99–010

Calendar No. 561

107TH CONGRESS REPORT " SENATE ! 2d Session 107–251

SMALL BUSINESS PROCUREMENT OMBUDSMAN ACT OF 

2002

SEPTEMBER 3, 2002.—Ordered to be printed 

Mr. KERRY, from the Committee on Small Business and 

Entrepreneurship, submitted the following 

R E P O R T 

[To accompany S. 2753] 

The Committee on Small Business and Entrepreneurship, to 

which was referred the bill (S. 2753), having considered the same, 

reports favorably thereon with an amendment and recommends 

that the bill (as amended) do pass. 

On July 24, 2002, the Committee on Small Business and Entrepreneurship considered S. 2753, the ‘‘Small Business Procurement 

Ombudsman Act of 2002’’ originally introduced as the ‘‘Small and 

Disadvantaged Business Ombudsman Act.’’ The Committee adopted 

by unanimous voice vote a substitute amendment offered by the 

Chairman, Senator John F. Kerry, and the Ranking Republican, 

Senator Christopher S. Bond. As amended, S. 2753 would create a 

statutory position housed in the U.S. Small Business Administration’s Office of Advocacy called the Small Business Procurement 

Ombudsman, make improvements to the Office of Small and Disadvantaged Business Utilization at each Federal agency, and increase the Federal government’s governmentwide small business 

prime contracting goal to 30 percent. Having considered S. 2753, as 

amended, the Committee reports favorably thereon without further 

amendment and recommends that the bill do pass. 

I. INTRODUCTION

Small businesses play a critical role in providing competition and 

bringing innovation to our Federal procurement system. A major 

reason for the creation of the Small Business Administration (SBA) 

was to ensure an adequate private-sector base for the Department 

of Defense, as it was deemed in our national security interests to 

have a thriving small business sector. The Committee believes that 

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a thriving small business sector is more important than ever, not 

just to our national security, but to our economic security as well. 

The Federal government, through the Small Business Act and 

other legislation, has in place programs designed to promote small 

business participation in the Federal procurement marketplace. 

The 8(a) Business Development program, the Small and Disadvantaged Business (SDB) program, the Historically Underutilized 

Business Zone (HUBZone) program, the woman-owned business 

procurement program, the disabled veteran-owned small business 

program, and the general small business set-aside all play a decisive role in providing fair access to the Federal marketplace for 

small businesses. However, these programs must be implemented 

fully and faithfully if small businesses are to receive their fair 

share of the Federal procurement marketplace. 

In addition to these programs, and in an effort to ensure small 

businesses are participating in Federal procurement at appropriate 

levels, Congress enacted legislation establishing statutory governmentwide goals for contracting dollars to be awarded to various 

types of small business: SDB, 5 percent; HUBZone, 3 percent (beginning in FY 2003); women-owned business, 5 percent; disabled 

veteran-owned, 3 percent; and all small businesses, 23 percent.

Table 1 demonstrates the Federal government’s small business 

prime contracting goal achievement for the previous four fiscal 

years and highlights when the Federal government failed to 

achieve a statutory small business goal. The table also demonstrates that the Federal government, for fiscal years 1998, 1999, 

2000 and 2001 achieved slightly below or slightly above the statutory, 23 percent governmentwide small business prime contracting 

goal. 

TABLE 1

SMALL BUSINESS 

Year Billion Goal

percent 

Actual

percent SB loss 

1998 .................................................... $181.7 23.00 23.39 

1999 .................................................... 185.7 23.00 23.10

2000 .................................................... 200.9 23.00 22.26 $1.5 billion 

2001 .................................................... 219.6 23.00 22.81 417 million 

WOMEN-OWNED 

Year Billion Goal

percent 

Actual

percent WOB loss 

1998 .................................................... $181.7 5.00 2.21 $5.1 billion 

1999 .................................................... 185.7 5.00 2.50 4.6 billion 

2000 .................................................... 200.9 5.00 2.28 5.5 billion 

2001 .................................................... 219.6 5.00 2.49 5.5 billion 

HUBZONE 1

Year Billion Goal

percent 

Actual

percent HZ loss 

1998 .................................................... $181.7 2 N/R N/R 

1999 .................................................... 185.7 1.00 N/A $1.9 billion 

