1. Subcontracting Program Updates Janice Buffler, Associate Director Subcontracting/Regional Councils DoD Office of Small Business Programs 1

2. 2 Better Buying Power 3.0 Subcontracting Surveillance DAU Small Business Program Course: 210 Subcontracting CSP Test Program eSRS Reporting Policy

3. 3 OSBP Website Updates / Resources  New guidance documents have been posted on OSBP website (http://www.acq.osd.mil/osbp/sbs/esrs.shtml)http://www.acq.osd.mil/osbp/sbs/esrs.shtml Subcontracting: The Basics (June 2016) The Individual subcontracting Report (ISR): Required by Individual Subcontract Plan (June 2016) The Summary Subcontracting Report (SSR): Required by Individual Subcontract Plan (June 2016) The Summary Subcontracting Report (SSR): Required by Commercial Subcontract Plan (June 2016) Tips for DoD Contractors Submitting Subcontract Reports

4. Backup Slides 4

5. Better Buying Power Initiative 3.6.3.5 5 OSBP, DPAP and DCMA establish specific guidance outlining the enforcement of subcontracting and subcontracting compliance 1.Provide “Checklist for Reviewing Subcontract Plan” (Request to open DFARS Case 7/19/16) 2.Provide access to DCMA Subcontracting Program Compliance Review (640 Review) (Working with DCMA)

6. Better Buying Power Initiative 3.6.3.5 6 3.Communicate change in FPDS to identify the type of subcontracting plan for a contract if required (Completed) 4.Expand contracting office PMR process to include additional subcontracting review elements (Completed) 5.Issue “DoD Guidelines on the Business Processes for the eSRS and Related Subcontract Reports” (Request to open DFARS Case 7/19/16)

7. DAU Small Business Program Course 7 Subcontracting Module – Pilot Instructor Course (Aug 8-12) – Pilot Student Course (Sept 19-23) – Includes post-award and compliance

8. FY17 SBA Scorecard Changes 8 Potential Scenario Being Considered Beginning FY17 Prime80% Sub10% Peer Review 10% Prime50% Sub20% Peer Review 20% New Category 10% 30% taken from prime & 10% added to 3 categories FY16 & PriorFY17 & Beyond

9. Federal Register – Subcontracting Changes Effective 11/1/2016 9 FR Vol. 81, No. 135 / Thursday, July 14, 2016 / Final Rule 1.Requires prime contractors to make good faith effort to utilize proposed SBs during contract performance 2.Authorizes COs to calculate subcontracting goals in terms of total contract $ in addition to required goals in terms of total subcontract $ 3.Provides COs with discretion to require subcontracting plan when SB represents its size as other than small business

10. Federal Register – Subcontracting Changes Effective 11/1/2016 10 4.Requires subcontracting plans even for modifications under the plan threshold if modifications would cause the contract to exceed plan threshold 5.Requires prime contractors to assign NAICS codes to subcontracts 6.Restricts prime contractors from prohibiting a subcontractor from discussing payment or utilization matters with the CO

11. Federal Register – Subcontracting Changes Effective 11/1/2016 11 7.Requires prime contractor to resubmit a corrected subcontracting report within 30 days of receiving the contracting officer’s notice of report rejection 8.Requires prime contractors to provide the socioeconomic status of the subcontractor in the notification to unsuccessful offerors for subcontracts 9.Requires prime contracts with subcontracting plans on task and delivery order contracts to report order level subcontracting information after Nov 2017

12. Federal Register – Subcontracting Changes Effective 11/1/2016 12 10.Funding agencies receive small business subcontracting credit 11.On IDIQ contracts, the CO may establish subcontracting goals at the order level (but not a new subcontracting plan)

13. Class Deviation 2016-O0009 13 Rescinds 3 previous deviations related to eSRS reporting (to have everything in one Class Deviation). – Allows contractors to submit the SF 294 in lieu of ISR for orders under Basic Ordering Agreement (BOAs) and Blanket Purchase Agreements (BPAs) – Reduces the frequency of SSR submissions under an Individual Subcontract Plan from biannual to annual (to be in line with other Federal agencies) – Eliminates the requirement for multiple SSRs under an Individual Subcontract Plan for construction and related maintenance and repair contracts, so that only one consolidated SSR encompassing all contracts is necessary (to be in line with other Federal agencies) – Changes the entity to which the contractor submits the SSR in eSRS for an Individual Subcontract Plan from the military department or defense agency to DoD. (to eliminate the possible submission of multiple reports under the same DUNS by a contractor)

14. DoD Test Program – Comprehensive Subcontracting Plan 14 DFARS Case 2015-D013 (CSP Test Program), Proposed Rule, implements CSP-related requirements included in NDAA FY15 and FY16 ̶New Reporting Requirements (next slide) ̶Changed eligibility – requires contractor to have at least 3 DoD contracts with an aggregate value of at least $100M ̶Assessment of liquidated damages ̶Extends Test Program for DoD to 12/31/2017 NDAA FY17 proposed language ̶To be consistent with other type of subcontract plans ̶To have transparency in DoDs large defense programs

15. DoD Test Program – Comprehensive Subcontracting Plan 15 FY17 Subcontracting Reports semiannually, submit with SSR submission ̶$ subcontracted by DoD Programs (1 st tier) ̶$ subcontracted by contracts for maintenance, overhaul, repair, servicing, rehabilitation, salvage, modernization or modification of supplies, systems or equipment AND total value, including options, is $100M or greater, i.e. NAICS Code 54 (Professional, Scientific & Technical Services)(1 st tier) ̶$ subcontracted under each 2-digit NAICS (1 st tier) ̶Total # of subcontracts awarded to you under your CSP ̶Costs incurred in negotiating, complying with, and reporting for your CSP ̶Costs avoided through use of your CSP

16. Subcontracting History (Goals and Achievements) ($ = Billions) 16 Fiscal Year Total Subcont Dollars SB Awards SDB Awards WOSB Awards HubZone Awards SDVOSB Awards GoalAchievedGoalAchievedGoalAchievedGoalAchievedGoalAchieved %$%$%$%$%$ 201634.55533 2015$133.436.032.3$43.154.4$5.855.3$7.131.4$1.832.0$2.7 2014$133.836.733.2$44.454.6$6.255.7$7.731.5$2.032.1$2.8 2013$147.136.735.4$52.054.8$7.055.7$8.331.5$2.232.2$3.1 2012$158.536.735.5$55.754.8$7.555.7$9.031.4$2.231.9$3.0

17. 17 What are Subcontracting Goals based on? ̶Small Business goal is assigned by SBA for each Federal Agency, taking into account goals and achievements over previous 2-3 years ̶Statutory goals for remaining socioeconomic categories (HUBZone not statutory, but continues as 3%) Subcontracting Goals

18. 18 What are Subcontracting Achievements based on? ̶Subcontract $ reported in Summary Subcontract Report (SSR) submitted for ̶Individual Subcontract Plan: encompasses all subcontracting under prime contracts and subcontracts with the awarding agency, regardless of the dollar value of the subcontracts ̶Commercial Subcontract Plan: includes all subcontract awards under the commercial plan, based on total $ subcontracted for Federal government and non-Federal government ̶DoD Comprehensive Subcontract Plan: includes all subcontract awards under comprehensive plan Subcontracting Achievements