Review of SBA's 8(a) Procurement Program

GAO discussed the Small Business Administration's (SBA) 8(a) Program, which awards federal contracts to economically and socially disadvantaged small businesses, focusing on: (1) contractor performance; and (2) SBA program management. GAO noted that federal contracting officers believed that 8(a) contractors: (1) generally performed satisfactorily in terms of meeting delivery dates and providing adequate goods or services; (2) were sometimes more costly to the government; and (3) sometimes required more monitoring than non-8(a) firms. GAO also noted that, during fiscal year 1987: (1) 50 firms received about 35 percent of the dollar volume of 8(a) business; (2) 1,225 active firms did not do any 8(a) business; and (3) 55 firms did $100,000 or less in 8(a) business. In addition, GAO noted that SBA: (1) lacked plans to help 8(a) firms develop non-8(a) business; (2) did not have adequate staff to conduct all required annual reviews and site visits; (3) did not clarify its criteria for economic disadvantage; and (4) awarded some contracts with renewable options to firms on their last day of 8(a) participation, resulting in decreased availability of contracts to participating firms.