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Small Business Updates in NDAA 2020

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Section 823 – Modification of Justification and Approval Requirement for Certain DOD Contracts

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Bill Jaffe
July 15, 2020
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A list of small business-related FY 2020 updates/changes to the NDAA.

Note from Bill: The following document was sent to us on behalf of the Small Business Administration by Donna Ragucci of the Federal OSDBU Council.

The National Defense Authorization Act (NDAA) for Fiscal Year 2020 authorizes FY2020 appropriations and sets forth policies regarding the military activities of the Department of Defense (DOD), military construction, and the national security programs of the Department of Energy (DOE).

Below is a list of small business-related FY 2020 updates/changes to the NDAA. We’ll highlight each one here, and then delve into more detail in future posts:

SEC. 870. REQUIREMENTS RELATING TO CREDIT FOR CERTAIN SMALL BUSINESS CONCERN SUBCONTRACTORS.

Highlight: If the subcontracting goals pertain to more than one contract with one or more Federal agencies, or to one contract with more than one Federal agency, the prime contractor may only receive credit for first tier SB subcontractors.

Note from Bill: Interesting nuance here. So multi-award contracts or ANY contract that spans multiple agencies, only the first tier subs apply for SB credit. This mostly applies to large businesses, but can also affect “similarly situated entity” use in multiple award GWACS.

SEC. 871. INCLUSION OF BEST IN CLASS DESIGNATIONS IN ANNUAL REPORT ON SMALL BUSINESS GOALS.  (House bill)

Highlight: In addition to the requirements listed in this section for each best in class designation, the Administrator shall include new requirements in the in Best In Class Small Business Reporting.

Note from Bill: The Best in Class designation is rapidly taking hold, and many agencies are opting out of having their own vehicles and using the BIC. This change allows for more reporting of BIC vehicles and defines legislatively, the requirements.

SEC. 873. ACCELERATED PAYMENTS APPLICABLE TO CONTRACTS WITH CERTAIN SMALL BUSINESS CONCERNS UNDER THE PROMPT PAYMENT ACT.

Highlight: To the fullest extent permitted by law, the head of an agency will establish an accelerated payment date (with a goal of 15 days after a proper invoice for the amount due is received) if a specific payment date is not established by contract.

Note from Bill: Good for all us smalls, because the fact is, the sooner we get the funds, the better.

SEC. 874. POSTAWARD EXPLANATIONS FOR UNSUCCESSFUL OFFERORS FOR CERTAIN CONTRACTS.

Highlight: Upon receipt of a written request from an unsuccessful offeror for a task order or delivery order in an amount greater than the SAT and less than or equal to $5,500,000 issued under an IDIQ contract; the CO must provide a brief explanation as to why such offeror was unsuccessful.

Note from Bill: So, interesting, this used to be $10M, so the size threshold has gone down (good for us in seeking info), but they mention “brief explanation,” which is frustrating. Brief is NEVER good.

SEC. 875. SMALL BUSINESS CONTRACTING CREDIT FOR SUBCONTRACTORS THAT ARE PUERTO RICO BUSINESSES OR COVERED TERRITORY BUSINESSES.

Highlight: Businesses receive contracting credit for subcontractors that are Puerto Rico Businesses and covered territory businesses. Covered territory businesses are located in the United States Virgin Islands, American Samoa, Guam, and The Northern Mariana Islands.

Note from Bill: A simple change that allows Puerto Rican and territorial companies to be included in US designations for SB credits.

SEC. 876. TECHNICAL AMENDMENT REGARDING TREATMENT OF CERTAIN SURVIVING SPOUSES UNDER THE DEFINITION OF SMALL BUSINESS CONCERN OWNED AND CONTROLLED BY SERVICE-DISABLED VETERANS.

Highlight: In section 3(q)(2) of the Small Business Act is amended (bb) in the case of a surviving spouse of a veteran with a service-connected disability rated as less than 100 percent disabling who does not die as a result of a service-connected disability, is 3 years after the date of the death of the veteran.

Note from Bill: This is useful, because it does mean that for a business designated as SDVOSB when the veteran passes, the surviving spouse has three years to “wind things up.” Definitely a good idea.

SEC. 880. ASSISTANCE FOR SMALL BUSINESS CONCERNS PARTICIPATING IN THE SBIR AND STTR PROGRAMS.