2000 .................................................... 200.9 1.50 0.33 2.4 billion 

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HUBZONE 1—Continued

Year Billion Goal

percent 

Actual

percent HZ loss 

2001 .................................................... 219.6 2.00 0.72 2.8 billion 

1 HUBZone = Historically Underutilized Business Zone. 

2 N/R = not yet required by law. 

DISABLED VETERAN-OWNED 

Year Billion Goal

percent 

Actual

percent DV loss 

1998 .................................................... $181.7 1 N/R N/R 

1999 .................................................... 185.7 N/R N/R 

2000 .................................................... 200.9 3.00 N/A $6.0 billion 

2001 .................................................... 219.6 3.00 0.25 6.0 billion 

1 N/R = not yet required by law. 

8(a) 

Year Billion Goal

percent 

Actual

percent 

Percent change 

from 1998

1998 ............................................................... $181.7 1 N/G 3.57

1999 ............................................................... 185.7 N/G 3.40 ¥4.76

2000 ............................................................... 200.9 N/G 2.88 ¥19.33

2001 ............................................................... 219.6 N/G 2.86 ¥19.89

1 N/G = no statutory goal. 

ALL SDB 1

Year Billion Goal

percent 

Actual

percent SDB loss 

1998 .................................................... $181.7 5.00 6.48

1999 .................................................... 185.7 5.00 6.70

2000 .................................................... 200.9 5.00 6.49

2001 .................................................... 219.6 5.00 7.12

1 SDB = Small Disadvantaged Business. 

According to the Federal government’s own data, as presented in 

Table 1, small business participation in Federal procurement has 

failed to achieve the statutory goal of 23 percent for the past two 

years, 8(a) participation has steadily declined, the HUBZone and 

disabled veteran-owned small business procurement programs have 

fallen well short of goal attainment, and women-owned small business participation in government procurement has failed to achieve 

any noticeable increase, despite passage of a targeted procurement 

program to assist these firms. 

The Committee believes that a major cause of this decline has its 

roots in the new procurement environment created by reforms in 

the mid-1990s (such as passage of the Federal Acquisition Streamlining Act and the Federal Acquisition Reform Act, and the regulatory changes to procurement programs in response to the 

Adarand Constructors Inc. v. Pen ̃a decision), and reductions in the 

acquisition workforce. Additionally, a procurement culture that favors expediency and short-term cost savings has relegated small 

business participation in Federal procurement to secondary status. 

Until the Federal government, at all levels, realizes the importance of doing business with small business, these negative trends 

will continue. Our nation will not have access to a wide range of 

small business suppliers, and small businesses across the country 

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will continue to lose billions of dollars in contract opportunities 

year after year. 

While no single piece of legislation alone can ever solve the complex problems faced by small businesses in today’s Federal procurement environment, the Committee believes that the creation of an 

advocate, such as an ombudsman for small business procurement, 

to assist small business owners and ensure they are treated fairly 

in the procurement process will be of great benefit. 

For example, small businesses frequently contact the Committee 

to report problems they are having with a prime contractor or a 

contracting agency. Too often, these businesses are afraid to come 

forward and make an official complaint for fear of being blackballed and denied future contracting opportunities. A small business procurement ombudsman would provide one solution for these 

small businesses who fear retaliation, by allowing them to submit 

confidential complaints. A small business procurement ombudsman 

would also work to change the culture at Federal procuring agencies by tracking the training of procurement personnel and working 

to ensure that this training not only includes the ‘‘how to’’ of small 

business participation, but the ‘‘why’’ of small business participation—their crucial role in agency success and the national economy. 

The Committee also believes that strengthening the role played 

by the Office of Small and Disadvantaged Business Utilization at 

each Federal agency will have a positive impact on small business 

participation in the Federal procurement system and serve as a 

necessary corollary to creating a governmentwide advocate for 

small business procurement. 

The Committee has heard statements that the governmentwide 

small business prime contracting goal should be raised to provide 

small businesses an increased share of the over $200 billion in 

goods and services purchased yearly by the Federal government. 

Some advocates have requested a level as high as 40 percent, given 

that small businesses make up an overwhelming percentage of Federal contractors. However, given the current level of small business 

participation, the Committee has supported a goal of 30 percent. 

