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### C H A P T E R   1	

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### THE BUSINESS PARTNERSHIP NETWORK PROGRAM 

The Business Partnership Network Program (the Program) is designed to motivate and encourage large business and small business prime contractor firms to provide mutually beneficial subcontracting opportunities to small business, veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small-disadvantaged business, and women-owned small business concerns.

This Program is a community-based effort involving leaders of major firms, financial and bonding institutions, industry associations, contract officers, policy and compliance, small business enterprises, and support service organizations. It provides an opportunity for the subcontractor firms to overcome barriers that typically inhibit or restrict the success of its business. It encourages major federal prime contractors to enhance the management and technical capabilities of subcontracts. The business partnership network may provide financial assistance in the form of equity investments and/or loans and subcontracts/subcontract support opportunities.  The prime contractor may also provide technical assistance, operational assistance, etc. to subcontractors in performing as first tier subcontracts through mutually exclusive agreements with the primes.

Overall, the Program is designed to produce a broad base of high quality, competitive and profitable companies through incremental improvement and new entrant engagement. It is expected that as a result of the Program, the subcontractor partnerships will experience a greater than industry average success rate and realize the growth and profitability objectives of their business plans, as well as long range stability.

#### BENEFITS OF THE PROGRAM

By implementing this Program as a component of our small business enterprise, TREASURY will provide a community benefit by strengthening emerging businesses and providing them with previously denied opportunities for growth, expansion and increased participation in Treasury’s economic development. The Program enables TREASURY to build effective working relationships between leaders of mature established companies and new/emerging small business enterprises in order for the small businesses to benefit from the knowledge and experience of the established partnership.   Furthermore, the Program:

**»**Fosters the establishment of long-term, mutually beneficial business relationships between TREASURY and industry associations.

**»**Facilitates the ability to acquire an expanded base of qualified small businesses who can successfully win prime and sub - contracts in TREASURY.

**»**Strengthens subcontracting opportunities.

**»**Provides greater assurance that a subcontractor will be able to perform under a contract.

**»**Supports Treasury mission to increase job opportunities and promote the conditions that strengthen economic growth.

**»**Supports Treasury’s objective to increase the number of new entrants to Treasury’s diverse supplier base.   

### THE PROGRAM PROCESSES

Treasury’s OSDBU has a particular set of responsibilities to ensure that the Program is executed in accordance with guidance outlined in Executive Order 13985 and OMB Memorandum 22-03 including:

**»**Coordinating with OPE to formulate the Program policies and procedures.

**»**Marketing and promoting the business partnerships to support HBCU’s and small businesses that are located in underserved communities.

**»**Organizing partnership training, representing Treasury OSDBU at vendor outreach and industry association events, and hosting an annual subcontracting match-making event.

**»**Reviewing and approving business partnership agreements for participation in the Program.

**»**Attending SBA’s and other industry partnering meetings to learn from best practices and lessons learned.

**»**Conducting annual performance reviews under the approved Program agreements.

**»**Attracting the support of large business contractors and mature small business prime contractor to enter into subcontracting partnerships.

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### C H A P T E R  2	

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# THE LEAD PARTNER

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ELIGIBILITY REQUIREMENTS

As a potential lead partner, you must meet the established eligibility requirements to participate in the Program.  A lead partner can be either a large business or a mature small business.  Regardless of size, the lead partner must have the capability to assist the subcontracting partner firm and be able to make a commitment to the partnership for at least one year. The Subcontracting Program can be found in Federal Acquisition Regulation Part 19.7.  The eligibility requirements will be updated in Treasury’s Small Business Policy Handbook and is summarized below:

**»**The potential lead partner may be either a large or mature small business entity;

**»**The potential lead partner must be eligible for award of Government contracts;

**»**The potential lead partner must be able to provide developmental assistance that will enhance the ability of subcontractor partners to perform as prime contractors or subcontractors; and

**»**The potential lead partner will be encouraged to enter into arrangements with entities with which it has previously established business relationships.

