Helping Small Businesses Compete In The Federal Procurement Marketplace

113th CONGRESS SMALL BUSINESS CONTRACTING REFORM INITIATIVE 

  Contracting with small businesses ensures that taxpayer money is being spent efficiently; small contractors have proven they can do quality work cheaper and often faster.

 Legislative Update

-During the 113th Congress, the House Small Business Committee has set out to pass legislation that builds on the Committee's 112th Congress reforms to create more opportunities for small businesses through the federal government marketplace.
-On May 22, 2014, the House passed a condensed version of a small business contracting reform package in the National Defense Authorization Act of 2015. The Senate has yet to act on this legislation.
-On December 26, 2013, the President signed the National Defense Authorization Act of 2014 into law, which included two small business contracting reform amendments that originated within the House Small Business Committee.


Original Legislation:

1. Greater Opportunities for Small Business Act of 2014 (HR 4093):
• Sponsor: Chairman Sam Graves (R-MO)
• Introduction: February 26, 2014, Bill Text
• Markup Date: March 5, 2014.
• House Passage: May 22, 2014. 
• Raises the small business contracting goal from 23% to 25%. Raising the goal by 2% means a substantial amount of new business for small businesses – about $10 billion worth. 
• Ensures opportunities for small businesses as subcontractors, with a goal of awarding 40% of all subcontracted dollars to small businesses – an increase from the current goal of 35.9%. The new goal will go into effect once the subcontracting reforms in the FY 14 NDAA are fully implemented.
• Promotes accurate reporting, by requiring that only prime contract awards can count towards the prime contract goal.
  
2. Contracting Data and Bundling Accountability Act of 2014 (HR 4094):
• Sponsor: Chairman Sam Graves (R-MO)
• Introduction: February 26, 2014, Bill Text
• Markup Date: March 5, 2014.
• Recent GAO reports and Committee hearings have brought to light that the data on contract bundling and consolidation reported each year is seriously flawed. Some agencies claim not to have bundled a single contract in the 17 years since the original contract bundling legislation passed, but even a brief examination of contract practices suggests otherwise.
• This legislation requires the Small Business Administration (SBA) to work with other agencies to create and implement a data quality improvement plan to promote greater accuracy, transparency and accountability in the reporting of contract bundling and consolidation.  It then requires GAO to assess the agencies’ success, and offer suggestions for further improvement.  

3. Commonsense Construction Contracting Act of 2013 (HR 2751):
• Sponsor: Subcommittee on Contracting and Workforce Chairman Richard Hanna (R-NY) 
• Introduction: July 19, 2013, Bill Text
• Markup Date: March 5, 2014.
• Prohibits the use of reverse auctions for construction services contracts if the contract is awarded pursuant to the Small Business Act, since two Army Corps of Engineers studies show this doesn’t save money but puts contractors and the government at risk. 

4. Improving Opportunities for Service-Disabled Veteran-Owned Small Businesses Act of 2013 (HR 2882):
• Sponsor: Rep. Mike Coffman (R-CO)
• Introduction: July 31, 2013, Bill Text
• Markup Date: March 5, 2014.
• Moves verification and appeals under the VA’s Service-Disabled Veteran-Owned Small Businesses (SDVOSB) – one at the Department of Veterans Affairs (VA) to SBA, which is better suited to making determination on whether a firm is small (98% of cases rejected by VA are based on the business structure).
• Uses money in a VA slush fund to pay for verification, rather than appropriated funds.

5. Security in Bonding Act of 2013 (HR 776):
• Sponsor: Subcommittee on Contracting & Workforce Chairman Richard Hanna (R-NY)
• Introduction: February 20, 2013, Bill Text
• Markup Date: March 5, 2014.
• House Passage: May 22, 2014. 
• Cracks down on unscrupulous surety bond providers. SBC jurisdiction: Increases guarantee rate on SBA’s preferred bonding program. SBA assures us that there is no cost involved, but this will make it easier for small construction companies to compete.

6. Small Business Development Centers Improvement Act of 2014 (HR 4121):
• Sponsor: Ranking Member Rep. Nydia Velazquez (D-NY)
• Introduction: February 28, 2014, Bill Text
• Markup Date: March 5, 2014
• Allows SBDCs to market their private programs, ensuring confidentiality, and promoting equity.
• Strengthens congressional oversight of entrepreneurial development programs by requiring better data collection as well as an annual report by the SBA to the Congressional Committees of jurisdiction on the entrepreneurial development activities occurring during the year.
 
7. NDAA Floor Amendment #75 (HR 2232):
• Sponsor: Chairman Sam Graves (R-MO)
• Introduction: June 14, 2013, Text
• House Passage: June 14, 2013 (added as Floor Amendment #75 to NDAA of 2014)
• Signed into law:  December 26, 2013
• Allows contracts that are subject to the Small Business Act’s limitations on subcontracting be exempt from Sec. 802 of the FY 2013 NDAA, which applied limitations on subcontracting to Dept. of Defense contracts to prevent excessive pass-throughs of work.
• This will resolve the conflict in a manner that will continue to prevent pass-through contracts, but will make sure that small companies know which set of rules to follow.

8. Make Every Small Business Count Act (HR 2232):
• Sponsors: Chairman Sam Graves (R-MO) and Subcommittee on Contracting and Workforce Chairman Richard Hanna (R-NY)
• Introduction: June 4, 2013, Bill Text
• House Passage: June 14, 2013 (added as Floor Amendment #72 to NDAA of 2014)
• Signed into law: December 26, 2013
• Incentivizes large prime contractors to make sure that there are opportunities for small businesses working as lower tier subcontractors.

9. Design Build Efficiency and Jobs Act (HR 2750)
• Sponsor: Chairman Sam Graves (R-MO)
• Introduction: July 19, 2013, Bill Text
• House Passage: May 22, 2014.
• Requires a two-phase process that allows the government to assess technical qualification in the first round of a design-build procurement process, but doesn’t ask small businesses to expend significant funds unless they make the list of the top five most qualified, competitive companies in the second phase.
• This saves the government time and money, since they do not have to evaluate proposals that have no chance of success, and allows businesses to reserve their bid and proposal funds for contracts where they will be highly competitive.