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Measure Would Steer Federal Contracts to Beleaguered Island

A key Congressional panel took steps today to advance legislation aimed at helping small companies in Puerto Rico obtain a greater share of federal contracts.  The House Small Business Committee approved the “Puerto Rico Small Business Contracting Assistance Act,” legislation that would help stimulate economic activity in the Commonwealth, which has suffered from years of economic malaise and, more recently, been devastated by Hurricane Maria.  The bill was authored by Rep. Nydia M. Velázquez (D-NY), the Committee’s top Democrat.

“Federal procurement dollars can be one of our most powerful tools in jumpstarting economic growth and creating opportunity,” Velázquez noted.  “This legislation will harness the power of federal spending to help small firms in Puerto Rico perform federal work, creating badly needed jobs along the way.”  

Currently, a small number of federal contracts are performed in Puerto Rico with the Island ranking 50th out of 56, in comparison to all U.S. states and territories.  Between Fiscal Years 2014 and 2015 the total awards of federal contracts to Puerto Rican small businesses declined by nearly $85 million. 

Velázquez’s bill would allow agencies to count contracts awarded to Puerto Rican small firms double when working to reach their small business contracting goals. This would incentivize federal agencies to employ more small businesses on the Island. 

“Under the law, every single federal agency has a statutory goal they must meet in terms of the percentage of contracting work they have performed by small companies,” Velázquez explained. “This legislation leverages those rules to create a new incentive to steer federal contracts – and jobs - to Puerto Rico.”

In addition, the legislation builds on an existing mentor-protégé program, that helps inexperienced firms learn about and enter the federal marketplace. By helping more firms access this program, the new legislation would create additional opportunities for Puerto Rican companies that have not previously performed federal work.  The bill also allows surplus government equipment, furniture and other assets to be transferred to small businesses in Puerto Rico, a benefit usually reserved for small companies operating in a specialized program. 

“We need to do everything we can to help Puerto Rico recover,” Velázquez added. “By using a variety of federal programs, this bill will bring more federal work to Puerto Rico and create jobs when the Island needs it most.”

Velázquez’s legislation, H.R. 5178, was approved by the Small Business Committee with bipartisan support.  It is modeled on portions of previous legislation Velázquez authored in May.  The bill will now need to be considered by the full House of Representatives. 

“I want to thank all my colleagues for working with me in a bipartisan manner to advance this bill, especially Chairman Steve Chabot,” Velázquez added. “I’ll continue working in coming weeks to see this bill pushed through the House and, ultimately, enacted.” 

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