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Laughlin Air Force Base is a military training base situated 8km east of Del Rio in Texas, US. It is the United States Air Force's biggest pilot training base. The base is owned by the United States Air Force and operated by Air Education and Training Command. Read the article (download PDF)


Phil Howry Co. Receives Award at Dedication Ceremony
A story in the April 3, 2202 issue of the Rio Grande Herald covered the dedication ceremony of the Rio Grande City Border Patrol Station for the newly-renamed U.S. Bureau of Customs and Border Protection Agency, located in Starr County, Texas. Constructed by the Phil Howry Co., the building of the new Station was a multiple-contract project, totaling $6.5 million.

At the dedication ceremony, the Phil Howry Co. received a plaque for its "dedication, tolerance and attention to detail in the successful construction and completion for the new Border Patrol Station." The project was completed within budget on schedule.

A slice of federal pie

Alicia Pounds   Austin Business Journal Staff

Not many business owners want to be more involved with the federal government.

The headache of additional paperwork and the adherence to stringent guidelines sometime prompt businesses owners to avoid federal procurement programs.

But Austin's Phil Howry takes the opposite view. In fact, Austin-based general contracting company Phil Howry Co. works only on federal contracts, accounting for 100 percent of its business.

In private sector procurement, "there are different ways of communication with vendors, and there are arbitrary decisions and lots of politics," Howry says.

"The most important aspect of why I stick with federal procurement is there are no emotional ties to the money. I don't have to worry about a developer going broke, a bank not approving a draw, Aunt Sally getting sick or a wife divorcing a husband."

The appeal of a standardized federal procurement process led Howry to the U.S. Small Business Administration's 8(a) program.

Howry, who started his business in 1982, entered the business development program 11 years later. The 8(a) program sets aside federal contracts for minority-owned businesses. Contracts can be granted through one-on-one negotiations with the procurement agency or through open bidding.

Today, Howry is Austin's top business in terms of money generated through the 8(a) program in fiscal 2000. His business is one of six in the Austin area that generated $4.6 million from 8(a) projects in 2000, according to the SBA.

The company has worked on several federal projects, such as converting a warehouse to office space for the U.S. Department of Veterans' Affairs in Austin for $812,000; building a new border patrol station near Hebbronville in South Texas for $2.8 million; and installing a fire suppression system at Randolph Air Force Base, near San Antonio, for $961,000.

"I am a very strong advocate of the program," Howry says. "Not in the sense I have been in it and done well from it, but more in the sense of being a good participant in the program and leaving it so contractors who come along after me can build good businesses ... and be ongoing entities."

Debate over the SBA's 8(a) program for minority-owned businesses often is fueled by the words "dependency" and "preferential treatment." Howry says the 8(a) program has been beneficial for his company, but government agencies benefit as well.

"It has worked both ways," Howry says. "We have been very successful in finishing projects and completing projects. We have been able to develop a track record of execution and build a reputation."

Average annual revenue for the privately held company is about $4 million. Howry says about 50 percent of his business each year stems from 8(a) work.

Howry's company now is in the transition phase of the 8(a) process. A company can participate in the program for nine years. The first five years are designated as developmental, and the final four are transitional.

Howry says one of the reasons he's been successful in the program is his track record before joining the program.

"The 8(a) program really gave me an opportunity to get in some markets, get my foot in the door and expand my business," Howry says.

Aaron Concrete Contractors Inc., ranking No. 2 locally for 8(a) revenue in fiscal 2000, is another Austin company participating in the program. It generated $480,000 from 8(a) contracts in 2000. Aaron Concrete's average annual gross revenue is $14.5 million.

Austin's Ecological Communications Corp., an environmental consulting firm, ranks No. 3 locally in terms of revenue generated through the 8(a) program. The company gained $290,000 from 8(a) projects in fiscal 2000.

Business partners Victor Palma and Jill Madden founded Ecological Communications two years ago after teaming up with larger consulting firms on federal projects. The company has worked on federal contracts with Kelly Air Force Base in San Antonio and the Texas Natural Resource Conservation Commission.

"What the 8(a) program has done for us is it has opened up avenues to the federal consulting market that would have been much tougher as a startup company," Palma says.

"In the long run, it didn't help immediately, it doesn't guarantee you work, but it is like having another tool in the tool belt to use for contracting."

About 20 percent of Ecological Communications' business comes through the 8(a) program. Average gross revenue is $625,000 a year.

"We still have to market our company and find work," Palma says.

"Some work comes to us because of the reputation of a company. We will go to companies and explain what we do and see what projects might be coming up. I would say that most work comes, frankly, from business-to-business networking and past clients."

Palma and Howry say the additional paperwork strains their business, but the benefits outweigh the extra labor.

"It isn't because the 8(a) program is easier," Howry says. "In fact, it is more difficult to have a definite business system in place; it is voluminous in nature.

"But it is very organized. The government inspects jobs on a daily basis; they are sticklers on safety. But whether the projects are programmed as 8(a) or we are going to bid it, our business system will be the same. There is no difference in the way we handle projects."

ALICIA POUNDS can be reached by email at (apounds@bizjournals.com).