**»**The potential lead partner shall not appear on the Federal list of debarred or suspended contractor as described in the FAR Subpart 9.4, Debarment, Suspension, and Ineligibility.

A lead partner may have several Treasury business partnership relationships.  In that case, separate Program packages must be submitted for each partnership relationship.  Assistance may be obtained by the lead partner’s firm for the subcontractor’s firm from one or more of the following resource centers:

**»**Small Business Development Centers (SBDC) established pursuant to the Small Business Act (15 U.S.C. 648)

**»**Entities providing procurement technical assistance pursuant to Title 10 U.S.C. (Procurement Technical Assistance Centers)

## BENEFITS OF THE PROGRAM

For acquisitions that contain the requirement for a subcontracting plan, the members of a Treasury business partnership agreement are eligible to receive additional credit in the source selection and evaluation criteria process for contracts.

Additionally, a post-award incentive for meeting and exceeding the subcontracting plan/subcontracting goals in the electronic subcontracting review system (eSRS) is available as a rating in the Contractor’s Performance Assessment Reporting Systems (CPARS) by recognizing successful performance and management of the subcontractor

As an entity seeking to participate as a lead business partner, you must apply to the TREASURY OSDBU detailing your qualifications. Once approved, you will provide the appropriate developmental assistance as specified in your Program Package. 

### SELECTING A SUBCONTRACTOR

As the lead partner, you are solely responsible for selecting a subcontractor with whom you believe you can develop a successful business relationship. Be aware that a previously established association is highly recommended between you and the subcontractor.  Consider the following when selecting a subcontractor:

**»**The subcontractor’s geographic proximity to you;

**»**The subcontractor’s strategic vision and how the partnership assistance will align;

**»**The subcontractor’s attitude regarding a formal partnership agreement;

**»**The subcontractor’s commitment to the partnership relationship;

**»**The subcontractor’s capabilities and how they may interface with your business;

**»**The subcontractor’s financial status and the overall stability of their management;

**»**The subcontractor’s past performance including the results of any contract or subcontract work between you and the subcontractor; and

**»**The subcontractor’s overall expectations.

### **BUSINESS PARTNERSHIP NETWORK PACKAGE**

Once your firm has identified an eligible entity to participate as a subcontractor, you should perform a needs assessment prior to completing the Program Package. The needs assessment will help you determine the difference between current and desired states. Furthermore, it will help your firm discover the needs expressed by management and/or other employees and establish realistic developmental needs for the subcontractor firm.

The lead partner should also discuss the potential relationship with the Contracting Officer for any existing TREASURY prime contracts, Blanket Purchase Agreement (BPA), or an Indefinite Delivery Indefinite Quantity (IDIQ) Contracts which could be modified to include the provisions of the agreement.

As the lead partner, you are responsible for working with the subcontractor to develop the proposed Partnership agreement for each business relationship. The package must contain a signed business partnership agreement that includes the following information:

**»**Names, addresses, phone numbers, and e-mail addresses of the lead partner and subcontractor firms and points of contact for both;

**»**A description of the assistance that will be provided by the partnership, including a description of the work or product contracted for (if any), a schedule for any training assistance, and criteria for evaluation of the subcontractor’s developmental success.

**»**A listing of the number and types of subcontracts to be awarded in the partnership;

**»**Duration of the agreement, including rights and responsibilities of both parties;

**»**Termination procedures, including procedures for the parties’ voluntary withdrawal from the Program in writing at least 30 days in advance of its intent to voluntarily terminate the agreement;

**»**Procedures requiring the partners to notify OSDBU immediately upon receipt of termination notice from the other party;

**»**Should the agreement be terminated, a plan for accomplishing the work or product contracted for should be sent to the Contracting Officer and OSDBU; and

**»**Other terms and conditions, as appropriate.

### SUBMISSION OF THE PROGRAM PACKAGE

As the lead partner, you are responsible for submitting the signed proposed Program Package for each partnership relationship to Treasury for approval. Application for and enrollment into the Program are free and open to the public. The deadlines for submission to the OSDBU Program Manager are:

**»**January 30th

**»**June 30th

Any proposed Program Package that is submitted outside of the dates mentioned above will be held for evaluation in the next cycle.

