this subcommittee is pleased to welcome our witnesses today we look forward to hearing the testimony of our small business witnesses concerning their experiences in contracting with the federal government and we also pleased to receive the testimony of agencies within the jurisdiction of this subcommittee about their goals and accomplishments for small businesses and for minority owned  minority women owned and other disadvantaged businesses the subject of today's hearing could not be more timely or important because of the government's because the because of the government's critical interest in ensuring that small minority and women owned businesses are given an equal opportunity for federal contracts according to information supplied us by the department of justice there is strong evidence that these small businesses continue to face barriers in numerous areas of business that unlawfully limits their opportunities for example minority and women owned business businesses experience discrimination from business lenders are charged higher prices for central materials are intentionally subjected to unnecessarily high bonding requirements and are excluded from sub contracting opportunities by prime contractors robust implementation of the federal programs and acted to support these businesses is necessary to ensure that the government does not lawfully and unconstitutionally but to slip a tin or perpetuate these barriers today's hearing is a follow up of our march sixth two thousand and eight hearing on this bob when we alerted our agencies that we would be holding annual oversight hearings on issues and progress in small business contracting among the issues we addressed last year were bundling of contracts by federal agencies that makes it difficult for small businesses to compete the benefits of competing on the g s a schedule small business outreach by federal agencies and how agencies account for small business participation in procurement we look forward to examining agency efforts to address these as well as new issues that may have a risen this subcommittee places a strong emphasis on business small business  because they are central to the u s economy particularly during what is now being called the great recession the federal government as the largest small business contractor has a special obligation to this and dispensable sector especially in today's economic turndown the roughly twenty five million small businesses in the united states account for fifty percent of the nation's private non from gross national product how they however they receive only twenty percent of federal contracts women make up thirty percent of the small business owners nationally in two thousand and eight for received only three point four percent of contracts minorities own eighteen percent of small businesses nationally but receive only six point eight percent of federal contracts and nine and two thousand and eight because in most of the jobs created by small businesses remain in this country there formidable job creation power has premium value for our economy and for the american people small businesses with fewer than five hundred employees accounted for sixty four percent of the two twenty two point five million net new jobs between one thousand nine hundred three and the third quarter of two thousand and eight according to the small business administration of course many federal contracts necessarily go to large contractors so federal agencies are in the best position themselves to analyze their contracts in order to make a fair and practical allocation of contracts that should go to small businesses under the law we are particularly interested in how agencies make these allocations considering that small businesses are responsible for the lion's share of new jobs unfortunately however the difficulty of a stab wishing and maintaining small businesses even in the best of economic times means that many of these businesses and the jobs they generate do not survive however they are quickly replaced by new risk takers characteristic of successful entrepreneurship in this country the small business administration said in a recently released report to the president that the recessions credit free in the sort term funding market that had a particularly harmful effect on the ability of small businesses to operate the american recovery and investment act provided an important opportunity for the federal government to offer a lifeline to small businesses in this tough economy as of august fourteenth two thousand and nine the s b a were poor what's that twenty three point seven  percent of the eight point three seven billion in recovery act contract dollars have gone to small businesses and those federal agencies have been meeting disadvantaged business categor category goals with stammerers spending as well as be a reports that ten point six percent of contracts are awarded to small disadvantaged businesses eighty seven percent  firm six point four percent to the hub zone from four point three percent to women own forms and three point one percent to service disabled veteran own firms how have the businesses under our jurisdiction this subcommittee's jurisdictions used stimulus months there or other funds available to them to help fill the gap for small businesses in today's economic climate and stem english funding alone the general services administration is receiving approximately five point five billion dollars the federal emergency management agency or family is receiving two hundred ten million dollars in the smithsonian is receiving twenty five million dollars we will be interested to know the number and type of opportunities for small business contracting  that have been generated by agencies under the jurisdiction of this committee for almost fifty years it has been the policy of the federal government to encourage the participation of small business and federal procurement and contracting the small business that requires an affirmative federal policy of doing business with small businesses and here i'm quoting in order to preserve freedom tentative enterprise ensure that a fair portion of the total purchases contracts for supplies and services  for the federal government is place with small businesses and maintain and strengthen the overall economy of the nation and for minority and women owned businesses there is an additional fourteenth amendment constitutional obligation carried out in federal law about title six of the one nine hundred sixty four civil rights act and by federal register or other federal legislation to assure that federal dollars do not fun elimination of their areas to public contracting opportunities in quote tough competitive standards must be enforced for small businesses and small disadvantaged businesses as for large contractors however targeting federal procurement contracts and sub contracts for small businesses and for management and technical grants educational and framing support as well as well as surety bond assistance our obligations under the law although small business administration has oversight for encouraging small business which is a patient by federal sector agencies only continuing and regular oversight by the authorizing and appropriation committees with who we will be working on these issues in concert can hold individual agencies accountable to implement the small business policies of the federal government we believe that this subcommittee has the obligation to increase the momentum established without first hearing considering the so oh great the worst recession that has sees the country and most of the world the agencies in force today have submitted information to our subcommittee on their progress in meeting the requirements of federal law all three of these agencies the architect of the capitol as a legislative agency the smithsonian institution and john f kennedy performing arts center center technically are not covered by the small business that were to their credit voluntarily about by the law we will be happy to hear from all the federal agencies which we perform oversight general services administration the federal emergency management agency the architect of kabal the capitol visitor center the smithsonian and the john f kennedy performing arts center the offer us banks in advance as well to our small business witnesses witness tamela riggs deputy assistant commissioner for vendor alliance and acquisition general services administration public building service to discuss the general services administration record and record and goals for small minority and disadvantaged businesses and deputy assistant commissioner for the public building services office of acquisition management and  solutions acquisition services and management policy focus on small business starts with our agency leaders who recognize the importance of small businesses in our nation's economy and in helping the community empowerment and economic revitalization agency works hard to improve small business access to our procurement program g s a has continually increased its efforts to purchase products and services from small businesses which is led to not only meeting our small business goals but exceeding them the small business act stablish is for federal executive agencies and you will go of awarding twenty three percent of prime contract are proud that in two thousand and eight we surpassed the small business statutory goal and all of the social economic goals that were set for our agency public building service services related to real estate the largest contracting areas are repairing alterations building construction of building and operations and maintenance in fiscal year two thousand and eight of the more than two point four billion dollars eligible in those areas businesses federal acquisition service creates vehicles that cover more than four million commercial products and services and has a strong record of helping other federal agencies achieve small business contracting the fast multiple award schedules program for small businesses a tremendous opportunity for potential work with federal state and local government and i'm happy to report that eighty percent of all schedule contracts with small website provides valuable and from and links to a variety of resources and small business information g s a has consistently demonstrated its commitment to small business and we are proud that we were able to exceed our goals in two thousand and  businesses therefore has significantly increased small business outreach and education efforts to heighten the small business community's awareness of recovery act contracting opportunity also remains committed to negotiating aggressive small business contracting plans for prime contractors we are now publicizing prime contractor contact information online and hosting partnering events that provide opportunities for small excel when working with us i thank you for the opportunity to appear before you today and i will be happy to answer any questions that you may have thank you very much the next witness is jacob hans director acquisition management division of female chairwoman norton and members of the subcommittee thank you for the opportunity to appear before you today i will submit a written statement for the record in the near future in addition to my oral statement i'll be pleased to respond to any questions you may have today his mission is to support our citizens and first responders to ensure that as a nation we work together to build sustain and improve our capability to prepare for protect against respond to recover from and mitigate all hazards the must prepare mccoll is to use competitive strategies while also providing local and socioeconomic business contracting opportunities whenever and wherever possible i'm proud to report that team a has competed eighty five point five percent of its procurement dollars to date in fiscal year two thousand and nine this is up from seventy eight point one percent competition statistics in fiscal year two thousand and eight this is a major accomplishment and families all the h s components in the percentage of procurement dollars awarded to competition thus far in fiscal year two thousand and nine form should follow function in addressing diversity on a management emergency management contracting accordingly the aim is working to develop an organization that is more closely reflect the diversity of our stakeholders further the businesses with which we choose to work and invest taxpayer money to build our capabilities must also reflect this mission as a measure of our commitment fema has dedicated a full time small business specialist whose primary responsibility is to increase contracting opportunities for small minority and disadvantaged businesses the position is currently being filled by a senior member of my staff as we look for an experienced per permanent replacement isn't anticipated that the position will be filled during the first quarter of fiscal year tw having a dedicated small business specialise helps to institutionalize and focus attention on the small and minority contracting efforts as well as helps to maintain a level playing field the much continues to work to meet and exceed our socio economic contracting goals in fiscal year two thousand and seven for example the model warded four hundred eighty five million dollars to small businesses this amount represented approximately thirty three percent of the agency's total procurement dollars dollars that figure represented only twenty six point eight percent of the agency's total prick your meant dollars which was less than the thirty one point nine percent goal for fiscal year two thousand and eight as of september fifteenth two thousand and nine in fiscal year two thousand and nine the may has awarded four hundred five point five million dollars to small businesses which represents twenty nine point five percent of the agency's total expanded procurement dollars just under the thirty one point nine percent target for this year hopefully the next two weeks will continue to see an increase in the percentage of contract dollars awarded to small businesses as the end of the federal fiscal year typically tends to be very busy the reason why fema did not meet its goal in fiscal year two thousand and eight is largely attributable to hurricane ike and gustav as came up on its nest necessary to activate a significant number of prepositioned contracts all of which were awarded competitively to large businesses with respect to the areas in which fema has exceeded its goals and slightly more than six percent of the chairman's dollars have been awarded to women owned businesses and approximately five point six percent of retirement dollars have been awarded to small disadvantaged businesses thema will continue to work to meet the agenc percent to s t v zero s b s and is awarded one point zero three percent to hub zone small businesses it is worth noting that the small minority and disadvantaged business investments made in fiscal year two thousand and nine approximately twenty two percent were for professional services twenty percent were for management support services fourteen percent were for a d p and i t services and five point one percent were for housekeeping services as the subcommittee considers