[Federal Register Volume 60, Number 131 (Monday, July 10, 1995)]
[Notices]
[Pages 35669-35671]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-16720]
Federal Register / Vol. 60, No. 131 / Monday, July 10, 1995 /
Notices
[[Page 35669]]
DEPARTMENT OF DEFENSE
Test Program for Negotiation of Comprehensive Small Business
Subcontracting Plans
AGENCY: Department of Defense (DoD).
ACTION: Notice of test program.
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SUMMARY: The Department of Defense is proposing to amend the Test
Program for Negotiation of Comprehensive Small Business Subcontracting
Plans.
DATES: Comments on the test plan should be submitted in writing at the
address shown below on or before September 8, 1995 to be considered in
finalization of the program.
ADDRESSES: Interested parties should submit written comments to: Office
of Small and Disadvantaged Business Utilization, ATTN: Ms. Susan Haley,
USD (A&T) SADBU, 3000 Defense Pentagon, Washington, DC 20301-3000.
Telefax number (703) 693-7014.
FOR FURTHER INFORMATION CONTACT:
Ms. Susan Haley, (703) 697-9383.
SUPPLEMENTARY INFORMATION:
A. Background
Under Section 834 of Pub. L. 101-189, as amended, the Department of
Defense (DoD) established a test program to determine whether the use
of comprehensive small business subcontracting plans would result in
increased opportunities for small firms performing under Defense
contracts. The initial test program covered a four-year period,
beginning October 1, 1990.
The period of the test program has been extended through September
30, 1998, to implement Section 7103 of the Federal Acquisition
Streamlining Act of 1994 (Pub. L. 103-355).
With regard to eligibility criteria, the revised plan clarifies
that the requirement for business concerns to annually receive $25
million or more under DoD contracts applies at the corporate level.
Eligibility criteria are further revised to require firms to have
achieved a small disadvantaged business (SDB) subcontracting
performance rate of 5 percent or more in order to participate, or to
submit a special request for participation which would include a plan
to achieve the 5 percent participation rate. All participants will be
required to accept a 5 percent or higher SDB goal and must agree to
comply with the provisions of Section 215.605 of the Defense Federal
Acquisition Regulation Supplement regarding evaluation of small
business (SB)/SDB participation in source selections.
The revised plan reduces from quarterly to annually the requirement
for the contracting officer (CO) to review the progress of
participating contractors toward achievement of the SB, SDB and women-
owned small business goals as agreed upon in the comprehensive
subcontracting plan. Submission of subcontracting reports (Standard
Form (SF) 295) remains unchanged.
The test plan is also amended to recognize revisions related to
women-owned small business.
The contracting activities under the military departments
designated to participate remain unchanged. Defense agencies may
nominate to the Director, Office of Small and Disadvantaged Business
Utilization, Office of the Under Secretary of Defense (Acquisition and
Technology) a contracting activity to participate in this program.
Susan Haley,
Office of Small and Disadvantaged Business Utilization.
The revised test plan is as follows:
Test Program for Negotiation of Comprehensive Small Business
Subcontracting Plans
I. Purpose
This document implements section 834 of Public Law 101-189, the
National Defense Authorization Act for Fiscal Years 1990 and 1991, as
amended. The primary purpose of the Test Program (the Program) is to
determine whether the negotiation and administration of comprehensive
small business subcontracting plans will result in increased
opportunities for small business concerns performing under Department
of Defense (DoD) contracts.
II. Authority
The Program is established pursuant to section 834 of the National
Defense Authorization Act for Fiscal Years 1990 and 1991, as amended.
III. Program Requirements
A. The Program shall be conducted from October 1, 1990, through
September 30, 1998.
B. The selection of contractors for participation in the Program
shall be in accordance with section 834(b)(3). Large business concerns
at the major (total) corporate level that, during the preceding fiscal
year:
1. Pursuant to at least five Department of Defense (DoD) contracts,
furnished supplies or services (including professional services) to the
DoD, engaged in research and development for the Department, or
performed construction for the Department; and were paid $25,000,000 or
more for such contract activities.
2. (a) Achieved a small disadvantaged business (SDB) subcontracting
participation rate of five percent or more during the preceding fiscal
year 1994; or
(b) Firms with an SDB subcontracting participation rate of less
than five percent during the preceding fiscal year 1994 may request
through the designated contracting activity to participate under the
Comprehensive Subcontracting Test Program. Requesting firms shall
submit a detailed plan with milestones leading to attainment of at
least five percent SDB subcontracting participation rate by fiscal year
1998. The provisions of paragraph B(2) do not apply to the eight
original contractors accepted into the program.
