Small Business Contracting: Action Needed by Those Agencies Whose Advocates Do Not Report to Agency Heads as Required
Published: 2011-06-03T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Section 15(k) of the Small Business Act requires that all federal agencies with procurement powers establish an Office of Small and Disadvantaged Business Utilization (OSDBU) to advocate for small businesses. Section 15(k)(3) requires that OSDBU directors be responsible only to and report directly to agency or deputy agency heads. GAO was asked to assess agencies' compliance with the reporting structure and identify the functions OSDBUs performed. GAO reviewed compliance with section 15(k)(3) at 16 agencies--the 7 agencies that each procured more than $15 billion in goods and services in 2009 and 9 that it had previously reported were not complying with this requirement. GAO also surveyed the OSDBU directors at 25 agencies that represented more than 98 percent of civilian obligations and 90 percent of DOD obligations in 2009.
section_title: What GAO Found
paragraphs: Nine of the 16 federal agencies that GAO reviewed were in compliance with section 15(k)(3) of the Small Business Act, which requires OSDBU directors to be responsible only to and report directly to the agency or deputy agency head. The remaining seven agencies were not in compliance with the provision, and their OSDBU directors reported to lower-level officials or had delegated OSDBU responsibilities to officials who did not meet the reporting requirement. These agencies were not in compliance when GAO last examined them in 2003. During GAO's current review, directors who reported to agency heads cited benefits to the relationship, while those who did not had mixed views. GAO concluded that the views expressed by the directors at noncompliant agencies did not justify noncompliance and that these agencies should comply or provide support to Congress of their need, if any, for statutory flexibilities. Ongoing noncompliance with section 15(k)(3) undermines the intent of the act and may prevent some OSDBU directors from having direct access to top agency management. Consistent with its 2004 report, GAO's current work found that the 25 OSDBU directors surveyed focused their procurement activities on certain functions listed in section 15(k). At least 19 directors listed the five functions related to contract bundling, maintaining supervisory authority over staff, and helping small businesses obtain payments from agencies as among their duties. Fewer directors viewed the remaining three functions, such as reviewing acquisitions for small business set-asides and assisting small businesses to obtain payments from prime contractors, as duties. Directors who did not view these functions as their responsibility generally noted that contracting or program staff performed them. Whether OSDBU directors who do not perform certain functions listed in 15(k) are complying with the statute is not clear.
section_title: What GAO Recommends
paragraphs: GAO recommends that agencies not in compliance with section 15(k)(3) take steps to comply with this statutory requirement or report to Congress on why they have not complied, including any requests for statutory reporting flexibility as appropriate. SSA agreed with the recommendation, and Interior agreed to reevaluate its reporting structure. Commerce, Justice, State, and the Treasury disagreed, believing they were in compliance. GAO maintains its position on agencies' compliance status, as discussed further in the report. Agriculture did not comment.

section_title: Letter
paragraphs: Maximizing contracting opportunities for small businesses has been a  long-standing policy of the federal government. To help ensure that small  businesses receive a share of federal procurement contract dollars,  Congress has set an annual governmentwide goal of awarding not less  than 23 percent of prime contract dollars to small businesses. Congress  has also mandated that the Small Business Administration (SBA) negotiate  annual procurement goals with each federal agency. In fiscal year 2009,  small businesses accounted for almost $100 billion in federal contracts— about 22 percent of all federal prime contracts awarded.
To increase small businesses’ visibility within federal agencies, in 1978  Congress amended the Small Business Act to require that all federal  agencies with procurement powers establish an Office of Small and  Disadvantaged Business Utilization (OSDBU), which would advocate for  small businesses within the agencies. The OSDBU is managed by a  director who is responsible for implementing and executing the agency’s  functions and duties related to the award of contracts and subcontracts to  small and disadvantaged businesses. Section 15(k)(3) of the act requires  that OSDBU directors be responsible only to and report directly to agency  heads or their deputies. The purpose of this provision is to help ensure  that OSDBU directors have direct access to their agencies’ top decision  makers in order to advocate effectively. Section 15(k), as amended, also  lists a number of functions that OSDBU directors are responsible for in  carrying out their roles as advocates for small businesses.
In two earlier reports, we reviewed federal agencies’ compliance with the  Small Business Act and the extent to which OSDBU directors viewed the  functions listed in section 15(k) as duties of their offices. In September  2003, we reported on the OSDBUs at 24 federal agencies and found that 11  of these offices did not comply with the law’s requirement that the OSDBU  director report directly to and be responsible only to the agency head or  deputy head. We recommended that 10 agency heads take steps, as  necessary, to comply with the requirement. However, 8 of the 10  disagreed with our recommendation. In a follow-on March 2004 report, we  noted that almost all of the 24 OSDBU directors surveyed reported that  they viewed most of the functions outlined in the Small Business Act as  current duties of their offices. Most of the OSDBU directors we surveyed  reported that their offices faced few challenges to carrying out their  responsibilities, but some reported challenges in three areas—lack of  influence in the procurement process, limited budgetary resources, and  lack of adequate staff.
For this report, you asked us to review OSDBU practices for carrying out  the requirements of the Small Business Act at federal agencies with major  contracting activity. Specifically, we (1) assessed whether the director  reported directly to the agency head or the deputy head, (2) determined  the functions conducted by the OSDBUs, and (3) examined the actions  taken by the OSDBUs and other officials at the various agencies to further  small business contracting opportunities and the effects of funding and  staff levels on these efforts.
To address these objectives, we focused our review on the seven agencies  that procured more than $15 billion in goods and services in fiscal year  2009: the Defense Logistics Agency (DLA); the Departments of the Air  Force, the Army, Energy, Health and Human Services (HHS), and the  Navy; and the National Aeronautics and Space Administration (NASA). To  assess whether the directors were responsible only to and reported  directly to the agency head or the deputy head as required by section  15(k)(3) of the Small Business Act, we included an additional nine  agencies that we reported in September 2003 were not complying with this  requirement. We determined that agencies were in compliance if the  designated OSDBU directors both exercised OSDBU responsibilities and  reported directly to and were responsible only to the agency head or the  agency head’s deputy as the act requires. To determine whether OSDBU  directors were in compliance with section 15(k)(3), we interviewed the  designated directors to identify the official(s) they had reported to in fiscal  year 2010 and asked them to provide information characterizing the  reporting relationship, such as the extent to which small business issues  were discussed. In addition, we reviewed documentary evidence, including  organization charts and OSDBU directors’ performance appraisals and  position descriptions.
To determine the functions conducted by the OSDBUs, we surveyed the  OSDBU directors at 25 agencies on their offices’ duties and functions. The  25 agencies included all 20 civilian agencies that procured more than $800  million in goods and services in fiscal year 2009, as well as the Department  of Defense (DOD)—Office of the Secretary; the Departments of the Air  Force, Army, and Navy; and DLA. We received responses from all 25  OSDBU directors, for a response rate of 100 percent. The survey was  similar to one we administered in 2003 and asked the directors about their  functions in three areas: (1) participation in the agency procurement  process, (2) facilitation of small business participation in agency  contracting, and (3) interaction with SBA. The three areas covered OSDBU  functions listed in the Small Business Act as well as additional functions  that OSDBUs might perform. The purpose of the survey was to obtain the  views of OSDBU directors on their roles and responsibilities. In addition,  the survey asked the directors what challenges they faced in carrying out  their responsibilities. In certain instances, we conducted follow-up  interviews to clarify responses.
To examine the actions taken by the OSDBU and other agency officials to  further small business contracting opportunities and determine how funding  and staff levels affected these efforts, we reviewed the survey responses  from the 25 OSDBU directors. To determine actions taken by top  management to further small business contracting, we reviewed documents,  including policy statements, at the seven agencies with major contracting  activity. We also interviewed the OSDBU directors at these agencies on the  actions they and other agency officials had taken to further small business  contracting; methods used by the agency and SBA to hold officials  accountable for furthering small business contracting; and challenges that  may have affected these efforts, such as funding and staffing levels.  Appendix I contains additional information on our scope and methodology.
We conducted our work from June 2010 to May 2011 in accordance with  generally accepted government auditing standards. Those standards  require that we plan and perform the audit to obtain sufficient, appropriate  evidence to provide a reasonable basis for our findings and conclusions  based on our audit objectives. We believe the evidence obtained provides  a reasonable basis for our findings and conclusions based on our audit  objectives.
subsections: section_title: Background
paragraphs: The Business Opportunity Development Reform Act of 1988 amended the  Small Business Act to establish an annual governmentwide goal of  awarding not less than 20 percent of prime contract dollars to small  businesses. The Small Business Reauthorization Act of 1997 further  amended the Small Business Act to increase this goal to not less than 23  percent. To help meet this goal, SBA annually establishes prime contract  goals for various categories of small businesses for each federal agency.  Although SBA is responsible for coordinating with executive branch  agencies to move the federal government toward this mandated goal,  agency heads are responsible for achieving the small business goals with  their agencies.
A 1978 report by the Senate Select Committee on Small Business noted  that officials who were responsible for advocating for small business  participation in federal government procurement often did not hold  positions that were high enough in the agency structure to be effective.  The 1978 amendment to the Small Business Act that established section  15(k)(3) addressed this issue by establishing a direct reporting  relationship between the OSDBU director and the agency head or deputy  head. The statute, as amended, specifies that the director would have  supervisory authority over OSDBU staff, implement and execute the  functions and duties under the relevant sections of the Small Business Act,  and identify proposed solicitations that involved the bundling of contract  requirements. (The Small Business Reauthorization Act of 1997 defines the  bundling of contract requirements as the consolidation of two or more  procurement requirements for goods or services previously provided or  performed under separate smaller contracts into a solicitation of offers for  a single contract that is likely to be unsuitable for award to a small  business concern for various reasons.)
