Federal Contracting and Subcontracting with Small Businesses: Legislation in the 113th Congress
Released: 2015-12-09T00:00:00

Summary:
Congress has generally broad authority to impose requirements upon the federal procurement process (i.e., the process whereby agencies acquire supplies and services from other entities for the agency's direct benefit or use). One of the many ways in which Congress has exercised this authority is by enacting measures that encourage agencies to contract and subcontract with "small businesses." For purposes of federal procurement law, the term small business generally denotes a business that (1) is independently owned and operated, (2) is not dominant in its field of operations, and (3) has fewer employees or annual receipts than the standards that the Small Business Administration (SBA) has established for the industries in which the business operates.
In exercising its authority over procurement, Congress has declared a policy of ensuring that a "fair proportion" of federal contract and subcontract dollars is awarded to small businesses. It has also required the executive branch to establish government-wide and agency-specific goals for the percentage of contract and/or subcontract dollars awarded to small businesses that equal or exceed specified percentages of federal procurement spending (e.g., 3% for Historically Underutilized Business Zone (HUBZone) small businesses). Congress has similarly required or authorized agencies to conduct set-asides, or competitions in which only small businesses may compete, as well as to make noncompetitive or "sole-source" awards to small businesses in circumstances when such awards could not be made to other businesses. In addition, the SBA and officers of the procuring agencies are tasked with reviewing and restructuring proposed procurements to maximize opportunities for small business participation.
Congress periodically amends the statutes governing contracting and subcontracting with small businesses to further its declared policy of ensuring that small businesses receive a "fair proportion" of federal procurement spending. The 111th and 112th Congresses, in particular, made numerous changes to such statutes. These Congresses enacted legislation (P.L. 111-240, P.L. 112-239) that addresses, among other things, (1) the standards under which business size is determined; (2) goals for contracting and subcontracting with small businesses; (3) prime contractors' obligations in subcontracting with small businesses; (4) SBA guarantees of small businesses' performance and payment bonds; (5) "bundling" and "consolidation" of agency requirements into contracts unsuitable for performance by small businesses; (6) set-asides for women-owned small businesses; and (7) mentor-protégé programs for small business contractors.
Compared to the 111th and 112th Congresses, the 113th Congress enacted relatively few measures addressing small business contracting, perhaps because the amendments made by its predecessors were still being implemented and assessed. Among other things, the primary measures enacted by the 113th Congress (P.L. 113-66, P.L. 113-291) made certain modifications to the legal requirements regarding the use of reverse auctions; sole-source awards to women-owned small businesses; reporting on "bundled" or "consolidated" contracts; reporting on goals for contracting and subcontracting with small businesses; and prime contractors' obligations as to subcontracting with small businesses. Other measures introduced or, in a few cases, enacted in the 113th Congress addressed other topics.

paragraphs: C ongress has generally broad authority to impose requirements upon the federal procurement process (i.e., the process whereby agencies acquire supplies and services from other entities for the agency's direct benefit or use). One of the many ways in which Congress has exercised this authority is by enacting measures that encourage agencies to contract and subcontract with "small businesses." For purposes of federal procurement law, the term small business generally denotes a business that (1) is independently owned and operated, (2) is not dominant in its field of operations, and (3) has fewer employees or annual receipts than the standard that the Small Business Administration (SBA) has established for the industry in which the business operates.
In exercising its authority over procurement, Congress has declared a policy of ensuring that a "fair proportion" of federal contract and subcontract dollars is awarded to small businesses. It has also required the executive branch to establish government-wide and agency-specific goals for the amount of contract and/or subcontract dollars awarded to small businesses that equal or exceed specified percentages of federal procurement spending (e.g., 3% to Historically Underutilized Business Zone (HUBZone) small businesses). Congress has similarly required or authorized agencies to conduct set-asides , or competitions in which only small businesses may compete, as well as to make noncompetitive or "sole-source" awards to small businesses in circumstances when such awards could not be made to other businesses. In addition, the SBA and officers of the procuring agencies are tasked with reviewing and restructuring proposed procurements to maximize opportunities for small business participation. CRS Report R42391, Legal Authorities Governing Federal Contracting and Subcontracting with Small Businesses , by [author name scrubbed] and [author name scrubbed], discusses these and related measures in more detail. 
Congress periodically amends the statutes governing contracting and subcontracting with small businesses to better achieve its declared policy of ensuring that small businesses receive a "fair proportion" of federal procurement spending. The 111 th and 112 th Congresses, in particular, made numerous changes. These Congresses enacted legislation ( P.L. 111-240 , P.L. 112-239 ) that addresses, among other things, (1) the standards under which business size is determined; (2) goals for contracting and subcontracting with small businesses; (3) prime contractors' obligations in subcontracting with small businesses; (4) SBA guarantees of small businesses' performance and payment bonds; (5) "bundling" and "consolidation" of agency requirements into contracts unsuitable for performance by small businesses; (6) set-asides for women-owned small businesses; and (7) mentor-protégé programs for small business contractors. Compared to the 111 th and 112 th Congresses, the 113 th Congress enacted relatively few measures addressing small business contracting, perhaps because the amendments made to the various laws governing small business contracting by its predecessors were still being implemented and assessed. 
This report describes, by issue area, the various small business contracting bills in the 113 th Congress and, particularly, the modifications to existing law that were made. In doing so, the report also briefly surveys current law on particular issues pertaining to small business contracting and subcontracting, including significant amendments to current law made by the 111 th and 112 th Congresses. The latter information is included because, in many cases, the legislation enacted or proposed in the 113 th Congress built upon changes made by its predecessors. Although the report cites numerous bills, it does not attempt to include all legislation related to small business contracting in the 113 th Congress. Nor does it discuss all provisions of bills that are included. Rather, its focus is upon legislation that reflects distinctive approaches to issues in small business contracting (e.g., increasing goals, authorizing set-asides or sole-source awards). The report will be updated as additional legislation is enacted or introduced. 
subsections: section_title: Government-Wide and Agency-Specific Goals
paragraphs: Government-wide and agency-specific goals for the percentage of contract and/or subcontract dollars awarded to small businesses have long been part of the federal procurement process. Congress amended Section 15(g) of the Small Business Act in 1978 to require that agency heads, in consultation with the SBA, set agency-specific goals for the percentage of federal contract and subcontract dollars awarded to small businesses each year. Ten years later, in 1988, Congress further amended Section 15(g) to require the President to set government-wide goals for the percentage of federal contract and/or subcontract dollars awarded annually to various categories of small businesses. These government-wide goals must equal or exceed certain percentages specified in statute (currently, 23% of federal contract dollars awarded to small businesses (of any type); 5% of federal contract and subcontract dollars awarded to women-owned small businesses; 5% to small businesses owned and controlled by "socially and economically disadvantaged" individuals and groups; 3% to HUBZone small businesses; and 3% to service-disabled veteran-owned small businesses). Individual contracts may be counted toward multiple goals. For example, an award to a HUBZone small business counts toward both that goal and the overall small business goal. 
