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DOCUMENT RESUME
02630 - [A1712687]
Department of Defensa Minority Business Enterprise Program. June
1, 1977. 9 pp.
Testimony before the House Committee on Small Business: Minority
Enterprise and Ceneral Oversight Subcommittee; by Richard W.
Gutmann, Director, Procurement and Systems Acquisition Div.
Issue Area: Non-Discrimination and Equal Opportunity Programs:
Federal lgencies' Achievement of Eqlual Opportunity and
Nondiscrimination Objectives (1010); Federal Procurement of
C3o~s and Services (1900) .
Contact: Procurement and Systems Acquisition Div.
Budget Function: National Defense: Department of Defense -
Procurerent & Contracts (058).
Organizatior Concerned: Department of Defense; Office of
Minority Business Enterpris-e.
Congressional Relevance: House Committee on Small Business:
Minority Enterprise and General Oversight Subcommittee.
Auth.-rity: Executive Order 11458. Executive Order 11625.
The Minority Business Enterprise (MBE) Subcontracting
Program of the Departhent of Defense (DOD) is an outgrowth of a
national commitment and executive crders to incLease minority
involvement in Federal procurement programs. After a review, 3A3
concluded that DOD's imnlementrtion )f the program was
inadequate in three respects: (1) thf contract clause to be
included in selected prime contracts o-erlooked certain key
aspects and requirem3nts necessary to assure the probability of
prograa success; (2) the Drrgram was not being adequately
monitored and had inadequ.'te standards for judging the prime
contractors' effectiveness; and (3) DOD contracting officers
were not qiven guidance on inclusion of the MBE subcontract
clause. Minority firms interviewed by GAO reported efforts to
solicit lusiness and to seek aid from the Small Business
Administration and other organizations, but they experience!
difficulty b:ealing into established markets. Minority
businessmen made recommendations for program improvements, some
found to be feasible, but some going beyond the intent of the
Executive order by implying a quota system. GAO recommended that
DOD should revise the current coatract clause to provide
contractors with more specific direction on increasing minority
involvement by: including objectives for prime contractors;
defining the role of corporate officials; requiring contractors'
records on so!icitations and awards; providing guidance for
determining contractors required to implement the program; and
proviling for nore effective monitoring. (BTV)](ViewImageLocal?handle=hein.gao/gaobadxup0001&div=1&collection=&method=preview&ext=.png&size=3)