Venable, Small Businesses from Across Nation, Launch Small Business Coalition for Fair Contracting

Small businesses, the backbone of the American economy, are negatively impacted by government's new in-sourcing policy

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May 07, 2010, 12:18 ET

WASHINGTON, May 7 /PRNewswire/ -- Venable LLP announced today that the firm, in conjunction with a group of clients and other government contractors, is launching the Small Business Coalition for Fair Contracting in response to federal government procurement initiatives that could, if unchecked, have a significant and negative impact on the operations of small businesses working for the federal government.

Small businesses represent 99.7 percent of all businesses in the nation and received 21.5 percent of all federal prime contracting dollars in fiscal year 2008. Small businesses contracting with the federal government employ workers in every state in the nation, do work for every government agency, and provide services from cleaning offices to providing complex intelligence analysis.

"Although well intentioned, the federal government's current in-sourcing initiative threatens to take away work from hundreds of small entrepreneurs," said Venable partner Rob Burton, who served at the Office of Federal Procurement Policy as the nation's top career federal procurement official.

The 2011 budget has been designed to "rebalance" the relationship between the government and federal contractors through more oversight and in-sourcing. A goal of the budget is to "decrease reliance on contract services" by using federal employees to perform services currently provided by contractors.

In line with the budget's goals, the Office of Federal Procurement Policy recently provided detailed guidance to agencies on the types of work that should be reserved for government employees. As a result, contractors may soon see fewer business opportunities, as agencies in-source jobs that serve a "critical function" in the government.

"No one wants to be associated with a 'non-critical' function," Burton said. "Many federal agencies will be tempted to 'over classify' jobs as 'critical.' Those agency choices are not victimless. Small businesses are already feeling the impact of those choices."

According to Burton, the in-sourcing initiative has already forced small contractors across the nation to dramatically reduce the scope of their operations as their contracts are cancelled and their employees are hired into government jobs.

The Coalition represents a diverse group of companies with a common interest in ensuring that small businesses do not suffer a disproportionate loss of business as a result of the government's in-sourcing and other policy initiatives.

"The government recognizes small contractors' critical role in supporting the operation of the federal government and understands the importance of expanding that role," said Burton. "The coalition will educate lawmakers and federal executives about the unintended consequences of the in-sourcing initiative, provide ideas on how to fix the process and implement fair solutions that best meet the nation's needs, while protecting the economic viability of America's small businesses."

The Small Business Coalition for Fair Contracting will hold a briefing conference call on Tuesday, May 11 at 11 am (EDT). Small businesses doing business with the government are invited to participate in the call and should contact Venable for additional information. Although the call is closed to members of the media, Venable partners Rob Burton and Paul Debolt will be available to provide members of the media with commentary on the call and issues raised by the participants.

Note: An American Lawyer top 100 law firm, Venable LLP has attorneys practicing in all areas of corporate and business law, complex litigation, intellectual property and government affairs. Venable serves corporate, institutional, governmental, nonprofit and individual clients throughout the U.S. and around the world from its headquarters in Washington, D.C. and offices in California, Maryland, New York and Virginia. For more, visit www.Venable.com.

Contact: Allan Ripp 212-262-7477 [email protected]

Charles Wilkins 202-344-8253 [email protected]

SOURCE Venable LLP