DALTON, COOPER & GATES CORP. HOUSE SMALL BUSINESS COMMITTEE, 2361 Rayburn House Office Building, Washington, D.C. DALTON, COOPER & GATES CORP., New York, N. Y., May 5, 1969. Attention Representative Joe L. Evins, Chairman. DEAR MR. EVINS: We are pleased to refer to your Committee's news release of May 1, 1969 regarding the meeting scheduled for May 15, 1969 in Washington concerning Small Businesses' Participation in the procurement of goods and services financed with AID funds throughout the world. Unfortunately we will not be able to attend the meeting on May 15 in view of the fact that our management is leaving for Novi Sad, Yugoslavia on May 8 to attend the 36th International Agricultural Fair being held there May 9-19, 1969. Our firm is participating with a sizable U.S. exhibition of farm implement lines that we represent for export. Over the years we have participated in many U.S. Department of Commerce sponsored farm shows including Bangkok, Thailand, the Central American Common Market Farm Shows held in San Salvador, El Salvador, etc. Our firm has specialized in the export sales of agricultural machinery and related commodities since 1939. We are privileged to represent such firms as: Athens Plow Company, Athens, Tennessee Brillion Iron Works, Inc., Brillion, Wisconsin Gehl Company, West Bend, Wisconsin Dempster Industries, Beatrice, Nebraska Poplarville Implement Company, Poplarville, Mississippi Knowles Mfg. Co., Glenbeulah, Wisconsin and many others. We have also been an associate member of FARM EQUIPMENT MANUFACTURERS ASSOCIATION, a national organization that involves approximately 300 short line manufacturers of agricultural machinery. Your news release invites small business firms and their associations to write to your Committee regarding views and recommendations to broaden American Small Business participation in the procurement of goods and services financed with A.I.D. funds. In actual fact we, in our business, think very highly of the AID loan officers. and officials in Washington and at the Missions throughout the world. Years ago we were quite instrumental, through the FARM EQUIPMENT MANUFACTURERS ASSOCIATION to end bid discrimination against short line manufacturers of farm implements so that today all bid items are evaluated on a fully responsive bid item only rather than a group of items in the aggregate. The only thing that we would like to see be improved is the communication gap between the U.S. AID Missions in foreign countries and small business exporters. We would say that in our dealing throughout the world it usually takes no less than four weeks for answers to questions we write about to the Missions that are directly related to new AID loans and projects reported from time to time out of Washington. Oftentimes we get no replies at all and in some instances we have to send as many as two or three follow-ups and then when we do get an answer it is usually brief and incomplete. There is one exception to this complaint and this would be the U.S. AID Mission in Santiago, Chile and in particular Mr. Frederick W. Schieck, the loan officer handling AID financed bids to the Chilean government. The AID Mission in Chile has been extremely helpful to our firm and our small business farm implement lines and we can only say that if the various other AID Missions throughout the world followed the example of the Chilean Mission that small business would definitely have a much greater participation in the procurement of goods and services financed with AID funds. We think it would be most helpful to small business if something could be done to alleviate the "communications gap" that we feel is an area to be urgently corrected. In conclusion we want to thank the Committee for having this opportunity to submit our views and remain Very truly yours, THOMAS E. DROSS, Manager. DALTON, COOPER & GATES We regret the reported "communications gap" between the U.S. AID Missions and American firms interested in exporting. There is no excuse for non response or incomplete responses to reasonable inquiries nor, in most cases, for long delays in answering. We appreciate this matter having been brought to our attention and will see that these deficiencies are corrected. WESTON G. DOWER WESTON G. DOWER, INTERNATIONAL MARKETING SPECIALIST, U.S. Representative JAMES C. CORMAN, Subject: "A.I.D. financed purchases to be probed in hearings by House Small Business Subcommittee." DEAR REPRESENTATIVE CORMAN: I have received, and read with much interest, the May 1, 1969, News Release concerning your pending May 15th investigation into AID overseas procurement practices. I congratulate your Committee heartily for this effort; needless to say, AID purchasing practices does need looking into. I have been receiving the AID Small Business Procurement Circular for a number of years now, both as: 1. International Marketing Supervisor, Fairchild Semiconductor, Division Fairchild Camera & Instrument Corporation, and now in my present role as, 2. Self-employed International Marketing Specialist, specializing in the exportation and export sales of U.S. manufactured industrial goods. Informatively, this year, as of this date, in my role No. 2 above, I have responded to and submitted Thirteen (13) quotation bids, totalling approximately $140,000.00 from the AID Small Business Procurement Circulars. Please be advised that when in role No. 1, above, I successfully requested and was placed on the mailing list to receive AID Small Business Procurement listings, and on three (3) occasions, I was awarded successfully purchase contracts. This despite the fact that Fairchild was, and is, one of the largest electronic manufacturers' in the world with upwards of 28,000 employees. Just recently, in April of this year, I personally was denied an AID Small Business purchase contract to a large corporation and manufacturer (NuclearChicago Corporation, Chicago, Illinois) for medical apparatus to Lebanon, even though I bidded the exact equipment. My price was just slightly higher. My question is: Why does AID Small Business Office put large corporation businesses on their mailing list, if, in fact, their business is intended for small business? It would seem the logical thing to