House members introduce flood of small-business legislation

Small business advocates in the House continue to introduce bills in support of small federal contractors. The latest bill would bring into the light the process by which agencies insource work and give firms standing to challenge an insourcing decision in court.

Rep. Mick Mulvaney (R-S.C.) introduced the Subcontracting Transparency And Reliability (STAR) Act on Feb. 2.

Under the bill, agency officials would have to allow the public to comment on the agency's procedures for bringing in-house work that a small business has been doing. The small business advocates within a department, such as Office of Small and Disadvantaged Business Utilization (OSDBU) officials, would have to review the procedures as well.

The bill would also give small businesses the opportunity to challenge insourcing decisions in court.

Mulvaney tackles subcontracting problems as well in the bill. A small business could not subcontract more than 50 percent of what the government pays it for a contract. There would be a penalty for violating the rule, including a possible three-year suspension from contracting, a fine or jail.

The legislation is designed to ensure that small businesses that get the contracts are doing the bulk of the work. It would make it easier to crack down on deceptive large businesses hiding behind small businesses.

“The STAR Act will help provide an even playing field for many small contractors who otherwise would not have the resources to fight deceitful subcontracting and unjustified insourcing within the federal procurement system,” said Mulvaney, chairman of the Small Business Committee’s Contracting and Workforce Subcommittee.

Mulvaney’s legislation was introduced two days after the Small Business Committee chairman, Rep. Sam Graves (R-Mo.), introduced two bills. One bill would pressure agencies to meet their small business contracting goals or take bonuses away from senior federal officials. The Government Efficiency through Small Business Contracting Act (H.R. 3850) also raises the governmentwide contracting goal from 23 percent to 25 percent.

Graves introduced the Small Business Advocate Act (H.R. 3851) the same day. It would make the OSDBU director a senior executive position and “report directly and exclusively” to the agency head. The Small Business Committee wrangled with agency officials in 2011 about the access their OSDBU directors had to the top-ranking official.

In addition to these three bills, Rep. Bill Owens (D-N.Y.), member of the Small Business Committee, introduced a bill that would cut an agency’s budget by 10 percent in the following fiscal year if that agency missed the set small-business contracting goal.

Each of the bills has been referred to the Small Business Committee for further consideration.

About the Author

Matthew Weigelt is a freelance journalist who writes about acquisition and procurement.

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Reader comments

Fri, Feb 3, 2012 Jerrylca Ca.

OccupyIT's last sentence hits the nail on the head. Prohibit small business contracts from being bundled and included into larger corporate contributor's contracts where a $100,000 bid is accepted and NOT bundled and included in a $10 Million contract instead where there is NO accountability for any savings. Stop bundling of small business contracts or force large businesses to show how they have included the same savings offered by the small business proposal!

Fri, Feb 3, 2012

Subcontracting Plans don't have a large amount of impact if the agency is not performing adequate oversight. Many are far worst than others & it applies mostly to the larger budget offices.

Fri, Feb 3, 2012 DCTransplant DC

Feds are getting push from OMB to limit contract support staff if there is not adequate resources to oversee the work and to finally put an end to all the support contracts that violate FAR 37.203(c)(2). So if this legislation is passed, it would put feds in a catch-22 situation when trying to make a determination to not reprocure an inappropriate support contract that previously was awarded to a small business.

Fri, Feb 3, 2012 OccupyIT

Failure to meet small business targets is not the result of small businesses subcontracting more than 50% of the work - that is already prohibited in essentially all awards with appropriate redress available when violated. The real issue is large businesses not meeting the subcontracting plans that they bid as a required part of their large business awards. What a red herring that turns this on its head. Ridiculous, Mr. Mulvaney! Include the same penalties for large business violating the subcontracting plans!

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