Nydia M. Velazquez: “the Federal marketplace has experienced amazing growth over the past 4 years, increasing by $100 billion. Given this…”

“the Federal marketplace has experienced amazing growth over the past 4 years, increasing by $100 billion. Given this increase, it would only be logical that our Nation's small businesses would see similar growth in contracting opportunities. However, this has not been the case. The reality is that small firms continue to be shut out of the Federal marketplace. The Federal Government has failed to reach its small business goal of 23 percent for the past 4 years now, costing small businesses $15 billion in lost contracting opportunity in fiscal year 2003 alone. The Department of Defense has been an agency that has had a significant amount of trouble with this. One of the main causes has been contract bundling, which is the practice of combining contracts previously performed by small businesses into one megacontract that is simply too large for small firms to bid on. But often overlooked is that a significant contribution to the inability of the Department of Defense to make its goal is the comp demo program. The comp demo program was created in 1989, but was made permanent during the Clinton administration under the guise of increasing small business participation. The theory behind it was to give agencies direction in finding small business contracting opportunities in nontraditional industries. This would be done by capping the amount of contracts in those industries that have been historically dominated by small businesses.…”