3. Shall accept a SDB goal for each fiscal year of not less than
five percent, or a SDB goal that is in accordance with the milestone
established in paragraph B(2)(b) above.
4. Shall comply with the requirements of the Defense Federal
Acquisition Regulation Supplement Subpart 215.605 for source selection
purposes.
C. For the purposes of the Program, to the extent practicable,
contractors selected to participate shall establish their comprehensive
subcontracting plans on the same corporate, division or plant-wide
basis under which they submitted the Standard Form (SF) 295 during the
preceding fiscal year except that in the case of a division or plant
that historically reported through a higher level division, but would
meet the criteria under B(2) above, shall be permitted to participate
in the program if the division, plant or profit center can demonstrate
a five percent or greater subcontract performance level with SDB
concerns.
D. Contractors selected for participation shall:
1. Be eligible in accordance with III (B) and (C),
2. Have reported to the DoD on the SF 295 for the last fiscal year,
except as applicable under III(C) above,
3. Offer a broad range of subcontracting opportunities,
4. Voluntarily agree to participate, and
5. Have at least one active contract that requires a subcontracting
plan at the designated DoD buying activity responsible for negotiating
the Comprehensive Subcontracting Plan.
IV. Elements of the Comprehensive Small Business Subcontracting Plan
A. The comprehensive small business subcontracting plan shall
address each of the eleven elements set forth in paragraph (d) of the
clause at FAR 52.219-9, ``Small Business and Small Disadvantaged
Business Subcontracting Plan.''
[[Page 35670]]
1. The subcontracting plan, percentage and corresponding dollar
goals for awards to small business, small disadvantaged business and
women-owned small business concerns shall be developed by the
contractor for its entire business operation in support of all DoD
contracts regardless of dollar value.
2. Participating contractors shall include separate specific goals
and timetables for the awarding of subcontracts in two industry
categories which have not historically been made available to small
business, small disadvantaged business and women-owned small business.
These industry categories will be recommended by the contractor and
approved by the contracting officer. Subcontract awards made in support
of the specific industry categories shall also count towards attainment
of the overall small business, small disadvantaged business and women-
owned small business goals.
3. The subcontracting plan shall set-forth the prime contractor's
actions to publicize prospective subcontract opportunities for small
business, small disadvantaged business and women-owned small business
concerns.
B. Subcontracting plans to be established under the Program shall
be submitted each year by participating contractors to the designated
contracting officer 45 days prior to the end of the Government's fiscal
year (September 30). However, new contractors requesting participation
under the Program shall submit subcontracting plans to the contracting
officer as close as possible to September 30.
V. Procedures
A. The Service Acquisition Executive within each Military
Department and Defense Agency having contractors that meet the
requirements of III(B) shall designate one contracting activity to
participate in the Program.
B. The designated contracting activity will accomplish the
following:
1. With the coordination of the Director, Office of Small and
Disadvantaged Business Utilization for their military Department or
Defense Agency, select as many eligible prime contractors for
participation under the Program as deemed appropriate.
2. Establish a ``Comprehensive Small Business Subcontracting Plan''
negotiating team(s) composed as follows:
a. A contracting officer(s) who will be responsible for negotiation
and approval of the comprehensive subcontracting plan(s) as well as the
responsibilities at FAR 19.705.
b. The contracting activity's Small and Disadvantaged Business
Utilization Specialist.
c. The Small and Disadvantaged Business Utilization Specialist of
the cognizant contract administration activity that administers the
preponderance of the selected prime contractor's contracts and/or the
appropriate individual who will administer contractor performance under
the test in accordance with FAR 19.706 and the provisions herein.
d. Production specialist, price analyst and other functional
specialists as appropriate.
C. The designated contracting officer shall:
1. Solicit proposed comprehensive subcontracting plans from
selected contractor(s) as soon as possible and by July 1, annually
thereafter.
2. By October 1, and annually thereafter, review, negotiate and
approve on behalf of the DoD a comprehensive subcontracting plan for
each selected contractor.
3. Distribute copies of the approved subcontracting plan in
accordance with VI(A) below.
4. Upon negotiation and acceptance of the comprehensive
subcontracting plan, the contracting officer shall obtain from the
contractor:
a. A listing of all active DoD contracts that contain individual
subcontracting plans required by section 211 of Public Law 95-507.
b. The listing shall include the following:
i. Contract number.
ii. Name and address of the contracting activity.
iii. Contracting officer's name and phone number.
