Democratic Women Senators Stand Up For Female-Owned Small Businesses

WASHINGTON, D.C. – Standing up for female-owned small businesses throughout the country, Democratic Women Senators Barbara A. Mikulski (D-Md.), Patty Murray (D-Wash.), Dianne Feinstein (D-Calif.), Barbara Boxer (D-Calif.), Mary L. Landrieu (D-La.), Debbie Stabenow (D-Mich.), Maria Cantwell (D-Wash.) and Hillary Rodham Clinton (D-N.Y.) today condemned the Small Business Administration’s (SBA) preliminary rule that reverses Congress’ long-time efforts to help give women-owned small businesses opportunities for federal contracts.  The proposed rule has drawn strong opposition from many organizations, including the U.S. Women’s Chamber of Commerce and Women Impacting Public Policy.  It was also the subject of a January 30, 2008, hearing of the Senate Small Business and Entrepreneurship Committee. 

In 1994, the Federal Acquisition Streamlining Act set a goal that 5 percent of federal contracts should go to women.  Unfortunately, this goal was never met.  In 2000, the Equity in Contracting for Women Act gave agencies the ability to limit certain competitions to women-owned small businesses to meet this goal.  However, the SBA never implemented the law.  After a protracted legal proceeding, the SBA issued their rule in December 2007, directing federal agencies to limit preference to women-owned small businesses to only four out of 2,300 business categories.  This ruling ignores congressional intent, and comes despite the SBA’s own research, which found that women-owned businesses were underrepresented in federal contracting in as many as 87 percent of all industries. 

“Women make this country run – we are business leaders, entrepreneurs, politicians, mothers and more.  But the SBA’s own research shows that women-owned businesses are significantly underrepresented in federal contracting,” said Senator Mikulski, Dean of the Senate Women.  “The SBA’s rule disregards Congress and the women-owned businesses that are depending on us to level the playing field.”

“It’s far past time we made the federal government ‘open for business’ to women in business,” said Senator Murray.  “Congress has recognized this and called for modest goals to level the playing field.  Unfortunately, with this new rule, the SBA is ignoring Congress and turning its back on women entrepreneurs who deserve their shot at helping our economy grow.”

“Women are a major force in our nation’s economy.  One third of American small businesses today are owned by women.  Yet women-owned businesses are seriously underrepresented when it comes to federal contracting.  Instead of providing more opportunities to women, the Small Business Administration appears ready to take a step backward.  This would be a real shame, and it would set back so many years of progress for women entrepreneurs.  We need to make sure this doesn’t happen,” said Senator Feinstein.

“This ill-advised rule by the SBA flies in the face of law and makes it clear that the SBA is not committed to giving women entrepreneurs the chance they deserve.  I hope that the SBA reconsiders this rule and makes a real commitment to supporting women-owned small businesses,” said Senator Boxer.

“The SBA is failing women-owned small businesses by ignoring Congress’ intent and only agreeing to help women in 4 of 2,300 business categories.  This is unacceptable,” said Senator Landrieu.  “Women deserve the opportunity to compete on an even playing field for federal contracts, and I will work with my colleagues to ensure the SBA follows this congressional direction.”

“This decision by the SBA represents a leap backward in terms of real progress in the workplace and sends the wrong message to women entrepreneurs across this country,” said Senator Stabenow. “I encourage the SBA to withdraw this rule and work with Congress to ensure that federal contracts are distributed fairly to small business owners throughout the country.”

“It is vital to make sure women-owned small businesses get the support they deserve,” said Senator Cantwell.  “I have been a long-time supporter of making sure small business owners, men and women alike, are given opportunities to compete in a free and fair market.  This proposed rule is a step in the wrong direction.  Small business owners must be treated equally.  Small businesses are the backbone of our communities and contribute greatly to our economy.  We should not put them at risk, especially during these unstable economic times.”

“Women own one-third of our nation’s small businesses, but they receive only about three percent of federal contracts.  Rather than leveling the playing field, President Bush’s proposed SBA rules would put up roadblocks to women entrepreneurs.  There’s no excuse for this chronic under-representation and I urge the SBA withdraw this rule and replace it with policy reflecting the findings of its own research and the explicit Congressional intent regarding the issue,” said Senator Clinton.



The text of the Senators’ letter SBA Administrator Steven follows:

………………………………………………………………………………………………….

Dear Administrator Preston,

As women in the Senate we strongly oppose rule #3245-AF40 regarding Women-Owned Small Business Federal Contract Assistance.   This rule undermines 8 years of Congress’ efforts to help women-owned small businesses compete on a level playing field for federal contracts.

Almost a third of all businesses in the U.S. are owned by women.  They are mothers, wives, and sisters but also hardworking entrepreneurs contributing to the economy.  They deserve a fair shot at doing business with their government but in 2006, women run business only won 3.4% of federal contracting dollars.

In 2000, Congress passed a law that said 5 percent of federal contracts should go to women-owned businesses.  Considering the growing number of women business owners, a 5 percent goal seems more than realistic.  To meet this goal, SBA was supposed to instruct agencies to limit certain competitions to women-owned businesses.  However, the agency dragged their feet and according to the court that looked at the case “sabotaged…the implementation of the program.”

In December, despite clear congressional intent and a strong call to action from the courts, the SBA published a rule that would only help women in 4 of 2,300 business categories.  This is outrageous, especially considering a study commissioned by the SBA itself found women were underrepresented in federal contracting in 87 percent of all industries.  SBA’s new rule would do almost nothing to help level the playing field – which is what Congress has been trying to do for over 8 years.

Congress has demanded that women in business be given a fair chance and we’re relying on your agency to come through for them.  Your first step should be to come up with a new rule that takes a realistic look at women’s growing small business presence but continued lack of federal contracting opportunities.  The pending rule ignores congressional intent, SBA’s own research, and the reality many women confront when trying to work with the federal government. It needs to be withdrawn.