ALBUQUERQUE, N.M. - Rudy Gonzalez sold his house in Virginia, moved back home to the Southwest and set up the office for his new construction company in a downtown apartment.

After Builtek Construction Inc. finished its first job building housing for U.S. Border Patrol agents in Big Bend, Texas, the 30-year-old entrepreneur was broke.

But his small company had the start of a good reputation, and six years later, Builtek has a $2 million subcontract to build the walls and doors of a nanotechnology facility at Sandia National Laboratories.

Walking among workers in hard hats and construction equipment in the partially finished structure, Gonzalez said, "If it wasn't for Sandia, a company like mine would have never seen a project like this."

Still, Gonzalez and other small-business advocates say national laboratories could do more to support small companies by increasing direct contracts to them.

At Los Alamos National Laboratory in northern New Mexico, there has been a recent decline in the amount of money going to small businesses. On the other hand, Sandia and the Waste Isolation Pilot Project near Carlsbad have seen increases in money paid to small companies.

Richard Marquez, Los Alamos lab's associate director for administration, said the lab's efforts to recruit small businesses were sidetracked by a procurement scandal early last year.

That resulted in the drop in money spent on small-business contracts - from $431 million in fiscal 2002 to $417 million the next fiscal year.

"We've got to stop that trend and get it back up to a healthy profile," Marquez said.

In July, the lab was able to begin refocusing its efforts and some contracts suitable for small businesses are now in the pipeline, he said.

But small businesses doing work at Los Alamos have yet to feel the effects.

The lab has "been in a shutdown mode, and it's had a huge impact on small business people," said Tina Cordova, president and co-owner of Queston Construction Inc.

Her company has not seen a direct contract from Los Alamos in 18 months, although typically it has had as many as 20 employees working there, she said.

Even with his work at Sandia, Gonzalez said his company has had a tough few months, working with a large out-of-state company and nearly going bankrupt after 41⁄2 months of delays.

Gonzales said Sandia worked with him and increased his contract to cover the additional expenses.

"To their credit, they came on board," he said.

Gonzalez believes the labs should put mechanisms in place so large contractors can't save construction costs on the backs of small businesses.

Theresa Carson, manager of supplier information and relations at Sandia labs, said the lab has taken a lot of initiatives to encourage small businesses - from small-business fairs to posting business opportunities on its Web site.

Sandia's efforts have increased the amount of money going to small businesses from $360 million in fiscal year 2001 to $459 million two years later. But the percentage of contracts going to small businesses decreased from 69 percent to 53 percent over the same period.