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H.R. 6367 - Incentivizing Fairness in Subcontracting Act

Introduced: 2018-07-13
Bill Status: Placed on the Union Calendar, Calendar No. 733.
Summary Not Available

Full Text

2d Session
H. R. 6367

    To amend the Small Business Act to specify what credit is given for certain subcontractors and to provide a dispute process for non-payment to subcontractors, and for other purposes.


July 13, 2018

    Mr. Lawson of Florida introduced the following bill; which was referred to the Committee on Small Business


    To amend the Small Business Act to specify what credit is given for certain subcontractors and to provide a dispute process for non-payment to subcontractors, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. Short title.

This Act may be cited as the “Incentivizing Fairness in Subcontracting Act”.

SEC. 2. Small business lower-tier subcontracting.

Section 8(d) of the Small Business Act (15 U.S.C. 637(d)) is amended—

(1) by amending paragraph (16) to read as follows:


“(A) IN GENERAL.—For purposes of determining whether or not a prime contractor has attained the percentage goals specified in paragraph (6)—

“(i) if the subcontracting goals pertain only to a single contract with the Federal agency, the prime contractor may elect to 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

“(ii) credit is not permitted for subcontracts at any tier that are to be reported under a commercial plan or a Department of Defense comprehensive subcontracting plan.

“(B) COLLECTION AND REVIEW OF DATA ON SUBCONTRACTING PLANS.—The head of each contracting agency shall ensure that—

“(i) the agency collects and reports data on the extent to which contractors of the agency meet the goals and objectives set forth in subcontracting plans submitted pursuant to this subsection; and

“(ii) the agency periodically reviews data collected and reported pursuant to subparagraph (A) for the purpose of ensuring that such contractors comply in good faith with the requirements of this subsection and subcontracting plans submitted by the contractors pursuant to this subsection.

“(C) RULE OF CONSTRUCTION.—Nothing in this paragraph shall permit lower-tier subcontracting goaling requirements to prime contractors that are eligible to receive lower-tier subcontracting credit under this paragraph.

“(D) DEFINITIONS.—For purposes of this paragraph:

“(i) COMMERCIAL PLAN.—The term ‘commercial plan’ has the meaning give that term under section 19.701 of the Federal Acquisition Regulation.

“(ii) COMPREHENSIVE SUBCONTRACTING PLAN.—The term ‘comprehensive subcontracting plan’ has the meaning given that term under section 252.219–7004 of the Defense Federal Acquisition Regulation Supplement.”; and

(2) by adding at the end the following:


“(A) NOTICE TO AGENCY.—With respect to a contract with a Federal agency, a subcontractor of a prime contractor on such contract may, if the subcontractor has not received payment for work performed within 90 days of the completion of such work, notify the Office of Small and Disadvantaged Business Utilization (‘OSDBU’) of the Federal agency of such lack of payment, if such notice is provided to the agency within the 15-day period following the end of such 90 days.

“(B) AGENCY DETERMINATION.—Upon receipt of a notice described under clause (i), the OSDBU shall verify whether such lack of payment has occurred and determine whether such lack of payment is due to an undue restriction placed on the prime contractor by an action of the Federal agency.

“(C) CURE PERIOD.—If the OSDBU verifies the lack of payment under clause (ii) and determines that such lack of payment is not due to an action of the Federal agency, the OSDBU shall notify the prime contractor and provide the prime contractor with a 15-day period in which the primae contractor may make the payment owed to the subcontractor.

“(D) RESULT OF NONPAYMENT.—If, after notifying the prime contractor under clause (iii), the OSDBU determines that the prime contractor has not fully paid the amount owed within the 15-day cure period described under clause (iii), the OSDBU shall ensure that such failure to pay is reflected in the Contractor Performance Assessment Reporting system.”.

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