The 1978 and 1988 amendments granted the executive branch considerable discretion in determining how the "total value of all prime contract and subcontract awards" for a fiscal year was to be calculated, and in deciding what steps should be taken to meet the government-wide and agency-specific goals. This discretion, coupled with persistent failures to meet the goals, prompted the 111 th and 112 th Congresses to make multiple changes to what is commonly known as the "Small Business Goaling Program." Initially, the 111 th Congress required that senior procurement executives, senior program managers, and agency directors of Small and Disadvantaged Business Utilization (OSDBUs) communicate to their subordinates the "importance of achieving small business goals." Subsequently, the 112 th Congress reiterated this requirement, and made other amendments to Sections 15(g) and (h) of the Small Business Act with the intent of improving performance as to these goals. Among other things, the 112 th Congress directed the SBA to review its "Goaling Guidelines" to ensure that certain types of spending are not excluded when goals are set. It also imposed several requirements as to the establishment of agency-specific contracting goals, directed agencies to take specified steps to meet their goals, and increased reporting regarding goaling program performance. In addition, the 112 th Congress mandated an independent assessment of the goaling program and required that certain members of the Senior Executive Service (SES) be trained on contracting requirements under the Small Business Act. 
subsections: section_title: Legislation Enacted by the 113th Congress
paragraphs: Building on the work of its predecessors, the 113 th Congress addressed the government-wide and agency-specific goals for contracting and subcontracting with small businesses. One measure enacted by the 113 th Congress amended Section 15(h) to require that agency reports regarding performance in contracting and subcontracting with small businesses include a "remediation plan with proposed new practices to better meet such goals, including analysis of factors leading to any failure to achieve such goals." Previously, such plans only had to address (1) the extent of small business participation in agency contracts and subcontracts, (2) whether the agency achieved its goals, and (3) justifications for any failures to attain goals. 
Another measured enacted by the 113 th Congress amended Section 15(g) to permit the Department of Energy (DOE) to count first-tier subcontracts awarded by contractors managing and operating national laboratories toward the DOE and government-wide goals for prime contracts . This change arguably reflects the unique nature of the supplies and services the DOE purchases, a sizeable percentage of the total value of which is made up of contracts for the management and operation of laboratories that are generally seen as unsuitable for performance by small businesses. At earlier dates, the DOE had prime contract goals that were substantially lower than those of other agencies. However, the DOE could potentially have been said to have failed to comply with certain requirements imposed by the 112 th Congress—particularly a requirement that agencies "make a consistent effort to annually expand participation by small business concerns from each industry category in [agency] procurement contracts and subcontracts" —if it had reported this same low goal as to prime contracts year after year, without any increases. Counting certain subcontracts as if they were prime contracts arguably gives the DOE greater latitude for improvements in its performance as to its prime contracting goals. On the other hand, an argument could be made that treating subcontracts as if they were prime contracts minimizes the DOE's incentives to contract with small businesses. Those opposed to counting certain DOE subcontracts as prime contracts may also note that subcontractors do not enjoy the same protections as prime contractors under federal law, making it inappropriate to equate the two.
section_title: Legislation Proposed in the 113th Congress
paragraphs: Members of the 113 th Congress also introduced legislation that would have increased the government-wide goals for the percentage of contract and/or subcontract dollars awarded to small businesses, thereby also effectively increasing the agency-specific goals. Most commonly, these measures would have increased the goal for the percentage of prime contract dollars awarded to small businesses (of any type) from 23% to 25%, and the goals for the percentage of contract and subcontract dollars awarded to small disadvantaged businesses and women-owned small businesses from 5% to 10% each. Some measures would also have increased the goals for the percentage of contract and subcontract dollars awarded to HUBZone small businesses and service-disabled veteran-owned small businesses from 3% to 5%-6% each. Such measures responded to concerns that the goals—which were set a decade or more ago—are too low and do not adequately reflect the availability of minority-, women-, and service-disabled veteran-owned small businesses in today's marketplace. Also, given recent reports that the federal government has met its goals for contracting and subcontracting with small businesses for the first time in seven years, an argument could be made that increasing the goals is necessary to ensure continued federal efforts and improvements in this area.
Other measures introduced in the 113 th Congress would have clarified how particular contracts are to be counted for goaling purposes. Several of these measures sought to prevent "double dipping," or counting a single contract toward multiple goals because, for example, it happens to be awarded to a firm that is owned by a service-disabled woman that is participating in the SBA's Minority Small Business Ownership and Capital Development Program (commonly known as the "8(a) Program"). These measures would have generally barred agencies from counting a small business in more than two categories (e.g., HUBZone, women-owned) when determining whether the agency has met its goals. Some measures would have also required agencies to count awards to small businesses participating in the 8(a) Program toward the goal for small disadvantaged businesses, as opposed to other goals. Other measures would have clarified how specific contracts (e.g., contracts with "teaming arrangement entities") are to be counted. 
Yet other bills in the 113 th Congress would have mandated reporting of specific information about agencies' performance in contracting and subcontracting with small businesses, or would have required independent assessments of agency performance. Other measures would have repealed the provisions, previously noted, that authorize the DOE to count first-tier subcontracts awarded by management and operations contractors toward the DOE and government-wide prime contracting goals. 
section_title: Subcontracting Plans
paragraphs: The basic requirement that agencies incorporate clauses stating U.S. policy as to subcontracting with small businesses into their prime contracts, and "subcontracting plans" into larger prime contracts, originated with the 1978 amendments to Section 8(d) of the Small Business Act. As amended, Section 8(d) generally requires agencies to incorporate terms addressing subcontracting with small businesses in contracts performed within the United States whose value exceeds a minimum threshold (currently, generally $150,000) . These terms (1) articulate that it is the "policy of the United States" that small businesses have the "maximum practicable opportunity to participate" in the performance of federal contracts, and (2) obligate the prime contractor to carry out this policy "to the fullest extent consistent with the efficient performance of th[e] contract." In addition, "larger" contracts (currently those whose value exceeds $700,000 ($1.5 million for construction contracts)) that offer subcontracting possibilities must generally also incorporate so-called subcontracting plans with
percentage goals for the amount of work to be subcontracted with various types of small businesses (e.g., HUBZone small businesses); descriptions of the efforts the contractor will take to ensure that small businesses have "an equitable opportunity to compete" for subcontracts; assurances that the contractor will "flow down" these requirements to all subcontractors (other than small businesses) with "larger" subcontracts (currently, those valued in excess of $700,000 ($1.5 million for construction contracts)); and recitations of the types of records the contractor will maintain to demonstrate the procedures it has adopted to comply with its subcontracting plan.
