On Friday, December 12, the Senate passed the National Defense Authorization Act (NDAA) of 2015, sending it to President Obama for signature. The $585 billion bill includes $521.3 in base defense spending and another $64 billion in war funding.
The NDAA contains a number of provisions that affect small business contractors, including:
- Comprehensive Subcontracting Plan Reform (Section 821) – The NDAA includes provisions to increase transparency and accountability in the Test Program for Negotiation of Comprehensive Small Business Subcontracting Plans. This requires prime contractors to report subcontracting plan compliance to the Department of Defense on a semi-annual basis and adds additional penalties for non-compliance, such as downgrading past performance in technical evaluations for subsequent government procurements.
- Reverse Auctions Reform (Section 824) – Within the Department of Defense, this provision limits the use of reverse auctions by banning the use of single-round reverse auctions, single-bid reverse auctions absent price protections, third-party reverse auctions that include inherently governmental functions or private past performance evaluations, and reverse auctions for design-build work. Given that 95 percent of reverse auctions are for contracts of less than $150,000, improper use of this tool has been harming small businesses, limiting competition, and delivering contracts that fail to save the taxpayers money. (This was memorialized in a GAO report, which was released in December of 2013).
- Women-Owned Small Businesses (Section 825) – Permits sole-source contracts for Women-Owned Small Businesses (WOSBs) and Economically-Disadvantaged Women-Owned Small Businesses (EDWOSBs) if there is only one WOSB or EDWOSB who can perform the work and the value of the contract is below $ 4 million, or $6.5 million for manufacturing. This provides WOSBs and EDWOSBs with the same sole-source authority currently available to HUBZone and Service-Disabled Veteran-Owned Small Business firms
For the last 52 years, Congress has not once failed to pass the NDAA that provides funding to our military. And in a bi-partisan vote (89-11), on December 12 Congress made it 53. Now it’s all up to President Obama. Access the bill here.
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