Today, Rep. Wm. Lacy Clay introduced legislation co-authored by Congresswoman Yvette D. Clarke. The bill, entitled the Subcontractor Fairness Act of 2009, would hold prime contractors accountable for subcontracting proposals that they submit as a part of a Federal contract bid in the civilian or defense context.

“I was pleased to coordinate with Rep. Clay on this important legislation. It fills a need that has gone unmet in the small business community for too long. Current law requires companies competing for Federal contracts of more than $550,000 to include ‘acceptable’ sub-contracting plans. Too often, prime contractors begin preliminary discussions and work with smaller subcontractors in order to increase their chances of securing the contract award,” stated Congresswoman Yvette D. Clarke. “These small firms spend significant resources on industry analysis and business strategy in order to be on the initial contract bid teams. Many subcontractors are eliminated from the process once the prime contractor secures the bid. Often, the small firms receive no communication from the prime firms once the contract is awarded, left with no indication of why they are not being called to perform the work. This act aims to close the loophole.”

This bill would:

•require bidders for contracts greater than $550,000 ($1,000,000 for construction bids) to submit copies of agreements with intended subcontractors as part of the bid;

•create a valid contract between prime contractor and sub-contractor at the time the contract is awarded to the prime;

•require that the agreement include the identity of the subcontractor, the scope of the work to be performed under the purported agreement and the dollar amount of the subcontract; and

•make the effective date 60 days after enactment.

“Veteran-owned, women-owned, and minority firms are often too small to engage in the bidding process for large prime federal contracts. Therefore, they can only access the federal contracting arena through subcontracts with larger companies,” added Rep. Clarke. “This legislation will bring a greater level of clarity and accountability to our federal procurement process and will ensure contract fairness.”

“As the only Congressional Black Caucus Member on the House Small Business Committee, I believe in the importance of raising a voice for the veteran-owned, women-owned, and minority firms. It is important that prime contractors are held accountable to small businesses that depend on them. Small businesses are the corner stone of this economy and hold the key out of this recession and we must provide them with all available resources for their successful growth,” concluded Congresswoman Yvette D. Clarke.

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