New Bill Strengthens Subcontracting on Government Projects

A bipartisan effort is being made to promote a small business environment

Source : Office of Rep. Kweisi Mfume

August 2, 2022

Author : Alex Bustillos

Last month, the United States House of Representatives passed HR 7694, the "Strengthening Subcontracting for Small Businesses Act of 2022." 

This Bill proposes to amend the Small Business Act to require federal agencies to consider the content of subcontracting plans and the performance of subcontracting plans when evaluating large businesses for federal contracts.

Subcontracting can be a great method for small businesses to enter and flourish in the federal market, but when major companies don't meet their small business goals, small businesses suffer.

Bill sponsors such as Rep. Kweisi Mfume (D-MD 7th District) says it will help incentivize small business involvement with large federal projects and procurement. 

The Small Business Act currently requires federal agencies to consider the following factors when evaluating offers from large businesses: 

  1.  The rate provided under the offeror's subcontracting plan for small business participation 
  2. The extent to which the offeror attained its small business participation goals during performance when evaluating past performance.

The Bill expands these elements in two ways.

First, the Bill compels federal agencies to examine these evaluation elements for any contract that involves a subcontracting strategy, not just bundled contracts with large subcontracting opportunities. 

Second, rather than requiring federal agencies to analyze the rate of small business participation in an offeror's subcontracting plan, the Bill requires them to review the extent to which the offeror seeks to engage small business subcontractors at any tier.

The bill will be instrumental in shaping a pro-small business environment and helping spawn public-private partnerships over the coming decades.

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Category : Small Business Enterprises Federal Government Public-Private Partnership Public Works

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