IB 

Union Calendar No. 71 

110TH CONGRESS 

1ST SESSION H. R. 1873 

[Report No. 110–111, Parts I and II] 

To reauthorize the programs and activities of the Small Business 

Administration relating to procurement, and for other purposes. 

IN THE HOUSE OF REPRESENTATIVES 

APRIL 17, 2007 

Mr. BRALEY of Iowa (for himself, Mr. CHABOT, and Ms. VELA ́ZQUEZ) introduced the following bill; which was referred to the Committee on Small 

Business 

APRIL 26, 2007 

Reported with an amendment and referred to the Committee on Oversight and 

Government Reform for a period ending not later than May 4, 2007 for 

consideration of such provisions of the bill and amendment as fall within 

the jurisdiction of that committee pursuant to clause 1(m), rule X 

[Strike out all after the enacting clause and insert the part printed in italic] 

MAY 3, 2007 

Additional sponsors: Mr. BARTLETT of Maryland, Mr. JOHNSON of Georgia, 

Ms. MOORE of Wisconsin, Mr. BUCHANAN, Mr. DAVID DAVIS of Tennessee, Ms. FALLIN, Mr. FORTENBERRY, Mr. HELLER of Nevada, Mrs. 

MUSGRAVE, Mr. WESTMORELAND, Mr. GRAVES, Mr. ELLSWORTH, Mr. 

SESTAK, Mr. SHULER, Mr. CUELLAR, Ms. CLARKE, Mr. JEFFERSON, Mr. 

ALTMIRE, Mr. GRIJALVA, Mr. SHUSTER, Mr. MICHAUD, Mr. LIPINSKI, 

Mr. REYES, Mr. LARSEN of Washington, Mr. GONZALEZ, Mr. JORDAN

of Ohio, and Ms. BEAN

MAY 3, 2007 

Reported from the Committee on Oversight and Government Reform with an 

amendment, committed to the Committee of the Whole House on the 

State of the Union, and ordered to be printed 


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[Strike out all after the enacting clause and insert the part printed in boldface roman] 

[For text of introduced bill, see copy of bill as introduced on April 17, 2007] 

A BILL 

To reauthorize the programs and activities of the Small 

Business Administration relating to procurement, and 

for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

4 (a) SHORT TITLE.—This Act may be cited as the 

5 ‘‘Small Business Fairness in Contracting Act’’. 

6 (b) TABLE OF CONTENTS.—The table of contents for 

7 this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Regulations. 

TITLE I—CONTRACT BUNDLING 

Sec. 101. Definitions of bundling of contract requirements and related terms. 

Sec. 102. Justification. 

Sec. 103. Appeals. 

Sec. 104. Third-party review. 

TITLE II—INCREASING THE NUMBER OF SMALL BUSINESS 

CONTRACTS AND SUBCONTRACTS 

Sec. 201. Small business goal. 

Sec. 202. Include overseas contracts in small business goal. 

Sec. 203. Annual goal negotiation. 

Sec. 204. Goal reasonableness. 

Sec. 205. Usage of small companies in goal achievement. 

Sec. 206. Annual plan for each agency explaining how agency will meet small 

business goals. 

Sec. 207. Making small businesses the first choice. 

Sec. 208. Uniform metric for subcontracting achievements. 

Sec. 209. Subcontracting database. 

Sec. 210. National database. 

Sec. 211. Review of subcontracting plans. 


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Sec. 212. Agency obligation for fulfilling contracting goals. 

TITLE III—PROTECTION OF TAXPAYERS FROM FRAUD 

Sec. 301. Small business size protest notification. 

Sec. 302. Review of national registry. 

Sec. 303. Recertification of compliance with size standards and registration with 

Central Contractor Registry. 

TITLE IV—AUTHORIZATION OF APPROPRIATIONS 

Sec. 401. Authorization of appropriations. 

1 SEC. 2. REGULATIONS. 

2 (a) IN GENERAL.—Not later than 180 days after the 

3 date of the enactment of this Act— 

4 (1) the Administrator of the Small Business Ad5 ministration shall promulgate regulations to imple6 ment this Act and the amendments made by this Act; 

7 and 

8 (2) the Federal Acquisition Regulation shall be 

9 revised to implement this Act and the amendments 

10 made by this Act. 

11 (b) NOTICE AND COMMENT.—The regulations required 

12 by subsection (a) shall be promulgated after opportunity for 

13 notice and comment as required by section 553(b) of title 

14 5, United States Code. 

15 TITLE I—CONTRACT BUNDLING 

16 SEC. 101. DEFINITIONS OF BUNDLING OF CONTRACT RE17 QUIREMENTS AND RELATED TERMS. 

18 Section 3 of the Small Business Act (15 U.S.C. 632) 

19 is amended by amending subsection (o) to read as follows: 


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1 ‘‘(o) DEFINITIONS OF BUNDLING OF CONTRACT RE2 QUIREMENTS AND RELATED TERMS.—For purposes of this 

3 Act: 

4 ‘‘(1) BUNDLED CONTRACT.— 

5 ‘‘(A) IN GENERAL.—The term ‘bundled con6 tract’ means a contract or order that is entered 

7 into to meet procurement requirements that are 

8 consolidated in a bundling of contract require9 ments, without regard to its designation by the 

10 procuring agency or whether a study of the ef11 fects of the solicitation on civilian or military 

12 personnel has been made. 

13 ‘‘(B) EXCEPTIONS.—The term does not in14 clude— 

15 ‘‘(i) a contract or order with an aggre16 gate dollar value below the dollar threshold 

17 specified in paragraph (4); or 

18 ‘‘(ii) a contract or order that is entered 

19 into to meet procurement requirements, all 

20 of which are exempted requirements under 

21 paragraph (5). 