how well theme is working with small minority and disadvantaged businesses across the procurement continuum we urge you also take note of how are we are in gauging the project private sector where the largest small across the homeland security landscape they met continues to aggressively pursue initiatives with the private sector and business community on various fronts to build a stronger emergency management system these initiatives include one the fema private sector division of external affairs established  dialogue with the private sector year round working with acquisitions and other thema programs the division increased awareness among private sector audiences of all sizes of key resources on how to do business with d m a disaster preparedness and recover information training and other resources the division also maintains an online portal with resources and training for businesses of all sizes that addresses w w w dot fema dot gov slash private sector as well as a growing distribution list of almost eighteen thousand subscribers nationwide who receive private sector preparedness tips and other updates the division also developed and piloted a basic training course for disaster reservists who work with the local businesses in declared disasters to be made is building new and in hansing existing preparedness part of partnerships three d images soliciting private sector participation in a development and refinement of the national response framework and a national preparedness system for him is creating stronger more vibrant public private partnerships through programs and initiatives namely the citizen cor ready business and the fema donation management system and other national regional state and local planning exercise and training efforts these efforts foster open lines of communication with our homeland security partners in the business and nonprofit communities we are leveraging the resources and expertise of our partners in the private and nonprofit sectors even above and beyond the important role they've always played in the past it's important however to give some context to a perspective on the opportunity and challenge involved in effectively engaging the private sector in emergency management the magnitude and complexity of the business community what is variously varying needs capabilities and capacity makes coordination a daunting challenge and will require a sustained and long term effort through its private sector division of external affairs thema continues to build a network with non governmental organizations business and trade associations and local regional and national chambers of commerce and it dissipates making continued significant progress in integrating the private sector as a full partner in incident management we know that the worst time to build private sector relationships is during a disaster thus we are building them today and in a sustainable and ongoing manner thank you for the opportunity to speak about the most record and goals in working with small minority and disadvantage businesses and thank you mr hanson now my good friend and the ranking member has been good enough to stop by after the last vote and people clear out of dogs and he's got to clear out for a plane so i am interrupting the testimony if you will forgive me it is time to hear the ranking member statement with appreciation that he did stop by the running on thank you i'm trying to thank all the witness the government to protect the interest of small businesses in order to preserve and the competitive enterprise and free market and a fair share for the government contracts are awarded to small businesses and obviously nobody can deny the importance of small businesses to our economy and to strengthening our economy and also we all know unfortunately the that the national employment rate has risen to nine point seven the highest since one thousand nine hundred three florida's unemployment rate is even above the national average at ten point seven percent and carolyn knows florida very well has been there number of times so job creation has to be a priority and obviously when you look at job creation it is small businesses  from smallest companies follows firms with fewer than twenty five employees and not only do they create jobs but they're also you know the others in florida small businesses account for more than ninety nine percent of the state's employers and they  provide forty for forty four percent of private sector jobs i mean those are stunning numbers when you want to incentivize the economy and you want job creation you have to look at small businesses and those numbers are very plain so now despite the importance of protecting interest small businesses unfortunate many government agencies are continuing to really fall short of their goals for contracting with small businesses last year only one of twenty four agencies scored by the small business administration met all the small business contracting goals i'm very pleased however that g s a met its to late goals and that's that's a step in the right direction and we're very proud of that but despite this progress as this progress we need to continue to pressure agencies to continue to work with with small businesses to to to achieve those goals in addition agencies must must ensure that contracting practices are fair they're accessible they're transparent obviously to maximize small business participation and as i stated a little while  ago supporting small business small businesses is crucial always is crucial but particularly now with unemployment rate as high as it is and again as i said a little while ago if you want to create jobs you have to look no farther good afternoon chairwoman norton my name is rudy wiley and i'm a supplier diversity program manager in the office of equal employment a minority affairs at the smithsonian institution on behalf of the institution let me express my appreciation to you for holding this hearing on the use of small disadvantage of minority and women on small businesses and federal contract operations and let me thank you for inviting the smithsonian institution to participate in this discussion and share with you  if you are supplier diversity program achievements and ongoing initiatives this missoni is the world's largest museum research complex with nineteen museums nine research centers one hundred thirty seven million artifacts eighteen libraries and the national zoo the smithsonian stands out as a unique entity and a leader in science research history art and call the smithsonian institution is a trust instrumentality of the federal government that has been a the institution's leadership believes that very city and inclusion are entered vocal proponents of the mission and expressly committed to diversity in all aspects of its workforce and business operations diversity and inclusion have long been a part of the institution strategic plan and performance plan our policy statements and directives doing business with small minority and women owned businesses is a reflection of that commitment over the past three years the institution  roughly forty to fifty percent of its contracting procurement dollars with small businesses and as indicated in the materials attached to my written statement you can see the institution has consistently achieved and exceeded all of its  percent in f y two thousand and eight we have made progress and we are actively pursuing and zeroing in on projects that can be performed by these firms as shown in the chart provided for f y two thousand and nine we have exceeded and more than doubled our accomplishments these accounts misspeak for themselves specifically we have spent forty nine percent of our federal contracting dollars with small businesses a whopping twenty percent with small disadvantaged businesses twelve percent with reginald small business remains a challenge we are actively pursuing opportunities to do business with these firms the success of the smithsonian's supply diversity program is the result of unwavering commitment from the top starting with the secretary dedication and collaboration from all managers and perseverance on the part of all procurement officials are the ingredients that makes the program work as well as it does please say that the collaborative relationship among the supplier diversity american recovery and reinvestment act funds allocated to the smithsonian in contracts with minority small businesses specifically nine point five million of the twenty five million the smithsonian received in recovery act funds obligated to a small businesses using our supplier diversity program infrastructure we were able to move swiftly to galvanizing employ these firms to participate in this great opportunity this is a testimony to the effectiveness of our program the institutions commitment to supplier diversity let me share one more example of the success of the smithsonian's commitment to supply diversity that i believe will have historic significance as a result of aggressive outreach initiatives minority  firms were identified and competed in the design competition for the new national museum of african american history and culture and the winning frenemies minority young we are currently negotiation with the minority firms to perform the architecture and engineering design services for the new museum we are particularly proud of this accomplishment in closing let me reiterate as evidence throughout its operations remains strong and we will continue to engage a wide array of small disadvantaged minority and women firms as well as services able veteran firms in our business relationships thank you again for this opportunity to share good afternoon madam chairwoman my name is roger mosher and i serve as vice president facilities for the john f kennedy center for the performing arts the kennedy center is unique in that it serves the dual purpose of being the national cultural center and the memorial to president john f kennedy each year the kennedy center reaches over two million people with more than two thousand performances in all performing arts disciplines every season our focus is on developing programming that achieves national and international acclaim has is the fitting our role as a national cultural center we appreciate the committee's interest in the promotion of small businesses i'll provide an overview of the kennedy center as efforts in this regard in fiscal year two thousand and nine the cent receive direct federal funding of thirty six point four million dollars for operations and maintenance and capital repair while our contracting our activities are small in comparison to the agency's appearing with me we are committed to awarding a fair portion of our federal purchases to small minority and disadvantaged business enterprises the kennedy center continually looks for opportunities to offer contracts to small businesses given our relatively small budget the opportunities for such awards are limited however each contracting action is evaluated as to its suitability for a small minority or disadvantaged business opportunity in general the center's chief of contracting services our small business advocate in a dish project managers and other contracting officers representatives are also advocates for this program due to our track record of successful work with small businesses regarding operations and maintenance funding many basic services and minor repair contracts are awarded to small businesses including minority and disadvantaged businesses these contracts range in size from three thousand dollars for sign language interpretation for federal employees to approximately two million dollars for housekeeping services on an ongoing basis the center utilizes small businesses for services such as elevator maintenance and inspection as best as abatement indoor air quality monitoring work and textile maintenance pipe organ maintenance emergency generator maintenance maintenance and various mechanical and electrical equipment inspection repair and maintenance services additionally supplies such as carpet air filters paint light bulbs and many more are regularly purchase from small businesses for construction projects from capital projects to major maintenance we utilized small businesses for both consulting and contracted services for professional services we've contracted with small businesses for architectural and engineering services cost estimating and construction scheduling review for general construction work we have awarded a number of contracts to small businesses ranging in size from twenty thousand dollars to nearly five million these have included recently completed work to upgrade life safety systems on the centers roof terrace level and a project to paint the exterior columns of the facility both of these projects were completed within budget and on schedule this summer we awarded a construction contract of four point nine million dollars to a small business for the renovation of the concert hall support spaces including practice rooms for her school rooms lockers and offices this project is one of the largest private capital projects we currently have in progress most recently we awarded approximately one point eight million dollars in miscellaneous work to a small business for construction work and that's just getting underway center has also  stablished open contracts with small disadvantaged general contracting businesses participating in a program these contracts are utilized for minor repair and significant maintenance projects that typically cost less than a quarter million the centers work today firms for many years and currently has four a day firms under indefinite delivery indefinite quantity contract this summer a firm's refurbish the center's co chaired room renovated the african room and repainted a significant portion of the concert hall ceiling the center's achieve success and working within the a program by actively pursuing opportunities to promote the use of small minority and disadvantaged businesses including meetings with a marketing firm representing a firm's this allows us to remain current on the breadth of companies participating in the program as well as their capabilities based on  size and scope of the contract to be awarded the contracting office will avail itself of the option to go directly to the small business administration first set aside or may limit competition to only small minority and disadvantaged businesses this method proved successful in the world of our housekeeping contract which is in the final year of a multi year contract a new small business procurement for the next housekeeping contract is currently ongoing while not every contract can be awarded utilizing the small business vehicles many of the capital projects outlined in our five year conference a building size and complexity that fit within the services we have to our small business relationships the kennedy center capital plan includes a number of relatively smaller infrastructure projects that we have been able to award to small businesses in summary our experiences with small minority and disadvantaged businesses have proven to deliver a successful outcome in a variety of areas including services supplies consulting and construction as a result we are proactive in seeking out