
I think there are a lot of unintended consequences that have not
yet been assessed or studied. And I think there is a great oppor-
tunity to provide additional help and oversight to the Small Busi-
ness Administration so that they actually collect more data and un-
derstand the implications.
How much of the revenue that is going to these joint ventures
is really ending up in small business? And how successful are these
small businesses, beyond the joint venture, in winning contracts
and building up their corporate capabilities to be a great prime
contractor on their own?
And so I think this is a great opportunity to collect data to un-
derstand these unintended consequences so that you can seek to
identify additional legislation that may actually take a program
that has the spirit of helping small businesses and make that much
more successful.
Ms. YOUNG KIM. Thank you, Ms. Casey.
You know, let me ask to all witnesses: There is currently no proc-
ess in place allowing the government to gather data on the federal
contracts that went to small businesses versus large mentors.
So would you be in favor of having a process that could allow us
to tap into that data? And, if so, how do you think having that data
could improve federal contracting for small businesses?
Any one of you can answer.
Mr. ALBA. Sure. So, yeah, I mean, there are laws and regula-
tions that dictate the performance of work and what is allowed as
a maximum, but, yeah, you are absolutely right that there is no
way of tracking internally what is happening in joint ventures.
Some of these IDIQs, though, or other contracts do make you re-
port back data on whether you are meeting the performance-of-
work requirements, and perhaps expanding that and making sure
that it is done correctly.
But I would say not just the dollars, but also making sure you
report who is doing what, so that you can show that the small busi-
ness is actually learning from this experience, actually managing,
actually doing the work, as opposed to just hitting some arbitrary
number.
Ms. YOUNG KIM. Yeah.
Unless any other witness would like to respond to that, I have
one other question, so let me throw it out there in the short period
of time I have.
It seems like there aren’t many governmentwide contracts that
offer very limited spots, although there are many qualified contrac-
tors out there. So do you have any thoughts on whether the govern-
ment should open that pool to many more contractors and push
competition [inaudible]?
Maybe, Ms. Askew, you can answer this one.
Ms. ASKEW. Thank you.
28

I would say that opening it up to more spots could be an answer.
The issue still becomes, how do you get on—you know, what re-
sources and requirements do you need to be able to actually get
onto that opportunity, no matter how many spots are open? And so
I think that is really where the difficulty lies.
Ms. YOUNG KIM. Well, I would like to hear more about the
agency delays and amendments (ph) impacting small businesses’
chance of success at getting on an award.
So what is the typical timeline in which an award is made? And
what potential factors delay these awards? And is there anything
that can be done to mitigate the negative impact felt by small busi-
nesses?
Ms. CASEY. I can cover that.
In my experience with some of the governmentwide contracts, it
takes between 1 and 3 years to get to an award.
Delays come in multiple forms. One, it takes a very long time for
the government to evaluate the proposals. Secondly, there is an in-
crease in the number of protests, because maybe the requirements
weren’t as clear as they could have been. And then those protests
create delays, as is seen in the examples of CIO-SP4 and recently
in Polaris.
So the time between making the investment and the time you ac-
tually get the award, if you are lucky enough to get one of these
coveted spots, could be 3 years. And you could have spent, in our
case, between $60,000 and $100,000 on a single IDIQ bid.
So making sure that the government provides a near-final draft
prior to releasing the solicitation, that would really allow busi-
nesses to know exactly what they are going to be bidding on, create
a strategy, and reduce costs and time. So that could help quite a
bit.
Ms. YOUNG KIM. Well, thank you so much.
I really look forward to working with my colleagues to improve
the federal contracting process for small businesses.
And thank you so much for letting me go over time, and I yield
back my time.
Chairwoman VELÁZQUEZ. The gentlelady yields back.
Now we recognize the gentlelady from Texas, Ms. Van Duyne,
Ranking Member, of the Subcommittee on Oversight, Investiga-
tions, and Regulations.
Ms. VAN DUYNE. Thank you very much, Madam Chair
Velázquez and Ranking Member Luetkemeyer, for holding this
hearing today.
While large corporations might provide the manufacturing and
scale to power our economy forward, our small-business industrial
base provides the agility and innovation necessary to keep us lead-
ing the world. Our ability to protect the supply of entrepreneurs
from government over-regulation and being crowded out by larger
companies, who have a greater ability to tip the regulatory scales,
will be crucial to the United States’ ability to compete on the world
stage in every industry.
In the fiscal year 2020, the SBA announced that the federal gov-
ernment exceeded its small-business contracting goals, with $145.7
billion in federal contract dollars, up $13 billion from the pre-
viously year. And, while that number may sound good, it hides the
29

