SmallGovCon: The SBA Proposes New Rules to Help Small Businesses in Obtaining Past Performance

“The SBA proposes to amend its regulations to implement new provisions of the National Defense Authorization Act (NDAA) for fiscal year 2021 that provides small business contractors with new tools to establish past performance when bidding on prime contracts for Government procurements. The proposed rules would add two new methods for small businesses to obtain qualifying past performance. One proposed rule would allow a small business with no relevant past performance of its own to use the past performance of a joint venture in which it took part. The second proposed rule would require prime contractors to provide, to small businesses that served as a first-tier subcontractor, a record of the business’s past performance for use by the small business in future proposals…”

“Joint Ventures

The first proposed rule addresses past performance ratings of joint ventures for small businesses. This proposed rule creates a new 13 CFR § 125.11(a) (125.11 houses SDVOSB rules and will be moved to a different section) which addresses the circumstance upon which an agency is required to consider past performance of small businesses that have been members of certain joint venture or first-tier subcontractors.

Under the rule, a small business would be able to include the past performance of the joint venture as part of its offer on a prime contract when bidding in its own name, when the small business was a member of the joint venture. The contracting officer is required to consider the joint venture’s past performance where the small business cannot independently demonstrate past performance necessary for award, and the small business elects to use the joint venture’s past performance, provided the small business identifies: “(i) the joint venture; (ii) the contract(s) of the joint venture that the small business elects to use; and (iii) describe to agency what duties or responsibilities the small business carried out as a joint venture member.” The small business cannot, however, claim past performance credit for work performed exclusively by other joint venture partners…”

“Subcontractors

The proposed rules also include provisions allowing small businesses to obtain past performance ratings for its performance as a first-tier subcontractor. The rule would require prime contractors, on contracts for which a small business served as a first-tier subcontractor, to provide the small business a past performance rating with respect to that prime contract.  This proposed rule would modify 13 CFR  § 125.3 to require prime subcontractors’ to provide a rating of a first-tier subcontractor’s past performance. Under the rule, the performance rating provided by the prime contractor “would be prepared to include, at a minimum, the following evaluation factors in the requested rating: (a) Technical (quality of product or service); (b) Cost control (not applicable for firm-fixed-price or fixed-price with economic price adjustment arrangements); (c) Schedule/timeliness; (d) Management or business relations; and (e) Other (as applicable).” The prime contractor would be required to provide the rating of the first-tier subcontractor’s past performance within 15 days of the first-tier subcontractor’s request…”

“Overall, these proposed rules would expand the opportunities for small businesses to establish past performance; and, if adopted, will prove beneficial to many small businesses by enabling them to be more competitive when bidding for prime contracts. Comments must be received on or before January 18, 2022 if you have concerns about the proposed rules…” Read the full article here.

Source: The SBA Proposes New Rules to Help Small Businesses in Obtaining Past Performance – By Kevin Wickliffe, November 23, 2021. SmallGovCon.

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