### EVALUATION OF THE PROGRAM PACKAGE

Proposed Business Partnership Network packages will be evaluated by Treasury OSDBU’s Business Partnership Program Manager for OSDBU. The program manager will review the information to ensure that the partnerships meet the eligibility requirements and will ensure that the appropriate information is included. If the agreement relates to a specific contract, then the OSDBU will consult with the responsible Contracting Officer on the adequacy of the proposed agreement. The OSDBU will complete its review no later than 30 calendar days after the program enrollment cutoff date. All proposed packages will be **evaluated on the following criteria in descending order of importance**:

**»**Merit of the developmental assistance to the subcontracting firm;

**»**Perceived benefit and value of the agreement to TREASURY; and

**»**Subcontracting opportunities available.

Notification of the endorsement or rejection will be sent to the proposed partners with an explanation. Unsuccessful agreements may be revised and resubmitted in the next submission cycle. The supplemental information must be provided within 15 days of the notification. OSDBU will complete its review of the materials no later than 30 days after its receipt.

### PROGRAM EXECUTION AND DEVELOPMENTAL ASSISTANCE

As a lead partner, it is essential that you devote the necessary time, staff and other resources to fulfill your responsibilities to provide stronger, more capable subcontractors. You may provide guidance in the following areas:

**»**Subcontracting Management to ensure the work is completed as defined in the contract.

**»**Small business Certification to ensure the small business is considered small according to SBA size standards.

**»**Business Management such as assisting with strategic planning, business planning, and risk management.

**»**Business Development such as market research, product forecasting and web-based marketing techniques, and proposal management.

**»**Operational assistance****

**»**Technical Assistance such as ISO 9000 and SEI/CMMI Certifications.

**»**Award of subcontracts under TREASURY contracts or other contracts on a non-competitive basis.

**»**Administer advance payments under subcontracts in accordance with FAR Subpart 32.4.

#### MEETINGS

As the approved lead partner, TREASURY encourages you to conduct regular face-to-face sessions with your subcontractors. During these meetings, you should work together to develop the partnership strategic business plan and to discuss problems, strategies, and objectives that are critical to achieving results. You are encouraged to establish this meeting to discuss items relevant to your business relationship. Furthermore, inquire on the subcontractor’s efforts to establish and implement the business plan and discuss any actions required for a successful partnership. The partners should establish target dates for any improvements or enhancements to the partnership.

#### INFORMAL CONTACTS

TREASURY encourages the partners to routinely communicate with each other and attempt to correspond on a routine basis to discuss daily problems and situations encountered by the subcontractor and to provide periodic review.

#### INTRODUCTION TO RESOURCES

We also encourage you to introduce the subcontractor to a variety of business resources in which you consult, including representatives in the banking, bonding, management, and business industries as means of providing access and breaking down previously existing barriers which may have hindered the subcontractor in the past.

#### INDEPENDENCE

Be aware that as a lead partner, you must not assume managerial or administrative control of the subcontractor during or following the partnership period.

#### ASSISTANCE PLAN

Through your needs assessment, you should determine what stage of development the subcontractor (i.e., new entrant, growth, expansion, and mature) is in. The criteria to be considered shall include but not necessarily limited to the following:

**»**Net Worth – Does the subcontractor have a positive net worth?

**»**Cash flow or Bank Credit or banking line of credit?

**»**Bonding Capacity – Does the subcontractor have bonding? If so, to what capacity?

**»**Necessary Equipment – Does the subcontractor firm have the ability to rent/lease equipment as necessary to compete for work?

**»**Administrative Capacity – Does the subcontractor have the resources necessary to successfully perform the work in the contract?

**»**Technical Capacity – Does the subcontractor have adequate resources/clearances to direct the project’s management and operational requirements of their items of work?

**»**Estimating Capacity – Does the subcontractor have the ability to project and determine the pertinent cost factors associated with the performance of an item of work?