opportunities for the appropriate order of small business contracts we appreciate the subcommittee's interest in this program and for including the kennedy center in this discussion this afternoon thank you thank you thank you mr mosher the next witness is stephen ayers the acting architect of the capital mist madam chairwoman for inviting me here today to discuss a or sees efforts to increase procurement opportunities for small businesses we've made tremendous progress in our efforts to implement programs that enable and encourage small businesses to effectively compete for air sea contracts specifically i've directed our staff to employment to programs to actively award contracts to companies that reflect the diversity of our country above and beyond the standard requirements of federal regulations these include a small business set aside program for small purchases between five thousand and one hundred thousand dollars and a small business up contracting program for construction contracts exceeding one million dollars additionally we've recently partnered with the small business administration to further utilize small business programs on aug tenth administrator karen mills and i signed an m memorandum of understanding to establish the roles and responsibilities of each of our agencies in the implementation of the use of small business programs at the a o seeing the memorandum of understanding while preserving the separation of powers between the legislative and executive branches establishes the support activities roles and responsibilities necessary for the s c to fully utilize small businesses identified under the s b a act and s b a as regulations are small business  contracting program which was launched in august of two thousand and seven requires large businesses that are awarded construction contracts exceeding one million dollars to submit and here to a small business sub contracting plan this plan includes goals for prime contractors recruiting small businesses as abs and they meet and they must meet or exceed the small business administration statutory goals for federal executive agencies when contracts are awarded to large businesses under this program require we require each one to submit a semi annual progress report detailing how well they are achieving their prescribe goals on october first of this year our small business set aside program will be fully in effect for small purchases between five thousand and one hundred thousand dollars under this program are contacting officers make every effort to identify and use small disadvantaged women own veteran and services able veteran own small businesses along with these programs we continue our reach out to identify small businesses that are currently working with a o c or are interested in competing for work with us in the future we also continue to reach out to new vendors and the data received is used to identify small businesses that can compete for our requirements vendors not previously used by the a f c can also submit literature to our small business office and when they can find information on that on our website as we continue to expand our current vendor database to include small business information our procurement staff continues to communicate business opportunities with diverse audiences through workshops business fairs and small business conferences leading the way in the legislative branch and encouraging small disadvantaged and women owned businesses to effectively compete for contracts we're working to meet or exceed our goals through the three major initiatives i mentioned the small business set aside program the small business up counting sting program and our partnership with the small business administration we've obviously have a vested vested interest in supporting small businesses in order to help facilitate competition and to support local communities in a sustainable way we look forward to our continued work with this committee and the congress to ensure that our efforts result in strong small business participation and future a participate in today's hearing as a capitol visitor prepares to welcome its two million visitor we are on track to double the number of visitors to the capitol as compared with previous years we are pleased at this outcome and even more pleased to report that the business centers goal to work with and develop new opportunities for small and minority business is in line with the goals of the architect of the capital my staff and i have worked aggressively to hire personnel in to work contracts to individuals and small our gift shops more than seventy percent of the merchandise small business approximately twenty five percent of our vendors are women owned businesses as we are still in the ramp up of operation we are constantly reviewing our merchandise and our vendors in order to make sure that our offering our visitors are high quality merchandise from a variety of we will be working with the small business administration and the government printing office to major role in the development of the strategy we have also reached out to merchandising trade organizations including the museum stores and the producers of the new york international gift for information on minority owned businesses in order to further expand our reach and support of these businesses madam chair you have my commitment that i will continue to work to ensure that we do business as much as possible with small minority and disadvantages businesses and plain enough about this matter to spend at least a little time with us today and i want to welcome representative edwards tells me she doesn't have an opening statement this time so i will proceed with a dime to spend except the federal government these days i know you know that with the only game in town and the only way to reason we have money to spend is because we can write checks with money not in the bank therefore people are really looking sound you want to say this nobody cares about your general general jurisdiction except me and that's because i represent the district of columbia and in many ways the region it is an better because the federal government is expanding therefore we are probably going to put an extra burden on you and ask you to try even harder than you already have so in stimulus funds let's just get on the record given where and i know that we've had an issue in our larger committed about outlays versus obligation five think i'd be satisfied with obligations at this point i want to know for those who have stimulus phone what the percentages you can give me small businesses because  this hearing is about small businesses generally it's about small women owned businesses it's about small minority owned business and it's about small disabled veteran owned businesses so you can if you want to break those down be my guest but i want to know what percentage of stimulus funding the stuff that's being pumped into the economy as i say as i speak has gone wise in terms of contracts are competing very well say that again in terms of the number of contracts that were awarded for recovery the small businesses are competing very well just barely under fifty percent are going to small dollar wise however we see far more dollars going to the large recovery because so many of our dollars are going to the large construction projects that we'll see and i appreciate that and i also appreciate because you are doing the biggest construction project in the history of the united states and happen to be doing it right here in the district of columbia the h s and it's going beyond going on two years but as i go down the line first when you when you indicate what what your dollars are appreciate for example that you are abiding by the notion of said aside you set aside i think five million dollars a small business is a small business or that small disadvantaged business which is it five million dollars has been set aside for small or small disadvantaged businesses which is it and it may be small businesses i have no argument with that but i mean tell you a complaint i've already received and this complaint is applicable to each and every federal agency a fifty might million dollar contract to do the electrical work has already been awarded we received a complaint from an electrical contractor that well you awarded it to first of all the business car construction so i call names out in this place that's how you track people find this is an excellent company they competed for and they received it they compete the then we competed the the contract the electrical contract very lucrative contract today fifty million dollars in one region the complaint came from a small electrical contractor when he called to try to compete as a sub contractor i picked g s a because i've received a complaint but i assure you this is the kind of complaint we hear from small contractors all along this is how they evade the small disadvantage of business and small business contract this guy who has the electrical contract than electorate call his name out glad you got it got it fair and square but the sub contractor said when he then went on to say now we're ready to be a subcontractor he was told well we already have have our some contract and therefore there's nothing for the rest of you out of fifty million dollars this is the message i get now they don't have to come in and see me to correct the record but this is a message i get i know i got a requirement i'm going to meet it in the most minimal fashion i can i got me a disadvantage business a small business maybe even in good faith says dielectric we work with them in the past and so we know they're good later for all the rest of you out there no matter what your record is no matter how you would compete that may not be what's happening but briggs should fifty million dollars in electrical contract by the way down electric gets to keep what isn't given to the sub contractor and one of the abuses that we believe w is shall we say preconceived small businesses who kind of help us out here even some of the complaints go payoff of small business we don't even get to do it so long as the goal is reached i don't think that where a billion dollars and i can tell you th one member and only one member who struggle for that money for g s a i don't intend to use that one billion dollars to the heat this practice to the extended exists to call out people who are doing it so that in the other agencies across the government not necessarily those who are here we send the message with on a break that abuse technically within the law out rageous violation of the intent of congress so it suggests to me since he thought he was getting away with this the g s a just looked at the bottom line and didn't raise the issue until this electrical contractor got in touch with this member of congress what can you tell me mr good's i think generally speaking we are being very attentive and growing aggressively more so each day with our sub contracting plants and not only monitoring the the mission of the sun contracting plan but also here in to that plan with saying i do not have seen elizabeth development i don't have the specific information that you have about that company even know about this but this is this is the biggest contract you have you have know when do you know of this complaint i am not personally aware when i get up to your level project areas may very well and in fact the contracting officer is here with me and i have where the contracting officer stepped to the table contracting officer we're really here to try to find out some information and we're tired of hearing the complaints agencies have not been held accountable the best way to hold them accountable is to take the  dollars that's only the first of probably five billion dollars before it's all over da jack do you know of the dielectric contracting of a complaint that came from an electrical contractor yes man yes ma'am to some contractor that you're the contractor that you're talking about give me a phone call what has been done if anything to make sure that there's not a pass through to a favored minority or small this complain the project executive and i we actually had the general contractor clarke design build come in and we actually had a roundtable discussion to let them know that we weren't going to tolerate this kind of action let me thank you say your name again please bonnie eccles of the general services administration the same elizabeth project that was you do have some credibility with me because you have work with us and try to make sure that minority businesses do have access to this larger than average federal contract but it does suggest to me that unless one monitors these people as these contracts are given it's not worth a darn we say they've gotten into these habits because committees like us and like eve certainly the the progression committee have not only monitor only marching is done by s b a they don't have any jurisdiction so we're going to have to ask you and then i think you should have been reported to ms riggs she needs to know because she's in charge of the whole kit and caboodle so that she can be on the lookout for this happening elsewhere i suspect that this happens throughout the government by says i know what my goal is i got at least one i'm not even looking for any others and then members of congress get these complaints and nothing happens they don't do anything and all you all are are violating the law and then we're left to try to find well  phone calls we're not going to do it anymore not on something as big as this so i'm going to ask you to develop a procedure you are doing very well in developing a procedure for hiring and i find you for i want to develop a procedure for tracking those sub contracts to see where they go and to end form all the contractors inform clark that clock is going to be held accountable for clarke does district of columbia with people coming to me for merrill on the genyen and d c and by the way these contracts are open to people all over the united states knowing that i'm the chair of the committee with complaints we're going to correct the personally accountable because unlike mr hanson we these people report directly to us there is no state between us and g s a contracting arm is that mr hanson i'll be interested to hear how you do it there for the two hundred and ten million dollars were grants to modify upgrade or construct nonfederal fire stations so on really none of the stimulus funds came to my acquisition management division well that doesn't mean you have no responsibility mr hanson the grants division we can get that information for you ma'am but i'd have to go to a different department which is the amount these fire and the other part of our this is very important to us what do the states know about their obligations with respect to minority time and what kind of contracts are these mr hanson as again ma'am as these are grants handled to our grants department and i'm going to have to go to them to get you in more detail what kind of  what is funded by these grants from stands in this particular case it was a construction of nonfederal fire stations that's what i'll grant you can see that was not a lot of money and you can see how people under great compulsion to spend it because we're