Recent Congresses have, however, made a number of amendments to Section 8(d), in part, because of concerns about agencies' performance in meeting the government-wide and agency-specific goals for contracting and subcontracting with small businesses. Initially, the 111 th Congress amended Section 8(d) in an attempt to address "bait-and-switch" (i.e., prime contractors using subcontractors other than those whom they said in their bid or offer that they would use), and subcontractors' difficulties in obtaining payment from prime contractors. Among other things, the 111 th Congress required that subcontracting plans include terms obligating prime contractors to make "good faith efforts" to obtain supplies and services from the small businesses they "used" in preparing their bids and proposals, and provide the contracting officer a written explanation if they do not. It also required prime contractors to notify the contracting officer in writing if they pay a "reduced price" to a subcontractor for completed work, or if payment to a subcontractor for work for which the agency has paid the prime contractor is more than 90 days past due. 
Subsequently, the 112 th Congress imposed additional requirements on the collection and reporting of data regarding prime contractors' performance of their subcontracting plans. It also provided statutory authority for contracting officers to consider prime contractors' performance in subcontracting with small businesses when evaluating their "past performance" for source-selection purposes. In addition, it established further protections for subcontractors by requiring that (1) offerors who intend to identify a particular small business as a potential subcontractor in their bid or proposal notify the small business prior to doing so, and (2) the SBA establish a mechanism whereby subcontractors can report "fraudulent activity or bad faith" by contractors with respect to subcontracting plans.
subsections: section_title: Legislation Enacted by the 113th Congress
paragraphs: The 113 th Congress expanded on these requirements by enacting legislation that imposes certain obligations on prime contractors whose subcontractors are also required, through the "flow down" of contract requirements, to have subcontracting plans. Among other things, the 113 th Congress required that prime contractors (and any subcontractors whose own subcontractors have subcontracting plans) review and approve their subcontractors' plans; monitor subcontractor compliance with these plans; ensure subcontracting reports are submitted when required; compare subcontractors' performance to the plans and goals; and discuss performance "when necessary" to ensure a "good faith effort" to comply. The 113 th Congress also required that subcontracting plans contain a recitation of all "records" that the prime contractor will maintain to demonstrate the procedures it has adopted to ensure that its subcontractors comply with their subcontracting plans. In addition, the 113 th Congress addressed when and how lower tier subcontracts may be counted toward prime contractors' subcontracting goals, as well as amended a subcontracting program unique to the Department of Defense, as discussed below. 
section_title: Legislation Introduced in the 113th Congress
paragraphs: Other legislation in the 113 th Congress would have amended Section 8(d) to require that the goals for subcontracting with various types of small businesses included in subcontracting plans be "not less than 40 percent," rather than being left to agencies' discretion. Such legislation was intended to promote subcontracting with small businesses, as were other measures introduced in the 113 th Congress. One bill would, for example, have required the SBA to "collaborate" with contracting agencies to include contract terms that would provide contractors with "additional consideration"—an apparent reference to payment—if they meet their goals for subcontracting with small disadvantaged businesses. Another bill would have required the Administrator of the SBA to consult with other agency heads to develop and implement "standards" whereby contracting officers may consider potential contractors' prior performance as to their subcontracting plans when making source-selection determinations. Currently, the Small Business Act authorizes consideration of this information, and the Federal Acquisition Regulation (FAR) even requires it in certain circumstances. However, neither the Small Business Act nor the FAR prescribes specific "standards" for contracting officers to use in considering contractors' past performance in subcontracting with small businesses, such as those contemplated by the proposed legislation.
section_title: Bundling and Consolidation
paragraphs: The way in which agencies structure their contracting requirements can have significant implications for small businesses. When multiple requirements are grouped into a single contract, that contract may be difficult, or impossible, for small businesses to perform. For this reason, Congress has enacted progressively more stringent limitations upon the "bundling" and "consolidation" of requirements by federal agencies. First, in 1997, Congress amended the Small Business Act to define bundling as,
consolidat[ing] 2 or more procurement requirements for goods or services previously provided or performed under separate smaller contracts into a solicitation of offers for a single contract that is likely to be unsuitable for award to a small business concern due to—(A) the diversity, size, or specialized nature of the elements of performance specified; (B) the aggregate dollar value of the anticipated award; (C) the geographical dispersion of the contract performance sites; or (D) any combination of the factors described in subparagraphs (A), (B), and (C).
It also required agencies to take certain steps to ensure that any bundling that they engage in is "necessary and justified." Then, in 2003, Congress amended the Armed Services Procurement Act (ASPA) to prohibit defense agencies from executing any acquisition strategy that includes a "consolidation" of contract requirements valued in excess of $5 million (later adjusted for inflation to $6 million) without first (1) conducting market research, (2) identifying any alternative contracting approaches that would involve a lesser degree of consolidation of contract requirements, and (3) determining that the consolidation is "necessary and justified." The 111 th Congress subsequently imposed similar requirements upon other agencies' contracts valued in excess of $2 million. It also required (1) the development of a government-wide policy regarding bundling, (2) listings of and justifications for bundled contracts, and (3) periodic reports on the performance of agency officials who are tasked with minimizing bundling and promoting contracting with small businesses. Most recently, the 112 th Congress repealed the consolidation-related provisions of the ASPA and generally subjected defense agencies to the same requirements as civilian agencies.
subsections: section_title: Legislation Enacted in the 113th Congress
paragraphs: The 113 th Congress expanded on previous efforts to ensure that any bundling of contracts is "necessary and justified" by amending Section 15 of the Small Business Act to require the SBA Administrator, in consultation with the Small Business Procurement Advisory Council, the Administrator for Federal Procurement Policy, and the Administrator of General Services, to develop a plan to improve the quality of data reported on bundled or consolidated contracts in the Federal Procurement Data System-Next Generation (FPDS-NG). This plan is to describe the roles of specified officials in improving the quality of data reported on bundled and consolidated contracts, among other things. Currently, agencies are required to identify bundled and consolidated contracts in FPDS-NG, and Chief Acquisition Officers must annually certify that prior year FPDS-NG records are "accurate and complete." However, existing certification requirements are not specifically concerned with bundling and consolidation.
section_title: Legislation Introduced in the 113th Congress
paragraphs: Measures introduced in the 113 th Congress would have either placed further limitations on bundling or consolidation of contracts in general, or addressed bundling and consolidation within the context of strategic sourcing specifically. The former type of measure generally sought to amend the definition of bundling of contract requirements so that it would apply to requirements for construction (as the definition of consolidation of contract requirements currently does), as well as in situations where an agency adds a new requirement to requirements previously provided or performed under separate smaller contracts. These measures would also have generally altered—and established a statutory basis for—current regulatory and other procedures for resolving differences of opinion between the SBA and the procuring agency as to whether particular procurements are bundled. 