22 ‘‘(2) BUNDLING OF CONTRACT REQUIREMENTS.— 

23 ‘‘(A) IN GENERAL.—The term ‘bundling of 

24 contract requirements’ means the use of any bun25 dling methodology to satisfy 2 or more procureVerDate Aug 31 2005 23:45 May 04, 2007 Jkt 059200 PO 00000 Frm 00004 Fmt 6652 Sfmt 6203 E:\BILLS\H1873.RH H1873

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1 ment requirements for new or existing goods or 

2 services, including any construction services, that 

3 is likely to be unsuitable for award to a small 

4 business concern due to— 

5 ‘‘(i) the diversity, size, or specialized 

6 nature of the elements of the performance 

7 specified; 

8 ‘‘(ii) the aggregate dollar value of the 

9 anticipated award; 

10 ‘‘(iii) the geographical dispersion of the 

11 contract or order performance sites; or 

12 ‘‘(iv) any combination of the factors 

13 described in clauses (i), (ii), and (iii). 

14 ‘‘(B) EXCEPTIONS.—The term does not in15 clude— 

16 ‘‘(i) the use of a bundling methodology 

17 for an anticipated award with an aggregate 

18 dollar value below the dollar threshold speci19 fied in paragraph (4); or 

20 ‘‘(ii) the use of a bundling methodology 

21 to meet procurement requirements, all of 

22 which are exempted requirements under 

23 paragraph (5). 

24 ‘‘(3) BUNDLING METHODOLOGY.—The term ‘bun25 dling methodology’ means— 


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1 ‘‘(A) a solicitation to obtain offers for a sin2 gle contract or order, or a multiple award con3 tract or order; 

4 ‘‘(B) a solicitation of offers for the issuance 

5 of a task or a delivery order under an existing 

6 single or multiple award contract or order; or 

7 ‘‘(C) the creation of any new procurement 

8 requirement that permits a consolidation of con9 tract or order requirements. 

10 ‘‘(4) DOLLAR THRESHOLD.—The term ‘dollar 

11 threshold’ means— 

12 ‘‘(A) $65,000,000, if solely for construction 

13 services; and 

14 ‘‘(B) $1,500,000, in all other cases. 

15 ‘‘(5) EXEMPTED REQUIREMENTS.—The term ‘ex16 empted requirement’ means one or more of the fol17 lowing: 

18 ‘‘(A) A procurement requirement solely for 

19 items that are not commercial items (as the term 

20 ‘commercial item’ is defined in section 4(12) of 

21 the Office of Federal Procurement Policy Act (41 

22 U.S.C. 403(12))). 

23 ‘‘(B) A procurement requirement with re24 spect to which a determination that it is unsuit25 able for award to a small business concern has 


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1 previously been made by the agency. However, 

2 the Administrator shall have authority to review 

3 and reverse such a determination for purposes of 

4 this paragraph and, if the Administrator does 

5 reverse that determination, the term ‘exempted 

6 requirement’ shall not apply to that procurement 

7 requirement. 

8 ‘‘(6) PROCUREMENT REQUIREMENT.—The term 

9 ‘procurement requirement’ means a determination by 

10 an agency that a specified good or service is needed 

11 to satisfy the mission of the agency.’’. 

12 SEC. 102. JUSTIFICATION. 

13 Section 15(a) of the Small Business Act (15 U.S.C. 

14 644(a)) is amended— 

15 (1) by striking ‘‘is in a quantity or estimated 

16 dollar value the magnitude of which renders small 

17 business prime contract participation unlikely’’ and 

18 inserting ‘‘would now be combined with other require19 ments for goods and services’’; 

20 (2) by striking ‘‘(2) why delivery schedules’’ and 

21 inserting ‘‘(2) the names, addresses and size of the in22 cumbent contract holders; (3) a description of the in23 dustries that might be interested in bidding on the 

24 contract requirements; (4) the number of small busi25 nesses listed in the industry categories that could be 


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1 excluded from future bidding if the contract is com2 bined or packaged; (5) why delivery schedules’’; 

3 (3) by striking ‘‘(3) why the proposed acquisi4 tion’’ and inserting ‘‘(6) why the proposed acquisi5 tion’’; 

6 (4) by striking ‘‘(4) why construction’’ and in7 serting ‘‘(7) why construction’’; 

8 (5) by striking ‘‘(5) why the agency’’ and insert9 ing ‘‘(8) why the agency’’; 

10 (6) by striking ‘‘justified.’’ and inserting ‘‘justi11 fied. The statement shall also set forth the proposed 

12 procurement strategy required by subsection (e) and, 

13 if applicable, the specifications required by subsection 

14 (e)(3). Concurrently, the statement shall be made 

15 available to the public, including through dissemina16 tion in the Federal contracting opportunities data17 base.’’; and 

18 (7) by inserting after ‘‘prime contracting oppor19 tunities.’’ the following: ‘‘If no notification of the pro20 curement and accompanying statement is received, 

21 but the Administrator determines that there is cause 

22 to believe the contract combines requirements or a 

23 contract (single or multiple award) or task or deliv24 ery order for construction services or includes unjusti25 fied bundling, then the Administrator can demand 


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1 that such a statement of work goods or services be 

2 completed by the procurement activity and sent to the 

3 Procurement Center Representative and the solicita4 tion process postponed for at least 10 days to allow 

5 the Administrator to review the statement and make 

6 recommendations as described in this section before 

7 the procurement is continued.’’. 