putting them under that compulsion could easily go to the fastest best in their judgment quickest way to spend it so i'm going to have to ask norton the smithsonian institution received twenty five million dollars in recovery act funds that twenty five million dollars that we received we awarded nine point five million dollars to a small disadvantaged businesses there were eleven contracts awarded to these small businesses and that constituted thirty eight percent of our recovery acknowledged the type of work it was done was construction general construction facilities engineering maintenance contracts and that's how we spend that money now that's thirty eight thus far that's far have you been able to award such how have you been in front of your overall goals how does that compare with your overall goals compared to our overall talking about the nine million dollars to a small disadvantaged business is that correct while you're looking for that i understand it was edwards also has an appointment and may need to leave before i get to her so i'll come back to you i mean while this edwards may have questions for any of them any of you as long or as much time as you feel is consumed she may proceed now thank you madam chairwoman and of course i won't consume that much time and i appreciate it i have another committee assignment in just a few minutes and i do thank you for holding this hearing because you have been incredibly vigilant about our pursuit and our oversight responsibility to ensure that all of our businesses get the fullest benefit of participation particularly with the stimulus funds my question actually goes to sort of a process i think one of the when small businesses to me want to the biggest obstacles that they say they encounter is this you know and and then it becomes then there becomes a sort of ongoing process of you know knowing who you know in order to get the contract and next thing you know you look down a list and it's the same old folks even though they may be small minority and disadvantaged businesses or women owned businesses that are getting the same contracts over again and and so i want to talk about you know just the the process and get some thoughts particularly i'm just tired of looking at the same list of contractors and subcontractors and you know you've got contractors a perspectives out there who have the potential to do really great work for us and increase our level of competition and our knowledge about about what some other businesses are doing but they can't even get a bid in edgewise and so help me understand what you're trying to do to open the process and also to do it with a degree of transparency too often the client the complaint and i think the chairwoman has spoken to the complaint that we hear is that we just don't know and that perspective  solicitors don't know and don't understand and as a result they may be assuming that they've been left out or cut out or not made in a ward for reasons that may be perfectly justified but the level procurement process and through that we're reaching a lot of folks teaching them how to find out more about who our primes are we've published that list and we'll continue to of our prime contractors on the web site or also but expanding business opportunity and their knowledge of other business is there and it just doesn't seem to me that we i'm not quite sure whether the rules are in place and certainly the laws not in place that compels our prime contractors particularly on these huge contracts to really open their doors to the other vendors and then please don't leave out the question of bundling of contracts bundling in fact that question was asked in a previous hearing and so i know we had they had no bundled contracts last year we do have one this year that is underway actually underway as we speak in the environment so we have mr hanson first on the topic of bundling that's counter to my leadership philosophy to really truly have a small business program you've got to be a cultural event within an organization and i can give you a practical example i recently hired a new chief of contract operations in charge of my contract operations who served in the past as the director of small business programs for the department of defense and he served as the associate administrator for government contracting and business development of the small business administration this is my layer of leadership it takes that type of leaders in your organization to build that culture within your organization to let your workers know what expected small business and beam a is exactly where we want to go i don't want to bundle contracts i want to transparency i heard g s a is response i want to hear from our other agencies about about the methods that you put in place to ensure not just that we here in the committee have a sense of what you're doing but that the business community the small business community really have a sense that they're getting a fair shake but congresswoman for smithsonian one of the things we do is take our referrals from small businesses directly to the large businesses and pass that information on to them what i do in a supplier diversity program is with our office of contracting and more often for construction projects our facilities unit the sub contract plan prior to the contract award and we include the percentages in and after those percentages are included in the contracts then we we have for those small businesses that are interested electricians straight to our contractors and rigs before i leave can you tell me that once you do these kind of outreach efforts to small businesses how do you track the ones that actually come back and eventually or awards are made to them do you track that currently and th something we are putting into place because i mean other i mean the question is how do you know that all of this outreach business is really effective absolutely empathetically now that we're using so many different tools we really want to know which ones are most effective reaching them so we have began to capture the feedback that we're getting from the vendors and certainly in return calls telling us the results of the conversation but we're looking to put something more formal into place that would be great because i have to share with you when i talk to our small businesses they say oh yeah we go to those seminars and outrageous things all the time never gotten a contract and so it would be helpful i think for on an ongoing basis for for the chairwoman and th subcommittee to really hear from you and that is each of you what's the real result of your outreach efforts because otherwise i'd say why bother to spend the money on outreach if no one's ever going to get a contract thank you thank you madam chairwoman government very high when it comes to comes to building or doing a service for the federal government but the no to me if lesson we get back is to me did i'm going to use the same sub contractor in perpetuity you're doing nothing to carry out the congressional intent to increase and for that matter help train small businesses because they do get contracts  f a small business gets a contract and begins not to perform up to your expectation so they yank their contract people have things in the sub contract that make that possible but the fail safe notion which we believe has been abused even further that people have gotten sub contractor sub contractor to meet the requirement and then don't even do the work i know about it but i tried doing that on a billion dollar project at the d h s we understand and having familiarity with a subcontractor who has performed well means you want to go back to that sub contract with how in the world the you know that there's no other sub contract electr in this region and this country except the one you hadn't used an electric house in the war can you say especially since so many are out of work that you've got the one and only who can live up to the standards of the federal government that is where operation runs out and where we do not believe outages occur and i want to just say that mr eccles has already shown that there are ways to increase the numbers because of the g s a workshops which went on as i recall it for two days for several sessions and at the end is this not true miss ackles small business is qualified at the end for a four a day contracting is am i correct on there how did that work correct yes so what she did was the sensory system there and by the end of it if you had met all that it took to indicate that you had you were on a time track to having facts through now of course that's going to increase the number of contractors some may have come back already were just to refresh but we're either go contractor the electrical contractor did award x number of electrical contractors i'm going to have to sell look you can't expect every electrician in the region to ever see the contract and and if there are goals to be met then the goals have to go to where the small businesses are there at the sub contracting stage mr wylie would you continue so that we can quit more quickly go through this we ordered one hundred fifty eight million dollars eighteen million dollars was awarded to b c contractors and six million dollars was awarded to small businesses in the district you have percentage percentages awarded in this region and the reason i picked out this region is ferrous national capital region and it's where you'd expect more people to come forward i wanted by region by state by by district of columbia maryland and virginia and by category percentage in dollar amounts and names of contracts with contractors who give me a sense of whether or not the same contractor is simply getting the same business over and over again again i do not mean to say that that shouldn't happen i mean to say though when you have a mammoth time track like the electrical contractor and you can fire only one person a person is a red flag that's going to go up mr mosher your answer on this on stimulus broken down by those categories madam chairman what would you each of you by the give me if it's up to the quarter give me up to the quarter last year so they have some sense of whether or not agencies are doing their best to make up for the l capital has not received any stimulus funds either and to answer your second question last year and fiscal year two thousand and eight we awarded nineteen and a half percent of our contracts to small businesses and this year through september second we have awarded thirty five point seven percent of our contract to small businesses now have a disadvantage small businesses that went from three point two percent last year to four point nine percent this year one way to get at this sub contracting abuse is to make greater use of the g s a schedule them multiple awards schedule how many of you make use of that schedule the g s a schedule where the small businesses are not all of them some of them are with contractors but that the g s a schedule is full of contractors harder to get on because you've got to do a whole lot of show who you are and how good you are in advance but for that reason you would think that a federal agency would potentially be interested in the g s a schedule so why don't we just start with ms riggs on that  one yes ma'am schedules quite heavily and we have you schedules for recovery work as well and of course you use it as a g s a schedule i'm trying to find out about small business disadvantage small businesses  how often you go to let me be clearer then you go to the g s a schedule as opposed to going to the sub contractor who or contractor who is able to look it seems to camouflage a lot of the  week that you otherwise would require you go straight to that schedule don't you get yourself a small business more quickly and doesn't work for you with the kind of contracts you do us and small businesses over a period estimated year so we can compare in small disadvantage businesses in small businesses and in small businesses themselves the use of the schedule and in what kind of services i'm aware of course that sort of kinds of services and then themselves to the schedule more than others for example clark construction is responsible because he's a general contractor and therefore as ed was questioned for example there are more relevant although it's not that he couldn't go to the schedule benefit from going to the schedule as well but the responsibility lies with him for you the responsibility could lie with whether you decide to go straight to the schedule on some matters or to go through a contractor so i'm interested in the use of the schedule and i'm not complaining although i hear complaints so there's so that you don't think i simply bring you the complaints we hear from contractors we call all the time the sub contractors are not complaining although i would like you to look at what it takes to get on the schedule i happen to like government therefore i am particularly sensitive when people complain about government because the people who don't like government whose names shall go on mention often use the fact that government paperwork and all that goes with it can be so burdensome to try to get rid of a whole whole lot of what we do so i'm a huge streamline type and better known and see for getting rid of the ba than for the things that i rather have on my tombstone so i really do i'm interested particularly in the use of the schedule and i'm interested and this this i don't require in thirty days but i'm going to require  sixty and sixty day i need you and your staff to look at whether the schedule can be streamlined how much it can be streamlined and yet meet the high a schedules we primarily use them for supplies for office products janitorial supplies but not for construction related requirements you know with thema if you want to quit purchasing you ought to be going to the purchases it's of the schedules like like it was yesterday we love the g s a schedules nineteen percent of our acquisitions are  off schedule but keep in mind it doesn't that relinquish us of our responsibilities for competition we actually do competitions on the schedule when we might you know everybody on a schedule has already competed what you could still do competitions with the members on the schedule to get the best price of course but that doesn't take a lot of time does not take a lot of time they've done a lot of the work up front for us so in katrina how often did you what percentage of the contracts came off the schedule can i have my sixty days to respond to that matter you'll probably need for that yes ma'am also for the what was the one in houston that i i need to know the use of the schedules get get me those two hurricanes but if you want to simply do it by year and i understand a katrina problem i think i'd rather have it by year just like i'm asking people to give me go back to the quarter in one year go to the quarter and this year yes ma'am schedules and who else missed mosher you have a high percentage i can't believe you don't use the schedules we do we don't have a huge volume and schedule buys  our funding of course is solely for the main and so on and i get what it's soley for the maintenance and upkeep of the facility so all of our purchases are related to that but you talk