In contrast, the second type of measure would have addressed bundling and consolidation within the context of strategic sourcing specifically. The term "strategic sourcing" commonly describes the process of using analyses of an organization's spending to acquire frequently procured items more economically and efficiently. The General Services Administration (GSA) has recently promoted government-wide strategic sourcing as a way to save money. Individual agencies have also developed their own agency-specific strategic sourcing initiatives for the same purpose. On the other hand, small businesses have expressed concern that strategic sourcing could diminish opportunities for small businesses to obtain and perform federal contracts, since small businesses may not be able to supply the large quantities of supplies and services that are often required for discounted pricing. Several measures introduced in the 113 th Congress would have responded to these concerns by requiring the Office of Management and Budget (OMB) to develop guidance on strategic sourcing that "reflect[s] the requirements of the Small Business Act, including the provisions regarding contract bundling, contract consolidation, and the need to achieve the statutory small business prime contracting and subcontracting goals in section 15 of that Act." Other measures would have required the collection of data regarding strategic sourcing, or independent assessments of strategic sourcing's effects on small businesses.
section_title: Set-Asides and Sole-Source Awards under the Small Business Act
paragraphs: Competition is generally valued in federal contracting because it can result in the government paying lower prices, ensure some degree of transparency and accountability, and help prevent fraud. Because of this, Congress has generally required that agencies obtain "full and open competition through the use of competitive procedures" when awarding contracts, and defined full and open competition to mean that all responsible sources are permitted to submit bids or offers. However, in keeping with its declared policy of ensuring that small businesses obtain a "fair proportion" of federal procurement dollars, Congress has also enacted a number of statutes that require or authorize agencies to use other than full-and-open competition when contracting with small businesses. In particular, various provisions of the Small Business Act permit agencies to award contracts to small businesses on a set-aside or sole-source basis if certain requirements are met, as Table 1 illustrates. Key among these requirements is that the contracting officer reasonably expects bids or offers will be received from at least two small businesses, and the award can be made at a fair market price. This requirement is commonly known as the "Rule of Two" because of its focus upon receipt of bids or offers from at least two small businesses. The Department of Veterans Affairs (VA) has separate statutory authority, beyond that provided in the Small Business Act, to make set-aside and sole-source awards to service-disabled veteran-owned small businesses and other veteran-owned small businesses, as discussed below. 
Because legislation pertaining to the so-called "set-aside programs" for different types of small businesses (e.g., HUBZone, women-owned) has historically been enacted separately, each program is discussed below under its own heading. However, there have been occasional measures that affect set-asides or sole-source awards for all types of small businesses. These latter measures are grouped together under the heading "General."
subsections: section_title: General
paragraphs: Although the various provisions of the Small Business Act requiring or authorizing set-asides or sole-source awards to small businesses each pertain to a particular type of small business (e.g., HUBZone, women-owned), in some cases, Congress has enacted or considered legislation that would affect the ability of all types of small businesses to obtain awards under these authorities. Perhaps the most notable example is legislation enacted by the 111 th Congress that expressly authorizes agencies to set aside all or part of "multiple-award contracts" for small businesses. A multiple-award contract is a single contract awarded to multiple vendors, each of which is generally entitled to a "fair opportunity to be considered" for orders valued in excess of $3,000. Prior to the enactment of P.L. 111-240 , the setting aside of multiple-award contracts for small businesses seems to have been an accepted practice. However, there was not express statutory authority for such set-asides. However, there was not express statutory authority for such set-asides. Even more significantly, some asserted that the setting aside of orders under multiple-award contracts was effectively barred because of provisions of federal law which generally require that all vendors holding a multiple-award contract have a "fair opportunity to be considered" for orders under the contract. The legislation enacted by the 111 th Congress vitiates this argument by expressly permitting set-asides of orders "notwithstanding the fair opportunity requirements," as well as other set-asides and reservations of parts of multiple-award contracts. This legislation also defines multiple award contract in a way that apparently encompasses Federal Supply Schedules contracts. Previously, questions had been raised about the applicability of set-asides to Schedules contracts. 
Several measures introduced by Members of the 113 th Congress would have similarly affected the ability of all types of small businesses to obtain set-aside contracts. For example, one measure would have provided that "timely offers" from Federal Prison Industries (FPI)—a government-owned corporation that sells products manufactured by federal prisoners to federal agencies—are not to be considered if the contract has been set-aside for small businesses under "section 15(a) of the Small Business Act ... and its implementing regulations." Federal law currently requires that "timely offers" from FPI be considered whenever agencies use "competitive procedures" in procuring products for which FPI has a "significant market share," and the GAO has found that small business set-asides constitute "competitive procedures" for purposes of this provision. The proposed legislation would have effectively overturned this GAO decision as to contracts awarded under the authority of Section 15(a) of the Small Business Act, ensuring that contracts set-aside for small businesses generally (i.e., not of a particular type) cannot be awarded to FPI. 
Other measures introduced in the 113 th Congress would exempt contracts awarded under the authority of the Small Business Act from restrictions that would be imposed by the proposed legislation. 
section_title: Small Disadvantaged Businesses Participating in the 8(a) Program
paragraphs: Congress amended Section 8(a) of the Small Business Act in 1978 to expressly authorize agencies to award contracts on a set-aside or sole-source basis to small businesses owned and controlled by socially and economically disadvantaged individuals participating in the SBA's 8(a) Program. Section 8(a) and related provisions of the act broadly define social disadvantage and designate certain racial and ethnic groups as socially disadvantaged, although they also grant the SBA authority to recognize additional groups as such. Section 8(a) also defines economic disadvantage , but it does not establish any specific monetary thresholds for determining whether individuals are economically disadvantaged. Instead, the SBA promulgated the current "net worth" standards—of not more than $250,000 for initial entry into the program, and $750,000 for continuing eligibility—through notice-and-comment rulemaking in 1989. The act further limits participation in the 8(a) Program to a single term of no more than nine years for firms and individual owners. However, it, along with other provisions of federal law, permits certain owner-groups—namely, Alaska Native Corporations (ANCs), Community Development Corporations (CDCs), Indian tribes, and Native Hawaiian Organizations (NHOs)—to participate in the 8(a) Program on somewhat different terms than individual owners. No significant amendments to Section 8(a) have been enacted in recent years, despite the introduction of multiple bills on the topic. 
