Defense bill’s contractor provisions please advocates of all stripes

Rep. Sam Graves, R-Mo. Rep. Sam Graves, R-Mo. Flickr user republicanconference

The mammoth fiscal 2013 defense authorization bill now headed to President Obama’s desk contains an array of contractor-related provisions that are lifting the holiday spirits of various small- business advocates.

They ranged from postponement of new caps on reimbursement of contractor executive pay, to new set-asides for women-owned small businesses, to new requirements that agencies factor in efforts to meet mandatory small-business contracting goals in senior employee performance reviews.

Stan Soloway, president and CEO of the Professional Services Council, said in a statement that his group is “pleased to see common sense has prevailed on the key issues of workforce strength, contractor compensation and access to internal audits.”

During this week’s House-Senate conference negotiations, the bill’s civilian workforce provisions were altered to allow the Defense Department more flexibility in where it makes mandatory workforce cuts.

Soloway was also pleased negotiators replaced a Senate-passed plan to cap reimbursement rates on contractor executive pay with a plan for a Government Accountability Office study of executive pay rates and their impact on recruitment of industry talent. And the council applauded a provision limiting the Defense Contract Audit Agency’s use of internal company audits in contract award decisions.

House Small Business Committee Chairman Sam Graves, R-Mo., after the House approved the conference report on Thursday, said, “The small business provisions in the NDAA will help make sure existing small business goals are actually met, empower small business advocates, and crack down on fraud.” Graves held a series of hearings last year that resulted in a package of contracting reforms that made it to final passage. Among them:

  • New incentives for agencies to meet the goal of awarding 23 percent of contracts to small business;
  • Changes on limitations on subcontracting from cost to price, to make it easier for small businesses to comply with procurement rules, while also allowing them to team together to pursue larger contracts; and
  • New aids for prevention of contracting fraud such as penalties on violating limitations on subcontracting, and steps for easing the process for suspension and debarment of companies that defraud the government.
The Defense authorization bill also will remove current limits on the anticipated award price for contracts let under the procurement program for women-owned small businesses. Advocates for women in contracting had for nearly a decade argued that the cap of $4 million for goods and services contracts and $6.5 million on manufacturing contracts discouraged contracting officers from taking the trouble to solicit women-owned businesses.

Barbara Kasoff, president of the advocacy group Women Impacting Public Policy, which had long sought the change, said, “We are very pleased to see our members of Congress supporting the women entrepreneurs in their home states, and eagerly await the president’s signature on this bill, which is vital step toward spurring women-owned small business growth.”

The final bill also enhances whistleblower protections for employees of federal contractors, strengthens wartime contracting oversight and cracks down on contractors that participate in human trafficking. The nonprofit watchdog Project on Government Oversight, which took a skeptical view of the overall bill because of its cost, said in an analysis that it applauds the “conferees from the House and Senate Armed Services committees for keeping a few of the most important reforms on the table.”

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