Section 15(k) of the Small Business Act lists eight functions of OSDBU  directors, as follows:  Identifying proposed solicitations that involve significant bundling of  contract requirements.
Working with agency procurement officials to revise such proposed  solicitations to increase the probability of participation by a small  business.
Facilitating the participation of small businesses as subcontractors if  solicitations for bundled contracts are to be issued.
Assisting small businesses in obtaining payments from an agency with  which it has contracted.
Helping small businesses acting as subcontractors to obtain payments  from prime contractors.
Making recommendations to contracting officers as to whether particular  requirements should be set-aside for small businesses.
Maintaining supervisory authority over OSDBU personnel.
Cooperating and consulting on a regular basis with SBA in carrying out  OSDBU functions and duties under the Small Business Act and assigning a  small business technical advisor to each office with an SBA-appointed  procurement center representative. (A procurement center representative  is an SBA staff member assigned to federal buying activities with major  contracting programs to carry out SBA policies and programs.)
Acquisition Regulation Supplement for the Department of Defense. F purpose of our 2003 and 2010 surveys, we divided the procurement  process into four steps:    Acquisition planning involves developing an overall management strategy  in  for the procurement process for a potential contract. It takes place well advance of a contract’s award date and generally involves both a close  partnership between the program and procurement offices and the  involvement of other key stakeholders.
Solicitation development to submit offers, or bids. is the process of preparing requests for vendors    Proposal evaluation occurs after potential contractors submit proposa that outline how they will fulfill the solicitation requirements. Agency  personnel evaluate proposals for award and contracting officers award the  contract.
Monitoring, also known as surveillance, helps to determine a c progress and identify any factors that may delay performance.
To carry out the functions listed in section 15(k) of the Small Business OSDBU directors provide advice on small business matters and  collaborate with the small business community. Some of the primary  duties of OSDBU directors include advising agency leadership on small  business matters; providing direction for developing and implementing  policies and initiatives to help ensure that small businesses have the  opportunity to compete for and receive a fair share of agency  procurement; representing the agency at meetings, workgroups, and  conferences related to small business; initiating and building partnerships  with the small business community; providing agency acquisition and  program personnel with leadership and oversight of education and train related to small business contracting; conducting reviews of small  business programs; and serving as the agency liaison to SBA, including  providing annual reports on agency activities, performance, and efforts to  improve performance.
OSDBU directors are not the only officials responsible for helping small  businesses participate in federal procurement. At the agency level, the  heads of procurement departments are responsible for implementing thesmall business programs at their agencies, including achieving program goals. Generally, staff within agency procurement departments who are  assigned to work on small business issues (small business specialist coordinate  with OSDBU directors on their agencies’ small business  programs. s)
section_title: More Than Half of OSDBU Directors Reviewed Reported Only to Their Agen or Dep uty Agency Head
paragraphs: We found that 9 of the 16 agencies we reviewed were in compliance with  the Small Business Act’s requirement that OSDBU directors be responsible only to and report directly to the agency or deputy agency head (se e table  1). We determined that the remaining seven agencies were not in  compliance. These agencies, which use various reporting structures, a were not in compliance in 2003, when we last assessed the reporting  structure. The OSDBU directors at the compliant agencies cited benefit the reporting relationship. OSDBU directors at agencies that were not  complying with section 15(k)(3) differed in their of reporting to the agency head or deputy head.
Business Act. However, none of the legal arguments that the agencies raised caused us to revise our conclusions or recommendations. For  example, the Department of the Interior stated that the Assistant to whom the OSDBU director reported was the agency head for  acquisition matters, in accordance with the FAR. We responded that  Interior’s designation of the Assistant Secretary as its “agency head” for procurement powers did not mean that the person thereby became its  agency head for purposes of section 15(k)(3). Several agencies also  commented on the effectiveness of their small business programs and  reporting structure. During our interviews for this report, officials  generally did not state that their agencies were complying with the  requirement. Rather, they commented on how their current reporting  structures were working. For example, officials at five agencies stated small business matters were not suffering as a result of the structure.
subsections: section_title: OSDBU Directors at Agencies Reported Directly to the Agency Deputy Agency Head
paragraphs: At NASA, the Administrator is the head of the agency.
OSDBU directors reported to the Deputy Secretary. For instance, at the  Departments of the Air Force, Army, and Navy, the OSDBU directors  reported to the Under Secretary for their respective departments, and the  Under Secretary signed their performance appraisals. At Energy and HHS,  the OSDBU directors reported to the Deputy Secretary, who also assessed  their performance. In our 2003 report, we concluded that the Department  of Education was not in compliance with section 15(k)(3). At that time,  the OSDBU director did not report only to the Deputy Secretary but also  reported to the Deputy Secretary’s Chief of Staff. Since then, the agency  has changed its reporting structure to ensure that the OSDBU director is  responsible only to the Deputy Secretary. The OSDBU director stated that  she now had direct access to the Deputy Secretary, meeting with him for  routine discussions about small business activities and related issues. In  addition, the Deputy Secretary signed her performance appraisals. We also  concluded in 2003 that EPA was not in compliance because the OSDBU  director was not responsible only to the Administrator or Deputy  Administrator. At that time, the OSDBU director told us she reported to  the Deputy Chief of Staff, who also evaluated the OSDBU director’s  performance. For this review, the OSDBU director told us that, while some  matters were routed through the Deputy Chief of Staff, she ultimately  reported to the Deputy Administrator. The Deputy Administrator signed  her two most recent performance appraisals.
section_title: The Seven Agencies That Were Not in Compliance Had a Variety of Reporting Arrangements
paragraphs: As shown in table 1, seven agencies were not in compliance with section  15(k)(3). All of these agencies were also not in compliance in 2003. As in  our prior report, we found that a variety of reporting structures were in  place. OSDBU directors either reported to lower-level officials than the  agency head or deputy or had delegated their OSDBU director  responsibilities to officials who did not report to either the agency head or  the deputy head. However, these arrangements do not meet the law’s  intent and undermine the purpose of section 15(k)(3). To help ensure that  the OSDBU’s responsibilities are effectively implemented, the act  mandates that the OSDBU director—that is, the person actually carrying  out the responsibilities—have direct access and be responsible only to the  agency head or deputy. Appendix II provides details of the reporting  arrangements at each agency.
subsections: section_title: OSDBU Directors at Four Agencies Did Not Report Directly to the Agency Head or Deputy Head
paragraphs: At the Departments of Commerce, the Interior, and Justice and the Social  Security Administration (SSA), the OSDBU directors reported to officials  at lower levels than the agency head or deputy head. For example, at the  Department of Commerce, the organization chart showed that the OSDBU  director reported to two lower-level officials—the Deputy Assistant  Secretary for Administration and the Assistant Secretary for  Administration. At the Department of the Interior, the OSDBU director  reported to the Deputy Assistant Secretary for Budget, Finance,  Performance, and Acquisition and to the Assistant Secretary, Policy,  Management and Budget. At the Justice Department, OSDBU officials told  us that the current reporting structure was the same as in 2003. The  OSDBU is located within the Justice Management Division, with the  director under the supervision of the Deputy Assistant Attorney General  for Policy, Management and Planning. SSA also had the same reporting  structure that we documented in our 2003 report, with the OSDBU  director reporting to the Deputy Commissioner, Office of Budget, Finance  and Management, who is one of nine deputy commissioners managing  programs and operations.
section_title: OSDBU Directors at Three Agencies Delegated Their OSDBU Responsibilities to Lower-Level Officials
paragraphs: The designated OSDBU directors at the Departments of Agriculture, State,  and the Treasury delegated their responsibilities to officials who did not  directly report to either the Secretaries or Deputy Secretaries. These  arrangements were the same as those we determined in 2003 were not in  compliance with the Small Business Act. At these agencies, an Assistant  Secretary who managed the agency’s administrative functions was  designated as the statutory OSDBU director. The Assistant Secretaries  then delegated nearly all of their OSDBU responsibilities to lower-ranking  officials who reported directly to the Assistant Secretaries. The lower- ranking officials thus became the de facto OSDBU directors. At the  Department of Agriculture, for example, the designated OSDBU director  was the Assistant Secretary for Administration, who reported to the  Secretary and Deputy Secretary. However, the Assistant Secretary had  delegated nearly all of his OSDBU responsibilities to a lower-level official  who did not have direct access to the agency head or deputy head. At the  Department of State, the Assistant Secretary for Administration was the  designated OSDBU director. The Assistant Secretary, who reported to one  of the department’s two Deputy Secretaries on small business matters, had  delegated his OSDBU responsibilities to the Operations Director for the  OSDBU, who reported directly to him. At Treasury, the Assistant Secretary  of the Treasury for Management/Chief Financial Officer/Chief  Performance Officer was the designated OSDBU director. However, the  Director of the Office of Small Business Programs, an official who did not  directly report to either the Secretary or the Deputy Secretary, was  responsible for the day-to-day management of Treasury’s small business  programs. The Director of the Office of Small Business Programs told us  she spent 100 percent of her time on small business issues.
section_title: While Views Varied on the Importance of Reporting Only to the Agency Head or Deputy Head, the Small Business Act Requires It
paragraphs: OSDBU directors’ opinions varied on the importance of reporting only to  the agency head or deputy head. The OSDBU directors at the nine  agencies that were complying with section 15(k)(3) cited positive  elements to this reporting relationship. Five of the nine OSDBU directors  stated that reporting to the agency head or deputy showed top-level  support for small business efforts that sent a message to the rest of the  agency. For example, one OSDBU director explained that reporting  directly to the agency head or deputy head helped ensure that he was  viewed as equal to other senior managers. He noted that this relationship  was important because it allowed him to participate in senior management  meetings where decisions were made. Another OSDBU director stated that  she had a strong relationship with senior management and did not hesitate  to invite senior leaders to participate in small business outreach events.  She added that if she did not report to the agency head or deputy, she  would lose this rapport with senior leadership.