Members of the 113 th Congress also proposed several amendments to Section 8(a). Some bills would have increased the SBA's "net worth" standard to $1.5 million for initial and continuing eligibility, and codified this standard. These measures would have also permitted firms to participate in the 8(a) Program for more than nine years if they have not "completed" a contract awarded under the authority of Section 8(a). These changes were apparently in response to concerns that the current net-worth thresholds are too low and have not been adjusted for inflation. There have also been concerns that the percentage of contract dollars awarded to individual 8(a) firms has decreased as the number of firms participating in the program has increased. 
Another measure would have amended Section 8(a) to provide that, if an NHO establishes it is economically disadvantaged in connection with the application to the 8(a) Program of one firm it owns, it generally need not reestablish economic disadvantage when additional firms it owns apply to the program. Currently, Section 8(a) has two separate provisions regarding determinations of economic disadvantage, one addressing tribally owned firms, and the other addressing all other firms. Based, in part, on these provisions, the SBA has promulgated regulations which provide that Indian tribes generally need only demonstrate economic disadvantage one time to qualify firms for the 8(a) Program. In contrast, the regulations as to NHO-owned firms provide that: 
For the first 8(a) applicant owned by a particular NHO, individual NHO members must meet the same initial eligibility economic disadvantage thresholds as individually-owned 8(a) applicants [i.e., $250,000]. For any additional 8(a) applicant owned by the NHO, individual NHO members must meet the economic disadvantage thresholds for continued 8(a) eligibility [i.e., $750,000]. 
By providing that NHOs generally need only establish economic disadvantage one time, the proposed legislation would have effectively required that the SBA treat NHO-owned firms in the same way it currently treats tribally owned firms.
Yet another measure introduced in the 113 th Congress would apparently have permitted 8(a) firms to "self-certify" as to their eligibility for federal contracting preferences, instead of having their eligibility certified by SBA, as is currently the case.
section_title: Women-Owned Small Businesses
paragraphs: Congress added Section 8(m) to the Small Business Act in 2000 in order to authorize set-asides for women-owned small businesses. The SBA has construed Section 8(m) as authorizing agencies to set aside contracts for women-owned small businesses in industries where such firms are "substantially underrepresented," and for economically disadvantaged women-owned small businesses in industries where such firms are "underrepresented." However, due in part to difficulties in determining the industries in which women-owned small businesses are underrepresented, set-asides for women-owned small businesses were not actually implemented until 2011. Nonetheless, despite its relatively recent implementation, Section 8(m) has already been subject to two significant amendments.
First, the 112 th Congress removed caps on the maximum value of contracts that could be set aside for women-owned small businesses, thereby making set-asides for women-owned small businesses more like those for other types of small businesses (e.g., HUBZone, service-disabled veteran-owned), as illustrated in Table 1 . As initially enacted, Section 8(m) only permitted set-asides of contracts whose value was below $3 million, or $5 million for manufacturing contracts (later adjusted to $4 million ($6.5 million for manufacturing contracts)). However, legislation enacted by the 112 th Congress removed these caps, permitting "larger" contracts to be set aside for women-owned small businesses. 
Then, the 113 th Congress went a step further by authorizing agencies to award sole-source contracts valued at up to $4 million ($6.5 million for manufacturing contracts) to women-owned small businesses. The legislation permits sole-source awards to women-owned small businesses like those permitted to other types of small businesses. See Table 1 . The 113 th Congress also accelerated the deadline for the Executive to report on the industries in which women-owned small businesses are underrepresented, something which has been of concern to Congress ever since the Executive initially proposed regulations that identified only four such industries.
Another measure proposed in the 113 th Congress, but not enacted, would have provided for women-owned small businesses to be certified by SBA. Currently, only certain entities—not including SBA—certify women-owned small businesses. Firms may also self-certify.
section_title: HUBZone Small Businesses
paragraphs: Congress added Section 31 to the Small Business Act in 1997 to permit agencies to set aside contracts for HUBZone small businesses, make sole-source awards to such firms, and grant them "price evaluation adjustments" in unrestricted competitions. To be eligible for these preferences, firms must meet certain criteria, which include having their principal office in a HUBZone. At least 35% of their employees must also reside in a HUBZone. Section 3 of the Small Business Act, in turn, defines a HUBZone to include "qualified census tracts" and "qualified nonmetropolitan counties," the latter of which includes counties in which "the median household income is less than 80 percent of the nonmetropolitan State median income, based on the most recent data available from the Bureau of the Census," among other things. Also included within the definition of HUBZone are "redesignated areas," or areas that ceased to qualify as census tracts or nonmetropolitan counties, but were allowed to remain HUBZones until the later of (1) the date on which the Census Bureau publicly released the first results from the 2010 decennial census, or (2) three years after the date on which the census tract or nonmetropolitan county ceased to qualify.
Section 31 and the provisions of Section 3 pertaining to HUBZones have been periodically amended over the years, often in response to the release of decennial census data. Release of 2010 census data, in particular, affected the grounds upon which a number of firms qualified as HUBZone small businesses, and prompted the 112 th Congress to enact legislation permitting certain "base closure areas" (i.e., military bases that have been closed) to continue to be treated as HUBZones for an additional period. Specifically, the legislation in the 112 th Congress permitted areas that were treated as HUBZones pursuant to Section 152(a)(2) of the Small Business Reauthorization and Manufacturing Assistance Act of 2004 to be treated as HUBZones for up to five years, provided that no area may be treated as a HUBZone for more than five years under the authority of this legislation and/or the 2004 act. Section 152(a)(2), in turn, had provided for "base closure areas" that had undergone final closure to be treated as HUBZones for five years, and defined base closure area to include military installations closed pursuant to the Defense Base Closure and Realignment Act of 1990 and other authorities.
Similar legislation was introduced in the 113 th Congress to amend the definition of base closure area so that it includes the municipalities, counties, and census tracts where the military base was located that have a total population of not more than 50,000. Census tracts that are "contiguous" to such census tracts would have also been included. 