By raising the Federal governmentwide small business prime contracting goal, opportunities for all small businesses should increase 

and the diversified network of small business suppliers needed to 

meet the Federal government’s procurement needs should be enhanced. 

The Committee believes S. 2753 will help ensure small businesses are treated fairly in the Federal procurement process and 

enhance small business participation in the Federal procurement 

system. 

II. LEGISLATIVE HISTORY

S. 2753, the ‘‘Small and Disadvantaged Business Ombudsman 

Act,’’ was officially introduced by Senator John F. Kerry on July 18, 

2002. Senators Christopher S. Bond, Max Cleland, Maria Cantwell, 

Jeff Bingaman, Jean Carnahan and Mary L. Landrieu are cosponsors of the legislation. The Committee held a roundtable on June 

19, 2002 titled, ‘‘Are Government Purchasing Policies Hurting 

Small Business?’’ During the roundtable, the bill’s predecessor, a 

discussion draft of the Small and Disadvantaged Ombudsman bill, 

was a topic of deliberation. The draft included provisions to estabVerDate Aug 30 2002 03:03 Sep 05, 2002 Jkt 099010 PO 00000 Frm 00004 Fmt 6659 Sfmt 6602 E:\HR\OC\SR251.XXX SR251
5

lish a small business ombudsman to help ensure small businesses 

are treated fairly in the procurement process and to report to the 

Congress on Federal procurement activities as they relate to small 

business. The draft also contained an increase in the statutory, 

governmentwide small business prime contracting goal from 23 

percent to 30 percent. 

Many small business advocates that participated in the Roundtable supported the creation of a small business procurement ombudsman and supported the increase in the small business prime 

contracting goal. Suggestions were made to include provisions to 

improve the Office of Small and Disadvantaged Business Utilization (OSDBU) at each Federal agency and give the ombudsman the 

authority to rectify small business complaints as well. Suggestions 

were also made to change the name of the ombudsman to be more 

reflective of all small business concerns. 

During consideration of S. 2753, the Committee adopted a substitute amendment proposed by Senators Kerry and Bond, which 

changed the name of the ombudsman from the Small and Disadvantaged Business Ombudsman for Procurement to the Small 

Business Procurement Ombudsman, transferred the position from 

the Small Business Administration (SBA) to the SBA’s Office of Advocacy, and required the Chief Counsel for Advocacy to appoint the 

ombudsman. The substitute also transferred the authority to work 

on the goal attainment plan required under the legislation from the 

ombudsman to the SBA program managers and made a number of 

technical improvements to the section regarding the OSDBU at 

each Federal agency. 

The amendment also changed the short title of the legislation 

from the Small and Disadvantaged Business Ombudsman Act to 

the Small Business Procurement Ombudsman Act of 2002. 

The substitute amendment was the result of a compromise agreement reached between the Chairman and the Committee’s Ranking 

Republican. It also reflects issues and suggestions raised at the 

June 19, 2002, Committee roundtable.

III. ANALYSIS OF S. 2753, THE ‘‘SMALL BUSINESS PROCUREMENT

OMBUDSMAN ACT OF 2002,’’ AS AMENDED

Purpose 

S. 2753, the Small Business Procurement Ombudsman Act of 

2002, will establish a Small Business Procurement Ombudsman 

(Procurement Ombudsman) at the U.S. Small Business Administration’s (SBA) Office of Advocacy and strengthen the Office of 

Small and Disadvantaged Business Utilization (OSDBU) at each 

Federal agency. The legislation will also raise the Federal governmentwide procurement goal for small business prime contracting 

by 7 percentage points, over a period of three years, culminating 

with a governmentwide goal of 30 percent in FY 2006 and thereafter. 

The substitute amendment offered by Senators Kerry and Bond 

changed the short-title of the legislation and the title of the ombudsman position. As introduced, the legislation’s short-title was 

the ‘‘Small and Disadvantaged Business Ombudsman Act,’’ and the 

Procurement Ombudsman was known as the Small and Disadvantaged Business Ombudsman for Procurement (SDB Ombudsman). 

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Major Federal agencies 

A major Federal agency for purposes of the legislation means an 

agency that has procured over $200 million in goods and services 

in the previous fiscal year. 