do is to have firms qualify to be placed on the mailing list to receive AID Small Business procurement notices. It could be done by the following manner: 1. Show that they are a small business (by whatever means the Government normally determines a small business), 2. Show that such qualifying small business firms have the ability to export and handle AID international business. The above two points would certainly pave the way for proper intent of having AID Small Business Procurement notices being directed in the right direction. This leads me to a second question: Why does AID Small Business Office award their purchase contracts to large corporations in the first place, assuming small businesses have properly submitted competitive bids? In line with points No. 1 and No. 2, above, the above question/problem could be simply solved by putting only the firms who qualify in the case of points No. 1 and No. 2, above, on the mailing list; exclude those who don't qualify (which would be large corporations, or small firms who do not have the capabilities to export in the first place). Incidentally, I suggest your Committee recommend they study the procurement practices (for overseas purchases) of the U.S. Government General Serv. ices Administration, which it seems has certainly solved the problem by having a firm qualify as a small business before even putting them on their procurement list for small business, and even then committing all firms to show ability to perform (in your case with AID, this ability would be exporting capabilities), I welcomed this opportunity of writing you, and in this final regard would be most pleased to have the opportunity of testifying before your Committee. Thank you in advance for your attention. Cordially, WESTON G. DOWER. HOUSE SMALL BUSINESS COMMITTEE, Mr. WESTON G. DOWER, San Francisco, Calif. DEAR MR. DOWER: This is in reference to your recent letter expressing interest in testifying during the course of hearings conducted by this Subcommittee regarding the Agency for International Development. A session of the hearings at which testimony will be obtained from private industry witnesses is scheduled for July 10, 1969, in Washington, D.C. At this time it appears that we will be unable to hear all parties who have indicated a desire to testify in person. It will be helpful, therefore, if you would provide a copy of your proposed statement on or before June 27. If it should develop that the Subcommittee cannot receive your testimony in person, your statement could be made a part of the printed record of the hearings. In the event you have any questions, please contact Subcommittee Counsel, Henry Robinson (Area Code 202, 225-4881). Your interest and cooperation are appreciated. JAMES C. CORMAN, M.C., Chairman, Procurement Subcommittee. WESTON G. DOWER, U.S. Representative JAMES C. CORMAN, M. C. More specifically and in brief, I would like to again submit the following recommendations: 1. Qualify all firms who can receive AID procurement circulars. In this regard follow the procedures as set-up by the U.S. Government General Services Administration; have firms file a "Bidder's Mailing List Application" to so determine if they are in fact a small business. I call your attention to the GSA Standard Form No. 129. This procedure as utilized by GSA, is very mechanized and handled expeditiously by computer operation. The intent, here, is to insure that so-called small businesses are not un-fairly competing with their large business counterparts. 2. Pass on all purchase contracts and awards. AID should be informed and advised of all purchase awards. This pin-points, so-to speak, whether small businesses are receiving their fair share of AID business. As it stands now, no records are maintained or purchase awards listed so that the trade may know who is getting the business. To my knowledge, there is no AID follow-up on bids offered and subsequent purchase contracts awarded. Finally, I would like to mention the name of: Mr. Arnold Craft, Agency for International Development, Office of Small Business, Washington, D.C., who spent many, many years in Saigon (Vietnam) supervising AID activities in that region. Mr Craft is very knowledgeable and understanding of the small businessman's plight in trying to obtain a piece of the action. He personally has been most helpful to me. (Mr. Craft specializes in pump equipment.) I welcome this opportunity to submit my own recommendations for improving A.I.D. purchasing practices. I certainly hope and trust that your hearings are successful, and that meaningful and improved practices will result. Again, I thank you most kindly for allowing me this chance to state my recommendations. Cordially, WESTON G. DOWER WESTON G. DOWER. It is apparent that Mr. Dower is now under the impression that the AIDfinanced procurement opportunities which are published in the "AID Small Business Circulars" are intended to be exclusively for small business firms. Such is not the case. AID Small Business Circulars are issued in compliance with Section 602 of the Foreign Assistance Act which provides in part that-"the President shall assist American small business to participate equitably in the furnishing of commodities-financed with funds made available under this Act-by causing to be made available to suppliers in the United States, and particularly to small independent enterprises, information, as far in advance as possible, with respect to purchase proposed to be financed with such funds." (Emphasis supplied.) Thus, the Circulars are available to all American suppliers, and all American suppliers are entitled to compete for the business. The title Small Business Circulars was chosen since their issuance derives from the Small Business provision of the FA Act, and to emphasize to American small business firms the existence of trade opportunities of which they might not otherwise be aware. Despite the possible misleading title of the Circulars and Mr. Dower's misinterpretation of their intent, the absence of prior indications of similar misinterpretations over the past several years leads us to believe that a correct understanding exists among virtually all firms interested in exporting. 33-611 0-70- -18 |