about some renovation you were doing we don't do in very very rare cases we might do contracted services through the g s a schedule but we primarily use it for supplies once an open contract and open contract is i suppose just my way of saying an active contracted sort of a blanket purchase agreement or  vehicle with a small business that i can continue to tap into schedules missed them and we make extensive use of the g s a schedules we find them to be excellent vendors as well as it's a streamlined acquisition method that saves us time and effort so you do make use of the schedules absolute as opposed to going through the contract how much get me quarter over year i'm just trying to get a sense now i want to ask you something that i've just seen happen and i was pleased to see it happen and i want to know how you would how you go about deciding the amount is to be commended for setting a very important example when it did the preliminary work clearing   in lower reaches of the work and yes they must understand that because when they contracted over the past year according to our figures for the work one hundred percent of it went to this is without any hearing or a demand by this member or any other member when two minority asari disadvantaged businesses and forty percent of businesses in the district of columbia more recently g s a for the next stage i think a four hundred fifty million dollars contract set aside five percent for i don't know if it's small businesses or small disadvantaged businesses so i want you to break it down for me how did you decide i want everybody to listen how did you decide so that you were able to to get those numbers in small disadvantaged businesses in the beginning and what are you doing with this five million dollars and how did you even get to five million dollars because and certainly the committee didn't tell you that that was the number and we wouldn't have known how to tell you what the number was yes i'm not mistaken i believe you're talking about nasa's construction who did some work out there at the same what we know that they got the disadvantaged business process in the district of columbia right a depending on what project we're working on i hope everyone heard that inviting them to participate others will be to support will come forward on their own and if they hear about it they are too invited to participate so you don't i believe you may be talking about the demolition contract that's out there and that's probably right that was a competitive a requirement and what we did that was advertised and said this out in the requirement is that you must be certified as an eight firm to participate now this is legal and constitutional they're making eight a contract to compete with in the eight a category for small business where they have determine that there i now know that and how did you get the five million dollars was that based on what you know about the available pool for example of people who can do that work within the a contract pool  of contractors i am i'm looking  at examples of things that we've purchased from contractors last year i largest category of work maintenance and repair of office building behind that was construction and behind that because there's there's quite a list here but those are probably our largest categories that we where we thought dollars go to a company now could i know from the rest of you do you take some of your stimulus have to be dealing not with your grants but with your other funds that you use go ahead yourself or your fund there's a couple of different techniques that you can use to identify a contractor is one of the easiest ways is to put a request for information on that  ups giving a thirty days if you find out that you have eighty's out there that can compete with that one for you through that process so that's one technique we also have a program where if a contract is already a day i'm going to keep it active already demonstrated they can do the work we have a policy where we award sole source contracts to a days up to three point five million dollars but when we have a when we have a particular event in excess of three point five million dollars we can beat them amongst the a the information over the quarters one years another how much of that is taken place using your funds i'm interested in the a day so that when somebody calls me i can look look down and i can say well fema last year you know if you are saying to the a contractor has nine million dollars correct you surely don't pull that out of the air correct how you get to that number that number we came out of the amount that we obligated we did i was again nine point five years i'm trying to find so your way will to get those impressive numbers without having a specific goal correct and so what we did do we looked at the amount that we had and we do have id i q contracts that were previously awarded to eighty vendors and we said of the money that we receive what dollars and what projects can we award to these and so that was approached and we did rather than identifying a specific amount of money we looked at the projects and we looked at the vendors available and we may be awarded those are based on your your direct you know where where to go you know you're not going to find a time for actors in a number of different have and mr ayres those figures vary in court because you see i would be particularly embarrassed you know legislative branch agency to hear from to hear from constituents in the region but at our own legislative branch i had difficulty so look at the program it's really a small business administration program so today we've not made efforts to particularly work or direct a programs but i think with our new relationship and i agree meant that we signed last month with the small business administration maybe that's a goal we can develop and push for in the future you ought to be commended on understanding that though technically and of course technically we could we could take steps technically because if we ran to the government no legislative branch of government you apply the federal agencies  you mr ayres i had great problems you were not the architect then when we did this massive build out was just horrific where we spent all that money anymore no because there had so many complaints we were in the minority and it was very difficult to deal with that we're not going to have that again and if you're not use the a program the way these agencies are you know i don't have a lot of success we want the use of multiple ways i am after my minority business to get on the g s a schedule the minority contractor stop sorry he was a small business he was not a minority contractor came to me on the electrical he did the right thing i'm after them to go after the contractors contractors sometimes comes with from small businesses  you see me going into such great detail because we'll never be spending this kind of money again i just can't imagine for decades the other congressman with your agency others have smaller amounts you indicated that you did you small business saturday sides of which all you want going to be and that's not a bit of between five thousand and a hundred thousand dollars is that right that's correct and that's the first time you've done that that's correct well i compliment you you for that i think it is a scandalous that the agencies have been doing that in their own legislative branch that's why we're going to be doing the oversight that's not really a way for you to know unless the authorizing or the what about the vendor database that you and perhaps mrs rouse used we have an extensive database where we began focusing on this program in two thousand and seven the first thing we did was to send a letter out to all of our known vendors asking them to self identify whether they were a small business large business disadvantage and we've got that information back now and we load that loaded that into our vendor database and our financial management system and certainly several times a week we meet with new vendors obviously as you know we've been to your fair both in two thousand and eight and two thousand and nine and we've been to three fairs this year and we get information agency and therefore we will be particularly interested in the m o u and how you want to carry them out and of course the g s a experience is so extensive that i would invite you to collaborate with them to say some to get to some shortcut and i'd like to ask ms rouse and understand she she that much of the her work comes under the architect of the capitol but i wonder if you set internal goals with small business programs of your own for example  avenue to find new vendors are real interest is trying to work with secure money an s b a to do our first vendor failure at some point between now and the spring time which will allow us to actually hopefully attract more vendors who who want to create already have products that would be of interest to people in our gift shop so we think we have some new opportunities and i think the more people know that we're doing it the more vendors well you are very visible and so  during a disaster let me tell you the complaint i get as i have the primary jurisdiction over the same i'm also on homeland security they actually have much smaller part of the jurisdiction this is what we hear  here we have some of the only thing left standing in this area are awesome all businesses but they complain without any way for me to respond but it's all businesses here there and particularly the big bigger contractors are getting all the business so they really here i'm giving you their comply i'm not verifying it but they complain though that they really want to help us they give the business to the small business person who can it's up up and running and can do it that's the complaint about thema madam chairwoman you'll be happy to hear that theme a has adopted a program called the local business transition team that we actually deployed just last year to gustafsson and it's the job of that team to help transition work from the larger corporations to the smaller corporations it's also the job of that team that you have this question went to the smaller corporations and that is ask the area who happen to be up and running but see contracts going here there and yonder but not to the area where the money would flow back into the jurisdiction that has been hit that is it that's exactly the intent of this team is then to reach out to the community to reach out  those small local disadvantaged businesses to teach them how to work in the government to get them in rolled into central contract or registry to help them get downs numbers to show them how they can go on to fit that biz ops to see where the opportunities might exist in areas that are really devastated would actually have big boards and we would teach the local contractors how to go to the big boards to compete for these contracts so this local business transition team is really a good initiative that i think really gets to the crux of what i'm talking about you know setting that up now is that we did it in a the developed d h as development which is only now is only if it can't even be a third of the money you're going to be spending but it's currently under way  where we would expect small business opportunities to be unusually planful have you goals or how will you do goals for this development you're going to be going on i would be surprised if you were not going on for almost a decade when when all is said and done before the first people land there and say we now we fourteen thousand federal employees there how are you going to manage small business opportunities for so large a project in terms of goals for the development  i have nothing but always formis eccles but what i'm afraid of is a that's the best way to put this a step by step notion as opposed to you know exactly what you're going to do there you're going to be doing building from the ground up you're going to in fact there's no kind of construction work you're going to be doing including reuse where small contracts will be abundant in the extreme you're using maybe sixty percent of the buildings there somebody if if you want to be successful long before that work begins is going to have to begin to map out this miss miss ackles is an implementor because i've seen her do her work somebody before you get anywhere close to the next contract has got to be looking at reviews i'm going to insist that she has a do reuse and construction at the same time what are you waiting for we should be going step by step we use doesn't have anything to do with the building from the ground so i'm going to be seeing whether or not yes they can walk and chew gum at the same time therefore i ask about your overall planning for the small business contracting for this project to quite a lot of work just small businesses or sub contracting but we will also continue to work just small businesses as  available so that contractors and for that for that matter sub contractors will be briefed well in advance of what is going to be required is a tool to compete for the next one of the many contracts are going to come plan to do small cars a small business contracting considering the opportunity is going to be available for reuse and for construction and bearing in mind that since this is a mammoth con ce the big boys are who are going to benefit most and well they sure they have they have the necessary expertise they're putting  out much in order to be able to accomplish within the timeframes we give them but we are as intent on meeting the small business and small and disadvantaged business goals as we are on the rest and they are all tied into this you're not going to go to the g s a table for all of these people and i don't ever want to see another clock dielectrics complain in the years that this thing is going to be built never want to see it indeed i know of no nothing you can do after it's occurred please say just my next question is there anything you can do is there any  sanction that you know of or have you used if a base of contract or small business contracted and you found that in fact they were not using disadvantage contractors they were not fulfilling or they were simply not fulfilling what you asked them to do what do you do then well you know what i want to make it unnecessary to answer that question because my answer to what is it's all over then and we all lose and i know that there is some accounting or to be an all over then there for the most important mission i could leave you with is tracking catch the abuse all the failure before it comes whole you hold in the money friends is there any way to withhold money if a contractor fails to meet his goals and sub contracting then you know what is  we actually do a whole bag procedure say that again we actually do a whole bag procedure everybody but all those words hold back procedure because we don't want to have to call out names the way we did here call and contractors contractors are doing whatever they're doing because the federal government has not been tracking has not been helping some i have a great big contract you want to always say do i worried about the contractor so the failure lies with us and i'm trying not to be responsible