Establishment of a Small Business Procurement Ombudsman 

The legislation requires that the Chief Counsel for the SBA’s Office of Advocacy appoint a Procurement Ombudsman, looking to existing Federal employees to the extent practicable. The Procurement Ombudsman is required to be highly qualified, with experience assisting small business concerns with Federal procurement, 

and would receive compensation based on the Senior Executive 

Service pay scale. The Procurement Ombudsman will report to the 

Chief Counsel. 

The Committee strongly believes that the Chief Counsel should 

make every effort to promptly appoint a Procurement Ombudsman 

from existing personnel within the Federal government and that 

the Procurement Ombudsman should have extensive years of experience in the Federal procurement process, pre-dating the procurement reforms of the 1990s and continuing through the acquisition 

reform period, if at all possible. Additionally, the Committee believes that experience assisting small business concerns with the 

Federal procurement process at a major Federal agency and knowledge of and experience with the legislative process and congressional stakeholders are necessary and critical attributes for the 

Procurement Ombudsman to possess. 

During the Committee roundtable on June 19, 2002, participants 

strongly supported the concept of the discussion draft legislation to 

create an ombudsman to deal with small business procurement 

problems. However, no consensus was reached as to where the ombudsman should be located. 

The substitute amendment adopted in Committee moved the Procurement Ombudsman from the SBA to the Office of Advocacy and 

placed responsibility for appointing the Procurement Ombudsman 

with the Chief Counsel. As introduced, the SBA Administrator was 

responsible for the appointment. This transfer represented a compromise reached between the Chairman and the Ranking Republican about the use of SBA resources. 

Duties of the Small Business Procurement Ombudsman 

The Procurement Ombudsman shall work with each Federal 

agency with procurement authority to ensure small business concerns are treated fairly in the procurement process, serve as a focal 

point within the Federal government to track and rectify complaints received from small business firms regarding their treatment by Federal procuring agencies and non-small business prime 

contractors, and complete an annual report. 

The discussion draft of the legislation did not provide authority 

for the ombudsman to rectify small business problems. The ombudsman was merely to collect data and report on trends in small 

business procurement. During the Committee roundtable on June 

19, 2002, participants expressed strong support for providing authority to the ombudsman to rectify complaints. The legislation as 

introduced provided this authority. 

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The substitute amendment adopted in Committee added this provision after concerns were raised that the Office of Advocacy at the 

SBA might receive pressure to add the Procurement Ombudsman’s 

duties to an existing position. It is the Committee’s intention that 

the Procurement Ombudsman should be a new position and receive 

sufficient resources to carry out the duties under the legislation. 

The substitute amendment also removed the authority of the 

new position to negotiate goal attainment plans with Federal agencies. This was in response to concerns raised by the Ranking Republican that this was inherently a policy function and should rest 

with the Office of Government Contracting and Business Development at the SBA. However, the responsibility for evaluating the 

goal attainment plan remains with the Procurement Ombudsman. 

Due to the important nature of the Procurement Ombudsman’s 

responsibilities, the legislation bars the Procurement Ombudsman 

from having other significant job duties beyond those in the Act. 

Annual report 

The Procurement Ombudsman shall annually report to Congress 

on each Federal agency’s success or failure in meeting its small 

business goals, including subcontracting data, an overall score for 

each agency, and an evaluation of any required goal attainment 

plans; the treatment of small businesses by all Federal agencies; 

the training of contracting personnel at major Federal agencies to 

ensure knowledge of small business procurement programs and 

their importance to the Federal government and the economy; each 

major Federal agency’s outreach activities to small business contractors; each Federal agency’s compliance with the Small Business 

Act’s provision establishing an OSDBU at each agency; and any 

discrimination faced by small businesses based on their status as 

a small business concern, qualified HUBZone small business concern, small business concern owned and controlled by disabled veterans, or the gender or social or economic status of their owner. 

Federal agencies are given an opportunity to comment in writing 

on the annual report before its submission. 

The Procurement Ombudsman must keep confidential all information that could potentially expose a small business to retaliation 

from the Federal government or a non-small business prime contractor, unless a written waiver is obtained. The confidentiality 

clause extends to information received by any OSDBU employee 

that could expose the employee to retaliation from a Federal agency. 

Administrative resources 

The legislation requires the SBA to provide the Procurement Ombudsman with sufficient personnel, office space and dedicated financial resources, which shall be specifically identified in the annual SBA budget. 

