Comment on FR Doc # 2012-30550

The OMB Policy Memorandum M-12-16 uses words like “encourage,” “generally,” and “goal.” This rule uses mandatory language to require the prime contractor to make accelerated payments to subcontractors. The government currently has privity with only prime contractors and should have no direction connection to subcontractors. This rule will create privity between the government and subcontractor and will create a cause of action for a subcontractor against the government if it fails to enforce this rule. The rule does not specify what is a “proper invoice and all proper documentation” from small business contractors. It implies that the government will require clauses in subcontracting agreements similar to the ones included for prime contractors’ invoices to the government. However, the government should refrain from imposing such a requirement to avoid creating privity with the subcontractor and creating a cause of action for the subcontractor against the government. This proposed rule may create a slippery slope and be extended to creating other causes of action for subcontractors against the government if the prime contractor defaults on other clauses in its subcontracts. The rule does not propose who will be responsible for handling matters involving accelerated payments to subcontractors. It may be the Small Business Office, the Contracting Officer, a new designated office, etc. The rule does not specify how prime contractors will be penalized for failing to provide accelerated payments to subcontractors. Further information should be provided. The Contracting Officer’s main remedy for unsatisfactory performance is through reports on past performance for the contractor. There is no immediate remedy unless a clause is created to allow Contracting Officers to implement other remedies such as suspending invoice payments. The rule is not specific as to what is considered a prompt payment or what is the "maximum extent practicable."