Other legislation introduced in the 113 th Congress would have amended the definition of HUBZone small business concern in Section 3(p) of the Small Business Act to include small businesses owned and controlled by NHOs. Currently, small businesses owned and controlled by ANCs, Indian tribes, and CDCs are among those listed here, but small businesses owned and controlled by NHOs are not. ANCs, CDCs, Indian tribes, and NHOs are generally (although not universally) treated the same for purposes of other provisions of federal procurement law, which would appear to have been the rationale for including NHO's in Section 3(p)'s definition of HUBZone small business concern.
section_title: Service-Disabled Veteran-Owned Small Businesses
paragraphs: Congress added Section 36 to the Small Business Act in 2003 to permit agencies to set aside contracts for service-disabled veteran-owned small businesses, and to make sole-source awards of contracts valued at up to $4 million ($6.5 million for manufacturing contracts) to such firms. Section 36 has not been substantively amended since then. However, Congress enacted additional legislation pertaining to set-asides and sole-source awards by the Department of Veterans Affairs to service-disabled veteran-owned small businesses and other veteran-owned small businesses in 2006. The latter authority is part of the Veterans Benefits Act; it is separate and distinct from the authority provided under the Small Business Act. There is some overlap between the programs under these two acts, in that the Small Business Act relies upon the definitions of veteran and service-disabled veteran given in the Veterans Benefits Act. However, there are also a number of differences between the two programs. Perhaps most notably, firms and their owners must have their eligibility verified by the VA to be eligible for contracting preferences under the Veterans Benefits Act, while they may "self-certify" as to their eligibility for preferences under the Small Business Act. In addition, the Veterans Benefits Act permits firms owned by the surviving spouses of certain veterans to participate in the program for up to 10 years, while the Small Business Act does not. 
The existence of two separate set-aside programs—under different statutory authorities and with different rules—benefitting broadly the same population has prompted some concern and confusion. Legislation introduced in the 113 th Congress would have responded to this situation by standardizing eligibility requirements for the two programs. Specifically, this legislation would have amended the Small Business Act so that it corresponds to the Veterans Benefits Act (1) in its definition of service-disabled veteran-owned small business , and (2) in permitting certain surviving spouses of veterans to participate in the program for a period of time. Currently, businesses that are majority owned by one or more veterans with service-connected disabilities that "are permanent and total" who are unable to manage the daily business operations are included within the definition of service-disabled veteran-owned small business under the Veterans Benefits Act, but not under the Small Business Act. Similarly, certain surviving spouses of veterans may continue participating in the program for a period of time after the veteran's death under the Veterans Benefits Act, but not the Small Business Act. The proposed legislation would have amended the Small Business Act so that its treatment of both these issues corresponds to that in the Veterans Benefits Act. At least one proposed bill would have also required that service-disabled veteran-owned small businesses have their eligibility, and that of their owners, verified in order for them to be eligible for awards under the Small Business Act, as is currently required under the Veterans Benefits Act. Other bills would not. 
The proposed legislation would have also required the SBA and the VA to enter into an agreement whereby the SBA would take over "control and administration" of VA's "Veterans First" contracting program, discussed below. The legislation would not, however, appear to completely merge the two programs, since it would not amend the provisions in Section 36 of the Small Business Act that authorize agencies other than the VA to make set-aside and sole-source awards to service-disabled veteran-owned small businesses. Other agencies would, for example, have continued to lack authority to make set-aside and sole-source awards to small businesses owned by veterans who are not service-disabled. They would also not have been required to set aside contracts for veteran-owned businesses, as the VA has generally been found to be under the Veterans Benefits Act. In addition, the Small Business Act would only permit sole-source awards of contracts that do not involve manufacturing whose value is at or below $4 million, while the Veterans Benefits Act would permit sole-source awards of contracts that do not involve manufacturing whose value is at or below $5 million.
section_title: Creation of Additional Set-Aside Programs or Other Contracting Preferences
paragraphs: As previously noted, there are currently set-aside programs for HUBZone small businesses, women-owned small businesses, service-disabled veteran-owned small businesses, certain small disadvantaged businesses, and small businesses not belonging to any of the foregoing types under the authority of the Small Business Act. The most recent of these programs were not created until 2003, in the case of the program for service-disabled veteran-owned small businesses, and not implemented until 2011, in the case of the program for women-owned small businesses. However, some have called for the establishment of additional set-aside programs that would benefit certain small businesses and, potentially, others. At least one measure introduced in the 113 th Congress would, for example, have authorized a set-aside program for businesses "owned or controlled by historically disadvantaged individuals," a category which would be defined by reference to the Department of Commerce's Minority Business Development Agency's (MBDA's) definition of socially or economically disadvantaged groups . Small businesses meeting specified criteria (e.g., owners' net worth no greater than $2 million; principal place of business in the United States) would have been eligible for set-asides through this program. However, eligibility would not have been limited to small businesses, as it would have been under similar measures introduced in the 112 th Congress.
Other measures proposed, but not enacted, in the 113 th Congress similarly called for particular types of small businesses to be given "preference" in the award of federal contracts. One such measure would have created a new category of "emerging business enterprises," which agencies would have been authorized to give "preference" in the award of agency contracts. Another measure would generally have barred the use of funds appropriated under the act to award a contract "using procedures that do not give to small business concerns owned and controlled by veterans ... any preference available with respect to such contract."
section_title: Surety Bond Guarantees
paragraphs: Various provisions of federal law require government contractors—including small businesses—to post performance and payment bonds. These and other types of bonds may also be required in conjunction with state, local, and private contracts. However, small businesses have historically had difficulty posting such bonds because of their limited access to capital. Thus, Congress amended Section 411 of the Small Business Investment Act in 1970 to authorize the SBA to guarantee certain bonds posted by small businesses that cannot obtain bonding on "reasonable terms and conditions" through regular commercial channels without the SBA's guarantee. 
Initially, Section 411 only permitted the SBA to guarantee bonds for contracts valued at $500,000 or less. However, Congress has increased the maximum contract value over the years, including to $2 million in 2000. The recession of 2007-2009 prompted a further increase, to $5 million ($10 million if the contracting officer certified that a larger guarantee is "necessary"), although this increase was a temporary one, lasting only from February 17, 2009, through September 30, 2010. Subsequently, though, the 112 th Congress increased the maximum contract value to $6.5 million, and provided for the cap to be adjusted for inflation every five years pursuant to Section 807 of the Ronald W. Reagan National Defense Authorization Act for FY2005. 
Legislation introduced in the 113 th Congress would have built on these changes by increasing the maximum percentage of the surety's loss that the SBA may pay in the event of a default by the contractor. At that time, Section 411 provided for a maximum guarantee of 70%, in the case of sureties authorized to issue bonds subject to the SBA's guarantee (90% in the case of sureties requiring the SBA's specific approval for the issuance of a bond). However, bills introduced in the 113 th Congress would have amended Section 411 to permit the SBA to pay up to 90% of losses paid by sureties authorized to issue bonds subject to the SBA's guarantee, regardless of whether the SBA had to specifically approve the issuance of the bond. (Such legislation was subsequently enacted in the 114 th Congress. )
section_title: Reverse Auctions
paragraphs: The term reverse auction generally connotes a bidding procedure wherein sellers compete to determine who is willing to offer their supplies or services at the lowest price. Federal law does not expressly authorize—or directly regulate—the use of reverse auctions by federal agencies. However, the GAO has found that the use of reverse auctions is permissible pursuant to FAR provisions that authorize the use of procurement practices and procedures that are not "prohibited by law." The use of reverse auctions by federal agencies has reportedly increased recently, prompting some concern that such auctions could be detrimental to small businesses, which are generally less able to compete on price than larger firms. 