and i think you have to in inform your your small business contracts that you are going to be held accountable before the subcommittee you certainly will be held accountable or an annual basis and g s a who comes who has the largest amount will be held accountable more often than that because we have hearings often with g s a and are prepared to have hearings if we find lapses which we have not found today we found much more than good faith efforts today we knew that from the s b a figures and how how well we were doing and the administration takes this very seriously i've had discussions with the justice department which means to proceed not in this area where we're talking about affirmative work but in areas where we find  people in violation of the law where you may need the justice department to back us up i want to thank all of you for your testimony today is very very helpful please remember the time frames we've set and please be in touch with they have because we're here not simply to do oversight to but to be helpful to all of you and i'd like to call the final panel panels to this is a very important panel because agencies come forward simply to tell us what they mean to do and what they believe they have done and they did they testified truthfully and in good faith but we we need to put that together with how that experience works on the ground and therefore we are welcoming the next witnesses asking them  to quickly be seated and we will hear their testimony we're going to go left right here and we're going to proceed quickly beginning with rosalind's steppenwolf president and c e o of capital city associates good afternoon congresswoman norton i am excited to say the least to be here to be able to testify again before your committee to talk about the small disadvantaged businesses and your goals for meeting for assisting us in competing in the federal marketplace again i'm roslyn style steppenwolf and i am president and c e o of capital city associates incorporated an african american woman small and disadvantage business that is located in the a steamed anacostia neighborhood of washington d c capital city was established solely for the purpose of assisting federal and local into cheese made to corporations and private developers to maximize the participation of local residents and businesses within communities to participate in the revitalization of their neighborhoods capital city has worked with communities in washington d c and now has extended is work in maryland and northern virginia working to negotiate relationships with owners of development projects and establishing partnerships with a resident organizations so the inclusion of local businesses is inherent in the design and construction projects capital city also works to develop capacity building skill training programs such as a print for your printer ship for the ship administrative office property management communication systems operations training that help people to not only effectively compete for employment during the construction of projects but also as employees during the operation of the facilities post construction most of the partnerships implemented written agreements which included a process for monitoring and enforcement capital city is a public private expert having successfully assisted the government of the district of columbia to change the laws governing the participation of local small and disadvantaged business in apprises on city funded projects from a goal to our requirements and we continue to monitor come monitor compliance on federal local and private development initiatives to ensure the full participation of the small disadvantaged business community in construction related projects i offer my congratulations and support to you congresswoman norton for spearheading this initiative on the federal level and working to ensure that local residents and businesses are able to participate in the construction marketplace on projects under your purview i  witnessed first hand the instrumental role you have played to include the united states recovery act dollars in g s a redevelopment of the same lizabeth west campus in southeast washington and unprecedented requirement has been included in the solicitation for construction management and the general contractor teams to a stablish and maintain a plan for pre apprenticeship an apprenticeship training programs to be incorporated in their construction plan this brings me to my review of the general services administration and the support of small business and entrepreneur participation in this historic development initiative center lizabeth west campus as you know sits in one of the most highly distressed neighborhoods in the country the state of the economy recently reported that the current recession has lasted longer than any recession since the great depression that the unemployment rate is the highest as head it has been in twenty six years and that unemployment in the construction industry is at the highest unemployment rate in the industrial section in comparison the residents of the war they could munity surrounding this development project has lived with these distressed economic standards for generations it would be a great disservice to our community if the first recipients of the economic recovery possible from this project provided by the united states does not benefit the residents and local businesses impacted by this multibillion dollar development initiative over the past five years g s a has facilitated dialogue with the ward a community to get to gain input and garner support in development of the same elizabeth west campus but i think g s a can do more to expand its public engagement efforts in engaging in deeper outreach they can continue to they can create small work groups advisory committees and community engagement venues designed to advise residents and local businesses of employment training and business opportunities they can initiate alternative marketing tools for distribution in communities that are more sensitive to the neighborhood and its constituents providing technical support in partnership with the small business administration they can provide one on one technical support to assist local small businesses to achieve federal certification conduct assessments of current businesses and provide a road map to become competitive in the construction marketplace and provide financial counseling for businesses and avenues for sistas with bonding startup costs personnel and other business expenses the third area is in private to provide employment and training opportunities create partnerships with as stablish local support service programs and training for that is to recruit residents for employment utilize specialized resident advocacy agencies and organizations such as sex offender public housing and human service programs who are currently subsidized by federal programs to refer local residents and assist with ongoing counseling services throughout their employment the next step to successfully implement these programs and services is accountability g s a should include a strong monitoring and compliance component developers general contractors and prime contractors have historically maintain as their bottom line having a project to come in quote on time and under budget the inclusion of alternative recruitment training and employment programs and services in their opinion has a negative impact on their bottom line g s a and all federal small and disadvantaged business participation should be a strong requirement not a goal all contracts utilizing federal funds should include strong enforcement language that does not only state possible penalties for noncompliance but should outline the process for the enforcement of penalties by the withholding of funds and payment of fines goals and requirements can only be sta by financial retribution to ensure compliance lastly i wish to add that does not two thousand and five i have served as the president of the national association of minority contractors washington d metropolitan area chapter wearing that hat i would like to address our organizations concerns regarding the possible implementation of a project labor agreements on any federal construction project and it specially i'm referring to the project at the west campus over the past forty years name that has served as an advocate for minority contractors throughout this country designed to address the needs and concerns of minority contractors and create parity in the construction industry name and has aggressively pursued equity in contracting for small minority and disadvantaged businesses our local chapter also includes women  hub zone and veteran owned businesses in the washington metropolitan area which includes the federal enclave we have several significant construction projects planned or underway because of the state of the national economy construction firms and their employees are saturating our area to compete in the construction marketplace do the possibly of minority contractors in the construction industry our members cannot continue with the established unionized labor force through project labor agreement if any of these highly competitive federal contract projects fall under p l a's and alarming number of minorities and female workers and contractors who are living and working in washington d c and the surrounding area will be denied access to a vital opportunity for work name act washington would like to continue our dialogue with with your committee regarding the implementation of a p l a we can provide you with statistical data that the u s department of labor cannot which outlines the status of journeymen employees by race and gender within each construction trade which will validate the significant disparity in the in the construction trade by race and gender we are committed to work with this committee to craft a process for the local minority and women owned businesses are at the forefront of the redevelopment of our cities and our neighborhoods capital city associates and the national association of minority contractors washington d c metropolitan area chapter stands ready to assist your committee to increase the participation of small and minority businesses doing business with the federal government i thank you for your time thank you very much  business development and sustainable design and construction efforts for over fifty years or firms specialize in renovations restorations and modernization of large scale government and commercial buildings including office laboratory  educational facilities in addition we construct new facilities in addition to exist buildings for both public and private sector clients on behalf of the associated general contractors of america we strongly support full and open competition for the many contracts necessary to construct improvements to real property this includes competition among general contractors especially contractors suppliers and service providers over the years it has been established that such competition energizes and improves the construction industry to the benefit of the end history and the nation as a whole as the committee considers the changing federal  offers the following points for consideration regarding contracting reform issues a g c supports for care meant reform to improve delivery of federal construction services reform of the federal process should recognize constructions unique melding of industry sectors while ensuring the government is using the most cost effective method of preparing an agency is working to foster a business climate that enhances opportunities for all businesses construction is an intensely competitive industry and we believe that competition penalizes any firm that resorts to discrimination to succeed construction firms have to focus on price quality and reliability are members recognize the benefits that the a program and the disadvantaged business enterprise programs have to contractors who qualify for these programs we also have growing concerns about the need for federal decision makers to address the challenges small businesses that do not qualify for special preferences are also facing in today's harsh economic conditions we believe that current federal rules need to be updated to generate more collaboration mentoring and assistance no matter who is the business owner agency would like to discuss issues surrounding the wide range of concerns and recommendations we have for improving the federal market at this point i'd like to refer the subcommittee to my submitted testimony topics include agencies physicians on contract bundling the hub zone program and alaska native contracting i'd like to also highlight a few other points subcontracting goal achieved in current s b a rules require small business set asides and establish while business goals to be met by large businesses to assure that significant portions of federal procurement dollars flow to small business firms but the rules for keeping track and measuring the actual flow of dollars to small businesses do not take into account the actual amounts that flow down below the first year level of sub contracting within the construction industry the bulk of the work is performed by sub contractors who in turn hire second tier and third tier firms to perform elements of the project under the current system if an other than small business is included as a first or sub contractor the prime contractor is not asked to report further dollars that are going to small businesses below the first year sub contractor this is because the contracting agency is not allowed to take credit for those dollars towards its goals allowing prime contractors to report small business of contracting at all tiers with demonstrate true small business participation on a federal contract and which show more accurately how the construction industry supports and is dependent upon small businesses to shift to electronic sub contracting reporting system the e s r as by the federal government provides the opportunity to correct this problem the system has the capability or can be made to have the capability to track and report small business subcontractors on multiple tiers yet current rules do not encourage the prime contractors and their sub god directors to account for total small business participation at all teeters a recommends congress direct the change to the system through legislation to potentially help all parties track the dollars flowing to all small businesses the federal acquisition workforce requirement retention and training of the government workforce should be a high priority for both government and industry as you can already see from the concerns of the contracting bundling which i submitted in the testimony and understaffed federal acquisition workforce is suffering from the pressures of an already challenging for carom an environment the shrinking acquisition workforce is an ongoing problem and will exacerbate as the number of procurements continue to grow about one federal acquisition professional and eight already is eligible to retire and that will rise to more than half the workforce by two thousand and sixteen the average retirement eligibility for contracting professionals will increase from twenty nine percent in f y two thousand