fact that the number of small businesses contracting with the fed-
eral government is actually rapidly shrinking.
One reason for this almost-40-percent decline in the govern-
ment’s small-business vendors is increased regulation and consoli-
dation of contracts.
Last year, Chairman Dean Phillips of the Oversight Committee
and I held a hearing over the DOD’s new cybersecurity assessment
framework versus Cybersecurity Maturity Model Certification. And
while the intent behind the framework was good, it left many
small-business contractors scrambling trying to navigate massive
compliance manuals, while large contractors could simply rely on
their large legal teams to meet the new requirements.
And if you want to talk about how important it is to have people
come up here and actually testify, this guy held up a 3-inch binder
that was multiple inches thick, and he says, ‘‘For me to be able to
implement this, I am going to have to hire a team of people. It is
going to cost me about $100,000. And I, as a small-business owner,
do not have those margins. Think about what you are doing when
you pass these. For large corporations, no big deal. But for the
small businesses, this is something that we cannot do.’’
So I guess my first question is going to be to Ms. Askew.
In your view, when competing for contracts with the federal gov-
ernment, is the scale tilted too far toward companies with greater
compliance resources instead of businesses with the best product?
Ms. ASKEW. Thank you for that question.
We are actually engaging right now in deciding how we are going
to manage the maturity model that we are required to comply with
in order to continue to win contracts.
And so, for Circuit Media, we really had to—you know, you are
making a day-to-day decision about, am I going to do this or that?
And, you know, the 3-inch binder is no joke.
And so our position has been, how can we continue to compete
but still be able to pay our bills? And that has really been, you
know, something that you think about on a daily basis.
Ms. VAN DUYNE. Does anybody else on the panel want to weigh
in on that question?
Mr. ALBA. Yeah, I will say a couple things dealing with regula-
tions. Some of them are written so broadly and so vaguely, and it
is really unfair.
I mean, I deal with False Claims Act defense work as well, and
I have situations right now where: Someone has a firm-fixed-price
contract. The contract is not clear what that firm fixed price is for.
And they billed the government on a firm-fixed-price basis. And the
Department of Justice is now coming after them because they said,
well, certain work wasn’t done. It was firm-fixed-price.
And so how is someone supposed to figure out what ‘‘firm fixed
price’’ means if it doesn’t mean firm fixed price? It is things like
that that are causing needless problems for our small businesses.
Ms. VAN DUYNE. Ms. Hart?
Ms. HART. From a proposal standpoint—so I have been working
on federal proposals for over a decade now, and I have never seen
a request for proposal that was actually straightforward, that
didn’t involve a very large conversation on ‘‘what does this mean’’
several times.
30

There are amendments that are put out that are ambiguous, that
don’t answer questions, that just say—when you ask a three-part
question, their answer to that three-part question is ‘‘yes,’’ and it
is, ‘‘yes’’ to what? And that is a common occurrence. That happens
all the time.
So I would say, absolutely, as someone that does support vendors
in this, absolutely, there is a lot of time and money spent on us
just figuring out what is being asked.
Ms. VAN DUYNE. I don’t know if we have another witness up
there. If she wants to——
Ms. CASEY. Yeah. I would echo what Ms. Hart and Ms. Askew
have said. The number of regulations when you are bidding on one
of these proposals, it is extremely complex. Newer small businesses
don’t understand what some of these compliance requirements real-
ly mean. And you have to go through so much compliance to just
put in the proposal, and then you have to make sure you comply
during delivery.
So I would say that the proposals could be significantly sim-
plified and less complex. We have seen attempts to do that through
SAM.gov. But I would say, you get one thing that gets better and
three things that get harder, in terms of compliance and proposals.
Ms. VAN DUYNE. Thank you. And I appreciate your—I appre-
ciate your input. We had actually introduced a bill that would look
at SBA, and any regulation that you add, it would have to be budg-
et-negative or budget-neutral. I hope we can move forward with
that bill.
But I thank all of the witnesses for your testimony today, and
I yield.
Chairwoman VELÁZQUEZ. The gentlelady yields back.
Now we recognize the gentleman from Minnesota, Mr. Stauber,
for 5 minutes.
Mr. STAUBER. Thank you, Madam Chair, and thank you, Rank-
ing Member Luetkemeyer.
I just want to follow up on my colleagues’ questions.
Under this administration, there has been an additional $201 bil-
lion of additional regulations on small businesses.
The four of you said exactly what we have been talking about.
You cannot continue to punish the small businesses across this
country. As a former small-business owner, that was one of the
most devastating things that happens to small businesses.
We always talk about ‘‘the engine of our economy is our small
businesses.’’ In anywhere, main street, USA, our small businesses
employ our friends and neighbors and make our economies grow.
And this administration added an additional $201 billion to that.
Mr. Alba, can you comment on those regulations? You just talked
about some of them. How destructive are they, and how cum-
bersome?
Mr. ALBA. So I think it probably depends on which regulations.
You know, some are there to protect the government or protect oth-
ers.
But there are certainly a lot of issues that are very ambiguous.
And the ambiguities, I think, are really what creates most of the
additional cost——
Mr. STAUBER. Right.
31

