1. Subcontracting and Electronic Subcontracting Reporting System (eSRS) for the Prime Contractor and the Contracting Officer
Presenter: Karen Poole Office of Small Business Utilization General Services Administration
May 2012

2. “The basic building block of good team
building is for a leader to promote the
feeling that every human being is unique
and adds value.”         ~Unknown

3. SUBCONTRACTING ASSISTANCE PROGRAM
Public Law Amended Section 8(d) of the Small Business Act and created the foundation for the Subcontracting Assistance Program. It requires that all small businesses have the maximum practicable opportunity to participate in the performance of Federal agency contracts and subcontracts.

4. SUBCONTRACTING ASSISTANCE PROGRAM “Subcontracting is More than a Subcontracting Plan”
Federal Government awards billions of dollars in prime contracts for supplies and services to large or “other-than small” businesses.
Subcontracting Program is comprised of activities to ensure small businesses receive a fair and equitable opportunity to participate in requirements awarded by Federal agencies, including subcontracts resulting from award of prime contracts.

5. SUBCONTRACTING ASSISTANCE PROGRAM
Small Business concerns are:
Small business (SB)
Veteran-owned Small Business (VOSB)
Service-disabled Veteran-owned Small Business (SDVOSB)
Historically Underutilized Business Zone Small Businesses (HUBZ)
Small Disadvantaged Businesses (SDB)
Woman-owned Small Businesses (WOSB)

6. SUBCONTRACTING ASSISTANCE PROGRAM
FAR Subpart 19.7 – The Small Business
Subcontracting Program outlines:
Statutory requirements
Eligibility requirements for participating in the program
Subcontracting Plan Requirements
Responsibilities of the contracting officer

7. SIZE STANDARDS FAR 19.102 Government-wide
North American Industry Classification System Codes (NAICS)
Number of Employees OR
Annual Revenue/Sales
SBA Office of Size Standards
Phone: , web site or
SBA’s size standards define whether a business entity is small and, thereby, eligible for Government programs and preferences reserved for “small business” concerns. Size standards have been established for types of economic activity, or industry, generally under the North American Industry Classification System (NAICS).
A concern may qualify as a small business for one type of work, but be considered a large business for a different type of work.
For contracts with multiple NAICS codes and size standards, the order will contain the NAICS and size standard from the underlying contract that best corresponds to the work to be performed, and only concerns that have certified that they are small for that same or lower size standard will be deemed to be small for that particular order.

8. WHEN A PROCUREMENT NEED IS DETERMINED

9. WHEN A PROCUREMENT NEED
IS DETERMINED
Internal customer identifies procurement needs and discusses with the Contracting Officer.
Contracting Officer, Administrative Contracting Officer (ACO) or Program Manager conducts market research, with assistance of the Small Business Office as needed, to identify potential small business concerns who can perform the requirements.
If the procurement is not set-aside for small business, the CO must complete GSA Form 2689 “Small Business Analysis Record” and attach a written justification.
SUBCONTRACTING STARTS WITH ACQUISITION PLANNING AND SHOULD BE CONSIDERED WHEN THE NEED IS DETERMINED
ONCE WE KNOW THERE IS A NEED, WE SHOULD DO MARKET RESEARCH BEGINNING WITH SBA’s DYNAMIC SMALL BUSINESS SEARCH FEATURE OF CCR TO IDENTIFY BUSINESS BY NAICS, SMALL BUSINESS CATEGORY, CONGRESSIONAL DISTRICT, ETC. -- VERY FLEXIBLE
Encouraging small business participation in acquisitions.
(a) The acquisition planner is required to coordinate with the Small Business Technical Advisor or Small Business Specialist any acquisition that: (1) Requires submission of a GSA Form 2689, Small Business Analysis Record, under GSAM
(2) Involves contract bundling (see FAR (e)).
(3) Is $5,000,000 or more (See FAR 7.104(d)(2).
(4) Exceeds the simplified acquisition threshold, if you decide not to set the acquisition aside for HUBZone Small Businesses (See (a)).
(b) Bundled acquisitions (See Appendix F).
(1) If the planner and contracting officer have failed to recognize that the acquisition is bundled, the small business specialist shall notify the Office of Small Business Utilization.
(2) When substantial bundling is contemplated (see FAR 7.107(e)), coordination with the Office of Small Business Utilization is also required.