and eleven to fifty percent in f y two thousand and sixteen we fear that the federal government workforce challenges may only get worse in the coming years in order for the government  many missions it will have to do better a better job of recruiting hiring and training new employees given that the government's purchase of goods and services is at an all time high it is essential that the government acquisition positions be fully staff this problem needs to be addressed in the near term to avoid the negative ripple effect scuse me this trained workforce can have on off assets of contract agency consistency as a matter of agency recommends that agencies with the larger regional offices continue to work to promote the implementation of uniform agency policies that will provide greater consistency in the construction process many of our members have repeatedly found wide variances in regional operations contracted ministration and administrative practices such can produce serious administrative and communication problems and can discard contractors from continuing to work in the federal market we are pleased that the general services administration has worked very hard to ensure consistent communication and consistency between regional offices over the past several years and hope that trend continues into the future project labor agreements at the outset agency wishes to explain its overall position on p l a's a g c neither supports nor opposes p l a's per se what agencies strongly opposes is government mandated p l a's and any publicly funded construction projects agency is committed to free and open competition in all public construction markets and believes that publicly finance contracts should be awarded without regard to the labor relations policy of the government contractor agency believes that neither a public owner north representative should mandate the use of a project labor agreement that would compel any firm to change its labor policy or practice in order to compete for or to perform work on a publicly financed project agency further believes that the proper party parties to determine whether to enter into a p l a and to negotiate the terms of d l a the employers that employ workers covered by the agreement and the labor organization representing the employer employee relationship i'm sorry and the workers covered by the agreement since those are the parties that formed the basis for the employer employee relationship have a vested interest important in forging a fair and stable employment relationship and are authorized to enter into such an agreement under the national have on federal procurement policy and the costs of doing business with the federal government would be pleased to share a copy of our comments to the committee that really concludes my formal comments i'm answer any questions  good afternoon here holmes norton my name is katherine giordano i am the c e o of knowledge information solutions inc located in virginia beach virginia we are an information technology value added network integrator with a full range of products and services to create manage and secure networks we are in a woman on firm i'm appearing here today in behalf of women impacting public policy a national bipartisan policy public policy organization representing well over a half a million women and minorities in business and quoting forty nine associations that partner with us thank you for holding this hearing and for inviting me to testify let me first mention i had the opportunity to testify on the very same topic last year march of zero eight and i am pleased to give you an update on the small business contracting issues that are so important to women owned businesses and with members the most pressing issue for women owned businesses as a procurement arena is the failure of the s b a to implement a women's procurement program as this subcommittee knows public law one of six five five four which was passed in two thousand a stab wish to women's procurement program because federal agencies were not meeting their five percent women on contractual goals in fact the government has never met the five percent goal for women the highest number that it has ever achieved is three point four percent for seven long years the women's procurement program suffered from inaction in two thousand and seven and eight the s b a proposed a program that was unacceptable to women's business community and frankly was considered an insult by women business owners there were two major flaws in the proposed program one the s b a chose the narrowest method of data analysis by the rand corporation and only four next codes that would be subject to restricted competition to an agency was required to perform an internal audit of its past contracting action to show it is rec past discriminatory contracting practices before any contract could have qualified for a set aside we believe this would have set forth a new legal standard which would have been damaging out only to this program but potentially every woman business enterprise program in the country frankly with the influence of many members thankfully excuse me with the influence of many members of the house and senate including the chair of the subcommittee a proposed program was not implemented but we have reason to be more optimistic this year the new s b a administrator karen mills is now working to propose a new program and a simultaneous withdrawal of the previous program the s b a hopes to have a program in place by the end of the year which would give women owned businesses a real chance to compete for stimulus dollars we have urged the s b a to take another look at the rand corporation disparity study and expand the eligible industries to more than the narrow definition proposed in the past in fact the rand corporation stud suggests that up to eighty seven percent of the industry categories could be eligible for the program if the s b a chose to use that interpretation whip is working closely with the s ensure that women's procurement program will serve to assist the federal government and finally meeting its women own goals the federal government's ability to meet small business goals is making progress however it is far from impressive the own nine numbers show me the numbers show that the percentage of contracting to small businesses dropped to twenty one point five percent the woman own goal number has remained at three point four however the number met the woman and contractual goal increased from ten to fourteen agencies from zero six to zero eight i wish i had good news with respect to sub contracting and bundling but the challenges in these two areas continue to plague the small business community with continues to believe that if you list us use us small businesses spend thousands of dollars and staff resources to be part of the sub contracting plan on a prime prime contractors we believe prime contractor should utilize small business unless they no longer meet the requirements there should be penalties assessed for violating the sub contracting plans with respect to the contract bundling to our knowledge there have been no new studies since o m b two thousand and two report which states for every one hundred dollars awarded on a bundled contract there is a thirty three dollar decrease to small businesses a new concern for small business is insourcing while we certainly understand the policy as it relates to the practice of awarding large sole source contracts to major corporations the unintended consequence for small business contractors is they are losing opportunities in the sub contracting front and losing their employees to the government we believe the federal government should make a deeper commitment to contracting directly with the small businesses we certainly do not believe the administration intended government agencies to poach small business employees who are working at their sites but we worry about the consequences of this policy with urges the committee to take a closer look at this issue in conclusion it is not impossible for small women owned businesses to be successful in federal contracting i am an example of that success but our success does not rest soley on the quality of our products and services federal acquisition policy largely dictates if and when we will be successful the congress and the federal agencies must work together to ensure that the policies they enact and the paper work they create do not shut out the ability of the woman owned businesses to succeed in the federal marketplace i the government set aside program for small minority and disadvantaged business programs has been especially helpful and we have made every effort to work within those guidelines to the best of our ability brick walls surrounding surrounding it and most recent the seventy district of columbia national guard armory on which we are currently replacing all mortar that has accumulated over two years and  due to recent downturn in the economy whereas we earlier bit four to five local companies for government jobs we are now sometimes find ourselves betting against as many as twenty companies from as far fullness in a special program made available by further on in the state government on behalf of nasa construction i wish to thank you and member of the committee for having me  e what type of work have you done for g s a and the last eight years under program we have done numerous projects that include the design and build of and you are located right here so you alert to the opportunities available and you clearly have taken advantage of them are you andy this is for all of you who are you mr marion and do any of you know  venture of about one hundred fifty six million dollars worth the work that is again being funded under funds all of those contracts have small business plans and roughly where we're going to give you time to do this but i would like you then six months of the day job report how those funds in turn have been distributed sub contractors contractors beneath yourselves and to manage business contractors we let me report second and third yes and fact i'm going to ask  why this segment and third tier contractors are not report not a quote not allowed according to your testimony page three and four subcontract ing i report here i said that to them and what did they give you as a reason here is the general understanding that i have which i i suggest is probably the understanding that the industry has an agency has small business goals within the contracts that they award you're required when you compete for this work to submit either with your submission or immediately after a small business plan that plan outlines what percentage of the sub contracts are going to be awarded to two small businesses and then within that what percentages will flow down to the other special categories one tier two and three and so no no  to the sub contract talking strictly out of the sub contract ok then the process begins the work begins and reports or do the reports that are due come from us to the agency they used to be forms two ninety four to ninety five i believe are the names and now there's the e s r s system for doing it electronic very very high potential to get good information and get it quickly what we're asked to is at the sub contractor level only whether those are small businesses or not or are there special categories we're not asked to report about what happens below that and i'll talk about that in a minute when we were poor the reason we're only asked to report and this is my supposition is because the agency does not get credit with the small business administration towards the goals because level except for the cause because either the law says it their rules say there's policy i don't know i will leave that up to other is it a paperwork problem they  reason this is so important is because the goals of the small business program and all the subsets are to get money flowing to small businesses this is what we want to do vision of the social economic political goals and many of the subcontractors are not small businesses right well at that well here's here's the point on that let's take one of these hundred million dollar renovation project the buildings exist so where is the money going what kinds of things are happening in those buildings an awful lot of it is happening in the mechanical and the electrical areas of upgrading and modernizing the building bringing the performance levels up in terms of energy reduction and s forth those companies that can do the thirty million or forty million out of that hundred are not small businesses they don't have the bonding capacity they don't have the means to do it so there's a large business the often have that contract but if you look it won't take you long to see that they in turn are sub contracting to a second tier of third tier level and so that thirty or forty million dollars is absolutely that all goes to me and one other now that might be a vision in one sense and the last thing we going to do is reduce the efficiency but hey license contractors i bet there are a lot of very efficient licensed saab sub subs but you want to characterize them out there who can do it so i get your point and we're going to find out why they're given no credit because it's seems to me that runs chanter to what the law is asking them to do to get to small businesses that you can't get down to them or get credit for them then you're going to do with dielectric did that the at the first year i would like to just make sure that my words are clear that all of this we're just trying to get a report on how it occurs and unless we get it and then hear their explanation and they may have a good one that we haven't heard then we won't be able to do anything about it or to or to at least try that that is still the case because i do i want to note that i recall very i recall very distinctly the part of your testimony that described what and i agree with you was an to women own small but i don't think minorities were required to do this women were picked out for this but i can only call discrimination and women across the board here in the congress were your eligibility and we thought it was a joke when we read that they had identified for competition only now this is women own businesses everybody cabinetmaking engraving other motor vehicle dealers and national security and international affairs it almost looks like they say well where have women   to my knowledge it is being looked at i believe they're not utilizing those four categories i believe it has been withdrawn what they could be looking at however is the value of the rand  study showing that eighty seven percent of the qualifying categories of naik's codes could indeed be considered qualified among those that one would choose then you could go to as many as eighty seven percent you could go to well they left it up the s b a to make the decision how narrowly or broadly and that's still under consideration my understanding that it is still under if you propose a rule you're not supposed to do more harm than good it seems to me that that's what the last administration did it was laughable except it made you want to cry why bother if you're going to make it worse and we will be tracking this with this large amount of funds flowing in