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Small Business Contracting Program Improvements Act

Floor Speech

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Location: Washington, DC


SMALL BUSINESS CONTRACTING PROGRAM IMPROVEMENTS ACT -- (House of Representatives - October 30, 2007)

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Mr. CHABOT. Mr. Chairman, I yield myself such time as I may consume.

Mr. Chairman, I rise in opposition to H.R. 3867, the Small Business Contracting Program Improvements Act. I strongly support the provisions in the bill that help those Americans, veterans of our Armed Forces, who have provided the great sacrifices to defend our freedom and our way of life. However, there are other provisions that are sufficiently problematic that makes it impossible for me to support the overall bill.

In 1997, Congress established the Historically Underutilized Business Zone, or HUBZone program. The program is designed to assist areas of low income and high unemployment by providing incentives for government contractors to relocate in these areas and expand their operations. By making it easier for small businesses located in HUBZones to win Federal contracts, Congress expected more government contractors to relocate in these areas and provide an important component to their revitalization.

As anyone who has traveled through many urban and rural districts realizes, they have a large number of HUBZones. Unfortunately, H.R. 3867 could make it more difficult for HUBZone firms to win government contracts and thereby detract from the ability of this program to help revitalize urban and rural areas that need greater economic development.

Mr. Chairman, while I concur with the Chair of the committee that we need to ensure that only firms eligible for the HUBZone program participate, it is unnecessary to take punitive action against HUBZone firms as a result of a few bad actors. I am sure that if we scrutinize each of the procurement programs, we could find a few bad actors in each. That justifies taking appropriate legal action against the bad actors. It does not, in our view, necessitate punishing the firms that complied with the letter and spirit of the law.

It also is important to note that a number of the issues raised in this legislation are being addressed by the administrator of the SBA. I certainly understand the frustration that Members of Congress have when the executive branch does not implement legislation in a timely manner. Nevertheless, one aspect of this bill involves a program that has not been implemented for 7 years. While that normally would suggest further legislative action, the administrator, we believe, is doing everything possible at this point to issue rules, a process that can take time. In addition, the program is the subject of a lawsuit in which the plaintiffs have not sought any subsequent court action for nearly 2 years since the Federal Court ruled that the SBA violated the Administrative Procedure Act and failed to implement the program.

Mr. Chairman, I also would point out that the bill as reported out of committee, in our opinion, would only complicate the implementation of the procurement program. While I understand that the chairwoman will be offering an amendment to correct that problem, it does so by classifying 92 percent of the industries in the United States as historically underrepresented by women businesses and Federal procurement. While I concur that women are historically underrepresented in the Federal procurement arena, the amendment paints, we believe, with a broad, over-inclusive brush, and may include numerous industries in which businesses are not underrepresented by women entrepreneurs.

I also need to point out that the bill would classify individuals as economically disadvantaged if they have assets exclusive of their primary residence and their business up to $550,000. So over a half million dollars. According to research by our staff, roughly half the Members of Congress, half the Members of this body would qualify as economically disadvantaged under that standard. I find it very difficult to believe that the average American would consider a Member of Congress to be economically disadvantaged.

These are only some of our concerns about the bill that we have before us here today. While some of these concerns are technical in nature, my primary dispute with the bill is that it continues, unfortunately, to segment the small business government contracting arena. The result is that, in our opinion, rather than growing opportunities for all small businesses, it pits all of these deserving groups against one another. That, in our view, undermines their ability to speak as a united front in debates over Federal procurement policy that would promote all of their interests.

Despite my disagreement with the chairwoman, I do not doubt her sincere desire to improve the SBA contracting programs. The Chair and her staff, particularly Michael Day and Adam Minehardt, should be commended for their efforts in trying to find a solution that I, in good conscience, could have supported. However, the philosophical gap was simply too large to span. Therefore, I cannot support this legislation. I would urge my colleagues to vote ``no.''

Mr. Chairman, I reserve the balance of my time.

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Mr. CHABOT. Mr. Chairman, we have already stated our concerns about the bill in particular, but I would again emphasize the fact that the chairwoman did reach out, and her staff did as well. But philosophically, this was a bridge too far. We want to thank them again for working in a cooperative manner. This is a committee that under the Chair's direction has worked very much with the minority, and we want to thank them and hope that we can continue to work together on bills in the future.

