CPA & Business Advisory Blog

A Tale of Two National Defense Reauthorization Acts – The House’s Version v. The Senate’s Version

We would like to share the following update on contracting issues in Congress that was sent to us by the Surety Association of Ohio.

“S. 3254, the Senate’s version of the National Defense Reauthorization Act (NDRA) is headed to the Senate floor without the provisions regarding the Bond Guarantee Program of the Small Business Administration (SBA) and the contracting reforms that were contained in the House version of the NDRA.  The Senate is expected to pass its legislation in the near future, leaving the future of the contracting provisions, which SFAA supports, in the hands of a conference committee this September.

The U.S. House previously passed H.R. 4310, which would raise the maximum amount of the bond that the SBA could guarantee from $2 million to $6.5 million. The House version of the NDRA also contains provisions that are intended to prevent the SBA from unraveling bond guarantees made with the SBA’s prior approval.

The House bill also contains legislation from its Small Business Committee on contract bundling and mentor-protégé programs. The bill would establish a threshold for bundling construction contracts at $5 million. Under H.R. 4310, the SBA would be charged to develop a model for mentor-protégé programs for all federal agencies. The SBA regulations would contain requirements for such programs, which would include the eligibility requirements, the effect of mentor-protégé relationships on contracting/procurement rules, whether any developmental assistance provided by the mentor may affect the status of a program participant, and the need for a mentor-protégé pair to be accepted as a pair in all federal programs if accepted as a pair in one federal program. 

The differences between the two bills likely will be the subject of a conference when Congress comes back after Labor Day.   SFAA and NASBP will work with the contractors’ associations to seek enactment of the favorable contracting provisions.  We already know that there will be pushback on the Senate side, which wants to limit the NDRA to Department of Defense issues only.“

Have questions about the National Defense Reauthorization Act? Post a comment below or contact the accountants and business advisors in our Real Estate and Construction Group at 440-449-6800.

Courtesy: Surety Association of Ohio

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