Although this provision should need no explanation, the Committee is concerned that the SBA will not provide sufficient resources for the Procurement Ombudsman, given the lack of resources requested for many key functions in recent budget submissions. The Committee strongly urges the SBA to provide the needed resources for the Procurement Ombudsman to carry out the duVerDate Aug 30 2002 03:03 Sep 05, 2002 Jkt 099010 PO 00000 Frm 00007 Fmt 6659 Sfmt 6602 E:\HR\OC\SR251.XXX SR251
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ties under the legislation and serve as an effective advocate on behalf of the small business Federal contracting community. 

Effect on other agencies 

None of the authority or duties given to the Procurement Ombudsman is intended to limit the role of the OSDBU at any Federal 

agency. 

The Committee strongly supports the OSDBU provisions of the 

Small Business Act and views these offices as critical links for 

small businesses in the Federal marketplace. The Committee 

strongly believes that the Procurement Ombudsman and each 

OSDBU should work together to advocate on behalf of small businesses, with the Procurement Ombudsman acting as a governmentwide advocate and each OSDBU serving as an advocate at its respective Federal agency. 

Improvements to the Offices of Small and Disadvantaged Business 

Utilization 

S. 2753 makes several improvements to the director’s position at 

each OSDBU. The legislation requires OSDBU Directors to receive 

pay up to GS–15 (major Federal agencies set at a minimum GS–

15); requires OSDBU Directors to be well-qualified at assisting 

small businesses with procurement matters; bars senior procurement executives from simultaneously serving as OSDBU Directors; 

requires OSDBU Directors at major Federal agencies to attend 

OSDBU Council meetings to the extent practicable; clarifies the 

underlying legislation by stating that the OSDBU Director is responsible to the head or deputy head of an agency for all matters; 

requires OSDBU Directors to assist the Procurement Ombudsman; 

and states that the OSDBU Director at a major Federal agency 

shall have no other substantial job duties beyond those stated in 

the Small Business Act. 

The Committee expects the OSDBU Director’s position at each 

Federal agency to be filled by career personnel to the extent practicable. The Committee believes that the use of career personnel 

will provide continuing expertise and experience, which will better 

serve the small business government contracting community. 

The legislation also makes statutory the OSDBU Council, requiring it to meet at least once every two months. The membership of 

the Council shall consist of all OSDBU Directors, and requires the 

Procurement Ombudsman and the SBA’s Associate Deputy Administrator for Government Contracting and Business Development to 

serve as non-voting, ex officio members. The Council will be headed 

by an elected chairperson, who shall serve a one-year renewable 

term, and consider issues such as personnel matters, barriers to 

small business participation in the Federal marketplace, agency 

compliance with provisions of the Small Business Act and any 

other matter within its mission scope. The legislation bars the SBA 

from providing financial assistance to the Council. 

The discussion draft of the Small and Disadvantaged Business 

Ombudsman Act did not contain provisions to strengthen the 

OSDBUs. During the Committee Roundtable on June 19, 2002, 

participants urged the Committee to consider strengthening the 

OSDBUs. The legislation as introduced by Senator Kerry contained 

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provisions in response to the suggestions discussed at the roundtable. 

The Committee believes strongly in the need to strengthen the 

OSDBU Director’s role at each Federal agency. Although it is the 

Committee’s position that these additions to Section 15(k) of the 

Small Business Act were a part of the legislation’s original intent, 

Federal agencies have consistently thwarted its provisions, especially the requirement that OSDBU Directors report to the head or 

deputy head of their agency. The Committee has received information in writing from several agencies, and through verbal communications, that have led the Committee to conclude that the majority of Federal agencies are in violation of Section 15(k) of the Small 

Business Act. It is the Committee’s hope that by clearly stating 

that the OSDBU Director shall report to the head or deputy head 

of his or her agency, Federal agencies will seek to comply with the 

law rather than explore possible loopholes. 

The Committee understands that a successful OSDBU Director 

is one with access to the highest level of his or her agency and that 

a successful OSDBU Director is necessary for a successful small 

business procurement program. The Committee strongly urges all 

Federal agencies to comply with the letter and spirit of Section 

15(k) of the Small Business Act and allow the OSDBU Director to 

play a key role in acquisition policies. The Committee also urges 

all Federal agencies to have their OSDBU Director report to the 

head of the agency, as opposed to the deputy head. 