OSDBU directors at the seven agencies that were not complying with  section 15(k)(3) differed on the importance of reporting to the agency  head or deputy head. For example, two of these OSDBU directors thought  that not reporting to the agency head or deputy was a problem. One  director stated that reporting to the agency head or deputy could provide  the OSDBU with more authority and enable it to collaborate more  effectively with other offices. The other director noted that being too far  down the reporting structure meant that she could not independently  voice her opinion, especially when it differed from her supervisor’s. The  OSDBU directors at the other five agencies did not see problems with the  existing structure, stating that small business matters were not suffering  as a result of the structure. For instance, one director stated that his  agency’s structure worked well and that the agency’s small business  initiatives were resulting in high marks on the SBA scorecard and effective  relationships with other agency officials. This official noted that if he  were to report directly to the Secretary or Deputy Secretary, small  business efforts would compete against significant national foreign policy  priorities. Another director stated that the OSDBU was getting all of the  support it needed under the current reporting relationship. The director  further explained that the office did not have a problem with resources  and that he had a strong relationship with his supervisor. Additionally, he  noted that any areas needing attention were communicated to higher  management. Yet another director stated that his agency had a successful  small business procurement program. He also cited accomplishments such  as meeting small business contracting goals and increasing the number of  small businesses with which the agency interacted.
However, the Small Business Act requires that the OSDBU director have  direct access to the agency head or deputy to help ensure that the  OSDBU’s responsibilities are effectively implemented. As such, the  statements made by the OSDBU directors at these five agencies do not  justify their noncompliance with section 15(k)(3). SBA officials said the  agency had also raised concerns about compliance with the reporting  requirement during its surveillance reviews of federal agencies. These  reviews are evaluations of small business contracting that assess (1)  management of the small business programs, (2) compliance with  regulations and published policies and procedures, (3) outreach programs  focusing on small businesses, and (4) procurement documentation. When  SBA finds that an agency does not have the required reporting  relationship, it identifies this as a deficiency in the review report. Ongoing  noncompliance with section 15(k)(3) undermines the intent of the act and  may prevent some OSDBU directors from having direct access to top  agency management. Given how long these agencies have not been in  compliance with the requirement, at a minimum they have an obligation to  explain their noncompliance to Congress and provide support for their  need, if any, for greater statutory flexibility in establishing a reporting  structure for their OSDBU director.
section_title: Survey Results Showed That Most OSDBUs Continued to Focus Their Procurement Activities on Five Functions
paragraphs: Like the results of our 2003 survey, the responses of the 25 OSDBU  directors we surveyed in 2010 indicated that they generally focused their  procurement activities on the functions listed in section 15(k) of the Small  Business Act. Most OSDBU directors reported they viewed five of the eight  functions identified in section 15(k) as among their offices’ current duties,  but the extent to which the individual OSDBUs carried out each activity  varied. Directors who did not view a section 15(k) function as their  responsibility generally reported that contracting, acquisition, or program  staff performed it. Section 15(k) lists the functions of OSDBU directors but  does not necessarily require them to personally carry out these activities  themselves. Few OSDBU directors viewed non-15(k) procurement  activities such as developing solicitations and evaluating proposals as  roles of their OSDBU.
subsections: section_title: Nearly All OSDBU Directors Surveyed Reported Their Offices Performed Five of the Eight Functions Identified in the Small Business Act
paragraphs: For this report, we asked 25 OSDBU directors which of the responsibilities  listed in the Small Business Act they saw as responsibilities of their  offices. As shown in figure 1, at least 19 of the 25 OSDBU directors that we  surveyed reported they viewed five of the eight functions identified in  section 15(k) of the Small Business Act as current duties of their office.  These five functions included (1) having supervisory authority over  OSDBU staff, (2) three functions involving contract bundling (that is, the  consolidation of two or more procurement requirements for goods or  services previously provided under separate smaller contracts), and (3)  assisting small businesses to obtain payments from agencies. Fewer  OSDBU directors (10 to 18) viewed the remaining three functions— reviewing individual acquisitions for small business set-asides, assisting  small businesses to obtain payments from prime contractors, and  assigning a small business technical advisor to offices with an SBA  representative—as their responsibilities. The data show little change from  the responses to our 2003 survey.
section_title: OSDBU Directors Varied in How Extensively They Carried Out Certain Section 15(k) Functions
paragraphs: We also asked OSDBU directors about the extent to which they carried  out six of the eight 15(k) functions, and their responses varied. Over half  of those OSDBU directors who responded to the contract bundling  questions reported that they carried out these functions to either a great or  very great extent (see table 2). In contrast, six OSDBU directors reported  having assisted small businesses to obtain payments from their agencies to  a great or very great extent. Even fewer (two) reported having assisted  small businesses to obtain payments from prime contractors to a great or  very great extent.
Of the 18 OSDBU directors who reported that reviewing or determining  individual contracts that should be set aside for a small business was a  function of their OSDBU, 13 stated they reviewed proposed small business  set-asides for individual acquisitions in all or most cases. In their written  comments, nine directors noted that they reviewed all acquisitions  exceeding a certain amount for small business set-aside determinations.  For instance, one of these directors explained that the agency had a  regulation that prescribed policies, responsibilities, and procedures for  clearing contracts over the simplified acquisition threshold ($150,000) that  were not set aside or reserved for small business participation, including  bundled contracts.
We also asked the OSDBU directors to indicate the extent to which they  cooperated and consulted with SBA in carrying out their responsibilities.  Twenty-one directors reported that they cooperated and consulted with  SBA to a great or very great extent. In their written comments, more than  half of the directors noted they participated in SBA-sponsored activities  and initiatives. For instance, 13 reported attending or sending staff to  monthly SBA Small Business Procurement Advisory Council meetings.
section_title: OSDBU Directors Reported That Agency Personnel Other Than the OSDBU Staff Often Carried Out Certain 15(k) Functions
paragraphs: The number of OSDBU directors surveyed who did not view a section  15(k) function as their current responsibility varied, depending on the  specific function. The number ranged from 1 who did not view maintaining  supervisory authority over OSDBU personnel as a function to 11 who did  not view assisting small businesses to obtain payments from prime  contractors as a responsibility. In their written comments and follow-up  interviews, the directors who did not view a section 15(k) function as their  responsibility generally stated that contracting, acquisition, or program  staff performed it. It was not clear from our survey results the extent to  which OSDBU directors are involved in those functions carried out by  other agency staff. Appendix III provides details on the agency personnel  other than OSDBU staff who carry out certain section 15(k) functions.
section_title: Few Directors Performed Procurement-related Roles Outside of Their 15(k) Functions
paragraphs: In 2010, a smaller number of OSDBU directors than in 2003 viewed  additional procurement activities such as developing solicitations,  evaluating proposals, developing factors for evaluating solicitations, and  monitoring small businesses as roles of the OSDBU (see fig. 2). For  example, 3 directors reported that developing proposed solicitations was a  role of the OSDBU in 2010, compared with 9 directors in 2003. The  majority of the 22 directors who reported they did not carry out this  function commented that their agencies’ contracting offices performed  this role. Of these 22 directors, 6 reported that the OSDBU played a  collaborative role, such as reviewing solicitation language. Additionally, in  2010, 11 directors viewed developing evaluation factors for solicitations at  their agencies as a role of the OSDBU, compared with 15 in 2003.  However, of the 14 directors who said they did not perform the function in  2010, 4 reported having some involvement in the process. For example, 1  director commented that the OSDBU had provided examples of  solicitation evaluation criteria for agency procurements.
section_title: OSDBUs Collaborated to Promote Small Business Contracting, but Some Directors Reported Staffing and Funding Challenges
paragraphs: OSDBU directors reported they collaborated with acquisition officials and  conducted outreach to small businesses to promote small business  contracting. For example, nearly all of the 25 OSDBU directors we  surveyed indicated they were involved in acquisition planning. At the  seven agencies with major contracting activity, OSDBU officials told us  that top agency leaders also participated in outreach events and issued  agency policy statements supporting small business efforts. Agencies were  held accountable for fostering small business contracting through SBA’s  small business goals, and SBA had initiated efforts to identify promising  practices OSDBUs can take to further small business contracting. Some  OSDBU directors we surveyed reported that inadequate staffing levels and  limited budgetary resources were challenges to carrying out their  responsibilities.
subsections: section_title: OSDBU Directors Used Collaboration, Outreach, and Oversight to Facilitate Small Business Contracting
paragraphs: OSDBU directors use a variety of methods—including internal and  external collaboration, outreach to small businesses, and oversight of  agency small business contracting—to facilitate small business  contracting.
subsections: section_title: Internal and External Collaboration
paragraphs: The OSDBU directors we surveyed and spoke with said that both internal  and external collaboration were important to their efforts to promote  small business contracting. Twenty-three of the 25 OSDBU directors  surveyed viewed involvement in acquisition planning as a role or function  of their OSDBUs. Of this number, 15 directors reported they carried out  this function to a great or very great extent. For instance, OSDBU  directors reported acquisition planning activities such as preparing annual  forecasts of contracting opportunities, being a voting member of the  agency’s senior procurement council, participating in contracting  agreement and review board meetings, and reviewing and providing  feedback on draft acquisition plans.