The 113 th Congress responded to these concerns, at least as they pertain to Department of Defense (DOD) contracts, by requiring that DOD regulations be "clarified" to ensure that (1) any "single bid" contracts entered into as the result of a reverse auction are compliant with existing regulations and DOD guidance regarding "single bid" contracts; (2) all reverse auctions provide offerors with the ability to submit revised bids throughout the course of the auction; (3) third parties conducting reverse auctions do not perform, or permit the performance, by private contractors of "inherently governmental functions," and make available to prospective vendors any "past performance" or "financial responsibility" information created by the third party; and (4) reverse auctions resulting in certain "design-build military construction contracts" are prohibited. Non-defense agencies are not subject to these requirements. 
Other legislation introduced, but not enacted, in the 113 th Congress also responded to these concerns, as well as related concerns that agencies may use reverse auctions in inappropriate circumstances (e.g., with supplies or services that cannot be evaluated strictly on price). Among other things, this legislation would have added a new section to the Small Business Act prohibiting the use of "reverse auction methods" for certain contracts "suitable" for award to a small business, or that are to be awarded pursuant to those sections of the Small Business Act that require or permit set-asides and sole-source awards to small businesses (i.e., Sections 8(a), 8(m), 15(a), 15(j), 31, and 36). One bill would have prohibited the use of reverse auctions only with contracts for design and construction services , which the bill would have defined to include site planning and landscaping design; architectural and interior design; engineering system design; delivery and supply of construction materials; and construction, alteration, or repair. Another bill would have prohibited the use of reverse auctions with any contract for "services, including design and construction services," as well as with contracts for supplies in which the offeror's technical qualifications constitute "part of the basis" for the award. The latter bill would have also extended these limitations to the use of reverse auctions to contracts awarded to service-disabled veteran-owned small businesses and other veteran-owned small businesses by the VA under the authority of the Veterans Benefits Act. The former would not.
section_title: Design-Build Contracts
paragraphs: Section 4105 of the Federal Acquisition Reform Act (FARA) of 1996 generally requires agencies to use "two-phase selection procedures" when contracting for the design and construction of public buildings or works, provided certain conditions are met. In the first phase, the agency solicits information about offerors' technical approaches and qualifications, without considering cost or price. Based on these submissions, the agency then selects the "most highly qualified" offerors from the first phase and invites them to submit proposals for a second phase of the competition that considers cost or price, among other things. Section 4105 further provides that the first-phase solicitation must state the maximum number of offerors who will be selected for consideration in the second phase, and that this number cannot exceed five unless the contracting agency determines, on a case-by-case basis, that a "specified number greater than 5 is in the Federal Government's interest and is consistent with the purposes and objectives of the two-phase selection process." However, concerns have been raised that agencies select more than five offerors in too many cases, thereby imposing the costs of competing on firms—particularly small businesses—that are progressively less likely to be selected as the number of competitors increases. 
At least one measure introduced in the 113 th Congress would have responded to these concerns by amending the codification of Section 4105 (i.e., 41 U.S.C. §3309) to require that (1) contracting officers document how selecting more than five firms is consistent with the purposes of the two-phase selection process, and (2) agency heads approve these justifications before a procurement contemplating more than five finalists proceeds. Currently, contracting officers must determine that selection of more than five firms is consistent with the purposes of the two-phase selection process, but they are not required by statute to document this determination in writing. Nor is the approval of the agency head presently required.
The proposed legislation would also have generally required the use of two-phase selection procedures in contracts whose value exceeds $750,000, with the apparent intent of foreclosing the use of design-bid-build or certain other procedures with such contracts. Agencies would have also been required to provide public notice of all cases in which they select more than five finalists, or do not use two-phase selection procedures with contracts valued in excess of $750,000. While the amendments that would have been made by this legislation did not involve the Small Business Act or expressly refer to small businesses, its drafters indicated, through the bill's title, that it was intended to benefit small businesses.
section_title: "Small" Contracts Reserved for Small Businesses
paragraphs: Federal law currently distinguishes between (1) purchases whose value is below the micro-purchase threshold (generally $3,500); (2) those whose value is above the micro-purchase threshold, but below the simplified acquisition threshold (generally $150,000); and (3) other purchases. In particular, Section 15(j) of the Small Business Act and its implementing regulations have long provided that those acquisitions whose value falls between the micro-purchase threshold and the simplified acquisition threshold are "exclusively reserved" for small businesses. However, there have been periodic reports of contracts whose value suggests that they should have been awarded to small businesses going to contractors that do not qualify as "small" under the criteria of the Small Business Act. The 111 th Congress responded, in part, to these reports by requiring the OMB, in consultation with the GSA, to issue guidelines regarding one of the most commonly used simplified acquisition methods: government-wide commercial purchase cards. The OMB issued this guidance on December 19, 2011, reminding agencies that those holding government-wide commercial purchase cards should consider small businesses "to the maximum extent practicable" when making micro-purchases.
Notwithstanding the issuance of this guidance, legislation was introduced during the 113 th Congress that would have increased the value of the "small purchases" that are reserved for small businesses. Among other things, this legislation would have generally required agencies "to the extent practicable" to award contracts whose value exceeds $3,000, but is below $500,000, to small businesses. The legislation would have also granted contracting officers additional authority to award contracts whose value is within this range to small businesses on a sole-source basis. Specifically, it would have authorized agencies to make sole-source awards of contracts valued at between $150,000 and $500,000 to women-owned small businesses, or other small businesses that are not 8(a), HUBZone, or service-disabled veteran-owned small businesses. At the time of introduction, the Small Business Act did not authorize sole-source awards to firms other than HUBZone small businesses; service-disabled veteran-owned small businesses; and small disadvantaged businesses participating in the 8(a) Program. Rather, it only authorized agencies to set aside contracts for such small businesses.
section_title: Definition of "Small Business"
paragraphs: Section 3 of the Small Business Act currently prescribes criteria that entities must meet to qualify as "small businesses" for purposes of the act. Specifically, it requires that businesses be (1) independently owned and operated; (2) not dominant in their fields of operation; and (3) meet any "size standards" that the SBA may establish based on the number of employees, dollar volume of business, net worth, net income, or "other appropriate factors." These basic criteria have not changed significantly since the act's enactment in 1958, although the 112 th Congress imposed certain requirements upon the SBA's promulgation of regulations revising, modifying, or establishing size standards. 