5. Upon receipt of the information provided by the participating
contractor under 4 above, the contracting officer shall notify the
designated administrative contracting officer to issue a comprehensive
change order, which modifies all of the contractor's active DoD
contracts that include subcontracting plans. The modification will
substitute the contractor's approved comprehensive subcontracting plan
for the individual plans, will substitute the clause at DFARS 252.219-
7004 for the clauses at FAR 52.219-9, and 52.219-16, respectively, and
will delete the clauses at FAR 52.219-10 and DFARS 252.219-7003 and
252.219-7005, as appropriate.
6. Review annually, with the contract administration activity,
contractor's performance under the plan. Document the review findings
and distribute, in accordance with VI(A), within 45 days of the end of
the fiscal year.
7. By November 15 of the year after acceptance and annually
thereafter, determine whether the contractor has met its comprehensive
subcontracting goals. If the goals have not been met, determine whether
there is any indication that the contractor failed to make a good faith
effort and take appropriate action.
8. By December 15, 1998, prepare and submit a report on each
participating contractor's performance which details the results of the
Program. The report must compare the contractor's performance under the
Program with its performance for the three fiscal years prior to
acceptance into the program. The report distribution will be in
accordance with VI(A) below.
D. Participating contractors:
1. To the extent practicable, shall establish their comprehensive
subcontracting plans on the same corporate, division or plant-wide
basis under which they submitted the Standard Form (SF) 295 during
fiscal year 1994, except those contractors that historically reported
through a higher headquarters however as a separate reporting profit
center, plant or division the contractor achieved an SDB subcontracting
performance rate of five percent or greater in fiscal year 1994.
2. Upon negotiation of an acceptable comprehensive subcontracting
plan shall be exempt from individual contract by contract reporting
requirements for DoD contracts unless otherwise required in accordance
with (III)(B)(5).
3. Shall continue individual contract reporting on non-DoD
contracts.
4. Shall comply with the flow-down provisions of section 211 of
Public Law 95-507. Large business concerns receiving a DoD subcontract
in excess of $500,000 ($1,000,000 for construction) are required to
adopt a plan similar to that mandated by the clause at 52.219-9.
Participating contractors are prohibited from flowing down the
``Comprehensive'' subcontracting deviations provisions of 252.219-7004.
Accordingly, large business subcontractors to the participating
contractors shall be required to establish individual subcontracting
plans with specific goals for awards to small business, small
disadvantaged business and women-owned small business.
5. Upon expulsion from the Program or Program termination on
September 30, 1998, shall negotiate and establish individual
subcontracting plans on all future DoD contracts that otherwise meets
the requirements of section 211 of Public Law 95-507.
[[Page 35671]]
VI. Monitoring and Reporting of Comprehensive Subcontracting Plans and
Goals
A. Upon negotiation and acceptance of comprehensive subcontracting
plans and goals the designated activity shall immediately forward one
copy of the plan to each of the following:
1. Director, Small and Disadvantaged Business Utilization, Office
of the Under Secretary of Defense (Acquisition and Technology), Room
2A338, The Pentagon, Washington, DC 20301-3061.
2. Director, Small and Disadvantaged Business Utilization, for the
Military Department or Defense Agency of the activity that negotiated
and accepted the comprehensive subcontracting plan.
3. The cognizant contract administration office.
B. Each participating contractor shall complete the Standard Form
(SF) 295 ``Summary Subcontract Report'' in accordance with the
instructions on the back of the form on a quarterly basis, except as
noted below:
1. Participating contractors shall be exempt from completing items
17 and 18 under ``Subcontract Goal Achievement.''
2. Participating contractors shall enter in item 16 ``Remarks''
block the annual corporate, division or plant-wide small business,
small disadvantaged business and women-owned small business percentage
and corresponding dollar goals.
3. Participating contractors shall also enter separately in item 14
the percentage and corresponding dollar goals for each of the two
selected industry category (see section IV(A)(2)).
4. Participating contractors shall also enter separately in item 14
on a quarterly cumulative basis the percentage and corresponding dollar
amount of subcontract awards made in each of the two selected industry
categories.
5. Participating contractors shall be exempt from the completion of
SF 294 ``Subcontract Report For Individual Contracts'' for DoD
contracts during their participation in the Program.
[FR Doc. 95-16720 Filed 7-7-95; 8:45 am]
BILLING CODE 5000-04-M