8 SEC. 103. APPEALS. 

9 Section 15(a) of the Small Business Act (15 U.S.C. 

10 644(a)) is amended— 

11 (1) by striking ‘‘If a proposed procurement in12 cludes in its statement’’ and inserting ‘‘If a proposed 

13 procurement would negatively affect one or more 

14 small business concerns, or if a proposed procurement 

15 includes in its statement’’; and 

16 (2) by inserting before ‘‘Whenever the Adminis17 tration and the contracting procurement agency fail 

18 to agree,’’ the following: ‘‘If a small business concern 

19 would be adversely affected, directly or indirectly, by 

20 the procurement as proposed, and that small business 

21 concern or a trade association on behalf of that small 

22 business concern so requests, the Administrator may, 

23 in the Administrator’s discretion, take action to fur24 ther the interests of that small business concern.’’. 


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1 SEC. 104. THIRD-PARTY REVIEW. 

2 Section 15(a) of the Small Business Act (15 U.S.C. 

3 644(a)) is amended by striking the sentence beginning 

4 ‘‘Whenever the Administration and the contracting procure5 ment agency fail to agree,’’ and inserting the following: 

6 ‘‘Whenever the Administrator and the contracting procure7 ment agency fail to agree, the Administrator shall submit 

8 the matter to the Administrator of the Office of Federal Pro9 curement Policy within the Office of Management and 

10 Budget, who shall render his decision regarding the matter 

11 not later than 10 days after receiving the matter.’’. 

12 TITLE II—INCREASING THE NUM13 BER OF SMALL BUSINESS 

14 CONTRACTS AND SUB15 CONTRACTS 

16 SEC. 201. SMALL BUSINESS GOAL. 

17 Section 15(g)(1) of the Small Business Act (15 U.S.C. 

18 644(g)(1)) is amended by striking ‘‘23 percent’’ and insert19 ing ‘‘30 percent’’. 

20 SEC. 202. INCLUDE OVERSEAS CONTRACTS IN SMALL BUSI21 NESS GOAL. 

22 Section 15(g) of the Small Business Act (15 U.S.C. 

23 644(g)) is amended by adding at the end the following: 

24 ‘‘(3) The procurement goals required by this subsection 

25 apply to all procurement contracts, without regard to 


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1 whether the contract is for work within or outside the 

2 United States.’’. 

3 SEC. 203. ANNUAL GOAL NEGOTIATION. 

4 Section 15(g)(1) of the Small Business Act (15 U.S.C. 

5 644(g)(1)) is amended by striking ‘‘The President shall an6 nually establish Government-wide goals for procurement 

7 contracts’’ and inserting ‘‘The President shall before the 

8 close of each fiscal year establish new Government-wide pro9 curement goals for the following fiscal year for procurement 

10 contracts’’. 

11 SEC. 204. GOAL REASONABLENESS. 

12 Section 15(g)(1) of the Small Business Act (15 U.S.C. 

13 644(g)(1)) is amended by striking ‘‘Notwithstanding the 

14 Government-wide goal, each agency shall have an annual 

15 goal’’ and inserting ‘‘Each agency shall have an annual 

16 goal, not lower than the Government-wide goal,’’. 

17 SEC. 205. USAGE OF SMALL COMPANIES IN GOAL ACHIEVE18 MENT. 

19 Section 15(g) of the Small Business Act (15 U.S.C. 

20 644(g)) is amended by adding at the end the following: 

21 ‘‘(4) For purposes of this subsection and subsection (h), 

22 a small business concern shall be counted toward one addi23 tional category goal only, even if that small business con24 cern otherwise qualifies under more than one category goal. 


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1 In this paragraph, the term ‘category goal’ means a goal 

2 described in paragraph (2).’’. 

3 SEC. 206. ANNUAL PLAN FOR EACH AGENCY EXPLAINING 

4 HOW AGENCY WILL MEET SMALL BUSINESS 

5 GOALS. 

6 Section 15(g) of the Small Business Act (15 U.S.C. 

7 644(g)) is amended by adding at the end the following: 

8 ‘‘(5) Before the beginning of each fiscal year, the head 

9 of each Federal agency shall submit to the Administrator 

10 of the Small Business Administration and to Congress a 

11 detailed plan explaining how the agency intends to meet 

12 the small business goals under this subsection that apply 

13 to that agency for that fiscal year.’’. 

14 SEC. 207. MAKING SMALL BUSINESSES THE FIRST CHOICE. 

15 Section 15(j) of the Small Business Act (15 U.S.C. 

16 644(j)) is amended— 

17 (1) in paragraph (1)— 

18 (A) by inserting ‘‘or order’’ after ‘‘Each 

19 contract’’; and 

20 (B) by striking ‘‘$100,000’’ and insert ‘‘the 

21 Simplified Acquisition Threshold’’; and 

22 (2) in paragraph (3), by striking ‘‘subsection (a) 

23 of section 8’’ and inserting ‘‘section 8, 31, or 36’’. 


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1 SEC. 208. UNIFORM METRIC FOR SUBCONTRACTING 

2 ACHIEVEMENTS. 

3 Section 8(d) of the Small Business Act (15 U.S.C. 

4 637(d)) is amended by adding at the end the following:. 

5 ‘‘(12) In carrying out this subsection, the Adminis6 trator shall require each prime contractor to report small 

7 business subcontract usage at all tiers based on the percent8 age of the total dollar amount of the contract award.’’. 