**»**Supervisory Staff – Does the subcontractor have an appropriate number of technically trained and experienced staff for their volume of work?

**»**Experience – Does the subcontractor have a sufficient number of trained staff and level of completed work to provide a minimum level of operational expertise in their area of work?

#### REPORTING PROBLEMS TO OSDBU

Treasury encourages you to discuss progress, issues or problems encountered with the business partnership arrangement with OSDBU Director as soon as possible.

#### WORKING RELATIONSHIP

Be aware that the relationship may develop slowly and at times the process may be time consuming. As a lead partner, you must be motivated by a desire to give something back and to help nurture a small business subcontractor in your community. You should also know that there is nothing in the regulations that prohibits you and the subcontractor from working together on other projects or in SBA approved joint venture arrangements.

#### INCENTIVES

Under the Small Business Act, 15 U.S.C. 637(7)(E)(3), TREASURY is authorized to provide appropriate incentives to encourage subcontracting opportunities for small business consistent with the efficient and economical performance of the contract. This authority is limited to negotiated procurements. The FAR provides additional guidance.

Costs incurred to provide developmental assistance and to fulfill the terms of their agreement(s) are not reimbursable as a direct cost under a TREASURY contract.  TREASURY will consider these costs in determining indirect cost rates.

In addition, Contracting Officers may grant additional credit for a Treasury business partnership agreements in proposal evaluation considerations for subcontracts awarded in their subcontracting plan.  Therefore:

**»**Contracting officers may evaluate subcontracting plans containing business partnership arrangements more favorably than subcontracting plans without these agreements.

**»**Contracting officers may assess the prime contractor’s compliance with the subcontracting plans submitted in previous contracts as a factor in evaluating past performance under FAR 15.305(a)(2) and determining contractor responsibility 19.705-5(a)(1).

The OSDBU will also present an annual non-monetary Business Partnership Network Award to the partner providing the most effective developmental support of a subcontractor. Each year the partners will be invited to present their program progress. 

### AGREEMENT TERMINATION

If for any reason, the partners decide to terminate the agreement prior to the scheduled completion date, a formal notification must be submitted to Treasury OSDBU’s Program Manager.

#### VOLUNTARY TERMINATION

You may voluntarily withdraw from the program. To do so, you should notify the subcontractor in writing at least 30 days in advance of your intent to voluntarily withdraw participation in the program. You may only voluntarily terminate your agreement(s) if you no longer want to be a participant in the program as a lead partner.  You are obligated to fulfill your contract requirements under the partnership and subcontracting agreement.  In no event shall the partner withdrawal from the contractual requirements under any prime contract.

#### TERMINATION FOR CAUSE

The lead partner must furnish the subcontractor a written and signed notice of the proposed termination, stating the specific reasons for such action, at least 30 days in advance of the effective date of such proposed termination.

**»**The subcontractor will have 30 days to respond to the notice of proposed termination and may rebut any issues and offer a proposed plan of remediation.

**»**Upon prompt consideration of the subcontractor’s response, the lead partner must either withdraw the notice of proposed termination and continue their partnership agreement, or issue the notice of termination to the OSDBU Director.

**»**The decision of the lead partner regarding termination for cause will be reviewed with comments by Treasury’s Business Partnership Program Manager.

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### ANNUAL REPORTING AND REVIEWS

Annual performance reviews will be conducted by Treasury’s Business Partnership Program Manager. These performance reviews will focus on the progress and accomplishment realized under the approved agreements. The Program package should include a statement upon submission that both partners will fully comply with all the reporting requirements outlined in Treasury’s Program guidance.

#### ANNUAL REPORTS

You are required to report on the progress made under each of your partnership agreements annually and throughout the term of the agreement.  Each report is due 30 days after the end of each twelve-month period commencing with the start of the agreement. 

The subcontractor will also be required to submit an individually developed annual report using the same form. Their report must document the progress made during by the prior twelve months in employment, revenues, and participation in TREASURY contracts. The subcontractor’s report may be submitted as part of the lead partner’s report or submitted separately, and is due at the same time.

