Proposed Rule for Lower-Tier Subcontracting Plan Credit Arrives

July 1, 2019


The 2014 National Defense Authorization Act allowed prime contractors with individual subcontracting plans to receive credit towards their subcontracting goals for awards made to small business concerns at any tier by subcontractors with individual subcontracting plans. In 2016, SBA issued its final rule implementing these directives.

SBA’s regulations require prime contractors to establish two sets of small business subcontracting goals, one for first-tier subcontractors and another for lower-tier subcontractors. The FAR Council is now beginning to catch up with these allowances so that prime contractors with small business subcontracting plans can take credit for lower-tier small business subcontracting.

You can read the proposed rule here >