On September 27, President Obama signed the Small Business Jobs & Credit Act of 2010, for small businesses and several significant contracting reform provisions that will have a wide-reaching impact on federal contractors.
First and foremost, the legislation puts an end to the uncertainty over parity in the small business program by re-establishing equality among each of the small business subcategories that competes for government contracts. The legislation now states that a contracting officer "may" - instead of "shall" - award contracts based on limited competition to HUBZone small businesses as a first option. Numerous Government Accountability Office and the U.S. Court of Federal Claims decisions in recent years determined that using "shall" unambiguously established a preference for HUBZone firms. ÎÚÑ»´«Ã½ argued that in order to preserve the concept of free and open competition, even within the small business program, there must be parity within the program.
There are other provisions in the legislation designed to improve the contracting process, including:
- Directions for SBA to establish a mentor-protégé program to assist small businesses owned by women, service-disabled veterans and those operating in HUBZones. The initiative would be modeled after the 8(a) mentor-protégé program.
- Requiring OMB's Office of Federal Procurement Policy to establish a government-wide policy for contract bundling -- a process in which several small contracts are consolidated and awarded to one firm, often out of the reach of small businesses. Prior to bundling a contract, procurement officials would be required to conduct market research and to have a senior acquisition official sign off on the decision. The rationale for bundling then would be publicly disclosed.
- Requiring small businesses to recertify their size status annually. The law also establishes a government-wide policy for prosecuting companies that fraudulently proclaim themselves to be a small business.