Groups protest contracting proposals

Industry trade groups are opposing two proposed amendments to the Defense Department authorization bill now under consideration in the Senate.

The Coalition for Government Procurement today issued an alert in opposition to an amendment by Sen. Olympia Snowe (R-Maine) that would require federal contracting officers to get quotes from at least two small contractors for every purchase they make from the General Services Administration's schedule contracts.

The Information Technology Association of America, also today, issued a statement opposing an amendment from Sen. Carl Levin (D-Mich.) that would force prime contractors engaged in time and material contracts to pass through subcontractor rates for firms added to a program after contract award. That means the prime contractors would be able to charge only what the subcontractors charge, and could not raise the rates to reflect their own overhead and risk, according to ITAA President Harris Miller.

“If this amendment goes forward, we’re looking at a potential disaster for small and mid-size businesses in the federal marketplace,” Miller said in a written statement. “Time and materials contracts are used when the nature of the work makes the outcome difficult or impossible to assign a fixed price. These contracts are freighted with risk -- risk that can be played out over a number of years."

Prime contractors won't accept a subcontractor if they are forbidden to increase prices, he added. "Asking prime contractors to assume this risk is simply unrealistic, and the consequence will be far fewer opportunities for smaller business participation in federal contracts.”

Snowe's amendment adds unnecessary requirements to the schedules system, and will not help small businesses, according to a Coalition position paper.

"Adopting the Snowe amendment hurts more small firms than it helps," the paper states. "It picks winners and losers in the small business community, actually doing more harm to 'the small of the small' that aren’t big enough to hold federal contracts themselves. Those small businesses that do compete, win without having to have special status. The schedules program is the fairest procurement method available to firms of all sizes."

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