Incentivizing Fairness in Subcontracting Act

Mr. Speaker, I move to suspend the rules and pass the bill (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, as amended.

Mr. Speaker, I ask unanimous consent that all Members may have 5 legislative days in which to revise and extend their remarks and include extraneous materials on the bill under consideration.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, before we begin discussion of this legislation, I would like to thank Mr. Lawson from Florida and Mr. Kelly from Mississippi for their leadership in addressing an issue that is a cause of great concern for small subcontractors; namely, prime contractor compliance with their subcontracting plans.

Large prime contractors have a statutory obligation to develop and submit a subcontracting plan as part of their bid and proposal package. In this plan, prime contractors are required to outline their intention to award a certain percentage of subcontracting dollars to small businesses.

Unfortunately, it has been a challenge to ensure that prime contractors are held accountable to these plans. Recently, the Department of Defense Inspector General's Office issued a report that found post-award compliance activities, specifically the oversight of subcontracting plans, is not a high priority for contracting officers. This finding is not limited to the military and can be generalized to apply across the Federal Government.

As the number of prime contracts suitable for small business continues to decline, subcontracting becomes increasingly important for small contractors trying to gain a foothold in the Federal market.

H.R. 6367, as amended, proposes to strengthen subcontracting measures by requiring large primes to maintain records proving they are subcontracting to small businesses, as required by their subcontracting plans.

Furthermore, this bill establishes an alternative avenue of redress for small subcontractors, allowing them to engage the appropriate Federal agency's small business advocate office if they believe payment is being withheld unfairly by a large prime contractor.

Because of these important measures undertaken to protect small contractors, I urge my colleagues to support H.R. 6367, as amended. I also, again, thank my colleagues for their leadership in this measure, and I reserve the balance of my time.

Mr. Speaker, I have no further speakers on this particular legislation, and I reserve the balance of my time.

Mr. Speaker, I continue to reserve the balance of my time.

Mr. Speaker, I yield myself such time as I may consume to close.

Mr. Speaker, as we have discussed, there are less prime contracting opportunities that are available for small businesses nowadays. It is in the subcontracting arena that is often the best and only way for a small contractor to engage with the Federal Government, but the lack of accountability and Federal oversight harms small subcontractors that rely on these opportunities to survive.

This is a lose-lose situation for both America's small businesses seeking to do work for the Federal Government and for the government itself. We want our citizens to get the best bang for their buck, and the more competition there is, the better it is for all of us. The greater oversight reforms in this legislation take a big step in ensuring small firms are protected.

I once again thank the gentleman from Florida (Mr. Lawson) for his leadership on this measure, and I urge my colleagues to support this bipartisan, commonsense piece of legislation.

Mr. Speaker, I yield back the balance of my time.

Mr. Speaker, I yield myself such time as I may consume.

Mr. Speaker, I rise in support of H.R. 6367, the Incentivizing Fairness in Subcontracting Act of 2018.

Mr. Speaker, in fiscal year 2017, the Federal Government purchased goods and services worth over $508 billion through over 22 million contract actions. Yet, not all this money stayed with the original prime contractor and, instead, trickles down to subcontractors.

Subcontracts are growing in importance as an avenue for small businesses to work with the government, so it is important that barriers to entry are reduced. By improving the tools that exist for small businesses to become subcontractors, today's measures will draw in more small businesses that are not regular government contractors.

This is a critical step to expanding the industrial base and including more small firms. Most importantly, it ensures more small contractors have just recourse through the Office of Small and Disadvantaged Business Utilization if payment is not received within 90 days of completion. Timely payment protects small contractors who do not have the overhead margins to continue operating without being paid.

Mr. Speaker, I urge Members to support this legislation, and I reserve the balance of my time.

Mr. Speaker, I yield 5 minutes to the gentleman from Florida (Mr. Lawson), the ranking member of the Subcommittee on Health and Technology and sponsor of the bill.

Mr. Speaker, I yield myself such time as I may consume, and I am prepared to close.

Mr. Speaker, I thank the gentleman from Florida (Mr. Lawson) and his cosponsor, Mr. Kelly, for introducing this important legislation. H.R. 6367 protects our small contractors by updating the subcontracting goaling regime through increased flexibility and accountability.

Establishing incentives to count low-tier subcontracting awards and a dispute process for subcontractors to utilize in the event of nonpayment ensures a healthy Federal procurement marketplace.

Today's legislation spreads the economic power of Federal procurement to more companies and the communities they are located.

Mr. Speaker, I urge Members to support this bill, and I yield back the balance of my time.

Mr. Speaker, I rise to support my bill, H.R. 6367, the Incentivizing Fairness in Subcontracting Act of 2018.

This bill will clarify what credit is given for certain subcontractors and to provide a dispute process for nonpayment to subcontractors. Simply put, this bill will help contractors receive the credit they need to satisfy Federal requirements.

Small businesses put in a tremendous amount of effort to receive Federal contracting jobs. There are tons of requirements, paperwork, and costs that go into applying and being awarded these opportunities.

Unfortunately, even after a Federal contract is awarded, small businesses still struggle. Whether it is a delay in payment due to the lack of an administrative dispute process or not being able to count lower tier subcontractors toward goals, many contractors face obstacles during the implementation of their contracts, creating the need for safe harbors to guarantee that they can move forward in the most effective and efficient manner.

H.R. 6367 will do just that. This is a bill that provides the clarity and resources needed to help contractors work at full capacity.

This bill is endorsed by the National Electrical Contractors Association, an association whose 4,000 members are 85 percent small businesses. NECA is the voice of about a $160 billion industry responsible for bringing electrical power, lighting, and communication to buildings and communities across the United States.

I am proud to work with Ranking Member Velazquez, the chairman, and the Congressman from Mississippi (Mr. Kelly). This is an important step in

guaranteeing that our contractors are treated fairly when carrying out their contracts.