Set-asides still offer billions in contracting prospects

Growth in prime contracts awarded to small businesses is leveling off, but the top opportunities still offer more than $8.5 billion in potential value, according to a new report from the research firm INPUT.

While spending is moving toward multiple award, task order-based contracts, federal agencies still are committed to meeting small business goals, the report noted. In fiscal 2000, the government awarded prime contracts valued at $208.8 billion to small businesses, INPUT said. That number had more than doubled to $436.4 billion by fiscal 2007, according to the report.

The value continues to increase, according to INPUT's report, though it is not rising as fast since agencies are nearing the congressionally mandated goal of awarding 23 percent of contracting dollars to small businesses annually.

"Although we commonly hear that federal agencies are not meeting their small business set-aside goals, the data shows that the situation is clearly improving," said Alex Rossino, senior analyst at INPUT. "Further pressure from Congress and more accurate tracking of small business procurement by the Small Business Administration suggest that federal agencies will edge even closer toward meeting their small business set-aside contracting goals in the coming years."

Most of the top 10 set-aside opportunities in fiscal 2009 are reserved for small businesses, but there are several for service disabled veteran-owned businesses and 8(a) firms as well.

INPUT's analysts cautioned that a growing number of small business opportunities are encountering major delays. Of the top 10 fiscal 2008 small business prospects the firm identified, five had a later request for proposal release date than anticipated, three were in source selection, one was canceled and one was placed on hold. While the reasons for the delays varied, the research firm found that contracting and program offices governmentwide were taking longer to develop requirements documents.

"This trend is being driven by an increased desire among government agencies to 'get it right' when it comes to acquisitions," the report stated. "Doing so reduces vendor protests and agency procurement costs, even though it takes longer to get programs up and running."

INPUT's report offers detailed information on the top 10 opportunities and an analysis of the significance of each. The following contracts made the list:

1. Air Force's NETCENTS II small business set-aside, with an estimated $4.2 billion ceiling;

2. Support to Assist the Assistant Secretary of the Army's Manpower and Reserve Affairs, with an estimated $1 billion ceiling;

3. Army's Space and Missile Defense Initiatives Support III, with an estimated $730 million ceiling;

4. NASA's Multidisciplinary Engineering and Technology Services II, with an estimated $500 million ceiling;

5. Army's Strategic Sourcing Environmental Enterprise Services, with a $470 million ceiling;

6. Army's Information Technology Services small business, with a $400 million ceiling;

7. Federal Aviation Administration's Service Operations Support 7 and 8 -- recompete, with a $400 million ceiling;

8. Defense Information Systems Agency's DISN Global Services Management small business with a $300 million ceiling;

9. National Oceanic and Atmospheric Association Link, with a $250 million ceiling;

10. Navy's Consolidated Afloat Network Enterprise Services Service-Oriented Architecture Integration contract, with a $250 million ceiling.