9 SEC. 209. SUBCONTRACTING DATABASE. 

10 Section 8(d) of the Small Business Act (15 U.S.C. 

11 637(d)) is amended by adding at the end the following: 

12 ‘‘(13) In carrying out this subsection, the Adminis13 trator shall develop and maintain a password-protected 

14 database that will enable the Administration to assist small 

15 businesses in marketing to large corporations that have not 

16 achieved their small business goals.’’. 

17 SEC. 210. NATIONAL DATABASE. 

18 The Administrator of the Small Business Administra19 tion shall ensure that whenever a small business enters its 

20 information in the Central Contractor Registry, or any suc21 cessor to that registry, the Administrator contacts that busi22 ness within 30 days regarding the likelihood of Federal con23 tracting opportunities. The Administrator shall ensure that 

24 each small business that so registers is, for each industry 

25 code entered by that small business, provided with the total 


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1 dollar value of government contract awards to small busi2 nesses for that industry. 

3 SEC. 211. REVIEW OF SUBCONTRACTING PLANS. 

4 Not later than 120 days after the date of the enactment 

5 of this section, the Administrator of the Small Business Ad6 ministration shall, after an opportunity for notice and com7 ment, prescribe regulations to govern the Administrator’s 

8 review of subcontracting plans, including standards for de9 termining good faith effort in compliance with the subcon10 tracting plans. 

11 SEC. 212. AGENCY OBLIGATION FOR FULFILLING CON12 TRACTING GOALS. 

13 Section 15(h) of the Small Business Act (15 U.S.C. 

14 644(h)) is amended by adding at the end the following: 

15 ‘‘(4) At the conclusion of each fiscal year, the head of 

16 each Federal agency shall submit to Congress a report speci17 fying the percentage of contracts awarded by that agency 

18 for that fiscal year that were awarded to small business con19 cerns. If the percentage is less than 30 percent, the head 

20 of the agency shall, in the report, explain why the percent21 age is less than 30 percent and what will be done to ensure 

22 that the percentage for the following fiscal year will not be 

23 less than 30 percent.’’. 


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1 TITLE III—PROTECTION OF 

2 TAXPAYERS FROM FRAUD 

3 SEC. 301. SMALL BUSINESS SIZE PROTEST NOTIFICATION. 

4 (a) IN GENERAL.—The Administrator of the Small 

5 Business Administration shall work with appropriate Fed6 eral agencies to ensure that whenever a business concern 

7 is awarded a contract on the basis that it qualifies as small 

8 and then is determined not to qualify as small, a notifica9 tion of those facts (that an award was made on such a basis, 

10 and that such a determination was made) shall be placed 

11 adjacent to that concern’s listing in the Central Contractor 

12 Registry (or any successor to that registry). 

13 (b) COMPTROLLER GENERAL CERTIFICATION.—The 

14 Administrator shall, in making any report of small busi15 ness goal accomplishments, qualify the accomplishments as 

16 ‘‘estimated’’, until the Administrator obtains from the 

17 Comptroller General the Comptroller General’s certification 

18 that there are no data integrity issues with respect to the 

19 national repository of contract award information known 

20 as Federal Procurement Data System-Next Generation 

21 (FPDS–NG), or any successor to that repository. 

22 (c) AWARDS TO LARGE BUSINESSES.—For each Fed23 eral agency, the Inspector General of that agency shall, on 

24 an annual basis, submit to Congress a report on the number 

25 and dollar value of contract awards that were coded as 


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1 awards to small business concerns but in fact were made 

2 to businesses that did not qualify as small business con3 cerns. 

4 SEC. 302. REVIEW OF NATIONAL REGISTRY. 

5 The Administrator of the Small Business Administra6 tion shall ensure, on a biannual basis, that an independent 

7 audit is performed of the Central Contractor Registry, or 

8 any successor to that registry, and that the Dynamic Small 

9 Business Search portion of the registry, or any successor 

10 to that portion of the registry, is purged of any businesses 

11 that are not in fact small businesses. If a business that has 

12 been so purged attempts, while not in fact a small business, 

13 to re-register, that business is subject to debarment as a 

14 Federal contractor and is further subject to penalties out15 lined in section 16 of the Small Business Act (15 U.S.C. 

16 645). 

17 SEC. 303. RECERTIFICATION OF COMPLIANCE WITH SIZE 

18 STANDARDS AND REGISTRATION WITH CEN19 TRAL CONTRACTOR REGISTRY. 

20 Section 3(a) of the Small Business Act (15 U.S.C. 

21 632(a)) is amended by adding at the end the following: 

22 ‘‘(5) RECERTIFICATION.— 

23 ‘‘(A) IN GENERAL.—If a business concern is 

24 awarded a contract because of a standard by which 

25 it is determined to be a small business concern, and 


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1 the business concern is close to exceeding that stand2 ard at the time the award is made, then the business 

3 concern must, annually after the date of the award, 

4 recertify to the agency awarding the contract whether 

5 it meets that standard. 

6 ‘‘(B) ‘CLOSE TO EXCEEDING’.—For purposes of 

7 subparagraph (A), a business concern is close to ex8 ceeding— 

9 ‘‘(i) a number-of-employees standard if the 

10 number of employees of the business concern is 

11 95 percent or more of the maximum number of 

12 employees allowed under the standard; and 

13 ‘‘(ii) a dollar-volume-of-business standard if 

14 the dollar volume of business is 80 percent or 

15 more of the maximum dollar volume allowed 

16 under the standard. 

17 ‘‘(6) REGISTRY.—For a business concern to be award18 ed a contract because of a standard by which it is deter19 mined to be a small business concern, the business concern 

20 must, annually after the end of the fiscal year used by the 

21 business concern, update its listing in the Central Con22 tractor Registry.’’. 


