Effective March 16, 2023, the FAR will be amended to provide for a goal of payment to small business prime contractors within 15 days of receipt of a proper invoice. In addition, the goal will be to pay prime contractors that subcontract with small business concerns within 15 days of receipt of an invoice if they agree to make payment to small business subcontractors within 15 days of receipt of the accelerated payment, assuming the small business subcontractor has submitted a proper invoice.
Employee-Based Size Standards
Effective March 17, 2023, SBA will increase 144 employee-based size standards and leave the other employee-based size standards at the existing level. Of note, SBA is retaining the Nonmanufacturer size standard of 500 employees, increasing the Environmental Remediation Services size standard from 750 to 1,000 employees (NAICS 562910 Exception), increasing the size standard for Ship Building and Repairing from 1,250 to 1,300 employees (NAICS 336611), and increasing the size standard for Guided Missiles and Space Vehicles, Their Propulsion Units and Propulsion Parts from 1,250 to 1,300 employees (NAICS 541715 Exception3).
Status Protests and 8(a) Options
Effective March 16, 2023, the FAR will be amended to implement SBA rules which allow protesters to allege that an apparent successful offeror or awardee under a HUBZone, SDVO, or WOSB/EDWOSB set-aside or sole source award is unduly reliant on an ineligible concern for performance, i.e., not a similarly situated an entity. The FAR will also implement SBA’s rule concerning long-term 8(a) contracts (contracts with duration greater than 5 years) requiring an 8(a) firm to be in the 8(a) program within 120 days of the end of the fifth year of the contract for the agency to exercise the option..
Lower Tier Subcontracting
Historically, large prime contractors with subcontracting plans reported small business subcontracting performance at the first tier, i.e., firms with a direct subcontract with the prime contractor. In 2013, Congress amended the Small Business Act to provide that prime contractors with individual small business subcontracting plans “shall” receive lower tier credit toward their subcontracting plan goals. Congress further provided that the amendment did not abrogate a prime contractor’s responsibility to meet its first-tier goals. In 2016, SBA implemented this amendment and required large prime contractors to establish small business subcontracting goals at the first tier and at lower tiers and report their performance at both tiers. In 2019, Congress amended the Small Business Act to provide that large prime contractors could elect to establish small business subcontracting goals utilizing performance at lower tiers but were not required to do so.