SBA Proposes Credit for Lower Tier Small Business Subcontracting

The Small Business Administration is proposing revisions to its small business size regulations at SBA Part 121.

A proposed rule would allow an other than small prime contractor that has an individual subcontracting plan to receive credit towards its small business subcontracting goals for subcontract awards made to small business concerns at any tier. The prime contractor would have to incorporate the lower tier subcontracting performance into its subcontracting plan goals.

Currently, other than small prime contractors establish small business subcontracting goals at the first tier level, and receive credit toward their subcontracting plan goal performance only at the first tier level.

Also, the rule proposes to implement statutory requirements related to the subcontracting plans of all subcontractors that are required to maintain subcontracting plans, including a requirement to monitor subcontractor performance and compliance towards reaching their goals and their compliance with subcontracting reporting requirements.

Finally, the rule would clarify that the size standard for a particular subcontract must appear in the solicitation for the subcontract.

Comments on the rule are due December 7, 2015. For the text of the rule, see 80 FR 60300.

About William Van Huis

Bill Van Huis is a Senior Writer/Analyst for Wolters Kluwer Law & Business who tracks and analyzes new regulations impacting federal government contracting. He also follows court decisions involving bid protests and contract disputes. You can find his work in WK publications like Government Contract Reports and the FAR and DFARS Matrix Tools. Bill is a Certified Professional Contracts Manager, and he has a law degree from Southern Illinois University, where he graduated summa cum laude. Prior to joining WK, Bill worked both inside and outside state and local government in the areas of procurement and municipal finance. Bill also worked as a staff attorney for the Illinois Supreme Court.
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