Small Business Emergency Relief Act
PL 94-190 (H.R.5541), enacted 12/31/1975

PUBLIC LAW 94-190—DEC. 31, 1975 
89 STAT. 1095 
Public Law 94-190 
94th Congress 
An Act 
To provide for emergency relief for small business concerns in connection with 
fixed-price Government contracts. 
Be it enacted hy the Senate 
and House of Representatives 
of the 
United States 
of America 
in Congress 
assembled, 
SHORT TITLE 
Dec. 31, 1975 
[H.R. 5541] 
Small Businesi; 
Emergency Relief 
Act. 
SECTION 1. This Act may be cited as the "Small Business Emergency 41 USC 252 note. 
Relief Act". 
POLICY 
SEC. 2. It is the policy of Congress to provide relief to small busi- 41 USC 252 note, 
ness concerns which have fixed-price Government contracts in cases 
where such concerns have suffered or can be expected to suffer serious 
financial loss because of significant and unavoidable difficulties during 
performance because of the energy crisis or rapid and unexpected 
escalations of contract costs. 
DEFINITIONS 
SEC. 3. As used in this Act— 
(1) the term "executive agency" means an executive depart-
ment, a military department, and an independent establishment 
within the meaning of sections 101, 102, and 104(1) respectively, 
of title 5, United States Code, and also a wholly owned Govern-
ment corporation within the meaning of section 101 of the 
Government Corporation Control Act; and 
(2) the term "small business concern" means any concern which 
falls under the size limitations of the "Small Business Admin-
istrator's 
Definitions 
of 
Small 
Business 
for 
Government 
Procurement." 
AUTHORITY 
SEC. 4. (a) Pursuant to an application by a small business concern, 
the head of any executive agency may terminate for the convenience 
of the Government any fixed-price contract between that agency and 
such small business concern, upon a finding that— 
(1) during the performance of the contract, the concern has 
suffered or can be expected to suffer serious financial loss due to 
significant unanticipated cost increases directly affecting the cost 
of contract compliance; and 
(2) the conditions which have caused or are causing such cost 
increases were, or are being, experienced generally by other small 
business concerns in the market at the same time and are not 
caused by negligence, underbidding, or other special management 
factors peculiar to that small business concern. 
(b) Upon application under subsection (a) by a small business 
concern to terminate a fixed-price contract between an executive 
agency and such small business concern, the head of the executive 
agency may modify the terms of the contract in lieu of termination 
for the convenience of the Government only if he finds after review of 
the application that— 
41 USC 252 note. 
31 USC 846. 
Fixed price 
contracts, 
termination or 
modification. 
Application. 
41 USC 252 note. 
and certification. 
89 STAT. 1096 
PUBLIC LAW 94-190~DEC. 31, 1975 
(1) (a) the agency would reprocure the supplies or services in 
the event that the contract was terminated for the convenience 
of the Government; and 
(b) the cost of terminating the contract for the convenience of 
the Government plus the cost of reprocurement would exceed the 
amount of the contract as modified; and 
(2) Any such modification shall be made in compliance with 
cost comparison and compensation guidelines to be issued by the 
Administrator of the Office of Federal Procurement Policy. Such 
cost comparison and compensation guidelines shall be promulgated 
by the Administrator not later than 10 days after enactment of 
this Act. 
(c) If a small business concern in performance of a fixed-price 
Government contract experiences or has experienced shortages of 
energy, petroleum products, Or products or components manufactured 
or derived therefrom or impacted thereby, and such shortages result 
in a delay in the performance of a contract, the head of the agency, 
or his designee, shall provide by modification to the contract for an 
appropriate extension of the contract delivery date or period of 
performance. 
Request for 
(d) A small business concern requesting relief under subsection (a) 
'^^'i^f' 
shall support that request with the following documentation and 
documentation 
certification: 
(1) a brief description of the contract, indicating the date of 
execution and of any amendment thereto, the items being pro-
cured, the price and delivery schedule, and any revision thereof, 
and any other special contractual provision as may be relevant 
to the request; 
(2) a history of performance indicating when work under the 
contract or commitment was begun, the progress made as of the 
date of the application, an exact statement of the contractor's 
remaining obligations, and the contractor's expectations regard-
ing completion thereof; 
(3) a statement of the factors which have caused the loss under 
the contract; 
(4) a statement as to the course of events anticipated if the 
request is denied; 
(5) a statement of payments received, payments due and pay-
ments yet to be received or to become due, including advance and 
progress payments, and amounts withheld by the Government, 
and information as to other obligations of the Government, if any, 
which are yet to be performed under the contract; 
(6) a statement and evidence of the contractor's original break-
down of estimated costs, including contingency allowances and 
profit; 
(T) a statement and evidence of the contractor's present esti-
mate of total costs under the contract if enabled to complete, 
broken down between costs accrued to date of request, and runout 
costs, and as between costs for which the contractor has made pay-
ment and those for which he is indebted at the time of the 
request; 
(8) a statement and evidence of the contractor's estimate of the 
final price of the contract, giving effect to all escalation, changes, 
extras, and other comparable factors known or contemplated by 
the contractor; 
PUBLIC LAW 94-190—DEC. 31, 1975 
89 STAT. 1097 
(9) a statement of any claims known or contemplated by the 
contractor against the Government involving the contract in 
question, other than those referred to under (8) above; 
(10) an estimate of the contractor's total profit or loss under 
the contract if required to complete at the original contract price; 
(11) an estimate of the total profits from other Government 
business, and all other sources, during the period from the date 
of the first contract involved to the latest estimated date of com-
pletion of any other contracts involved; 
(12) balance sheets, certified by a certified public accountant, as 
of the end of the contractor's fiscal year first preceding the date 
of the first contract, as of the end of each subsequent fiscal year, 
and as of the date of the request together with income statements 
for annual periods subsequent to the date of the first balance 
sheet; and 
(13) a list of all salaries, bonuses, and all other forms of com-
pensation of the principal officers or partners and of all dividends 
and other withdrawals, and all payments to stockholder's in any 
form since the date of the first contract involved. 
DEUEGATION 
SEC. 5. The head of each executive agency shall delegate authority 41 U
S
C 252 note, 
conferred by this Act, to the extent practicable, to an appropriate 
level that will permit the expeditious processing of applications under 
this Act and to insure the uniformity of its application. 
LIMITATIONS 
SEC. 6. (a) The authority prescribed in section 4(a) shall apply only 41 USC 252 note, 
to contracts which have not been completely performed or otherwise 
terminated and which were entered into during the period from 
August 15,1971, through October 31,1974. 
(b) The authority conferred by section 4(a) of this Act shall termi- Termination date, 
nate September 30,1976. 
Approved December 31, 1975. 
LEGISLATIVE HISTORY: 
HOUSE REPORTS: No. 94-154 (Comm. on Small Business) and No. 94-724 (Comm. of 
Conference). 
SENATE REPORT No. 94-378 accompanying S. 1259 (Comm. on Government Oper-
ations). 
CONGRESSIONAL RECORD, Vol. 121 (1975): 
Apr. 22, considered and passed House. 
Oct. 29, S. 1259, considered in Senate. 
Oct. 30, considered and passed Senate, amended, in lieu of S. 1259. 
Dec. 15, House agreed to conference report. 
Dec. 17, Senate agreed to conference report.