Sec. 1614. Credit for certain small business subcontractors
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Section 8(d) of the Small Business Act ( 15 U.S.C. 637(d) ) is amended— in paragraph (6)(D), by adding before the semicolon at the end the following: , and assurances at a minimum that the offeror or bidder, and all subcontractors required to maintain subcontracting plans pursuant to this paragraph, will— review and approve subcontracting plans submitted by their subcontractors; monitor subcontractor compliance with their approved subcontracting plans; ensure that subcontracting reports are submitted by their subcontractors when required; acknowledge receipt of their subcontractors’ reports; compare the performance of their subcontractors to subcontracting plans and goals; and discuss performance with subcontractors when necessary to ensure their subcontractors make a good faith effort to comply with their subcontracting plans ; in paragraph (6)(F), by striking and at the end; by redesignating subparagraph
(G)of paragraph
(6)as subparagraph (H), and inserting after subparagraph
(F)of paragraph
(6)the following new subparagraph (G): a recitation of the types of records the successful offeror or bidder will maintain to demonstrate procedures which have been adopted to ensure subcontractors at all tiers comply with the requirements and goals set forth in the plan established in accordance with subparagraph
(D)of this paragraph, including— the establishment of source lists of small business concerns, small business concerns owned and controlled by veterans, small business concerns owned and controlled by service-disabled veterans, qualified HUBZone small business concerns, small business concerns owned and controlled by socially and economically disadvantaged individuals, and small business concerns owned and controlled by women; and efforts to identify and award subcontracts to such small business concerns; and ; by adding at the end the following: For purposes of determining whether or not a prime contractor has attained the percentage goals specified in paragraph (6)— if the subcontracting goals pertain only to a single contract with the executive agency, the prime contractor shall receive credit for small business concerns performing as first tier subcontractors or subcontractors at any tier pursuant to the subcontracting plans required under paragraph (6)(D) in an amount equal to the dollar value of work awarded to such small business concerns; and if the subcontracting goals pertain to more than one contract with one or more executive agencies, or to one contract with more than one executive agency, the prime contractor may only count first tier subcontractors that are small business concerns. Nothing in this paragraph shall abrogate the responsibility of a prime contractor to make a good-faith effort to achieve the first tier small business subcontracting goals negotiated under paragraph (6)(A), or the requirement for subcontractors with further opportunities for subcontracting to make a good-faith effort to achieve the goals established under paragraph (6)(D). . Section 3 of the Small Business Act ( 15 U.S.C. 632 ) is amended by adding at the end the following: In this Act: The term subcontract means a legally binding agreement between a contractor that is already under contract to another party to perform work, and a third party, hereinafter referred to as the subcontractor, for the subcontractor to perform a part, or all, of the work that the contractor has undertaken. The term first tier subcontractor means a subcontractor who has a subcontract directly with the prime contractor. The term at any tier means any subcontractor other than a subcontractor who is a first tier subcontractor. . Not later than 180 days after the date of the enactment of this Act, the Administrator of the Small Business Administration, the Secretary of Defense, and the Administrator of General Services shall submit to the Committee on Small Business and the Committee on Armed Services of the House of Representatives and the Committee on Small Business and Entrepreneurship and the Committee on Armed Services of the Senate a plan to implement this section and the amendments made by this section. The plan shall contain assurances that the appropriate tracking mechanisms are in place to enable transparency of subcontracting activities at all tiers. Not later than one year after the date of the enactment of this Act, the Administrator of the Small Business Administration, the Secretary of Defense, and the Administrator of General Services shall complete the actions required by the plan. No later than 18 months after the date of the enactment of this Act, the Administrator of the Small Business Administration shall promulgate any regulations necessary, and the Federal Acquisition Regulation shall be revised, to implement this section and the amendments made by this section. Any regulations promulgated pursuant to paragraph
(3)shall apply to contracts entered into after the last day of the fiscal year in which the regulations are promulgated.
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