Further, the OSDBU directors we interviewed at the seven agencies with  major contracting activity all viewed relationships with acquisition staff as  important in promoting small business contracting. For example, the  OSDBU director at DLA told us that establishing relationships with  acquisition management was the most important part of promoting small  business contracting. In addition, the OSDBU director at HHS described  small business contracting as a “three-legged stool,” with acquisition staff,  program staff, and OSDBU staff working together to support it. Four of the  seven OSDBU directors stressed the importance of working with  acquisition officials from the start of a project rather than trying to  integrate them after a project was under way. For instance, the director at  HHS stated that the OSDBU spent a great deal of time on early acquisition  planning to help ensure that small businesses received consideration  throughout the decision-making process. Officials at the Air Force OSDBU  also stated that early involvement gave the office time to review  acquisitions and discuss small business involvement. These officials noted  that reviewing proposed actions late in the process placed the OSDBU in a  defensive position.
Six of the seven directors we interviewed also told us they participated in  acquisition teams as advocates for small business. For instance, Energy  has established a monthly Advanced Planning Acquisition Team  comprising OSDBU, procurement, acquisition, and SBA officials. The  purpose of the team is to review proposed strategies for new and existing  acquisitions to identify prime and subcontracting opportunities for small  businesses. The OSDBU directors at both Army and DLA are members of  acquisition review boards for contracts of more than $500 million and $20  million, respectively. The seven OSDBU directors we interviewed also  stated that small business staff in the field, often referred to as small  business specialists, reviewed proposed acquisitions for opportunities. For  example, the Army OSDBU director told us that the OSDBU reviewed all  acquisitions of more than $500 million but that these specialists reviewed  all acquisitions over $150,000 that were not set-aside for small businesses  and worked with acquisition staff to ensure that small businesses were  considered.
In addition, the OSDBU directors we interviewed collaborated with other  federal agencies to maximize small business contracting. All seven  participate in the Federal OSDBU Directors Interagency Council, an  informal organization that meets to exchange information on initiatives  and processes related to small businesses and outreach events that  promote small business contracting. Among other things, the council  seeks to identify best practices and share ideas and experiences among  federal agencies and private industry to help leverage resources and  develop solutions for promoting small business involvement.
section_title: Outreach Efforts to Small Businesses
paragraphs: Nearly all of the OSDBU directors we surveyed saw outreach activities to  small businesses as a function of their offices. For instance, 23 of the 25  OSDBU directors viewed hosting conferences for small businesses as one  of their responsibilities, and 23 had hosted such an event in the last 2  years. More specifically, these 23 agencies had hosted an average of 20  conferences in the past 24 months. For instance, one OSDBU director  reported the agency had sponsored conferences of varying sizes to address  contractual requirements that program offices noticed or forecasted. The  same director noted the conferences were typically conducted in a  networking or “business fair” format, allowing vendors to engage program  and contracting officials. In addition, most of the OSDBU directors  surveyed (20 of 25) saw sponsoring training programs for small businesses  as one of their responsibilities, and 18 had hosted such an event in the last  2 years. For example, OSDBU directors described sponsoring trainings for  small businesses in specific socioeconomic groups, providing one-on-one  trainings, and offering workshops focused on specific skills such as  writing proposals and teaming with larger businesses.
The seven OSDBU directors we interviewed provided examples of  outreach to the small business community. For example, the OSDBU  director at DLA said the OSDBU worked closely with the American Legion  to promote contracting to small businesses owned by service-disabled  veterans. According to the NASA OSDBU director, small business staff  held over 100 outreach events in fiscal year 2010. Other OSDBU officials  described their efforts to disseminate information to small businesses  through Web sites. For instance, Navy’s OSDBU director stated the agency  was working to standardize the Web site formats used by its various units  for outreach to small businesses. He explained that OSDBU staff had  reviewed the Web sites to determine whether a small business could  access information easily, and found retrieving information on small  businesses difficult because each of the sites was set up differently. The  Air Force maintains a small business Web site that provides small  businesses with information on the agency’s contracting opportunities.  An OSDBU official stated the site was comprehensive and included the  contact information for small business staff, long-range acquisition data,  information on various outreach efforts, links to the Air Force’s quarterly  newsletter, and articles on small business issues.
section_title: Oversight of Agency Small Business Contracting
paragraphs: OSDBUs also provide oversight of agencies’ small business contracting.  The FAR requires annual assessments of the extent to which small  businesses are receiving a fair share of federal procurements. We found  that these assessments varied across the seven agencies we interviewed.  For example, the OSDBU at Energy conducts quarterly reviews of program  offices. Offices are rated using a color-coded system—green for reaching  95 percent of small business goals and yellow or red for lower  percentages. The NASA OSDBU produces monthly reports on the agency’s  individual space and research centers’ progress in meeting small business  goals and collects data on the centers’ outreach and training efforts. The  OSDBU follows up with individual centers that do not meet their goals. At  Army, the OSDBU director tracks agency performance using Federal  Procurement Data System—Next Generation data. She noted that if the  data indicated decreases in small business contracting from prior-year  trends, agency leadership would be informed.
All seven agencies we interviewed also conducted program management  reviews (PMR) or similar reviews to help ensure that small businesses  were being considered for contracts and internal controls for ongoing  contracts followed. During PMRs, officials review a sample of existing  contracts to determine whether proper procedures and internal controls,  including those related to small business, have been followed. The OSDBU  directors at four agencies (Army, DLA, HHS, and NASA) reported that  OSDBU and acquisition officials jointly conducted these reviews. At the  Air Force, small business staff in field offices conducted the PMRs, and at  Energy, procurement staff conducted them. The Navy OSDBU had  replaced PMRs with procurement performance management assessments,  which review contracting offices and commands on 11 categories,  including involvement of small business in acquisition planning and  procurement planning, marketing strategies and approaches, number of  set-asides, and inclusion of small business clauses in all contracts.
section_title: Top Agency Officials Generally Provided Support for Small Business Efforts
paragraphs: OSDBU officials at the seven agencies we contacted told us that top  agency leaders supported small business contracting by participating in  outreach events and issuing policy statements. For instance, these OSDBU  directors cited the following examples of their agency heads’ participation  in outreach events:    The DLA Director took part in public forums such as conferences and  emphasized small business contracting when interviewed for a magazine  article.
The NASA Administrator attended the agency’s second annual small  business symposium and award ceremony to personally recognize the  achievements of small businesses, while the Deputy Administrator handed  out awards.
In fiscal year 2010, top Army management attended five major outreach  events, including the National Veterans Conference, an event that the  OSDBU had hosted for 6 years.
Top management also promoted small business contracting by issuing  agency policy statements or memos. For instance:    The Secretary of the Air Force issued a joint memo with the Chief of Staff  in January 2009 that encouraged officials to “aggressively seek” small  businesses owned by service-disabled veterans for Air Force contracts and  encouraged using the OSDBU to help identify strategies and capable firms.
The Secretary of Energy issued a memo in November 2009 asking all  program offices to work with the OSDBU to promote prime contracting,  subcontracting, and financial assistance opportunities for small  businesses, including small disadvantaged, Historically Underutilized  Business Zone (HUBZone), 8(a), women-owned, and service-disabled  veteran-owned small businesses.
In June 2009, the Secretary of the Navy issued a memo establishing the  Department of the Navy Small Business Award to recognize individuals  and teams who have made outstanding contributions in promoting  competition and innovation in the Navy acquisition process.
The Deputy Secretary at HHS issued a memo in January 2009, which stated  that component heads were expected to provide their full support to the  small business program at every juncture within the acquisition process.
section_title: SBA’s Small Business Goals and Performance Standards Held Agencies and Staff Accountable for Furthering Small Business Contracting
paragraphs: Agencies as a whole are held accountable for furthering small business  contracting through SBA’s small business goaling program and scorecard.  SBA produces an annual “goaling” report showing the percentage of  contracting dollars awarded to small businesses. SBA’s goaling report for  fiscal year 2009 shows that 22 percent of eligible contract dollars  governmentwide were awarded to small businesses, an amount that was  just short of the statutory requirement of 23 percent. As shown in table 3,  the percentage awarded to small businesses by the agencies we surveyed  ranged from 6 percent to 56 percent of eligible contract dollars.
SBA sets annual goals for small business contracting at each agency,  basing these goals on the agencies’ past performance, total spending, and  purchases of goods and services from small businesses. These goals are  set for the agency as a whole, not just for the OSDBU. As we reported in  2009, OSDBU officials at some agencies reported challenges with the goal- setting process, including limitations in negotiating and appealing their  goals. At that time, agencies told GAO the goal-setting process was not a  negotiation and that SBA did not factor in changes to agencies’ contracting  priorities in setting the goals. Two of the seven agencies that we  interviewed (Energy and HHS) said that meeting small business goals was  difficult because the goods and services the agency purchased were not  well suited for small business contracts. For example, 85 percent of  Energy’s contracts are facility management contracts that have  traditionally been awarded to large businesses and universities to manage  operations at sites such as Los Alamos National Laboratory. According to  SBA officials, the agency has revised the goal-setting process to make it  more collaborative.
SBA also assessed all of the agencies we surveyed using its annual small  business scorecard to ensure greater accountability. According to SBA, the  scorecard fulfills its statutory requirement to report to the President and  Congress on achievements by federal agencies against their annual goals.  The SBA scorecard evaluates factors such as goals met, progress shown,  agency small business strategies, and top-level commitment to meeting  goals for 24 agencies and offices and the government as a whole. In fiscal  year 2009, SBA updated the scorecard and now assigns a letter grade to  each agency. Eighty percent of an agency’s grade is based on its progress  in meeting its prime contracting goal, 10 percent on its progress in meeting  its subcontracting goal, and 10 percent on a performance rating assigned  to the agency by a panel of OSDBU directors. The agencies submit reports  on small business achievements that the panel uses to determine  performance ratings. The scorecard does not specifically consider the  performance of the OSDBU or its director, although the OSDBU director  may be involved in some of the activities evaluated.