Highlight: The PCR (procurement center representative) is to consult with the appropriate personnel from the relevant Federal agency to assist small business concerns in participating in the SBIR or STTR program (with commercializing research developed under such a program) before a small business is awarded a contract from a Federal agency.

Note from Bill: This affects small businesses doing R&D, and is useful to give the SB staff a say in the process to ensure small businesses are utilized on SBIR and STTR  awards.

Related posts:

  1. NDAA FY 2019 – What’s Ahead for Small Business
  2. What’s in the 2019 NDAA for Small Business Contractors
  3. NDAA FY 2020 Section 806 – Fixed-Price Contracting
  4. Acquisition Provisions in 2020 NDAA – 852 Special Pathways for Rapid Acquisition of Software Applications and Upgrades
  5. NDAA FY17 – What’s Ahead for Small Business
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The All-Small Mentor-Protégé Program

SBA had a well-established mentor-protégé program (MPP) for SBA 8(a) certified firms but lacked an MPP program for other small business concerns and specifically, one for specialized certified concerns such as WOSB, EDWOSB, SDVOSB, & HubZone. The 2010 Jobs Act and 2013 NDAA gave SBA the authorization to address this by establishing an all-encompassing mentor-protégé program. Ms. Sandi Clifford, deputy director of the All Small Mentor-Protégé Program (ASMPP), visited the Mid-Tier Advocacy (MTA) earlier this year to discuss the program. Here are some of the highlights of this candid and informative discussion: As Ms. Clifford explained, mentor services to protégés include: • Management and technical assistance (internal business management systems) • Financial assistance (in the form of equity investments and/or loans) • Contracting assistance (contracting processes, capabilities acquisitions and performance) • International trade education (learn how to export, international trade business plan, finding markets) • Business development assistance (strategy, finding contracting and partnership opportunities) • General and/or administrative assistance (business processes and support) As administrators of the program, SBA provides: • Central HQ as opposed to 8(a) distributive model • Online application – certify.sba.gov • Online course tutorial requirement • Annual review and evaluation • Template agreements, i.e., MPA (Mentor-Protégé Agreement) Other All-Small Mentor-Protégé Program (ASMPP) details: • A protégé may generally only have one mentor at a time; SBA may approve a second (two is the maximum) where no competition exists, or if the protégé registers under a new NAICS or otherwise requires new mentor skills.  • Both protégé and mentor must be for-profit (with exception of protégé being an agriculture cooperative). • A mentor may have no more than three protégés at same time (no lifetime limit). • A participant can be both a protégé and mentor at the same time, if there is no competition or conflict. • The ASMPP is self-certifying and is open to businesses who qualify as small in their primary NAICS code, or who are seeking business development assistance in a secondary NAICs where they also qualify as small.  • SBA will not authorize MPAs in second NAICS in which firm has never performed any work; or where firm would only bring “small” status to Mentor and nothing else. • Existing 8(a) firms in last 6 months of the 8(a) program may transfer their MPA to the ASMPP via the online application process. Coordinate with 8(a) office to fine tune the process but there is no reapplication required. • Application requirements include upload of business plan, but no financial statements or tax returns. • JV agreements: ASMPP will not review and approve joint venture agreements. How to apply for the ASMPP: • Applicants are required to register in the System for Award Management (SAM) prior to submitting their mentor/protégé application. • Complete your business profile in certify.SBA.gov. • Evaluate and select your mentor prior to applying. This is not a matching program. SBA will not find a mentor for you. • Begin the ASMPP application process. • Protégés and mentors must complete the online tutorial and have their certificate of completion and all other required documents ready for upload Thank you to Sandi Clifford, Deputy Director, All Small Mentor-Protégé Program, for this helpful overview. TAPE has mentored several small businesses over it’s life as a large business (we’re large in some NAICS codes, though still small in others) and it has been gratifying, satisfying, and integral to our success. As protégés ourselves, we have benefitted from working with some really classy large businesses, and have also had the experience of being a protégé and really getting no tangible benefits. We are currently working with two small businesses, and negotiating ASMPP agreements. You can learn more about the ASMPP on the SBA site. To join MTA and attend future events like this one, please visit www.midtier.org.
Bill Jaffe
August 23, 2017
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