The Committee feels strongly that OSDBU Directors should have 

no substantial job responsibilities beyond those in the Small Business Act; however, budgetary constraints at non-major Federal 

agencies may make that difficult to achieve. As a result, the legislation includes a provision to bar an OSDBU Director from simultaneously serving as the senior procurement executive. The Committee believes that the role of the OSDBU Director is incompatible 

with that of a senior procurement executive because the role of the 

OSDBU Director is one of advocacy on behalf of small businesses, 

while the senior procurement executive must serve the entire contracting community. Moreover, the OSDBU Director is intended to 

influence contracting decisions by the procurement staff, and making that position superior to the OSDBU Director (or merged with 

the OSDBU) is incompatible with that supervisory function. 

The Committee intends ‘‘to the maximum practical extent,’’ with 

regard to Council meeting attendance, to mean that OSDBU personally should take the fullest possible advantage of Council meetings as an opportunity for exchange of ideas, training, and professional development. 

The substitute amendment adopted in Committee set the basic 

pay for an OSDBU Director at a major Federal agency at a minimum rate of 15 on the General Schedule. However the Committee 

intends for an OSDBU Director at a major Federal agency to receive basic pay at a rate equal to that of the senior procurement 

executive at his or her agency. 

The substitute amendment also made minor changes to other 

OSDBU provisions, but kept intact the original intent of the introduced version. 

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Goal attainment plan 

The legislation requires each major Federal agency that fails to 

meet a small business goal to submit a detailed report to the SBA 

as to why the agency failed to achieve a goal and a plan for attaining future goals. The Committee directs that the goal attainment 

plan be submitted to the Associate Deputy Administrator (ADA) for 

Government Contracting and Business Development, or any successor position, and that the ADA shall play a consultative role in 

establishing the plan. 

The substitute amendment adopted by the Committee transferred authority for negotiating this plan from the Procurement 

Ombudsman to the SBA. 

Increase in the governmentwide goal 

The legislation increases the Federal government’s statutory governmentwide procurement goal for small business prime contracting by 7 percentage points over a three-year period. The new 

governmentwide goal would be 30 percent. The goal increase would 

be phased in over three years: 26 percent in FY 2004, 28 percent 

in FY 2005, and 30 percent in FY 2006 and thereafter. 

During the Committee roundtable on June 19, 2002, the Committee heard testimony that the Federal government could achieve 

30 percent small business participation if it properly implemented 

small business programs. One participant even suggested a goal of 

40 percent small business participation. However, concerns were 

raised that the Federal government does not meet the current statutory goal of 23 percent small business participation, and that such 

an increase might serve to discourage Federal agencies from striving to meet their goal. However, evidence at the roundtable suggested that the Federal government, when firmly targeting a goal 

of 23 percent, has usually come very close to achieving this percentage, some years slightly more, some less. The Committee believes that some agencies may treat the 23 percent goal as a ceiling, rather than a minimum level of acceptable small business participation. The goal increase reflects the Federal government’s insistence on targeting a specific number, as opposed to striving to 

surpass that number. 

IV. COMMITTEE VOTE

In compliance with rule XXVI(7)(b) of the Standing Rules of the 

Senate, the following votes were recorded on July 24, 2002. A motion by Senator Kerry to adopt a substitute amendment by Senators Kerry and Bond concerning a compromise agreement on the 

legislation passed by unanimous voice vote. A motion by Senator 

Kerry to adopt S. 2753, the ‘‘Small and Disadvantaged Business 

Ombudsman Act,’’ as amended, was approved by a 19–0 recorded 

vote, with the following Senators voting in the affirmative: Kerry, 

Bond, Levin, Harkin, Lieberman, Wellstone, Cleland, Landrieu, Edwards, Cantwell, Carnahan, Burns, Bennett, Snowe, Enzi, Fitzgerald, Crapo, Allen and Ensign. No Senator voted in the negative. 

V. EVALUATION OF REGULATORY IMPACT

In compliance with rule XXVI(11)(b) of the Standing Rules of the 

Senate, it is the opinion of the Committee that no significant addiVerDate Aug 30 2002 03:03 Sep 05, 2002 Jkt 099010 PO 00000 Frm 00010 Fmt 6659 Sfmt 6602 E:\HR\OC\SR251.XXX SR251
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tional regulatory impact will be incurred in carrying out the provisions of this legislation. There will be no additional impact on the 

personal privacy of companies or individuals who use the services 

provided. 