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Mr. CHABOT. Mr. Chairman, her amendment makes some needed technical changes to the bill. Nevertheless, as I pointed out in my statement previously, we believe that this proposed solution to the failure of the SBA to implement the women's procurement is, in our view, overinclusive and should be further revised as the legislative process moves forward, but we do not oppose the amendment.

Mr. Chairman, I yield back my time.

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Mr. CHABOT. I thank the gentlelady for yielding, and I thank the gentleman for offering his amendment. He has been willing to, I think, stand up and make courageous stands on occasion. I think he is to be commended for that.

Relative to this particular amendment, as I stated in my opening statement, I have some concerns of the bill in general because of the segmenting of various groups and sometimes pitting one against another and being competitive with each other, and so I can't say that I honestly would be in favor of a number of additional groups again further segmenting this.

But this just calls for a study and doesn't implement any particular groups or propose any additional new groups. So, for that reason, I would not oppose the amendment, and I want to thank him for his thoughtful consideration of this.

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Mr. CHABOT. I thank the gentlelady for yielding. And I want to compliment and thank the gentlelady from Florida for offering this important amendment. I think it certainly is a good addition to the bill.

I think it's clear that most Americans would only want those that are in this country legally to benefit from these types of taxpayer-funded programs. So it's a very good amendment, and I want to thank you for offering it, and we certainly will support it.

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Mr. CHABOT. I thank the gentlewoman for yielding.

I strongly support the gentlewoman from New York's amendment. I think it certainly improves the bill. It's just clear, I think, many, many Members on both sides of the aisle want to make clear that we don't think that taxpayer dollars ought to be going for illegal immigrants. And companies that are knowingly hiring people who are here illegally should not be able to benefit from any Federal dollars. And I think the gentlewoman by offering this amendment has improved the bill, and I want to thank her for offering this.

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Mr. CHABOT. I thank the gentlewoman for yielding.

We do not oppose this amendment. I'm more used to dealing with the gentleman from Texas on some other issues, particularly his commitment as chairman of the Missing and Exploited Children's Caucus, and so many other issues. We have worked together on a whole range of issues attempting to protect children in this country. I want to thank him for his leadership in that area, and I also thank him for offering this amendment.

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Mr. CHABOT. Mr. Speaker, I yield myself such time as I may consume.

Mr. Bartlett from Maryland was previously going to offer the motion to recommit. He's not here; so I am going to offer it in his place, and I will be very brief.

This motion to recommit is really very simple. It reinstates the requirement that requires the government to set aside for competition contracts for small businesses located in HUBZones. As already noted, there is no reason to punish HUBZone firms by eliminating a mandatory competition requirement.

This motion will ensure that HUBZone firms will be able to carry out their purpose to redevelop low-income areas.

I also would just like to reiterate something that I said earlier when we were dealing with the overall bill in general, and that is that I want to again compliment the gentlelady from New York, Chairwoman Velázquez, for reaching out to the minority, as she has in the past, in trying to work together. There were just philosophical differences which could not be overcome on this bill. But the committee has worked very well together in a bipartisan manner, and I want to thank her for that cooperation.

It is my intention to continue to work together on bills in the future because we have supported most of the bills that come out of the Small Business Committee, and I think that's good for small business in this country because that's something that we do have in common, and that is, that we believe to our core that future job growth in this country is dependent upon the vitality of small businesses. And small businesses in this country have a lot of things that they have to deal with: high health insurance rates for their employees, energy costs that have been going through the roof, a tax structure which is, at this point, unclear as to where it's going to be in the future. That's why many of us on this side of the aisle believe to our core that we need to make those tax cuts that were passed back in 2001 and in 2003 permanent. We ought to allow small businesses to know what their taxes are going to be like next year and the year after and the year after so that they can depend upon that tax structure to grow their business and to make investments so that they can create jobs. Because ultimately, that's what it's all about, to keep the economy thriving so that we can create more and more jobs for people in this country. And keeping taxes low is probably the best thing that we can do to allow the small business community in this country to grow and prosper.

So again, I want to thank the members of the committee, the staff, and the gentlewoman for her cooperation and reiterate that, although a good-faith effort was made, we do support this motion to recommit and we do oppose and would urge my colleagues to oppose the overall bill.

Mr. Speaker, I yield back the balance of my time.

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Mr. CHABOT. I thank the gentlewoman for yielding.

It is our view that veterans would not be in any way adversely affected if this motion to commit were to pass because they are already covered by the sole source area in the bill. So we just have an honest disagreement on this. We believe there is no way that veterans would be adversely affected if this motion to recommit would be passed.

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