All seven of the OSDBU directors we interviewed are held accountable for  promoting small business contracting primarily through internal  performance standards and appraisals. Performance standards identify  goals and set objectives that are used as key indicators of achievement  during annual or midpoint performance appraisals. For example, the  NASA OSDBU director explained that, as part of his performance  appraisal process, he was reviewed against measurable and achievable  goals. These included developing a small business improvement plan for  the agency with specific initiatives to meet its small business goals and  implementing a training course for agency staff on a standard method to  evaluate proposals submitted to the agency.
To help OSDBUs improve their capabilities, SBA and others have initiated  efforts to identify promising practices that OSDBUs can use to facilitate  small business contracting. A White House Interagency Task Force on  Federal Contracting Opportunities for Small Businesses, which was  established April 2010, identified the need for best practices. The task  force issued a report that identified challenges to small businesses such as  inadequate training for agency staff. Among other things, it recommended  that the executive branch facilitate the identification and rapid adoption of  successful practices for increasing opportunities for small businesses. To  implement this recommendation, the task force suggested that SBA (1)  develop a Web site to share best practices and (2) organize an event for  OSDBUs to present best practices for ensuring greater small business  participation and catalog and publicize the results. According to SBA  officials, they have taken steps to plan these efforts. SBA had already  begun to highlight on its Web site best practices for making opportunities  available to small businesses and has identified three to date. In addition,  during the scorecard process, the panel of OSDBU directors identified best  practices at 12 agencies, although these have not been published with this  list on SBA’s Web site. The Federal OSDBU Directors Interagency Council  also seeks to identify best practices and has identified some that focus on  interactions between OSDBUs and small businesses.
section_title: Survey Respondents Identified Staffing, Funding, and Influence in the Procurement Process as Challenges
paragraphs: Most of the 25 OSDBU directors surveyed indicated that inadequate  staffing levels and limited budgetary resources were challenges to carrying  out their responsibilities to at least some extent (see table 4). These issues  were also reported as challenges in 2003. Twenty agencies reported that  inadequate staffing levels were a challenge to at least some extent in 2010,  compared with 17 agencies in 2003. Seventeen agencies reported that  limited budgetary resources were a challenge to at least some extent in  2010 and in 2003.
Six agencies reported that inadequate staffing levels were a challenge to a  great or very great extent, and seven agencies reported that limited  budgetary resources were a challenge to a great or very great extent. In a  follow-up interview, OSDBU officials at one agency explained that while  they were able to perform their mission, inadequate staffing levels had  resulted in increased staff workloads, longer work days, and the need to  cross-train staff. They noted that in addition to the functions listed in 15(k)  of the Small Business Act, they were also responsible for reviewing grant  programs for small business opportunities. The OSDBU director at another  agency indicated that because she had only one staff person, her office  was unable to review the majority of procurement actions, including those  involving contract bundling. She also noted that limited budgetary  resources restricted the hiring of additional staff. Additionally, in follow- up interviews, four OSDBU directors noted that limited budgetary  resources hindered their efforts to reach out to small businesses.
Almost half of the OSDBU directors surveyed also reported that their lack  of influence in the procurement process was a challenge to carrying out  their responsibilities to at least some extent. Three agencies indicated that  this issue represented a challenge to a great or very great extent. In a  follow-up interview, OSDBU officials at one agency told us that better  coordination was needed between the OSDBU and acquisition officials on  issues related to small businesses. While the OSDBU participated in  acquisition planning, the officials noted that their role in acquisition  decisions was not clear. Another OSDBU director stated that as part of the  acquisition approval process, he could disagree with a contract  recommendation. However, the director noted that his decision could also  be appealed and overruled by an acquisition executive, thus limiting the  OSDBU’s influence.
At the seven agencies with major contracting activity, trends in staffing  and funding levels varied over the past 5 years. From fiscal year 2006 to  2010, OSDBU staffing generally decreased at Energy, increased slightly at  DLA, the Navy, and NASA, and stayed the same at the Army and HHS (see  table 5). At the Air Force, staffing fluctuated in the interim, but was the  same in fiscal year 2010 as it was in fiscal year 2006.
Additionally, from fiscal year 2006 to 2010 OSDBU funding generally  decreased at the Air Force, the Army, and Energy and increased at DLA,  HHS, the Navy, and NASA (see table 6).
The OSDBU directors at the seven agencies we interviewed noted a  relationship between changes in staffing and funding levels. For example,  recent decreases in the Air Force and Energy ODSBU budgets were due to  decreases in staffing. Air Force officials told us that the OSDBU had  streamlined operations by eliminating some redundant contractor  positions and converting some contractors into civilian positions. They  noted that these changes had resulted in greater efficiencies and increased  quality. Energy officials stated that since the change in administrations in  2008, three political appointees working at the Energy ODSBU had left,  halving the number of staff responsible for the same workload. However,  they noted that hiring interns and contractors had mitigated staffing  constraints and the agency anticipated hiring additional OSDBU staff in  the future. Recent increases in the ODSBU funding for Navy and DLA had  resulted in increases in staffing. The Navy ODSBU director explained that  in addition to funding training and outreach programs, the recent  increases in funding were used to create an OSDBU industry analyst  position, and two additional positions were being developed. The DLA  OSDBU director noted that recent budget increases provided for an  increase in staffing but funding for other expenses such as travel had not  increased, causing her to have to turn down speaking and outreach events  due to lack of funds.
Six of the seven OSDBU directors we interviewed told us they would  increase the breadth of the activities they currently performed if more  resources were available. For example, the OSDBU directors at the Army  and Air Force stated they would increase their outreach activities.  Additionally, a few OSDBU directors noted that if more resources were  available, they would perform additional analysis and offer more training.  For example, the DLA OSDBU director stated she would analyze DLA  commodity purchases and research trends, assist with more market  research, provide more training to small business and other staff, and fill  skill gaps within the office. With additional resources, the HHS OSDBU  director stated she would increase internal training opportunities for  acquisition program staff and provide online training for small businesses.
section_title: Conclusions
paragraphs: Section 15(k)(3) of the Small Business Act seeks to help ensure that small  business advocates within federal agencies have direct access to the  highest levels of the agency. However, 7 of the 16 federal agencies that we  reviewed were not in compliance with the act. Moreover, all of the  agencies that are currently not in compliance were not in compliance in  2003 and have maintained the same or a similar reporting structure, even  though at the time we recommended changing them. The OSDBU directors  at the nine agencies that were in compliance with section 15(k)(3) cited  positive benefits to the reporting relationship, while the OSDBU directors  at the seven noncompliant agencies differed on the importance of  reporting to the agency head or deputy head. Two thought that not  reporting to the agency head or deputy head was a problem, while the  other five asserted that the lack of a direct reporting relationship with the  agency head had not adversely affected their efforts to advocate for small  business contracting. However, we did not find that these arguments  justified noncompliance with section 15(k)(3). Continued noncompliance  with the requirement undermines the intent of the provision. If the  agencies believe their reporting structures are sufficient to ensure that  small business contracting receives attention from top management at  federal agencies, at a minimum they have the obligation to explain their  noncompliance to Congress and provide support for their views, including  requesting any statutory flexibilities to permit exceptions as appropriate.  One potential mechanism for making this information available to  Congress would be through SBA’s annual scorecard process. The  noncompliant agencies could include their rationale for their reporting  structure in the annual reports that they submit to SBA, and SBA could  include such information in its scorecard report to Congress.
section_title: Recommendation for Executive Action
paragraphs: Given the ongoing requirement in the Small Business Act that OSDBU  directors report to agency heads or deputy heads, we recommend that the  heads of the Departments of Agriculture, Commerce, the Interior, Justice,  State, and the Treasury and the Social Security Administration take steps  as necessary to comply with the requirement or report to Congress on why  they have not complied. Such information could be included in SBA’s  annual scorecard report to Congress. Moreover, agencies that have not  complied with the requirement could seek any statutory flexibilities or  exceptions they believe may be appropriate.
section_title: Agency Comments and Our Evaluation
paragraphs: We sent a draft of this report to 26 agencies for their review and comment.  Of the nine agencies that we concluded were complying with section  15(k)(3) of the Small Business Act, only the Department of Education  provided written comments. In those comments, the agency noted that  since our 2003 report it had taken definitive corrective steps to achieve and  remain in compliance with all applicable requirements and stated that it was  pleased with our recognition of its changes to the reporting structure. (See  appendix IV for Education’s written comments.) None of the remaining  eight agencies found to be in compliance with section 15(k)(3)—the  Departments of the Air Force, the Army, Energy, and the Navy; DLA; EPA;  HHS; and NASA—provided any comments on the draft report.
Of the seven agencies that we concluded were not complying with section  15(k)(3), the Departments of Commerce, the Interior, Justice, State, and  the Treasury and SSA provided written comments. These written  comments are reproduced in appendixes V through X. The Department of  Agriculture did not comment on the draft report. Of the six agencies that  provided written comments, the Departments of Commerce, Justice, State,  and the Treasury disagreed with our conclusion that their reporting  relationships did not comply with section 15(k)(3) of the Small Business  Act. The Social Security Administration agreed to revise its reporting  structure, while the Department of the Interior stated it planned to  evaluate our recommendation and options to resolve the issue. None of  the agencies’ comments caused us to revise our conclusions or  recommendations. The six agencies’ specific comments and our responses  are summarized below.
