The U.S. Treasury has opened up the bidding process for small businesses to offer their expertise in helping the agency manage the purchases of financial institutions’ bad assets.
On Friday, Treasury issued a statement reporting how small companies can become financial agents or bid for procurement contracts under the Emergency Economic Stabilization Act, passed earlier this month. The bill gives Treasury the authority to lean on the private sector for help in implementing its Troubled Asset Relief Program.
Treasury suggests that small businesses register for updates on its EESA website, look at updates on the Federal Business Opportunities and the U.S. Small Business Administration websites, and register with the Central Contractor Registration database and the General Services Administration Schedules Program.
Last week, Neel Kashkari, who leads the newly established Treasury office tasked with buying up to $700 billion worth of troubled financial assets from banks, said his program will encourage the participation of small businesses, as well as companies owned by veterans, minorities, and women.
At the same time, he acknowledged that the work requires businesses to have experience managing large amounts of assets. “Treasury believes that it would not be fiscally prudent to ask a firm that only had experience managing only a few billion to manage $100 billion,” he said. “It could put the taxpayers at unnecessary risk.” As a result, the agency is asking the vendors it does hire to work with smaller businesses as subcontractors.
To the chagrin of small-business advocates, EESA gave Treasury the right to waive Federal Acquisition Regulation provisions that govern contracting rules. The American Small Business League has criticized that authority for allowing what it considers already abusive federal contracting practices to continue skirting rules meant to be inclusive of small businesses.
Treasury has already contracted with Simpson, Thacher, and Bartlett as legal adviser; Bank of New York Mellon for custodial, accounting, and auction management services; and EnnisKnupp and Associates as investment adviser. The agency had solicited financial agents at the beginning of the month, giving them two days to offer their services.