VI. CHANGES IN EXISTING LAW

In the opinion of the Committee, it is necessary to dispense with 

the requirement of rule XXVI(12) of the Standing Rules of the Senate in order to expedite the business of the Senate.

VII. COST ESTIMATE

In compliance with rule XXVI(11)(a)(1) of the Standing Rules of 

the Senate, the Committee estimates the cost of the legislation will 

be equal to the amounts indicated by the Congressional Budget Office in the following letter.

U.S. CONGRESS, 

CONGRESSIONAL BUDGET OFFICE, 

Washington, DC, July 31, 2002. 

Hon. JOHN F. KERRY, 

Chairman, Committee on Small Business and Entrepreneurship, 

U.S. Senate, Washington, DC. 

DEAR MR. CHAIRMAN: The Congressional Budget Office has prepared the enclosed cost estimate for S. 2753, the Small Business 

Procurement Ombudsman Act of 2002. 

If you wish further details on this estimate, we will be pleased 

to provide them. The CBO staff contacts are Ken Johnson and Matthew Pickford. 

Sincerely, 

BARRY B. ANDERSON

(For Dan L. Crippen, Director). 

Enclosure. 

CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

S. 2753—Small Business Procurement Ombudsman Act of 2002

S. 2753 would create a new Procurement Ombudsman within the 

Small Business Administration (SBA). The Ombudsman would address concerns raised by small businesses participating in the federal procurement process and annually report to the Congress. The 

bill would make technical changes to the Offices of Small and Disadvantaged Business Utilization within each federal agency exercising procurement authority. Finally, S. 2753 would raise the statutory goal for the value of federal contracts awarded to minority 

and women-owned businesses. 

CBO estimates that implementing S. 2753 would cost about $1 

million a year, subject to the availability of appropriated funds. 

The bill would not affect direct spending or receipts; therefore, payas-you-go procedures would not apply. 

S. 2753 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act and would 

not affect the budgets of state, local, or tribal governments. 

Based on information from SBA, CBO expects that the office of 

the Procurement Ombudsman that would be established under S. 

2753 would be similar in size to the office of the agency’s ReguVerDate Aug 30 2002 03:03 Sep 05, 2002 Jkt 099010 PO 00000 Frm 00011 Fmt 6659 Sfmt 6602 E:\HR\OC\SR251.XXX SR251
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latory Enforcement Ombudsman. Therefore, CBO estimates that 

creating the office of the Procurement Ombudsman would cost 

about $500,000 a year, assuming the appropriation of the necessary 

amounts. 

Additionally, the Offices of Small and Disadvantaged Business 

Utilization within each agency with procurement authority could 

incur additional costs to implement new management practices and 

reporting requirements related to the contracting goals for minority 

and women-owned businesses. CBO estimates these requirements 

would cost less than $500,000 a year. 

The CBO staff contacts for this estimate are Ken Johnson and 

Matthew Pickford. This estimate was approved by Peter H. 

Fontaine, Deputy Assistant Director for Budget Analysis. 

VIII. SECTION-BY-SECTION ANALYSIS OF S. 2753, AS AMENDED

Section 1. Short-title 

Titles the Act as the ‘‘Small Business Procurement Ombudsman 

Act of 2002.’’

Section 2

Amends Section 15 of the Small Business Act to include a new 

subsection (q), which establishes the Small Business Procurement 

Ombudsman at the SBA’s Office of Advocacy and spells out the duties of the position. 

Section 3

Amends Section 15(k) of the Small Business Act to add the improvements to the Office of Small and Disadvantaged Business Utilization (OSDBU) at each Federal agency contained within the legislation, and establishes the OSDBU Council. 

Section 4

(a) Amends Section 15(g) of the Small Business Act by adding 

paragraph (3) establishing the requirement for a goal attainment 

plan. 

(b) Amends Section 15(g)(1) of the Small Business Act by raising 

the statutory governmentwide small business prime contracting 

goal to 26 percent in FY 2004, 28 percent in FY 2005, and 30 percent in FY 2006 and thereafter.

Æ