these through the g s a and some of the other agencies you have seen i hope i administration was first you had to prove before you could even consider placing it in a set aside environment which does happen with eight days to some degree because they go out for a sources s and if they come up with more than three they know they have the capabilities in the marketplace to perform and i have to adjust that program the the women's part of that program but you have suggested that you have to set up have s b a set up a woman program do you believe that's the only way to straighten this out or are there other ways to do so because this was operating before the administration put up this barrier was it well the category of set aside is not  capable of being accomplished under the current program i look in the mirror i designate myself a woman own business woman and small business but i am not entitled to any of the categories of what's the reason for that i i'm not i'm not sure i understand why the s b a chose to eliminate women own small businesses eliminated that they have or have women own small businesses that can help her fast there is no per curiam program currently and place for one of the reason you haven't made a program is because we've had centuries of discrimination against people of color and that pushing and pushing yes ma'am i'm hispanic and i am a gay certified woman on this so you understand that i understand the open the whole program yes ma'am we have we will be very very vigilant if they don't want to have a similar program than they are going to have to have some way to make sure women owned businesses are not put in this category or continuing not to meet those very small goals that have been set for women owned businesses women are half the population many are not disadvantaged in the sense minorities are the quote disadvantage has been put to actually horrific because they have been well educated and yet not been able to get the same jobs and yet not been able to get the same businesses that's curable in fact it should be more given the advantages an education and station in life women have that you might expect more women are across the board in various ethnic groups than minorities in fact it's the other way around i'm not trying to use any group to make sure any other group equals them that won't happen that's a very false way to go about it but this is shameful for women and i keep getting these statistics not getting any  hand a small business education forum musta been five years ago it was way before i got the money out there in the community every other day specifics because we're in a position to make sure that g s a experiment tries new things we're not going to suffer one ounce of efficiency on this project no sir not without limit only one up they are able to go to the appropriators and say give me some money i've got to make sure that it all happens but if you say that there are some alternative market tools to be used i need to know what those are and i don't and you say here's a page that we specialize resident advocate agency an organization where they set aside to perform this function so i need i'm one of those people spend money to be spent in it i want to spend it on contracts so i need to know what it is more so in specific terms that you think a ought to be doing thank you for those questions let me let me say a very layman's terms that g s a has done a phenomenal job that i have not seen about as i said in my testimony there has been unprecedented for any federal agency within a community and you're right that as i participate in this in public engagement for the past it's been five years exactly where they have had these community forms what we're trying to do what i'm referring to is how to get the businesses to the table the difference between and also the braindead i mean here's a billion dollars out there true and everybody everybody is everybody is asking what we're talking what i was talking about is to having these small work rules because most of the businesses in the community say i don't know how to compete against the big boys just a moment we american wants to come to comment on this too that has to be renovated these are historical buildings oh absolutely that they cannot beat them out so we like to see them break into packages so small contractor can do well when as you have a sense that being a small that they not advertise yet for the use part so that you talk about the reuse the buildings all that work to be done that's where your brightest opportunity yet as far as i can tell it actually can also my recollection please correct my wrong is that they said that they would not and do not engage in bundling do you say say the they do know i haven't seen any specific projects coming out or advertisements so we just want to make sure before patches are put together and they are been informed that break into a smaller size so i certainly can't imagine that they would be in their right minds the bundle all of those buildings up when those are that's most remarkable set of small business opportunities on the face of the usa earth today i think so thank you for that that will help us to be proactive and messing with your resume your yeah what i and again what i'd like to be able to to reiterate is that the g s a has done a good job of putting the putting the project product on the market but it will be up to the general contractor to work with the prime contractors as he said to be able to solicit to break those packages up into small pieces so that the smaller businesses can participate i was also at the certification program that they had at the at the martin luther king library where they were helping to certify the small businesses what i'm talking about is do a lot more that within the community also because a lot of the businesses that that what they are continuing to do that throughout this project is going to last for ten ten years or so besides which they got nasa to rich number of a day contractors they won't want four but every business is not going to be able to have the capacity of a day and all of them for jobs are not a requirement there's also the disadvantage business  certification there is small business certification so those kinds of programs which can be done in conjunction with the small business administration can be done within community are there two more programs you would like to see workshops on exactly and one is i but they have a coffee is a hub zone business is a hub zone area we had the business all in within the community have not been educated about how to become certified and subzone so they can tell us are very good suggestions we were so pleased with their a day workshops we will approach them for fact those are if you want to continue to work and to work on other and perhaps even larger contracts than your first contracts you certainly got a graduate of the graduate to the program and so a lot of the businesses that are within the communities at the level that they have to start with they are not ready for the a level in order to compete so what is it that they are ready for they can become the the disadvantaged business they can they can compete in the disadvantaged business community and the hubs on community help of course in self certification of what we all of you know will ask g s a about contracts and i remember this problems in this region so much so that my good friend the chair of the subcommittee that was about to abolish the whole thing and then we've got a new administration which i believe is has made recommendations on on the program the problem for that that let me just say we were horrified that go to my region people within my region were using hub zone coming in and i was in the minority inside once they got survived so when you mess up that  chair and said don't hold a baby out with the bathwater and this is inserted i'm aware i was embarrassed by what the ideas were finding i could not in good faith say this program up unless it was like turned on its head a virtually started all over again but i would like to hear your experience and your suggestions well again  the the issues again the objectives of the program make sense to increase employment opportunities investment and economic development and low income or high unemployment areas that need to federal definition of a historically under utilized business without getting into a whole lot more there are some things that jumped out number one the way the program works and this speaks to the point that was just made if you're in a hub zone and you're boise and you're in a hub zone and you can come and compete against the same people that are in the hub zone where the project is you don't have to be in the hub zone where the project is you can be in a hub zone any place and come can be so you know the way it was mad because they wanted to bring yeah you've got people already competing and these are areas where there's not a lot of work and remember this brings employment and if you employing people what's the point that if you bring somebody who may not be in the area and may have business and that person begins to hire people who would otherwise not be employed that's a win win because you can expect people already doing business hub zone because these owners are per se by definition zones where there's not lots of contracting and not last employment as well so i mean if you're not going to have somebody else come in and say we're doing business in return for doing business here we'll hire this many employees how do you break through if you all only people who you know are ending up on the people already in the hub zone which are which are themselves in the same barrel as as the residents in the hub zone it starts with the notion that first of all you must be a certified hubs your own business and then once you are you are free as a hub zone business to go do business and get all of the benefits of that no matter where the project is so if there's a concern within the hubs and you mean no no the project if to go the other way let's assume there's a hub zone certified here in the district of columbia and the project is in new york state if they and it's set aside as a hub zone preference they become pany here can go do the project in new york state well the same is true here if there's a project in anacostia and hub zone wants to compete and get the hub zone for office and they're in ohio they can come and be treated the same as the local firm now that in not only that i'm very interested in and again i'll be working with the subcommittee and i wanted to elaborate your concern i'm not prepared to answer because i brag and see the can so i'm that's one the other the other thing that sort of jumps out is t percent preference about ten percent in the construction industry ten percent is a lot of money that's an extraordinary preference and that seen is because they would take in the preference without knowing anything within the community this is this was an abuse this was straight out fraud it was in this region it was the a it was so bad that they were having having these all over the united states  i'm sure the work is still going on since the new administration then was charged with straighten this out or or goes so by the time we have probably our next g s a hearing i will want to know more and i have the staff to bear this in mind about the progress the administration is doing and means the s b a who really was at fault on this just as they were at fault on the women's program  how far the gotten straightening out a program that collapsed of its own weight when the committee chair the small business community learned this is a puerto rican woman was so outraged the chair of the committee that she wanted to abolish the program i noted a problem in that program she comes from a part of brooklyn which is rich in small businesses so she has a vested interest in small businesses so i'm not prepared to do it because i don't know what what is at work but i certainly appreciate her alerting me test million dollars let me be clear because from a point of view ninety one percent of construction companies are small businesses i mean ninety one for the construction industry if there is such a thing as a hub zone program which by the way there were abolished in its present form would be everything to start over and do it different than if they may be doing that ok but energy present form related to construction the jobs in the dollars don't go to the local hub zone companies necessarily number two the ten percent preference is out of order it's extraordinary it's too high in a competitive world that's just simple same and then there's some other points which are going to be a much different economy that's why i don't want people to be waiting for the economy to come back it's it's going to be very different and i don't have anything to do with whether we stimulated it or not it's just that there's been a is even in that economy and i know enough about construction to know what that does i don't know what the effect was whether the effect was that they got all the contracts it was like you were doing pretty well your company well and there are hopes there are not all government contracts have his own preferences but where they do have a preference i see you have to think very seriously about whether you have a chance at all if you're not up so that doesn't mean you shouldn't  how far they have gotten the notion of any disadvantage to our companies doing business within the region right now and all these funds unprecedented flowing would be particularly on acceptable we've all worked together and minority and women own companies in particular have worked together no i recall for example that the problems i had when we were in the minority  how closely women and minorities work together we have been very pleased with how contractors have worked with g s a even given the scriptures that congress ha for small and for small women own in our own business placed on on them i'm former chair of the equal employment opportunity commission i spent i did some of my best work with business because these programs don't work if in fact business feels it's at a disadvantage for doing what the government thinks is the right thing to do to equal the playing field and not to put people out of it that's by one of the first things i did when i came to the  to initiate a negotiation so that not every complaint was there for two years most of them by the end of two years were in good anyway it all fall away and so we took complaints when you first got on see if we could work out some and sometimes the cost of doing business a employer would say it's not worth my time and we do so so employers decided to remain and we realized that he that the employer might indeed believe there was no discrimination the same time we would go aside with the minority and  the commission was working with the business community so that we work together and so that we weren't bring in suits left and right we brought suits for example on the basis of worst had yet been gotten to were trying to make sure that this these programs reflect that kind of rationality as well when it comes to business at the same time that we do all we do we can especially in the climate of the