The Department of Commerce stated that the agency was in compliance  with section 15(k)(3) because the OSDBU director reported directly to the  Deputy Secretary on all legislative and policy issues and to the Chief  Financial Officer and Assistant Secretary for Administration on  administrative matters such as personnel and budget. The comment letter  also cited the agency’s small business achievements, such as exceeding  small business goals. As noted in the draft report, the OSDBU director  stated that she reported to the Deputy Assistant Secretary for  Administration for all small business matters and to the Assistant  Secretary for Administration for administrative matters such as budget  and personnel. Agency documents, such as the organization chart and the  OSDBU director’s two most recent performance appraisals, confirmed this  reporting relationship. Further, the OSDBU director stated she had never  met the Secretary or previous Deputy Secretary. She met the new Acting  Deputy Secretary in December 2010, but did not have a reporting  relationship with her. Therefore, we did not revise our conclusion or  recommendation.
The Department of the Interior stated that it did not have comments on the  draft report, but would be evaluating our recommendation and options to  resolve the issue. The letter also indicated that the agency would report  back to GAO once it had finalized its plans.
The Department of Justice agreed that its OSDBU was located within the  Justice Management Division. However, its comment letter stated that this  arrangement was in place for administrative purposes, and that the  OSDBU director reported directly to the Deputy Attorney General on  matters of substance. The letter stated that through this organizational  structure, the Deputy Attorney General ensured that small businesses  were provided the maximum practicable opportunity to participate in  contracting opportunities throughout the agency. The letter also  commented that the current placement of the OSDBU allowed for the  efficient management and implementation of the small business  contracting programs that were vital to the agency in satisfying its mission.  As we noted in the draft report, agency documentation such as the OSDBU  director’s position description and performance appraisals indicated that  the director reported to the Deputy Assistant Attorney General for Policy,  Management and Planning. Further, the OSDBU director told us during  our review that he had never met the Deputy Attorney General. Therefore,  we did not revise our conclusion or recommendation.
The Department of State disagreed with the report’s conclusions. The  letter pointed out that the Assistant Secretary of State for Administration,  who is the designated OSDBU director, reports to the Deputy Secretary  concerning small business activities. This information was included in the  draft report. However, we concluded that the agency was not in  compliance with section 15(k)(3) because the Assistant Secretary had  delegated his OSDBU responsibilities to a lower-level official who did not  report to the Secretary or Deputy Secretary. Regarding this conclusion,  State commented that section 15(k)(3) permitted the delegation of  functions from the Assistant Secretary to the OSDBU Operations Director  and stated that while OSDBU directors were responsible for implementing  and executing the specific functions and duties assigned under sections 8  and 15 of the Small Business Act, section 15(k)(3) contained no  requirement that the director personally perform any specific functions.  The letter further commented that executive branch authority was  typically exercised through delegation, with an agency’s basic authority  being vested in the agency head and subsequently redelegated. It cited the  case of Fleming v. Mohawk Wrecking & Lumber Co., 331 U.S. 121 (1947)  as an example in which the authority to redelegate is implied. However, as  we stated in our 2003 report, the Fleming case recognizes that the  delegation of authority may be withheld by implication, and we believe  section 15(k)(3) does exactly that. As explained in this report, to ensure  that the OSDBU responsibilities are effectively implemented, the statute  mandates that the OSDBU director (i.e., the person carrying out the  responsibilities) have immediate access and be responsible only to the  agency head or deputy. The legislative history reveals that the reason for  this requirement is that Congress believed that agency officials responsible  for promoting procurements for small and disadvantaged businesses were  often too far down the chain of command to be effective. The reporting  requirement of section 15(k)(3) was intended to remedy this situation. The  Department of State’s letter also highlighted its small and disadvantaged  business goal achievements and commented that reorganizing the OSDBU  so that its Operations Director reported directly to the Secretary or her  Deputy would decrease efficiency. The letter concluded by stating that the  OSDBU Operations Director currently had direct access whenever  necessary to decision makers in the Department programs that utilize  small and disadvantaged businesses. As indicated in the recommendation,  agencies that believe that they should have greater flexibility should  pursue this with Congress.
The Department of the Treasury disagreed with the report’s conclusion  and commented that the statute did not require that the OSDBU director  be an official assigned to small business issues full time. The letter stated  that the Assistant Secretary for Management, in the capacity of OSDBU  director, had a direct reporting relationship to the Deputy Secretary of the  Treasury and provided oversight and direction to the Office of Small  Business Programs as well as to bureau heads and their procurement  officials in executing the agency’s responsibilities under the Small  Business Act. The letter noted that the Assistant Secretary exerted  considerable influence over acquisition and budget officials at all levels in  regards to attaining small business goals. Finally, the letter commented  that the OSDBU director assigning day-to-day operations pertaining to  small business functions to subordinate officials did not establish any such  other officials as the “de facto OSDBU director.” As previously discussed,  we believe that section 15(k)(3) includes an implied prohibition against  delegating the OSDBU director’s authority. As a result, we did not revise  our conclusion or recommendation.
The Social Security Administration’s letter did not provide comments on  the draft report but indicated that the agency had reevaluated the  reporting relationship in light of our draft. The letter stated that in the  future the OSDBU director would be reporting to the Deputy  Commissioner, the deputy agency head for SSA.
Of the remaining 10 agencies that received a copy of the draft report, 9  agencies—the Departments of Homeland Security, Housing and Urban  Development, Labor, Transportation, and Veterans Affairs; the General  Services Administration; the Office of the Secretary of Defense; the Office  of Personnel Management; and the U.S. Agency for International  Development—did not provide any comments on the report. The Small  Business Administration provided technical comments, which have been  incorporated as appropriate.
We also provided a copy of our survey results, which will be published in a  separate product (GAO-11-436SP), to the 25 agencies we surveyed and  SBA for their review and comment. Only one agency had a comment. The  Department of State provided a comment via email stating that the survey  questions focused on the daily duties of the OSDBU, but did not provide  an opportunity to explain the delegation of these duties to the OSDBU  Operations Director. We note that while the survey was designed to  capture the OSDBU director’s activities (and not the delegation of such  duties per se), there were numerous open-ended questions that allowed  respondents to add explanations or qualifications to their responses. State  also had the opportunity to explain the delegation of duties during our  interviews with OSDBU officials.
As agreed with your office, unless you publicly announce the contents of  this report earlier, we plan no further distribution until 30 days from the  report date. At that time, we will send copies of this report to the Ranking  Member of the Senate Committee on Small Business and  Entrepreneurship, the Chairman and Ranking Member of the House  Committee on Small Business, and other interested congressional  committees. The report will also be available at no charge on the GAO  Web site at http://www.gao.gov.
If you or your office have any questions about this report, please contact  me at (202) 512-8678 or shearw@gao.gov. Contact points for our Offices of  Congressional Relations and Public Affairs may be found on the last page  of this report. Key contributors to this report are listed in appendix XI.
section_title: Appendix I: Scope and Methodology
paragraphs: We reviewed Office of Small and Disadvantaged Business Utilization  (OSDBU) practices for carrying out the requirements of the Small  Business Act at federal agencies with major contracting activity.  Specifically, we (1) assessed whether the director reported directly to the  agency head or the deputy head; (2) determined the functions conducted  by the OSDBUs; and (3) examined the actions taken by the OSDBUs and  other officials at the various agencies to further small business contracting  opportunities and the effects of funding and staff levels on these efforts.
subsections: section_title: Identification of Federal Agencies with Major Contracting Activity
paragraphs: To determine which federal agencies engage in major contracting activity,  we reviewed fiscal year 2009 data from the Federal Procurement Data  System-Next Generation. (These were the most recent data available at the  time of our review.) This dataset includes information on 20 defense  agencies and 62 civilian agencies. Using these data, we determined that  seven agencies each procured more than $15 billion in goods and services  in fiscal year 2009. Table 7 shows the seven agencies with major  contracting activity as well as the other agencies covered in our review.
section_title: Assessment of Compliance with Section 15(k)(3) of the Small Business Act
paragraphs: To assess whether the OSDBU director reports directly to the agency head  or the deputy head as required by section 15(k)(3) of the Small Business  Act, we focused on the seven agencies with major contracting activity and  nine additional agencies that we reported in September 2003 were not  complying with this requirement. These nine agencies were the  Departments of Agriculture, Commerce, Education, the Interior, Justice,  State, and the Treasury; the Environmental Protection Agency; and the  Social Security Administration. We considered agencies to be in  compliance if the designated OSDBU directors exercised the OSDBU  responsibilities and reported directly to and were responsible only to the  agency head or the agency head’s deputy. To determine compliance, we  reviewed organization charts to identify where the OSDBU was located in  relation to the agency head or deputy head; OSDBU directors’  performance appraisals for the previous 2 years to identify the agency  official who evaluated the OSDBU director’s performance; the most  recent position description of the OSDBU director to identify the OSDBU  director’s supervisor; and various other agency documents, such as  reports and memoranda discussing the agency’s small business programs.  We also interviewed the designated OSDBU directors at each agency to  identify the official(s) they had reported to during the past year and asked  them to provide information characterizing the reporting relationship,  such as the extent to which small business issues were discussed. In  addition, we reviewed and analyzed section 15(k)(3).
section_title: Survey of OSDBU Directors
paragraphs: To obtain information on the functions conducted by the OSDBU, actions  taken by the OSDBU to further small business contracting opportunities,  and the effects of funding and staff levels on these efforts, we surveyed the  OSDBU directors at 25 federal agencies using a Web-based survey. The  survey was similar to one we administered in 2003 and asked the OSDBU  directors about their roles and functions in three areas: participation in the  agency procurement process, facilitation of small business participation in  agency contracting, and interaction with the Small Business  Administration (SBA). The survey questions covered the OSDBU  functions listed in 15(k) of the Small Business Act as well as additional  functions the OSDBUs might perform. In addition, the survey asked  OSDBU directors about challenges—including limited budgetary  resources and lack of adequate staffing levels—they face in carrying out  their responsibilities.
subsections: section_title: Selection of Survey Respondents
paragraphs: We selected 25 agencies to include in our survey of OSDBU directors.  These agencies included all 20 civilian agencies that procured more than  $800 million in goods and services in fiscal year 2009, as well as the  Department of Defense (DOD)—Office of the Secretary; the Departments  of the Air Force, Army, and Navy; and the Defense Logistics Agency  (DLA). The 20 agencies were responsible for more than 98 percent of  civilian agency obligations in fiscal year 2009. We selected the Air Force,  Army, Navy, and DLA because they were the four components within DOD  that procured the most goods and services in fiscal year 2009; together,  they were responsible for more than 90 percent of DOD’s obligations. The  25 agencies we selected included all 24 agencies we surveyed in 2003 and  the Department of Homeland Security.
section_title: Survey Design and Administration
paragraphs: To have comparable data with the 2003 survey of OSDBU directors, our  survey instrument listed the same questions and response choices as the  2003 survey. Updates to the 2003 survey were limited to making minor  word changes, reordering several questions, and deleting several questions  that were no longer relevant. We obtained input from GAO experts on  survey design. We also pretested the survey instrument with two OSDBU  directors to help ensure that the questions were still applicable and would  be correctly interpreted by respondents. Agency officials, including the  OSDBU directors, were notified about the survey before it was launched  on November 1, 2010. OSDBU directors were asked to complete the  survey by November 22, 2010, and by December 29, 2010, we had a 100  percent response rate.
