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Hon. John Boozman, Ranking Republican Member, and a Representative in Congress from the State of Arkansas

Thank you Madame Chairwoman.

It is no small secret that the federal government as a whole has done a poor job of meeting the requirements set forth in PL 106-50 and 108-183, and Executive Order 13360 in which three percent of all federal contract dollars are to be set aside for businesses owned by service-disabled veterans.

In Fiscal Year 2005, the last year for which SBA has complete data, the federal government spent a paltry six-tenths of one percent of all procurement with service-disabled veteran-owned businesses.  The is about one fifth of what the law and the executive order requires.  In 2005, only the Committee for Purchasing from Blind and Other Severely Handicapped, the Defense Nuclear Safety Agency, FEMA and the National Science Foundation were in compliance.  Notably absent were VA and DoD.  In VA’s defense, I understand they exceeded the goal in FY 06 in great measure due to the efforts of Scott Denniston.

While there is no entitlement to a contract for any set aside group, for obvious reasons, the federal government plays a special role is promoting veterans who choose the entrepreneurial path.  For, veterans are unique in that they earned whatever advantage the federal government provides… unlike all of the other set aside categories of small business.

PL 106-50 and 108-183 and 13360 were fairly straight forward.  But let’s consider the requirements laid out in the President’s directive.  Its main features are:

Relative to promoting disabled veteran-owned businesses, Agency Heads shall develop a strategy, report annually to the SBA, designate a senior official to implement the strategy, and include contracting with SDVOBs in the performance evaluations of appropriate agency staff.

An agency strategy must include plans to implement SDVOB set asides, encouraging SDVOB participation, encouraging primes to subcontract with SDVOBs, and training agency personnel.  These plans are important because if you don’t have a valid roadmap, it is difficult to achieve the 3% goal.  I note that Mr. Wynn’s testimony states that, “…over half the plans were incomplete and some were poorly developed.”  I hope Mr. Ellmore will address that statement.

The President also set very specific duties for SBA, VA, GSA and DoD.  What I am most interested today is to learn from agency representatives how they are meeting the President’s directions.

I am especially impressed with the testimony of Louis Celli and his approach to promoting service-disabled veteran-owned business by reinvigorating the Small Business Administration.  I think this makes eminent good sense given the controversy surrounding other efforts to improve federal assistance to SDVOBs.  I fully support providing SBA with the resources to improve their services to SDVOBs and holding them accountable for meeting their mandate included in PL 106-50, 108-183, and Executive Order 13360.

In an opposite vein, I do not agree with a statement in Mr. Cervantes’ written testimony.  He states that DoD could not, “strategize on reaching these goals” until the passage of PL 108-183.  The Defense Department never seems to have problems strategizing for other types of operational issues, in fact that is what they get paid to do – figure out how to do things and have back-up plans for the back-up plan.  In fact, as the federal government’s largest procurer of goods and services, DoD’s failure to meet the 3% goal is the major factor in the overall failure the federal government.

Madame Chairwoman, I note that we have 13 witnesses to hear from.  To make the best use of our time, I would ask them to skip their descriptions of the laws and President’s order and to concentrate on what they are observing and suggestions on how to improve federal performance and yield back my time.