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1 TITLE IV—AUTHORIZATION OF 

2 APPROPRIATIONS 

3 SEC. 401. AUTHORIZATION OF APPROPRIATIONS. 

4 There are authorized to be appropriated such sums as 

5 may be necessary to carry out this Act and the amendments 

6 made by this Act. 

7 SECTION 1. SHORT TITLE; TABLE OF CONTENTS. 

8 (a) SHORT TITLE.—This Act may be cited as 

9 the ‘‘Small Business Fairness in Contracting 

10 Act’’. 

11 (b) TABLE OF CONTENTS.—The table of con12 tents for this Act is as follows: 

Sec. 1. Short title; table of contents. 

Sec. 2. Regulations. 

TITLE I—CONTRACT BUNDLING 

Sec. 101. Definitions of bundling of contract requirements and 

related terms. 

Sec. 102. Justification. 

Sec. 103. Appeals. 

Sec. 104. Review. 

TITLE II—INCREASING THE NUMBER OF SMALL BUSINESS 

CONTRACTS AND SUBCONTRACTS 

Sec. 201. Small business goal. 

Sec. 202. Annual goal negotiation. 

Sec. 203. Usage of small companies in goal achievement. 

Sec. 204. Annual plan for each agency explaining how agency 

will meet small business goals. 

Sec. 205. Making small businesses the first choice. 

Sec. 206. Uniform metric for subcontracting achievements. 

Sec. 207. Subcontracting database. 

Sec. 208. National database. 

Sec. 209. Review of subcontracting plans. 

Sec. 210. Agency obligation for fulfilling contracting goals. 

Sec. 211. Appropriate limits on value of sole source contracts. 

TITLE III—PROTECTION OF TAXPAYERS FROM FRAUD 

Sec. 301. Small business size protest notification. 


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Sec. 302. Review of national registry. 

Sec. 303. Recertification of compliance with size standards and 

registration with Central Contractor Registry. 

TITLE IV—AUTHORIZATION OF APPROPRIATIONS 

Sec. 401. Authorization of appropriations. 

1 SEC. 2. REGULATIONS. 

2 (a) IN GENERAL.—Not later than 180 days 

3 after the date of the enactment of this Act—

4 (1) the Administrator of the Small 

5 Business Administration shall promul6 gate regulations to implement this Act 

7 and the amendments made by this Act; 

8 and 

9 (2) the Federal Acquisition Regula10 tion shall be revised to implement this 

11 Act and the amendments made by this 

12 Act. 

13 (b) NOTICE AND COMMENT.—The regula14 tions required by subsection (a) shall be pro15 mulgated after opportunity for notice and 

16 comment as required by section 553(b) of title 

17 5, United States Code. 


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1 TITLE I—CONTRACT BUNDLING 

2 SEC. 101. DEFINITIONS OF BUNDLING OF CONTRACT RE3 QUIREMENTS AND RELATED TERMS. 

4 Section 3 of the Small Business Act (15 

5 U.S.C. 632) is amended by amending sub6 section (o) to read as follows: 

7 ‘‘(o) DEFINITIONS OF BUNDLING OF CON8 TRACT REQUIREMENTS AND RELATED TERMS.—

9 For purposes of this Act: 

10 ‘‘(1) BUNDLED CONTRACT.—

11 ‘‘(A) IN GENERAL.—The term ‘bun12 dled contract’ means a contract or 

13 order that is entered into to meet 

14 procurement requirements that are 

15 consolidated in a bundling of con16 tract requirements, without regard to 

17 its designation by the procuring 

18 agency or whether a study of the ef19 fects of the solicitation on civilian or 

20 military personnel has been made. 

21 ‘‘(B) EXCEPTIONS.—The term does 

22 not include—

23 ‘‘(i) a contract or order with 

24 an aggregate dollar value below 


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1 the dollar threshold specified in 

2 paragraph (4); or 

3 ‘‘(ii) a contract or order that 

4 is entered into to meet procure5 ment requirements, all of which 

6 are exempted requirements under 

7 paragraph (5). 

8 ‘‘(2) BUNDLING OF CONTRACT REQUIRE9 MENTS.—

10 ‘‘(A) IN GENERAL.—The term ‘bun11 dling of contract requirements’

12 means the use of any bundling meth13 odology to satisfy 2 or more procure14 ment requirements for goods or serv15 ices, including any construction serv16 ices, previously supplied or per17 formed under separate smaller con18 tracts or orders that is likely to be 

19 unsuitable for award to a small busi20 ness concern due to—

21 ‘‘(i) the diversity, size, or spe22 cialized nature of the elements of 

23 the performance specified; 

24 ‘‘(ii) the aggregate dollar 

25 value of the anticipated award; 


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1 ‘‘(iii) the geographical disper2 sion of the contract or order per3 formance sites; or 

4 ‘‘(iv) any combination of the 

5 factors described in clauses (i), 

6 (ii), and (iii). 

7 ‘‘(B) INCLUSION OF NEW FEATURES

8 OR FUNCTIONS.—A combination of con9 tract requirements that would meet 

10 the definition of a bundling of con11 tract requirements but for the addi12 tion of a procurement requirement 

13 with at least one new good or service 

14 shall be considered to be a bundling 

15 of contract requirements unless the 

16 new features or functions substan17 tially transform the goods or services 

18 previously performed. 

19 ‘‘(C) EXCEPTIONS.—The term does 

20 not include—

21 ‘‘(i) the use of a bundling 

22 methodology for an anticipated 

23 award with an aggregate dollar 

24 value below the dollar threshold 

25 specified in paragraph (5); or 


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1 ‘‘(ii) the use of a bundling 

2 methodology to meet procure3 ment requirements, all of which 

4 are exempted requirements under 

5 paragraph (6). 

