The Biden-Harris administration announced the latest measures to expand access to the more than $700 billion spent annually through federal contracts to small businesses, especially those owned by individuals from underrepresented communities. The federal government is the world's largest purchaser of goods and services, making federal contracts a powerful tool for building wealth in underserved communities and ensuring the federal government leverages talent from across the country. I am. These new initiatives build on the President's Investment in America Plan and increase the share of federal contract funds paid to small businesses owned and controlled by socially and economically disadvantaged individuals (SDBs) to 15% by fiscal year 2025. will advance the ambitious goal of increasing the number of That's a 50% increase from his spending levels when he first took office.
In each of the past three fiscal years, the administration has increased spending on small business contracts toward this goal, with small businesses receiving approximately $163 billion in federal contract funding in fiscal year 2022, $70 billion of which Earned by SDB. Supporting small businesses and giving entrepreneurs the tools to succeed are key pillars of Bidenmics. Under President Biden, a record 16 million new business applications were filed, the percentage of Black households that owned a business more than doubled, and the percentage of Latino households that owned a business increased by 40%.
In 2021, President Biden took a historic step to increase transparency in federal contracting by ordering the release of federal contracting data disaggregated by employer race and ethnicity. New FY22 data released today shows that companies owned by historically underrepresented groups earn more through federal contracts across all categories.
The Administration continues to support programs that help small businesses and today announced new guidance to help small businesses access federal contracts, including the issuance of new guidance to federal agencies from the Office of Management and Budget (OMB). We are announcing measures. Provides technical resources to his SDBs to help them win contracts and grow revenue, and shares data on federal contracts with traditionally underserved small businesses. Actions include:
- New OMB guidance for all federal agencies to allow more small businesses to participate in frequently used federal contracts. Today, OMB released guidance on strategies federal agencies should employ to help small businesses participate in multiple contracts. This contracting vehicle accounts for more than 20% of all federal government contracts, or nearly $160 billion. Agencies rely on multi-award contracts because they allow them to meet mission needs with streamlined contests that are more timely and cost-effective. To ensure that small businesses have the opportunity to participate in multiple benefit agreements, this guidance encourages early engagement and planning for multiple benefit agreements to maximize opportunities for small business contract holders. I am. Additional consideration for “on-ramps” that allow companies to be added during the performance of multiple contracts. And the use of small and medium-sized enterprises sets aside the order for competition among small and medium-sized enterprises. These changes will help more small businesses participate in federal contracting, support a resilient federal market, and ensure that federal contracting is best for the American people.
- Improved technical assistance opportunities for small businesses considering doing business with the federal government. The Small Business Administration (SBA) announces major improvements to the popular 7(j) technical assistance program, now called Empower to Grow (E2G), available to SDBs located in high-unemployment or low-income areas Did. The revamped E2G program provides one-on-one training tailored to the needs of small businesses and the process of awarding government contracts and hosting networking and matching events between government agencies and prime contractors. will guide you. In fiscal year 2023, the E2G program provided assistance to his 6,000 small businesses and helped 2,000 small businesses expand their participation in federal contracts. On average, small businesses that receive training report a 45% increase in annual revenue.
Today's action builds on important steps the Biden-Harris Administration has already taken to support small businesses. Also:
- SBA expands lending programs focused on underserved communities for the first time in 40 years and makes important changes to the program to increase lending to underserved small businesses. added. This fall, the SBA issued new licenses to lenders in the Small Business Loan Company (SBLC) program for the first time in 40 years. The program's lenders have a strong track record of lending to traditionally underserved communities, and each new lender brings funding to sectors and groups facing persistent gaps in capital access. We are specialized in providing. SBA also made important reforms to its lending programs in 2023, supporting significant progress in addressing capital barriers faced by small business owners. In fiscal year 2023, SBA achieved record increases in loans to Black, Latinx, Indigenous, AAPI, women, and veteran entrepreneurs, including $1.5 billion in loans to Black-owned businesses, It includes $3 billion in loans to affiliated companies. Under the Biden-Harris administration, total loans and loans to Black-owned businesses more than doubled, and total loans to Latino businesses doubled, increasing total loans by more than 80%.
- The Department of the Treasury administers the $10 billion State Small Business Initiative (SSBCI). Funded by the American Rescue Plan, the Treasury Department's SSBCI program provides state, territorial, and tribal governments with funding and critical technical assistance to facilitate lending and investment in small business. To date, the Treasury Department has approved distribution of $7.7 billion to 54 states and territories and 25 tribal governments. Additionally, the Treasury Department will provide services to help people access the opportunities created by the President's investment policy in America, including the historic investments made through the Bipartisan Infrastructure Act, the Inflation Control Act, and the Inflation Control Act. announced a $75 million competitive grant program for states to provide services. CHIPS and Science Law, and the American Rescue Plan – by providing technical assistance.
- The Minority Business Development Agency's (MBDA) Capital Reserve Program invests in small business incubators and accelerators. MBDA's Capital Reserve Program has awarded $125 million to 43 community-based nonprofit organizations to help underserved entrepreneurs start and expand small businesses. Funded through the American Rescue Plan, this program is the largest direct investment in small business incubators and accelerators of its kind in history by the federal government.
- SBA's Community Navigator Program provides critical technical assistance. In December 2023, the SBA releases a report stating that more than 50 Community Navigator grant recipients funded by the American Rescue Plan have already approved more than $270 million for small businesses. The company announced that it has contributed to securing funding for the United States and has trained more than 350,000 business owners and provided 175,000 hours of training. One-on-one counseling. With funding set to expire by the end of this year, the Biden-Harris administration proposed additional funding for the program in its fiscal year 2024 budget proposal and asked Congress to continue the program.
