My talking points for Roundtable meeting with National Ombudsman – Feb. 12, 2010

[The following Talking Points were recently shared with Ms. Esther H. Vassar, SBA National Ombudsman & Ms. Yolanda Garcia Olivarez, SBA Regional Administrator]:

Through grass-roots intelligence via the LinkedIn and Facebook social media platforms, I have gathered communication with 8(a) firms across the country, to include a survey. This intelligence has yielded the following five major concerns and issues affecting 8(a) firms across the country:

Short-Term

  1. Alaskan Native Corporations (ANCs) or  “Super 8(a)s” Cannibalization of Regular 8(a) program participants
  2. SBA districts are currently too be focused on hawking debt (expenses) rather than assisting with contract acquisition (revenue)

Mid-term

  1. Insourcing by Government Agencies at the expense of 8(a) firms
  2. Regular 8(a) tenure in program is too short to benefit from program based federal agency procurement cycles

Long-Term

  1. Antiquated Policy & Legislation regarding the 8(a) program

The sum of the above concerns contributes to anemic economic growth for 8(a) certified firms and by extension the communities they reside in. Moreover, the President’s current strategy of focusing on an increase in small business lending is economically flawed when it comes to 8(a) firms.

The 8(a) program was incepted and exists to assist socially disadvantaged firms in growing and becoming viable primarily through government contract purveyance. Yet, over the last 20 years the program has methodically become a tool for banks to develop low risk loan portfolios through government guarantees; at the long-term expense of 8(a) firms.

Meanwhile, 8(a) firms obtain loans that in many cases they end up servicing with the principal of the very loans they took out because they are unable to obtain contracts to service the debt.

Revenue should drive expense, not the vice versa. In short, 8(a) firms need contracts to help bolster our economy, not debt.

For comment and detail, I can be reached at 202.540.8178 or rudy.sutherland@aljucar.com .

- Rudy Sutherland

8(a) Serial Entrepreneur, Principal Consultant of ALJUCAR & Co., and Chairman of the 8-PAC Small Business Discussion Group with 3,260 current members

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