6 ‘‘(3) BUNDLING METHODOLOGY.—The 

7 term ‘bundling methodology’ means—

8 ‘‘(A) a solicitation to obtain offers 

9 for a single contract or order, or a 

10 multiple award contract or order; or 

11 ‘‘(B) a solicitation of offers for the 

12 issuance of a task or a delivery order 

13 under an existing single or multiple 

14 award contract or order. 

15 ‘‘(4) SEPARATE SMALLER CONTRACT.—

16 The term ‘separate smaller contract’, with 

17 respect to bundling of contract require18 ments, means a contract or order that 

19 has been performed by 1 or more small 

20 business concerns or was suitable for 

21 award to 1 or more small business con22 cerns. 

23 ‘‘(5) DOLLAR THRESHOLD.—The term 

24 ‘dollar threshold’ means—


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1 ‘‘(A) $65,000,000, if solely for con2 struction services; and 

3 ‘‘(B) $5,000,000, in all other cases. 

4 ‘‘(6) EXEMPTED REQUIREMENTS.—The 

5 term ‘exempted requirement’ means a 

6 procurement requirement solely for items 

7 that are not commercial items (as the 

8 term ‘commercial item’ is defined in sec9 tion 4(12) of the Office of Federal Pro10 curement Policy Act (41 U.S.C. 403(12)). 

11 ‘‘(7) PROCUREMENT REQUIREMENT.—The 

12 term ‘procurement requirement’ means a 

13 determination by an agency that a speci14 fied good or service is needed to satisfy 

15 the mission of the agency.’’. 

16 SEC. 102. JUSTIFICATION. 

17 Section 15(a) of the Small Business Act (15 

18 U.S.C. 644(a)) is amended—

19 (1) by striking ‘‘(2) why delivery 

20 schedules’’ and inserting ‘‘(2) the names, 

21 addresses and size of the incumbent con22 tract holders; (3) a description of the in23 dustries that might be interested in bid24 ding on the contract requirements; (4) 

25 the number of small businesses listed in 


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1 the industry categories that could be ex2 cluded from future bidding if the con3 tract is combined or packaged; (5) why 

4 delivery schedules’’; 

5 (2) by striking ‘‘(3) why the proposed 

6 acquisition’’ and inserting ‘‘(6) why the 

7 proposed acquisition’’; 

8 (3) by striking ‘‘(4) why construction’’

9 and inserting ‘‘(7) why construction’’; 

10 (4) by striking ‘‘(5) why the agency’’

11 and inserting ‘‘(8) why the agency’’; 

12 (5) by striking ‘‘justified.’’ and insert13 ing ‘‘justified. The statement shall also set 

14 forth the proposed procurement strategy 

15 required by subsection (e) and, if applica16 ble, the specifications required by sub17 section (e)(3). The statement shall be 

18 made available to the public, including 

19 through dissemination in the Federal 

20 contracting opportunities database, con21 currently with the issuance of the solici22 tation.’’; and 

23 (6) by inserting after ‘‘prime con24 tracting opportunities.’’ the following: ‘‘If 

25 no notification of the procurement and 


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1 accompanying statement is received, but 

2 the Administrator determines that there 

3 is cause to believe the contract combines 

4 requirements or a contract (single or 

5 multiple award) or task or delivery order 

6 for construction services or includes un7 justified bundling, then the Adminis8 trator may request that such a statement 

9 of work goods or services be completed 

10 by the procurement activity and sent to 

11 the Procurement Center Representative 

12 and the solicitation process postponed 

13 for 10 days to allow the Administrator to 

14 review the statement and make rec15 ommendations as described in this sec16 tion before the procurement is contin17 ued.’’. 

18 SEC. 103. APPEALS. 

19 Section 15(a) of the Small Business Act (15 

20 U.S.C. 644(a)) is amended by inserting before 

21 ‘‘Whenever the Administration and the con22 tracting procurement agency fail to agree,’’

23 the following: ‘‘If a small business concern 

24 would be adversely affected, directly or indi25 rectly, by the procurement as proposed, and 


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1 that small business concern or a trade asso2 ciation on behalf of that small business con3 cern so requests, the Administrator may, in 

4 the Administrator’s discretion, take action to 

5 further the interests of that small business 

6 concern.’’. 

7 SEC. 104. REVIEW. 

8 Section 15(a) of the Small Business Act (15 

9 U.S.C. 644(a)) is amended by striking the sen10 tence beginning ‘‘Whenever the Administra11 tion and the contracting procurement agency 

12 fail to agree,’’ and inserting the following: 

13 ‘‘Whenever the Administration and the con14 tracting procurement agency fail to agree, the 

15 Administrator shall submit the matter to the 

16 head of the agency for a determination. The 

17 head of the agency shall provide a written re18 sponse to the Administrator. A copy of such 

19 response shall also be provided to the Com20 mittees on Small Business of the House of 

21 Representatives and Senate, the Committee 

22 on Oversight and Government Reform of the 

23 House of Representatives, and the Committee 

24 on Homeland Security and Governmental Af25 fairs of the Senate.’’. 


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1 TITLE II—INCREASING THE 

2 NUMBER OF SMALL BUSINESS 

3 CONTRACTS AND SUB4 CONTRACTS 

5 SEC. 201. SMALL BUSINESS GOAL. 

6 (a) GOVERNMENT-WIDE GOAL.—Section 

7 15(g)(1) of the Small Business Act (15 U.S.C. 