Be aware that the Business Partnership Network Program Manager places extra emphasis on the required annual reports, since these reports will be used to determine if the agreements add value to Treasury.  

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#### POST AGREEMENT REPORTS

The subcontractor is also required to submit data on employment and revenue for each of the two years following the end of their agreement. These reports are due one month after the end of the first and second year after the end of the agreement. 

C H A P T E R	3

# THE SUBCONTRACTOR

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ELIGIBILITY REQUIREMENTS

As a potential subcontractor, you must meet the established eligibility requirements to participate in the program. A subcontractor must be in good standing and must be current with its certification  requirements. The eligibility requirements are summarized below:

**»**The prospective subcontractor must be a small business, veteran-owned small business, service- disabled veteran-owned small business, HUBZone, small-disadvantaged business, or women-owned small business;

**»**The prospective subcontractor must meet the size standard corresponding to the NAICS code that the lead partner/prime contractor believes best describes the product or service being acquired by the subcontract;

**»**The prospective subcontractor must be eligible for award of government contracts; and

**»**The prospective subcontractor must not appear on the Federal list of debarred or suspended contractor as described in the FAR Subpart 9.4, Debarment, Suspension, and Ineligibility.

## BENEFITS OF THE PROGRAM

The program is intended to enhance the capability of small businesses so that they may compete more successfully for Federal Government contracts.

The program encourages private-sector relationships and expands Treasury’s efforts to identify and respond to the developmental needs of the participants. The Program arrangements enable subcontractors to receive technical, managerial or any other mutually agreed upon benefits from lead partners including work that flows from a government or commercial contract through subcontracting or teaming arrangements. 

Successful subcontractors capitalize on available business development resources, educate themselves on government buying needs, and market themselves based on skills and ability to meet such needs. Further, subcontractors gain opportunities to seek and perform government and commercial contracts through the guidance and support of the lead partner that may not have been available to them without the Program.

## PROGRAM PROCESSES

As an entity seeking to participate as a subcontractor, you must establish a business relationship with a lead partner and apply to the TREASURY OSDBU detailing your qualifications. Once approved, the lead partner will provide the appropriate assistance as specified in your agreement package.

### DEVELOPING RELATIONSHIPS AS PARTNERS

As a small or disadvantaged business, you are aware of the challenges you face to have a successful business. Learning new disciplines alone can be frustrating, time consuming, and expensive.

Effective partnering relationships are frequently slow to develop and need to be nurtured in order to become beneficial. But the results are worth the commitment and investment to make effective partnering happen and to enable you to learn new disciplines quickly and efficiently.

Accomplished partners are busy with their own businesses and have already capitalized on their entrepreneurial endeavors. They generally are motivated by a desire to give something back and to help nurture a small business in their community. In some cases, the subcontractor offers a specific area of expertise that compliments the lead partner’s business.

As a subcontractor partner, it is important to solicit and listen to counsel and advice on the full spectrum of experiences of the lead partner. As the subcontractor, you should not tune out information in areas where you think no help is needed, when in fact help in these areas may be more critical to your business than you perceive. A small business seldom, if ever, graduates from the need for partnering relationships. As business activities grow and become more complex, there are always partners with experiences and insights who can provide key assistance in helping the business ascend to the next level. So, nurture and develop a beneficial relationship with your partners.

### THE PROGRAM PACKAGE

Prior to drafting the Program Package, the lead partner must ensure your firm is eligible to participate as a subcontractor. Once you have entered in arrangements with the lead partner, you must work collectively to complete the Program Package. A template for the Program Package can be found in Appendix B.

The package should identify the difference between current and desired states. The package must contain a signed Business Partnership agreement that includes the following information:

**»**Names, addresses, phone numbers, and e-mail addresses of the subcontracting firm and a point of contact;

**»**A description of the assistance that will be provided by the lead partner to the subcontractor, including a description of the work or product contracted for (if any), a schedule for providing assistance, and criteria for evaluation of the subcontractor’s success.