From January to March 2011, we conducted follow-up with 22 OSDBU  directors who answered that one or more of the functions listed in 15(k) of  the Small Business Act was not a function of their office or who did not  provide responses to these questions. The purpose of the follow-up was to  determine which office, if not the OSDBU, carried out these functions at  their agency or to collect answers from OSDBU directors who did not  provide them initially. To do this, we conducted interviews with 11  ODSBU directors and corresponded via e-mail with 11 others. Based on  this follow-up, we changed 16 of the original survey answers related to  whether the OSDBU director viewed a section 15(k) responsibility as an  OSDBU role. Answers were changed only if at least one of the following  criteria were satisfied: the OSDBU directors explicitly stated that they  wished to change their answer and provided an explanation for the  change; the director misunderstood the question; or the director provided  a response to an initially unanswered question.
Additionally, we asked 11 of the 22 OSDBU directors with whom we were  conducting follow-up for further explanation of challenges they had  identified as affecting their office to a great or very great extent. Two of  the respondents requested that we change their responses to several  challenges due to initially misunderstanding the question. We agreed and  these adjustments are reported in our findings. Also, as necessary, we  followed-up with OSDBU directors to clarify their responses to our open- ended questions.
While the OSDBU directors at 25 agencies were asked to participate in the  survey and the survey results are therefore not subject to sampling errors,  not all respondents answered every question. Nonresponse, including item  nonresponse, and the practical difficulties of conducting any survey, may  introduce error in survey results. We took steps to minimize such errors by  conducting follow-up discussions with respondents who failed to answer  specific questions, and by checking and verifying survey responses and  analysis.
section_title: Survey Analysis
paragraphs: The survey contained closed-ended questions that we asked OSDBU  directors to answer by selecting from a finite number of response  categories. For example, some questions asked OSDBU directors to select  “Yes—an OSDBU role or function” or “No—not an OSDBU role or  function” based on if a certain function was performed by their office.  Other questions asked OSDBU directors to identify the extent to which  they performed a certain function or the extent to which a certain factor  was a challenge in carrying out the responsibilities of their office. Our  analysis involved reviewing the frequency of responses to a given question  using aggregate survey data. In the report, there are instances in which we  identify all of the responses and other instances in which we identify the  most common response. This report does not contain all the results from  the survey; the survey and a more complete tabulation of the results are  provided in a supplement to this report (GAO-11-436SP).
The survey also contained open-ended questions that asked OSDBU  directors to provide a narrative response. Most of these open-ended  questions provided respondents the opportunity to explain answers  provided to close-ended questions. For example, some closed-ended  questions asked the respondents if a certain activity was a function of their  office and the subsequent open-ended question asked them to elaborate on  which office carries out this role or function if they had responded “No— not an OSDBU role or function” to the prior question. We used these open- ended responses to provide context to close-ended questions, and some of  these narrative responses were included in our findings.
section_title: Interviews with Agency Officials and Review of Agency Documents
paragraphs: To examine the actions taken by the OSDBU and other agency officials to  further small business contracting opportunities and the effects of funding  and staff levels, we interviewed agency officials and reviewed documents  at the seven agencies with major contracting activity. Also, we reviewed  agency documentation, such as policy statements issued by agency  leadership on ODSBU practices or small business efforts, small business  manuals or strategic plans, and budget and staffing documentation. We  interviewed the OSDBU directors at the seven agencies on the actions they  and other agency officials had taken to further small business contracting;  methods used by SBA and the agency to hold officials accountable for  furthering small business contracting; and challenges that affected these  efforts, such as funding and staffing levels. Furthermore, we reviewed  documentation and data related to the SBA small business goaling  program and spoke with SBA officials about this program and reviewed  OSDBU council documentation and spoke with council leadership.
We conducted our work from June 2010 to May 2011 in accordance with  generally accepted government auditing standards. Those standards  require that we plan and perform the audit to obtain sufficient, appropriate  evidence to provide a reasonable basis for our findings and conclusions  based on our audit objectives. We believe the evidence obtained provides  a reasonable basis for our findings and conclusions based on our audit  objectives.
section_title: Appendix II: Reporting Relationships at Seven Agencies Not in Compliance with Section 15(k)(3)
paragraphs: Appendix II: Re Agen 15(k)(3)
As discussed in the body of our report, seven agencies were not in  compliance with section 15(k)(3) of the Small Business Act, which  requires that the director of the Office of Small and Disadvantaged  Business Utilization (OSDBU) be responsible only to and report directly to  the agency head or deputy head. We found that a variety of reporting  structures were in place. OSDBU directors either reported to lower-level  officials than the agency head or deputy or had delegated their OSDBU  director responsibilities to officials who did not report to either the agency  head or the deputy head.
subsections: section_title: OSDBU Directors at Four Agencies Did Not Report to the Agency Head or Deputy Head
paragraphs: At the Departments of Commerce, the Interior, and Justice and the Social  Security Administration (SSA), the OSDBU directors reported to officials  at lower levels than the agency head or deputy head.
subsections: section_title: Department of Commerce
paragraphs: A document outlining the organization structure of the Department of  Commerce’s Office of the Chief Financial Officer and Assistant Secretary  for Administration stated that the OSDBU director reported to the Deputy  Secretary on matters of policy and to the Assistant Secretary and Deputy  Assistant Secretary for Administration on administrative matters.  However, the OSDBU director at Commerce stated that she reported to  the Deputy Assistant Secretary for Administration for all small business  matters and to the Assistant Secretary for Administration for  administrative matters such as budget and personnel. The organization  chart also showed a direct link from the OSDBU to the Deputy Assistant  Secretary for Administration and the Assistant Secretary for  Administration (see fig. 3). In fiscal year 2009, the Assistant Secretary for  Administration evaluated the OSDBU director’s performance, while the  Deputy Assistant Secretary for Administration signed her performance  appraisal in fiscal year 2010. The OSDBU director stated that she had  never met the Secretary or previous Deputy Secretary and only met the  new Acting Deputy Secretary in December 2010.
The OSDBU director at the Department of the Interior reported to the  Deputy Assistant Secretary for Budget, Finance, Performance, and  Acquisition and to the Assistant Secretary, Policy, Management and  Budget (see fig. 4). The organization chart had a notation that the OSDBU  director reported to the Secretary and received administrative support  from the Deputy Assistant Secretary for Budget, Finance, Performance,  and Acquisition, who in turn reported to the Assistant Secretary, Policy,  Management and Budget. However, the OSDBU director told us he had  never met with the Secretary or Deputy Secretary and they had not  provided direct input into his performance appraisals. Instead, the OSDBU  director told us he met frequently with the Deputy Assistant Secretary for  Budget, Finance, Performance, and Acquisition on administrative and  small business matters. The director’s position description indicated that  the director reports to the Deputy Assistant Secretary. His two most recent  performance appraisals were signed by the Deputy Assistant Secretary and  the Assistant Secretary for Policy, Management and Budget, respectively.
As shown in figure 5, the OSDBU director at Justice reported to the  Deputy Assistant Attorney General for Policy, Management and Planning.  OSDBU officials told us the current reporting structure was the same  structure that was in place in 2003. The organization chart showed that the  OSDBU was located within the Justice Management Division, with the  director under the supervision of the Deputy Assistant Attorney General  for Policy, Management and Planning. The Justice Management Division  was headed by the Assistant Attorney General for Administration, who  reports to the Deputy Attorney General. While the organization chart  showed that the OSDBU was located within the Justice Management  Division for administrative purposes, the OSDBU director’s position  description listed his immediate supervisor as the Deputy Assistant  Attorney General for Policy, Management and Planning. The Deputy  Assistant Attorney General signed the OSDBU director’s two most recent  performance appraisals.