8 644(g)(1)) is amended by striking ‘‘23 percent’’

9 and inserting ‘‘25 percent’’. 

10 (b) GOALS FOR SMALL DISADVANTAGED BUSI11 NESSES AND WOMEN-OWNED BUSINESSES.—Sec12 tion 15(g)(1) of such Act is further amended 

13 by striking ‘‘5 percent’’ both places it appears 

14 and inserting ‘‘8 percent’’. 

15 SEC. 202. ANNUAL GOAL NEGOTIATION. 

16 Section 15(g)(1) of the Small Business Act 

17 (15 U.S.C. 644(g)(1)) is amended by striking 

18 ‘‘The President shall annually establish Gov19 ernment-wide goals for procurement con20 tracts’’ and inserting ‘‘The President shall be21 fore the close of each fiscal year establish new 

22 Government-wide procurement goals for the 

23 following fiscal year for procurement con24 tracts’’. 


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1 SEC. 203. USAGE OF SMALL COMPANIES IN GOAL ACHIEVE2 MENT. 

3 Section 15(g) of the Small Business Act (15 

4 U.S.C. 644(g)) is amended by adding at the end 

5 the following: 

6 ‘‘(4) For purposes of this subsection and 

7 subsection (h), a small business concern shall 

8 be counted toward one additional category 

9 goal only, even if that small business concern 

10 otherwise qualifies under more than one cat11 egory goal. In this paragraph, the term ‘cat12 egory goal’ means a goal described in para13 graph (2).’’. 

14 SEC. 204. ANNUAL PLAN FOR EACH AGENCY EXPLAINING 

15 HOW AGENCY WILL MEET SMALL BUSINESS 

16 GOALS. 

17 Section 15(g) of the Small Business Act (15 

18 U.S.C. 644(g)) is amended by adding at the end 

19 the following: 

20 ‘‘(5) Before the beginning of each fiscal 

21 year, the head of each Federal agency shall 

22 submit to the Administrator of the Small Busi23 ness Administration and to Congress a de24 tailed plan explaining how the agency intends 

25 to meet the small business goals under this 


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1 subsection that apply to that agency for that 

2 fiscal year.’’. 

3 SEC. 205. MAKING SMALL BUSINESSES THE FIRST CHOICE. 

4 Section 15(j) of the Small Business Act (15 

5 U.S.C. 644(j)) is amended—

6 (1) in paragraph (1), by striking 

7 ‘‘$100,000’’ and inserting ‘‘the Simplified 

8 Acquisition Threshold’’; and 

9 (2) in paragraph (3), by striking ‘‘sub10 section (a) of section 8’’ and inserting 

11 ‘‘section 8, 31, or 36’’. 

12 SEC. 206. UNIFORM METRIC FOR SUBCONTRACTING 

13 ACHIEVEMENTS. 

14 Section 8(d) of the Small Business Act (15 

15 U.S.C. 637(d)) is amended by adding at the end 

16 the following: 

17 ‘‘(12) In carrying out this subsection, the 

18 Administrator shall require each prime con19 tractor to report small business subcontract 

20 usage at all tiers based on the percentage of 

21 the total dollar amount of the contract 

22 award.’’. 


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1 SEC. 207. SUBCONTRACTING DATABASE. 

2 Section 8(d) of the Small Business Act (15 

3 U.S.C. 637(d)) is amended by adding at the end 

4 the following: 

5 ‘‘(13) In carrying out this subsection, the 

6 Administrator shall develop and maintain a 

7 password-protected database that will enable 

8 the Administration to assist small businesses 

9 in marketing to large corporations that have 

10 not achieved their small business goals.’’. 

11 SEC. 208. NATIONAL DATABASE. 

12 The Administrator of the Small Business 

13 Administration shall ensure that whenever a 

14 small business enters its information in the 

15 Central Contractor Registry, or any successor 

16 to that registry, the Administrator contacts 

17 that business within 30 days regarding the 

18 likelihood of Federal contracting opportuni19 ties. The Administrator shall ensure that each 

20 small business that so registers is, for each in21 dustry code entered by that small business, 

22 provided with the total dollar value of govern23 ment contract awards to small businesses for 

24 that industry. 


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1 SEC. 209. REVIEW OF SUBCONTRACTING PLANS. 

2 Not later than 120 days after the date of 

3 the enactment of this section, the Adminis4 trator of the Small Business Administration 

5 shall, after an opportunity for notice and com6 ment, prescribe regulations to govern the Ad7 ministrator’s review of subcontracting plans, 

8 including standards for determining good 

9 faith effort in compliance with the subcon10 tracting plans. 

11 SEC. 210. AGENCY OBLIGATION FOR FULFILLING CON12 TRACTING GOALS. 

13 Section 15(h) of the Small Business Act (15 

14 U.S.C. 644(h)) is amended by adding at the 

15 end the following: 

16 ‘‘(4) At the conclusion of each fiscal year, 

17 the head of each Federal agency shall submit 

18 to Congress a report specifying the percent19 age of contracts awarded by that agency for 

20 that fiscal year that were awarded to small 

21 business concerns. If the percentage is less 

22 than 25 percent, the head of the agency shall, 

23 in the report, explain why the percentage is 

24 less than 25 percent and what will be done to 

25 ensure that the percentage for the following 

26 fiscal year will not be less than 25 percent.’’. 