Mr. ALBA.—because they have to ask people like me what the
heck something means.
And sometimes the answer is ‘‘I don’t know.’’ Like, what is the
totality of the circumstances? How am I supposed to determine
what I am supposed to do if an agency bases what I am doing as
whether legal or illegal on a totality of the circumstances?
Mr. STAUBER. Right. Right.
Ms. Askew, would you like to comment on these additional $201
billion of regulations that are stifling and destructive to small busi-
nesses? What is your comment?
Ms. ASKEW. Well, I would agree with Mr. Alba about the ambi-
guity. I think that anytime you can provide clear and concise infor-
mation so that you can actually respond and respond accurately—
because every time you don’t respond accurately, it is counted
against you.
Mr. STAUBER. Right.
Ms. ASKEW. And so being able to, I think, really look at the am-
biguity and try to look at, you know, the language of what they are
asking you to do would be very valuable.
Mr. STAUBER. Ambiguity, bureaucracy—same thing here.
So, recently, the House passed my bill, the Strengthening Sub-
contracting for Small Businesses Act. This bill will help incentivize
prime contractors to comply with small-business subcontracting
goals.
To our witnesses: As we continue to study and examine federal
contracting and subcontracting issues, where should we focus our
attention?
Ms. Hart, go ahead.
Ms. HART. So, from my perspective, it would actually be pro-
viding more transparent data behind that. That information is cur-
rently not accessible and not reviewable for accuracy.
So I think focusing on that—because there is a lot of reporting
structured around that, but no one really knows what is being col-
lected and how it is being collected and if it is being reported accu-
rately by prime contractors.
So I think talking to maybe subcontractors——
Mr. STAUBER. Right.
Ms. HART.—about that and making sure that they are being
represented correctly and that maybe the prime is not overinflating
how much support they are giving would be a great place to start.
Mr. STAUBER. Ms. Askew?
Ms. ASKEW. I think being clear about the work performed.
Often, on these small-business plans, what ends up happening is
that you might be part of that team but you never see the work.
And so I think, to that point of having clarity and accountability
and transparency, that would be really valuable, because you aren’t
sure—although you might list a small business, you aren’t sure
that they are actually getting to be able to perform the work.
Mr. STAUBER. Right.
And it is well-known that there are high administrative costs as-
sociated with competing for and winning a large contract. Can you
speak to your experience with this?
32

And do you believe that the federal government acknowledges
the unintended consequences these contracts have on small busi-
nesses?
And, Ms. Askew, I will ask you first again.
Ms. ASKEW. Yes. Thank you. I am not sure if they acknowledge
the amount of work that is required. I can certainly talk about the
impact that it has on the small business.
Mr. STAUBER. Please. Go ahead.
Ms. ASKEW. Being able to, you know, go back to your day-to-day
operations and you are trying to, you know, manage a team and
move your company forward and be successful, being able to ade-
quately respond and to be involved in a contracting environment
with the federal government really does take, you know, where-
withal and tenacity and all of the things that we do as small busi-
nesses, but being able to manage that and manage all the other
things is really a difficult feat.
Mr. STAUBER. Thank you. My time is out.
And to the witnesses, thanks for your comments, and we appre-
ciate that.
Madam Chair, I yield back.
Chairwoman VELÁZQUEZ. The gentleman yields back.
The gentleman from New York, Mr. Garbarino, is recognized for
5 minutes.
Mr. GARBARINO. Thank you, Chairwoman, and to the Ranking
Member for holding this hearing today.
Actually, I wanted to follow up on my colleague Mr. Stauber. He
just asked a question about, do you believe the federal government
acknowledges the unintended consequences, the administrative
costs associated with competing for and winning these large con-
tracts, the effect on a small business?
And, Ms. Askew, you answered that question, but I want to let
the other witnesses.
Ms. Hart, you talked about the administrative costs in your testi-
mony, as well as some of the other witnesses. So I want to open
that up to you, Ms. Hart, first, and then maybe the other two wit-
nesses to talk about that.
Ms. HART. So, like a lot of this, I think the answer is: It de-
pends.
Every contracting officer that puts out these requests for pro-
posal, I think, has a different understanding of the practices of a
government contractor. We most certainly communicate with a lot
of them back and forth or have, kind of, you know, off-the-record
conversations, and it ranges anywhere from they absolutely recog-
nize the commercial practices and the cost of this, to ones who very
much believe that we already have something put together and we
are able just to slap it into a template and submit it.
I think that is shown when requests for proposals are released
on Fridays before holidays—on Christmas, on New Year’s, and
things like that—as well as the administrative costs for, you know,
25 amendments and what that means.
So I think the answer is, it depends, since this is such a human-
to-human type of selling process.
Mr. GARBARINO. I appreciate that answer.
Ms. Casey?
33

