Eight months after his subcommittee warned the Small Business Administration to clean up the "flagrant abuses" in the government's largest minority business development program, "nothing really has happened" to improve matters, Sen. Lawton Chiles (D-Fla.) charged yesterday.
The Senate Subcommittee on Federal Spending led reluctant SBA officials through a series of questions that revealed a lack of firm control or commitment to the success of the program at the top of the agency. Chiles raked SBA over the coals for failing, in his view, to make needed reforms.
"I'm concerned about a cover-up." Chiles said.
At a series of hearings in July, Chiles uncovered widespread problems in the administration of the 8 (a) program, through which the government sets aside a minute number of contracts for firms owned by socially or economically disadvantaged persons.
The abuses fell into two main categories, cases in which minorities were "bought" by white companies to act as "fronts" offering the whites access to the reserved contracts, and cases in which the minorities participating in the program were better off financially than Chiles felt they should be to qualify as "disadvantaged."
At yesterday's hearing, Chiles' motives for bringing the program under intense scrutiny were questioned by a group that represents about 250 of the 1,500 firms in the 8(a) program.
"It is the opinion of many minority businessmen, across the nation that you are taking the entire minority business program to the American public, through the mass media, as a direct vehicle for political gain," charged Jerry T. Jones, chairman of the National Association of Black Manufacturers.
"You are discrediting the total minority business community in the process," Jones said.
He charged that, rather than resulting in improvements to the program, Chiles' first round of hearings resulted in a moratorium that cut off opportunities for 8(a) firms, "a cloud of suspicion" over the program, and reluctance by government procurers to use 8(a).
"After you got through with your hearings, the closeted racist who had been lying out there in the weeds surfaced." Jones said. "Black companies, one after another, had their contracts delayed, their billings delayed, payrolls not met.
"We don't want to see the program done away with," said Chiles, only momentarily shaken by the attack. "We want to see it work properly."