NDAA Signed with Small Biz Provisions

December 2, 2015

pic-tax-peopleOn Nov. 25, President Barack Obama signed the National Defense Authorization Act for Fiscal Year 2016 (S. 1356). The annual bill has been passed each of the last 54 years and sets defense spending policy. This year’s legislation authorizes Congress to spend $607 billion, $5 billion less than an earlier version of the legislation which President Obama vetoed over concerns it circumvented defense spending caps then in place.

In addition to large defense spending programs, the NDAA also contains provisions changing the defense acquisition process. Included in the legislation are 25 provisions intended to ensure contracts are available for small businesses and better assist those businesses as they compete for contracts. The legislation incorporates several separate pieces of legislation focused on small-business contracting reforms including:

  • Small Contractors Improve Competition Act of 2015 (H.R. 1481) introduced by Small Business Committee Chairman Steve Chabot (R-Ohio). This bill amends the Small Business Act to require that the government ensures that a wide variety of small businesses are able to participate in the government procurement process
  • Commonsense Contracting Act of 2015 (H.R. 1444) introduced by Rep. Richard Hanna (R-N.Y.) would amend the Small Business Act to prohibit the use of reverse auctions for certain Small Business Administration (SBA) procurement contracts.
  • Small Business Joint Venture Act of 2015 (H.R. 1390) introduced by Rep. Steve Knight (R-Calif.) would allow small businesses to bid on a bundled or consolidated contract that provides for the use of a joint venture of small businesses.
  • SESO Act (H.R. 1386) introduced by Rep. Carlos Curbelo (R-Fla.) places responsibility on senior executive personnel responsible for acquisition for meeting their small-business prime contracting and subcontracting goals and percentages.
  • Small Business Contractor’s Clarification Act of 2015 (H.R. 1583) introduced by Rep. Cresent Hardy (R-Nev.) revises SBA’s subcontracting limitations such that contracts which are principally for supplies from a regular dealer of such supplies is required to supply the product of a domestic small-business manufacturer or processor unless a waiver is granted.

Among other things, the reforms contained within the NDAA should make bundling and consolidating contracts more difficult and ensure that small-business procurement advocates are better trained. The NDAA also would reform and reauthorize the mentor protégé program and make it easier for small businesses to form joint ventures for larger contracts.

NSBA supports improvements to the defense contracting process that make it more transparent and easier for small businesses to compete against larger more established contractors. NSBA looks forward to the implementation of the various small business provisions included in the law and is hopeful that Congress will fully fund the small-business provisions in the legislation. The funds which have been authorized will likely be appropriated in the omnibus spending bill currently working its way through Congress and expected to be finalized before Dec. 11.