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Saturday, October 1, 2022

GAO Recommends SBA Evaluates New Scoring Methodology to Measure Agency Performance

For fiscal year 2017, the Small Business Administration (SBA) revised the methodology for its Small Business Procurement Scorecard, which is used to assess federal agencies’ progress toward small-business procurement goals. The federal government is required to allocate at least 23 percent of its direct contract spending to small businesses. The Small Business Administration’s annual scorecards track progress toward that goal.

SBA made revisions to address requirements specified in the National Defense Authorization Act for Fiscal Year 2016 (2016 NDAA). SBA reduced the share of the total scorecard grade devoted to prime contracting achievement, which is the dollar amount of contracts awarded directly to small businesses, and added an element calculating changes in the number of small businesses receiving prime contracts.

SBA made two additional revisions—with input from other agencies’ representatives—to increase the share of subcontracting achievement results and peer review of required activities designed to facilitate small-business procurement. In July 2018, officials said they had begun developing a plan to evaluate the effects of the revised scorecard methodology but did not provide a draft plan.

A Government Accountability Office (GAO) report now recommends SBA evaluate its new scoring methodology to assess how effectively the scorecards measure agency performance and promote contracting opportunities for small businesses. GAO says SBA could use the evaluation results to inform Congress in its upcoming required report.

GAO also notes that the published fiscal year 2017 scorecards originally contained errors, including an incorrect grade and numeric score for one agency, and SBA does not have a process to ensure that scorecard results are published accurately. Although SBA later corrected the errors, the agency did not initially document that scorecards had been changed, which is inconsistent with SBA’s policy on information quality. SBA officials said that errors occurred in the process of formatting scorecards for publication.

Agency officials and representatives of small-business groups that GAO interviewed generally expected the scorecard revisions to have little impact on small business procurement opportunities. However, one agency’s officials said they would focus more on tracking subcontracting activity as a result of changes to the scorecard.

Read the full GAO report

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