The OSDBU director at SSA reported to the Deputy Commissioner, Office  of Budget, Finance and Management, who was one of nine deputy  commissioners managing various programs and operations (see fig. 6).  Both the organization chart and the OSDBU director’s position description  confirmed this reporting relationship. The OSDBU director told us that he  reported to this Deputy Commissioner for small business matters.  Additionally, the director’s most recent performance appraisal was signed  by the Deputy Commissioner, Office of Budget, Finance and Management.  The director confirmed that this same structure was in place in 2003. The  OSDBU director also told us he had never met either the Commissioner or  Deputy Commissioner of SSA.
section_title: OSDBU Directors at Three Agencies Delegated Their OSDBU Responsibilities to Lower-Level Officials
paragraphs: As we found in our 2003 report, the designated OSDBU directors at the  Departments of Agriculture, State, and the Treasury delegated their  responsibilities to officials who did not directly report to either the  Secretaries or Deputy Secretaries. At these agencies, the Assistant  Secretary who managed the agency’s administrative functions was  designated as the statutory OSDBU director. The Assistant Secretaries  then delegated nearly all of their OSDBU responsibilities to lower-ranking  officials who reported directly to the Assistant Secretaries. The lower- ranking officials thus became the de facto OSDBU directors.
subsections: section_title: Department of Agriculture
paragraphs: The designated OSDBU director at the Department of Agriculture was the  Assistant Secretary for Administration, who reported to the Secretary and  Deputy Secretary. However, the Assistant Secretary had delegated nearly  all of his OSDBU responsibilities to a lower-level official (see fig. 7). This  structure was the same one that we determined in 2003 was not in  compliance with the Small Business Act. The delegated OSDBU director  told us that he did not report to the Secretary or Deputy Secretary on  matters involving policy, budget, and personnel. The agency’s organization  chart confirmed that the delegated OSDBU director reported to the  Assistant Secretary for Administration. The Assistant Secretary for  Administration and the Secretary signed the director’s most recent  performance appraisal.
Other evidence showed that the delegated OSDBU director carried out the  day-to-day implementation of the agency’s OSDBU. The delegated director  told us he handled the day-to-day duties and functions of Agriculture’s  OSDBU and that he spent 100 percent of his time on OSDBU duties and  functions. Moreover, his position description indicated that he was the  official responsible for carrying out the duties and functions listed under  section 15(k). The position description stated, among other things, that the  delegated director was responsible for (1) establishing short- and long- range program objectives, time schedules, and courses of action for the  accomplishment of small business goals; (2) formulating, recommending,  and implementing broad policies and procedures that provide the  structural framework for all OSDBU functions; and (3) keeping abreast of  all OSDBU activities and initiating any corrective actions deemed  necessary. In contrast, OSDBU officials stated that the Assistant Secretary  for Administration spent time on OSDBU activities on an as-needed basis  but estimated that it averaged about 3 to 4 hours per week.
section_title: Department of State
paragraphs: The Assistant Secretary for Administration was the designated OSDBU  director at the State Department. The Assistant Secretary, who reported to  one of the department’s two Deputy Secretaries on small business matters,  had delegated his OSDBU responsibilities to the Operations Director for  the OSDBU (see fig. 8). In fiscal year 2010, the Operations Director’s  performance appraisal was signed by the Acting Assistant Secretary for  Administration. The position description for the Operations Director  indicated that he carried out the functions of the OSDBU director. For  example, it showed that his duties included (1) providing overall direction  for policies and programs governing the agency’s procurement and  financial assistance actions in accordance with the Small Business Act and  (2) developing small business goals.
The Assistant Secretary of the Treasury for Management/Chief Financial  Officer/Chief Performance Officer was the designated OSDBU director. He  stated that he was responsible for meeting the agency’s small business  goals and interacted with the Secretary and Deputy Secretary regularly,  including providing updates on small business matters. However, the  Director of the Office of Small Business Programs—an official who did not  directly report to either the Secretary or the Deputy Secretary—was  responsible for day-to-day management of Treasury’s small business  programs. According to Treasury, the Director of the Office of Small  Business Programs reported to the Director of the Office of Minority and  Women Inclusion, who in turn reported to the Assistant Secretary (see fig.  9). The Director of the Office of Small Business Programs stated that she  spent 100 percent of her time on small business matters, which included  all of the functions described in section 15(k) of the Small Business Act.  Her position description confirmed this statement, indicating that her  responsibilities included (1) planning, developing, issuing, and providing  overall direction for policies and programs governing Treasury  procurement and financial assistance action in accordance with the Small  Business Act and (2) directing Treasury’s annual goal-setting process.
section_title: Appendix III: Office of Small and Disadvantaged Business Utilization Directors Who Reported that They Did Not Carry Out Certain 15(k) Functions
paragraphs: The number of Office of Small and Disadvantaged Business Utilization  (OSDBU) directors surveyed who did not view a section 15(k) function as  their current responsibility varied, depending on the specific function. The  number ranged from 1 who did not view maintaining supervisory authority  over OSDBU personnel as a function to 11 who did not view assisting small  businesses to obtain payments from prime contractors as a responsibility. In  their written comments and follow-up interviews, the directors who did not  view a section 15(k) function as their responsibility generally stated that  contracting, acquisition, or program staff performed it.
The OSDBU director at the Social Security Administration (SSA) reported  that maintaining supervisory authority over OSDBU personnel was not a  function of his office because he did not have staff.
The OSDBU director at the Office of Personnel Management (OPM)  reported that attempting to identify proposed solicitations that involved  bundling of contract requirements was not a function of his office. He  commented that the contracting office within his agency performed this  function.
The OSDBU director at SSA reported that working with agency acquisition  officials to revise procurement strategies for bundled contract  requirements was not a function of his office. He commented that no  office carried out this role. Rather, he noted that when contract bundling  was identified, the acquisition official prepared a bundling justification for  the head of the procuring activity to sign. In a follow-up interview, he  clarified that nothing in the agency’s policies required coordination with  the OSDBU on contract bundling or gave the OSDBU the opportunity to  revise procurement strategies.
Five OSDBU directors reported that facilitating small businesses’  participation as subcontractors to bundled contracts was not a function of  their office. At the Department of Agriculture and OPM, the OSDBU  directors commented that their agencies had not bundled any contracts.  The Agriculture OSDBU director also stated that his office evaluates  proposed contract actions to ensure that there are no bundled contracts.  The OSDBU director at the Office of the Secretary of Defense reported  that this function was generally performed by the contracting offices at the  Department’s individual components, such as the Army, Navy, Air Force,  and Defense Logistics Agency (DLA). In a follow-up interview, the OSDBU  director at SSA stated that his role was limited by agency policy to  reviewing subcontracting plans to ensure that certain clauses required by  the Federal Acquisition Regulation were included. He noted that he would  need additional resources to advocate for increased small business  participation in subcontracting. The OSDBU director at the Department of  Commerce explained that the OSDBU did not have the staff to review  subcontracting plans.
Six OSDBU directors reported that assisting small businesses to obtain  payments from their agencies was not a function of their office. All six  directors—Departments of the Air Force, Education, and the Interior; the  Environmental Protection Agency (EPA); Office of the Secretary of  Defense; and SSA—reported that payment issues were addressed by  agency officials in the contracting, acquisition, or program offices.
Seven OSDBU directors reported that determining a small business set- aside for an individual contract was not a function of their OSDBU. Five of  these directors (Departments of the Army, Education, and Housing and  Urban Development (HUD); the Office of the Secretary of Defense; and  OPM) commented that their agency’s contracting or program offices  performed this function. The OSDBU directors at the Departments of  Transportation and Energy commented that they reviewed acquisitions  over a certain threshold level ($150,000 at Transportation and $3 million at  Energy).
Ten OSDBU directors reported that assigning a small business technical  advisor to each office with an SBA procurement center representative was  not a function of their office. In follow-up communication, the Acting  OSDBU director at the Department of Veterans Affairs (VA) explained that  his office had not assigned a small business technical advisor to each  office with a procurement center representative but noted that OSDBU  staff performed duties similar to those of a technical advisor. The Acting  OSDBU director at the Department of Energy explained that because the  agency had already implemented several levels of review by various  technical and procurement staff, it had delayed hiring and assigning a  technical advisor to contracting offices. However, he stated that the office  was reassessing their review processes and resources to determine when  such a hire would be feasible. The remaining eight OSDBU directors at the  Departments of the Air Force, the Army, Commerce, the Interior, Justice,  the Navy, and Transportation and DLA reported that the contracting  offices within their agencies assigned small business technical advisors.  For instance, Air Force officials commented that small business technical  advisors were assigned only to field sites where they could assist in  identifying specific opportunities for small businesses.
Eleven OSDBU directors reported that assisting small businesses to obtain  payments from prime contractors was not one of their functions. Seven of  these directors (Departments of Agriculture, the Air Force, and Education;  EPA; HUD; Office of the Secretary of Defense; and SSA) commented that  contracting, acquisition, or program officials carried out this function at  their agencies. Two of the seven directors clarified in follow-up interviews  that they were not privy to subcontractor information. The OSDBU  director at OPM commented that because the payment of invoices by a  prime contractor to its subcontractors is part of a contractual arrangement  to which the government is not a party, this function should not be  performed by anyone at the agency. The OSDBU director at the  Department of Transportation commented that the office provides  counseling on progress payments and prompt payment guidance to small  businesses. The OSDBU directors at Interior and the U.S. Agency for  International Development commented that if a small business were to  contact the OSDBU for payment assistance, the OSDBU would facilitate  communication with the contracting officer responsible for payments.
section_title: Appendix IV: Comments from the Department of Education
section_title: Appendix V: Comments from the Department of Commerce
section_title: Appendix VI: Comments from the Department of the Interior
section_title: Appendix VII: Comments from the Department of Justice
section_title: Appendix VIII: Comments from the Department of State
section_title: Appendix IX: Comments from the Department of the Treasury
section_title: Appendix X: Comments from the Social Security Administration
section_title: Appendix XI: GAO Contact and Staff Acknowledgments
subsections: section_title: GAO Contact
section_title: Staff Acknowledgments
paragraphs: In addition to the contact named above, Paige Smith (Assistant Director),  Farah Angersola, Tania Calhoun, Emily Chalmers, Janet Fong, Colleen  Moffatt, Marc Molino, Kelly Rubin, Rebecca Shea, Andrew Stavisky, and  William Woods made key contributions to this report.