The Biden-Harris Administration has announced new actions to increase access for small businesses to federal contracts. With over $700 billion spent through federal contracts each year, these initiatives aim to provide opportunities for small businesses, particularly those owned by individuals from underrepresented communities. By leveraging the power of federal contracts, the administration aims to build wealth in underserved communities and ensure talent from all corners of the country is utilized.
Expanding Opportunities for Small Businesses
The Biden-Harris Administration is committed to increasing the share of federal contracting dollars going to small businesses owned and controlled by socially and economically disadvantaged individuals (SDBs) to 15% by Fiscal Year 2025—a 50% increase from spending levels when President Biden took office. In the last three fiscal years, the administration has already increased spending on contracts to small businesses, with nearly $163 billion awarded in federal contracting dollars in FY 2022, $70 billion of which was earned by SDBs.
To further support small businesses, the administration is taking the following actions:
New OMB Guidance for Federal Agencies
The Office of Management and Budget (OMB) has issued new guidance to all federal agencies to help more small businesses participate in high-use federal contracts. Multiple-award contracts, which account for over 20% of all federal government contract dollars, are a valuable contract vehicle. The guidance encourages earlier engagement and planning for these contracts, consideration of “on-ramps” to add businesses during the performance period, and the use of small business set-aside orders for competition among small businesses. These measures will increase opportunities for small businesses to participate in federal contracts, support a resilient federal marketplace, and ensure the effective delivery of services to the American people.
Improved Technical Assistance Program
The Small Business Administration (SBA) is revamping its technical assistance program to better support small businesses looking to do business with the federal government. The program, now called Empower to Grow (E2G), will offer customized one-on-one training tailored to small business needs. It will guide businesses through the process of pursuing government contracts and facilitate networking and matchmaking events between government agencies and prime contractors. The E2G program provided support to 6,000 small businesses in FY 2023, with participants reporting an average 45% increase in annual revenue.
Building on Existing Support for Small Businesses
These new actions build upon the efforts of the Biden-Harris Administration to support small businesses. Some of the key initiatives include:
- SBA’s expanded lending program focused on underserved communities, which saw record gains in lending to Black, Latino, Native, AAPI, women, and veteran entrepreneurs.
- The Department of the Treasury’s State Small Business Initiative (SSBCI), which provides funding and technical assistance to states, territories, and tribal governments to spur lending and investing in small businesses.
- The Minority Business Development Agency’s (MBDA) Capital Readiness Program, which awarded $125 million to support underserved entrepreneurs through non-profit community-based organizations.
- SBA’s Community Navigators Program, which offers critical technical assistance to small businesses and has already helped secure over $270 million in approved funding.
FAQs
Q: How much do small businesses receive in federal contracting dollars?
A: Small businesses received nearly $163 billion in federal contracting dollars in FY 2022, with $70 billion earned by socially and economically disadvantaged individuals.
Q: What is the goal for the share of federal contracting dollars going to SDBs?
A: The Biden-Harris Administration aims to increase the share of federal contracting dollars going to small businesses owned and controlled by socially and economically disadvantaged individuals to 15% by Fiscal Year 2025.
Conclusion
The Biden-Harris Administration is taking significant steps to expand access for small businesses to federal contracts. By increasing opportunities for underserved communities and providing technical assistance, these actions aim to support small businesses in thriving and achieving their full potential. With a commitment to a resilient federal marketplace and economic empowerment, the administration is working towards a future where small businesses from all backgrounds can succeed and contribute to the nation’s prosperity.
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