Computer Frontiers Inc.’s owner thought she’d gotten a break when Stanley Inc. agreed to team up with the small technology company in the U.S. government market.
Instead, Barbara Keating says she feels betrayed. Canada’s CGI Group Inc., after buying Stanley, touted the relationship to win orders in the past three years under a State Department visa-processing contract valued at as much as $2.8 billion. Then it mostly cut the small business out of the deal, sending some work overseas, according to a federal lawsuit.
“We were a big part of winning the contract,” Keating said in a phone interview. “We definitely thought we’d all grow together because of this relationship. But that obviously didn’t happen.”
Large companies are increasingly reducing subcontractors’ roles to help cope with $1.2 trillion in automatic federal spending cuts that began in March, according to attorneys and contracting specialists. Those grievances have reached U.S. officials, who want to know when vendors won’t be working with small businesses that helped them get the work.
“We went to many different parts of the country and met with companies, and in almost every city there was someone that said this was an issue,” said Ken Dodds, director of policy, planning and liaison for the U.S. Small Business Administration.
The Small Business Jobs Act of 2010 demanded that the government start requiring contractors that operate under a subcontracting plan to notify agencies when they’re not using small businesses that were part of their bids, Dodds said. A regulation to implement that part of the law hasn’t been approved.
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