Business and Finance
The proposed legislation aims to bring transparency to federal contracts
The federal government is considered one of the world’s largest buyers of products, making it a major and attractive marketplace for entrepreneurs looking for international business opportunities.
However, the operation of this market requires greater transparency to streamline the bidding process, especially for minority-owned businesses and other businesses looking for to secure lucrative contracts.
To address this issue, U.S. Reps. Kweisi Mfume (D-Maryland) and Mark Alford (R-Missouri) introduced the Transparency and Predictability of Small Business Opportunities Act to ensure greater transparency and predictability in public procurement for small businesses.
Among other provisions, this bipartisan initiative seeks to demystify the federal contracting space for small, minority and women-owned businesses which are willing to provide services or products to the federal government.
The recent bill comes as the most recent data shows that Black-owned small businesses received $9.5 billion in federal contracts in 2022, a rise of $490 million over 2021. However, the 2022 number is small compared to the nearly $163 billion spent on all federal contracts this 12 months.
Earlier this 12 months, the Biden-Harris administration announced efforts to increase small business access to the greater than $700 billion spent annually on federal contracts. However, this report shows that only 12% of the 23% of firms registered for federal contracts are Black-owned.
In their statements, Mfume and Alford outlined what changes this legislation would bring. Here’s a fast have a look at their comments.
“Our nation’s minority-owned and women-owned small businesses embody the resilience and determination of the American Dream and are the lifeblood of our economy. However, the current procurement process for small businesses looking to contract with the federal government too often leaves our local entrepreneurs in the dark when the invitation to bid is canceled without full disclosure,” Mfume said.
He said the bill would offer small businesses with complete transparency on canceled orders, which Mfume said would allow them to “change their business strategies and plan for future tenders.”
Alford noted that “this legislation will require agencies to be liable when public procurement contracts are canceled, leaving small businesses facing the loss of thousands or tens of thousands of dollars.”
He further emphasized that the bill would “force existing Small and Disadvantaged Business Exploitation Offices to help small businesses find contracting opportunities.”
According to a press release, the bill would require the Administrator of Small Businesses to issue regulations regarding canceled public procurement contracts for small businesses. It would also require the federal agency to help small businesses seek additional opportunities if the offer is canceled.
The next step towards introducing this legislation will probably be a vote within the US House of Representatives on the contested date.