**»**A listing of the number and types of subcontracts to be awarded (if any) to the subcontractor

**»**Duration of the agreement, including rights and responsibilities of both partners;

**»**Termination procedures, including procedures for the parties’ voluntary withdrawal from the program. The agreement shall require the partners to notify each other in writing at least 30 days in advance of its intent to voluntarily terminate the Agreement;

**»**Procedures requiring the parties to notify Treasury OSDBU immediately upon receipt of termination notice from the other party;

**»**A plan for accomplishing the work or product contracted for should the agreement be terminated; and

**»**Other terms and conditions, as appropriate.

### SUBMISSION OF THE PROGRAM PACKAGE

The lead partner is responsible for submitting the signed proposed Program Package to TREASURY for approval.

Application for and enrollment into the program is free and open to the public. The deadlines for submission to the OSDBU Business Partnership Program Manager are:

**»**January 30th

**»**June 30th

Any proposed Program Package that is submitted outside of the dates mentioned above will be held for evaluation in the next cycle.

### EVALUATION OF MENTOR-PROTÉGÉ PACKAGE

The proposed Program Package will be evaluated by Treasury OSDBU’s Business Partnership Network Program Manager. The OSDBU will review the information to ensure that the partners meet the eligibility requirements and to ensure that the appropriate information is included. If the application relates to a specific contract, then the OSDBU will consult with the responsible Contracting Officer on the adequacy of the proposed agreement. The OSDBU will complete its review no later than 30 calendar days after receipt of the package. All proposed packages will be **evaluated on the following criteria’s**:

**»**Merit of the developmental, managerial, technical, and operational assistance;

**»**Perceived benefit and value of the agreement to TREASURY; and

**»**Subcontracting opportunities available.

Notification of the endorsement or rejection will be sent to the partners with an explanation. Any supplemental information requested by the Program Manager must be provided within 15 days of the notification.  The Program Manager will complete its review of the materials no later than 30 days after its receipt. Unsuccessful agreements may be revised and resubmitted in the next submission cycle.

### PROGRAM EXECUTION AND ASSISTANCE

As a prospective subcontractor, you must be actively conducting business and be considered ready for expansion and must agree to participate fully in the business partnership. It is essential that you devote the necessary time, staff and other resources to fulfill your responsibilities as a subcontractor and to become stronger, more capable small businesses. 

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#### REPORTING PROBLEMS 

Treasury encourages subcontractors to discuss progressive issues or problems (encountered with the business arrangement agreement) with the Business Partnership Program Manager as soon as possible.

#### WORKING RELATIONSHIP

Be aware that there is nothing in the regulations that prohibits the partners from working together on other projects or in SBA approved joint venture arrangements provided that control remains with the subcontractor itself. You may be used to meet subcontractor requirements on which the lead partner bids.

### AGREEMENT TERMINATION

If both partners decide to terminate the agreement prior to the scheduled completion date, a formal notification must be submitted to Treasury’s Business Partnership Program Manager.

#### VOLUNTARY TERMINATION

You may voluntarily withdraw from the program. To do so, you should notify the lead partnr in writing at least 30 days in advance of  your firm’s intent to voluntarily withdraw its participation in the program.

### ANNUAL REPORTING AND REVIEWS

Annual performance reviews will be conducted by the Business Partnership Program Manager. These performance reviews will focus on the progress and accomplishment identified under an approved Package. The partnership agreements should include a statement upon submission that both partners will fully comply with all the reporting requirements of Treasury’s  Program.

#### ANNUAL REPORTS

As the subcontractor, you will be required to submit your own individually developed annual report.    You must describe the progress made during the prior twelve months in employment, revenues and participation in Treasury contracts. Your report may be submitted as part of the lead partner’s report or submitted separately, and is due at the same time.

Be aware that the Program Manager places extra emphasis on the required annual reports, since these reports will be used to determine if the agreement is meeting its original agreement package, and the effectiveness of the partnership.

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