Cisneros Calls for Action to Protect Small Businesses in Federal Contracting

WASHINGTON - Today, the House Small Business Subcommittee on Contracting and Infrastructure, led by Ranking Member Gil Cisneros (D-CA), held a hearing titled "Leveling the Playing Field: Fostering Opportunities for Small Business Contractors." The hearing explored the decline in small business participation in the federal procurement system and the risks that Trump administration changes to federal acquisition rules pose to small firms.

During the hearing, Ranking Member Cisneros highlighted the decline in small business federal contracting and the need to reverse course.

"The federal government obligated $755 billion in contracts in FY24, $183 billion of which was awarded to small business government contractors," said Ranking Member Cisneros. "These dollars highlight the critical role small businesses play in supporting federal agency missions, but they do not paint a complete picture. Over the past decade, as the dollars have gone up, the number of small vendors in the government's ecosystem has been cut in half."

Witness Sue Tellier, President and CEO of JetCo Federal, offered her firsthand perspective on the challenges facing small federal contractors.

"Since 2010, the number of small businesses winning federal contracts has decreased by 50 percent, even as contract spending has increased. The market is steadily contracting, and becoming more stratified at the top, with the 20 largest vendors averaging 50% of all DOD spending," said Tellier. "One contributing factor to the shrinking industrial base, in addition to acquisitions, is the application of category management. While it makes sense in practice, it has become anti-competitive, as it gives larger corporations easier access to fast-track Best-in-Class contracting vehicles and demotes small business set-asides. This increases the likelihood of large corporations winning future awards versus fostering a more competitive field of small contractors."

Throughout the hearing, Democrats argued that changes to the Federal Acquisition Regulations should not come at the expense of small contractors, and that Congress has a responsibility to maintain strong protections like the Rule of Two and robust funding for small business contracting programs.

"This Committee cannot allow small businesses to become an afterthought. We need to ensure they are heard, and their concerns are addressed. Small businesses are the ones driving innovation and bringing in talent and solutions that deliver real value to the government customer. Their success is a win-win-for them and for the government." said Ranking Member Cisneros.

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