Ms. CASEY. I think that some in government understand the
unintended consequences and others don’t.
I think, though, senior government officials are really measured
by their compliance to Category Management and say, We are
meeting our Category Management goals, we are meeting our
small-business dollars, so we are doing great; we are meeting our
small-business dollars. But they are not measured on, like, how
large the small-business piece is and whether it is shrinking or it
is growing.
So I think figuring out how to measure based on the size of the
small-business space and its growth is also another metric that is
critical for these agencies that are involved in major procurements.
Mr. GARBARINO. I appreciate that. It sounds like they are just
checking a box if the money is getting out the door, you know, and
it might not actually be doing all it is supposed to be doing.
Mr. Alba, did you have anything to add?
Mr. ALBA. I think—I am not sure if the consequences are actu-
ally unintended. I think some of it is in order to reduce competition
and reduce the number of proposals and things that have to be re-
viewed.
The entire Category Management system is structured, I think,
to look focusing primarily on reducing administrative burden as op-
posed to actually getting the best products. And I think that is part
of the issue.
Mr. GARBARINO. I appreciate all those answers. And it defi-
nitely paints a picture from what I have been hearing from some
of my small businesses.
Ms. Hart, I wanted to follow up with something that—I have to
tell you, your testimony that you submitted was very detailed. I ap-
preciate it. And you detailed in it numerous governmentwide acqui-
sition activities, and you also outlined the number of protests asso-
ciated with each.
Why do you believe you are seeing these levels of protests?
Ms. HART. So that might be a better question for Witness Alba.
But what I do believe and what I see is: Because the business life
depends on it. You need it to survive. So, if you aren’t given that
award, your business might go under. And so, in order to keep that
alive or keep those task orders running, protesting sometimes is
the only way that you can do that to continue revenue streams.
Mr. GARBARINO. Mr. Alba?
Mr. ALBA. Yeah, I think that is the number-one reason. Every-
thing is do or die. And so it is the criticality of the requirement
that is probably driving it more than anything else. Which is why
things like on-ramps or rolling admission, things like that, I think,
would greatly lessen that issue.
Mr. GARBARINO. Okay. I appreciate it.
So, Mr. Alba, just a followup for you. As we continue to look at
this and study—as Members of Congress continue to look at this
and study, examine federal contracting issues, if there is one
thing—it is probably more than one thing, but if there is one thing
we should absolutely focus on, what is it?
Mr. ALBA. I think the big thing is clarity, and clarity in the reg-
ulations, and probably reducing the discretion of contracting offi-
34

cers in the process. Because that allows contracting officers to do
things without any rhyme or reason.
Like, for instance, requesting reconsideration of small-business
status after—like, you are a year into the procurement. They have
submitted proposals maybe a year ago you are still evaluating. You
suddenly ask for recertification for some option or some amend-
ment, and then people who submitted a year ago are no longer
small. They wasted all those dollars, and they are thrown in the
trash.
Mr. GARBARINO. I appreciate it.
I am out of time. I yield back.
Thank you to all the witnesses.
Chairwoman VELÁZQUEZ. The gentleman yields back.
I would like to thank our witnesses again for appearing before
the Committee today.
It is clear from your testimony that governmentwide contracts
have changed how small firms do business with the federal govern-
ment. While its goals are worthy, they are also forcing small con-
tractors out of the marketplace and impeding new entrants.
Today’s hearing has not only shed light on the significant chal-
lenges that small contractors face, but it also has put forward po-
tential solutions.
I just want to acknowledge that this is an issue that falls also
under the jurisdiction of Government and Oversight.
I look forward to working with my colleagues on both sides of the
aisle to advance policies that ensure small businesses have mean-
ingful ways to contract with the federal government.
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 again.
[Whereupon, at 11:44 a.m., the Committee was adjourned.]
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