Legislation introduced during the 113 th Congress would have amended the definition of small business to exclude "publicly traded" firms, "foreign-owned" firms, and their subsidiaries. These entities are not expressly disqualified from recognition as small businesses under the Small Business Act at present, although existing restrictions on firm size and the citizenship of firm owners may effectively exclude at least some of them. The proposed legislation would have also imposed related requirements to ensure that agencies and contractors were aware of these changes and of the penalties for misrepresentation of business size and status. It also would have permitted interested parties to file complaints with the SBA and the procuring agencies regarding firms' size or status, and require these complaints to be resolved in a "timely manner." Entities found to have fraudulently misrepresented their size or status would have been debarred from government contracts for five years.
section_title: Agency-Specific Provisions
paragraphs: The existing laws and proposed legislation discussed thus far generally have government-wide applicability. However, there are other measures that pertain only to an individual agency and, as a general matter, impose more stringent requirements upon that agency than apply to other agencies. Perhaps the most notable example is the Veterans Benefits, Health Care, and Information Technology Act (VBHCITA) of 2006. Sections 502 and 503 of VBHCITA have been construed as requiring (with certain exceptions) the VA to set aside contracts for service-disabled veteran-owned small businesses and other veteran-owned small businesses whenever the "Rule of Two" is satisfied. Other agencies are also subject to similar agency-specific requirements as to small business contracting. 
subsections: section_title: VA's "Veterans First" Contracting Program
paragraphs: Implemented under the authority of Sections 502 and 503 of VBHCITA, the VA's "Veterans First" contracting program gives small businesses owned by veterans (and certain surviving spouses of veterans) that meet eligibility requirements "preference" in the award of VA contracts. Under Section 502, in particular, the Veterans First program is subject to its own requirements as to (1) goals for contracting with veteran-owned small businesses; (2) set-asides and sole-source awards to service-disabled veteran-owned small businesses and other veteran-owned small businesses; (3) priority in awards among different types of small businesses; (4) eligibility criteria for firms and owners; and (5) sanctions for misrepresentation of size or status. 
Many of these requirements were part of VBHCITA, as originally enacted. However, the 111 th Congress substantially amended VBHCITA's eligibility requirements by barring the inclusion of persons whose status had not been verified by the VA in the VA's database of eligible firms and owners. The 112 th Congress further amended VBHCITA's penalty provisions by changing the type of actionable conduct from "misrepresentations" of status, to "willful and intentional misrepresentations" of status. The 112 th Congress also prescribed a five-year term of debarment from VA contracts for such misrepresentations, instead of leaving the term of any debarment to the VA's discretion. Debarment proceedings must also be commenced and completed within specified timeframes.
Members of the 113 th Congress proposed additional changes to the Veterans First program, including moving responsibility for verifying the status of firms and owners from the VA to the SBA. This legislation would have required the SBA to (1) enter into an agreement with the VA transferring "control and administration" of VA's "Veterans First" contracting program to the SBA, subject to certain conditions; (2) assume responsibility for the database that the VA uses in verifying the eligibility of firms and owners; and (3) hear appeals of denials of verifications. The VA, in turn, would also have been required to reimburse the SBA for the functions that the SBA performs. 
Several other measures introduced in the 113 th Congress would have expanded the circumstances in which family members of veterans may participate in the Veterans First program. Currently, only surviving spouses of veterans with service-connected disabilities rated as 100% disabling, or of veterans who die as the result of a service-connected disability, may participate in the program for a limited period of time. However, under legislation proposed in the 113 th Congress, surviving spouses of veterans who have service-connected disabilities rated at less than 100% disabling who do not die from a service-connected disability could have participated for a period of time. Surviving spouses or dependents of members of the armed services killed in the line of duty would also have been eligible to participate for a period of time. 
Other legislation would have modified the procedures for making awards under the Veterans First program. One measure would, for example, generally have required consideration of whether veteran-owned firms are local contractors —a term which would have been defined to mean contractors who have principal offices or "locations" within a 60-mile radius of a VA facility—in the award of contracts for the construction or maintenance of VA facilities. The measure would have also restated the order of priority for the award of contracts under the Veterans First program. Currently, this order is (1) service-disabled veteran-owned small businesses; (2) veteran-owned small businesses; (3) small disadvantaged businesses and HUBZone small businesses awarded contracts under the authority of Sections 8(a) or 31 of the Small Business Act; and (4) small businesses awarded contracts under other authority (e.g., women-owned small businesses awarded contracts under the authority of Section 8(m) of the Small Business Act). However, the measure proposed in the 113 th Congress would have changed this order of priority to give local small businesses a preference over other small businesses within the same category (i.e., local service-disabled veteran-owned small businesses would have priority other service-disabled veteran-owned small businesses, which would, in turn, have priority over local veteran-owned small businesses, etc.). 
Another measure would have required the application of "limitations on subcontracting"—or restrictions on the amount of work that prime contractors may subcontract to other entities, rather than perform themselves—to contracts awarded under the authority of VBHCITA. Currently, these limitations are required by statute to apply only to contracts awarded under the authority of the Small Business Act. The Small Business Act grants the SBA's Administrator the discretion to impose similar limitations on contracts awarded to small businesses under other authority, but the Administrator does not appear to have done so to date. 
section_title: Other Agency-Specific Provisions
paragraphs: Other measures enacted or introduced in the 113 th Congress similarly addressed contracting and subcontracting with small businesses by individual agencies. Among the notable measures enacted are ones
permitting the DOE to count first-tier subcontracts awarded by contractors managing and operating national laboratories toward the DOE and government-wide goals for prime contracts ; extending the DOD comprehensive subcontracting plan test program through the end of 2017, and requiring participating contractors to report "on a semi-annual basis" the amount of first-tier subcontract dollars awarded to covered small businesses, among other things; authorizing certain incumbent contractors who are other-than-small businesses to compete for contracts for the operation of Job Corps centers that are awarded via a set-aside for small businesses; requiring DOD to incorporate into larger value contracts terms which require the contractor to acknowledge that acceptance of the contract may cause the business to exceed the small business size standards for the applicable industry, thereby ceasing to qualify as a small business; exempting certain DOD and U.S. Agency for International Development contracts from otherwise applicable requirements when contracting with small businesses. 
Additional measures that were not enacted would generally have required additional reporting regarding an agency's performance in contracting with small businesses, or tasked specific agency officials with certain responsibilities as to contracting with small businesses. However, one measure would have also repealed the provision permitting the DOE to count certain subcontracts toward the DOE and government-wide prime contract goals, previously noted.