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1 SEC. 211. APPROPRIATE LIMITS ON VALUE OF SOLE 

2 SOURCE CONTRACTS. 

3 (a) APPROPRIATE LIMITS.—If a law is not 

4 enacted by December 31, 2007, revising the 

5 limits referred to in this subsection, the Ad6 ministrator for Federal Procurement Policy, 

7 in consultation with the Administrator for 

8 Small Business, shall establish appropriate 

9 limits on the value of contracts awarded with10 out the use of competitive procedures to par11 ticipants in the program established by sec12 tion 8(a) of the Small Business Act (15 USC 

13 637(a)) that are not subject to the limits on the 

14 value of such contracts established by para15 graph (1)(D) of section 8(a) of such Act. 

16 (b) CONSULTATION.—In establishing any 

17 limit described in subsection (a). the Adminis18 trator for Federal Procurement Policy shall 

19 consult with representatives of the affected 

20 program participants. The Administrator 

21 shall also take into account—

22 (1) any special circumstances and 

23 needs of the affected program partici24 pants; and 

25 (2) the advantages of promoting com26 petition in Federal contracting. 


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1 TITLE III—PROTECTION OF 

2 TAXPAYERS FROM FRAUD 

3 SEC. 301. SMALL BUSINESS SIZE PROTEST NOTIFICATION. 

4 (a) IN GENERAL.—The Administrator of the 

5 Small Business Administration shall work 

6 with appropriate Federal agencies to ensure 

7 that whenever a business concern is awarded 

8 a contract on the basis that it qualifies as 

9 small and then is determined not to qualify as 

10 small, a notification of those facts (that an 

11 award was made on such a basis, and that 

12 such a determination was made) shall be 

13 placed adjacent to that concern’s listing in the 

14 Central Contractor Registry (or any successor 

15 to that registry). 

16 (b) COMPTROLLER GENERAL CERTIFI17 CATION.—The Administrator shall, in making 

18 any report of small business goal accomplish19 ments, qualify the accomplishments as ‘‘esti20 mated’’, until the Administrator obtains from 

21 the Comptroller General the Comptroller 

22 General’s certification that there are no data 

23 integrity issues with respect to the national 

24 repository of contract award information 

25 known as Federal Procurement Data SystemVerDate Aug 31 2005 23:45 May 04, 2007 Jkt 059200 PO 00000 Frm 00034 Fmt 6652 Sfmt 6202 E:\BILLS\H1873.RH H1873

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1 Next Generation (FPDS–NG), or any successor 

2 to that repository. 

3 (c) AWARDS TO LARGE BUSINESSES.—For 

4 each Federal agency, the Inspector General of 

5 that agency shall, on an annual basis, submit 

6 to Congress a report on the number and dol7 lar value of contract awards that were coded 

8 as awards to small business concerns but in 

9 fact were made to businesses that did not 

10 qualify as small business concerns. 

11 SEC. 302. REVIEW OF NATIONAL REGISTRY. 

12 The Administrator of the Small Business 

13 Administration shall ensure, on a biannual 

14 basis, that an independent audit is performed 

15 of the Central Contractor Registry, or any 

16 successor to that registry, and that the Dy17 namic Small Business Search portion of the 

18 registry, or any successor to that portion of 

19 the registry, is purged of any businesses that 

20 are not in fact small businesses. If a business 

21 that has been so purged attempts, while not 

22 in fact a small business, to re-register, that 

23 business is subject to debarment as a Federal 

24 contractor and is further subject to penalties 


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1 outlined in section 16 of the Small Business 

2 Act (15 U.S.C. 645). 

3 SEC. 303. RECERTIFICATION OF COMPLIANCE WITH SIZE 

4 STANDARDS AND REGISTRATION WITH CEN5 TRAL CONTRACTOR REGISTRY. 

6 Section 3(a) of the Small Business Act (15 

7 U.S.C. 632(a)) is amended by adding at the end 

8 the following: 

9 ‘‘(5) RECERTIFICATION.—

10 ‘‘(A) IN GENERAL.—If a business con11 cern is awarded a contract because of a 

12 standard by which it is determined to be 

13 a small business concern, and the busi14 ness concern is close to exceeding that 

15 standard at the time the award is made, 

16 then the business concern must, annually 

17 after the date of the award, recertify to 

18 the agency awarding the contract wheth19 er it meets that standard. 

20 ‘‘(B) ‘CLOSE TO EXCEEDING’.—For pur21 poses of subparagraph (A), a business 

22 concern is close to exceeding—

23 ‘‘(i) a number-of-employees stand24 ard if the number of employees of the 

25 business concern is 95 percent or 


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1 more of the maximum number of em2 ployees allowed under the standard; 

3 and 

4 ‘‘(ii) a dollar-volume-of-business 

5 standard if the dollar volume of busi6 ness is 80 percent or more of the max7 imum dollar volume allowed under 

8 the standard. 

9 ‘‘(6) REGISTRY.—For a business concern to 

10 be awarded a contract because of a standard 

11 by which it is determined to be a small busi12 ness concern, the business concern must, an13 nually after the end of the fiscal year used by 

14 the business concern, update its listing in the 

15 Central Contractor Registry.’’. 

16 TITLE IV—AUTHORIZATION OF 

17 APPROPRIATIONS 

18 SEC. 401. AUTHORIZATION OF APPROPRIATIONS. 

19 There are authorized to be appropriated 

20 such sums as may be necessary to carry out 

21 this Act and the amendments made by this 

22 Act. 


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Union Calendar No. 71 

110TH CONGRESS 

1ST SESSION H. R. 1873 

[Report No. 110

–111, Parts I and II] 

A BILL 

To reauthorize the programs and activities of the 

curement, and for other purposes. Small Business Administration relating to proMAY 3, 2007 

Reported with an amendment, committed to the Comand ordered to be printed mittee of the Whole House on the State of the Union, 


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