10. DETERMINING THE NEED FOR A SUBCONTRACTING PLAN FAR 19.705-2
Determine prior to solicitation:
Could the prime contractor be other than small business?
Will the total contract value, including options, exceed $650,000 ($1,500,000 for construction)?
Are there possible subcontracting opportunities?
FAR   Determining the need for a subcontracting plan
The contracting officer must take the following actions to determine whether a proposed contractual action requires a subcontracting plan:
Determine whether the proposed contractual action will meet the dollar threshold in (a)(1) or (2). If the action includes options or similar provisions, include their value in determining whether the threshold is met. NOTE: the subcontracting threshold has increased again effective October 1, 2010, as indicated on the slide.
(b) Determine whether subcontracting possibilities exist by considering relevant factors such as—
(1) Whether firms engaged in the business of furnishing the types of items to be acquired customarily contract for performance of part of the work or maintain sufficient in-house capability to perform the work; and
(2) Whether there are likely to be product prequalification requirements.

11. DETERMINING THE NEED FOR A
SUBCONTRACTING PLAN
During solicitation preparation:
Include Subcontracting Plan requirement in the solicitation, if applicable
Include a subcontracting plan template in the solicitation (available from your local Small Business Technical Advisor)
Include Subcontracting Plan as an evaluation factor, if applicable
Provide solicitation to Small Business Technical Advisor (SBTA) and
Procurement Center Representative (PCR) for review before issuing it
Solicitation developed stipulates that the prime contractor must meet designated subcontracting guidelines of FAR Part 19

12. SUBCONTRACTING PLANS ARE NOT REQUIRED IF: FAR 19.702(b)
From small business concerns
For personal services contracts
For contracts performed entirely outside the
United States
For previous contracts that do not contain clause
FAR (b)(4) Statutory Requirements - For modifications to contracts within the general scope of the contract that do not contain the clause at , Utilization of Small Business Concerns (or equivalent prior clauses; e.g., contracts awarded before the enactment of Public Law 95-507).
(c) As stated in 15 U.S.C. 637(d)(8), any contractor or subcontractor failing to comply in good faith with the requirements of the subcontracting plan is in material breach of its contract. Further, 15 U.S.C. 637(d)(4)(F) directs that a contractor’s failure to make a good faith effort to comply with the requirements of the subcontracting plan shall result in the imposition of liquidated damages.

13. SUBCONTRACTING PLAN REQUIREMENTS

14. WHEN IS A SUBCONTRACTING PLAN REQUIRED TO BE SUBMITTED? FAR 19.702
New contracts $650,000 or more ($1.5 million for construction). Include all options in determining contract value, whether exercised or not.
Annual Update (Commercial Plans)
Modifications that meet subcontracting threshold
FAR   Statutory requirements.
Any contractor receiving a contract for more than the simplified acquisition threshold must agree in the contract that small business, veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business, and women-owned small business concerns will have the maximum practicable opportunity to participate in contract performance consistent with its efficient performance. It is further the policy of the United States that its prime contractors establish procedures to ensure the timely payment of amounts due pursuant to the terms of their subcontracts with small business, veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business, and women-owned small business concerns.

15. TYPES OF SUBCONTRACTING PLANS FAR 19.701
Commercial Plan: (company-wide)
Individual Plan: (contract specific)
Master Plan (when goals/dollars need to be submitted at a later time)
May be created in Model plan format or the company’s own creation. The model plan provided in the GSAM, Appendix 519A may be used as a guideline if it includes the latest up-to-date information and requirements of the FAR.
FAR (a)  Subcontracting plan requirements.
(a) Each subcontracting plan required under (a) (1) and (2) must include all eleven required elements.
FAR (d) In solicitations for negotiated acquisitions, the contracting officer may require the submission of subcontracting plans with initial offers, or at any other time prior to award. In determining when subcontracting plans should be required, as well as when and with whom plans should be negotiated, the contracting officer must consider the integrity of the competitive process, the goal of affording maximum practicable opportunity for small business, veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business, and women-owned small business concerns to participate, and the burden placed on offerors.

16. COMMERCIAL PLAN FAR 19.701, FAR 19.704(d) & FAR 12
Submitted and negotiated annually
Company fiscal year (12 month period)
Note: Leasing and construction do not
offer commercial items
FAR “Commercial plan” means a subcontracting plan (including goals) that covers the offeror’s fiscal year and that applies to the entire production of commercial items sold by either the entire company or a portion thereof (e.g., division, plant, or product line). Failure to make a good faith effort to comply with the subcontracting plan means willful or intentional failure to perform in accordance with the requirements of the subcontracting plan, or willful or intentional action to frustrate the plan.
FAR (d) - A commercial plan (as defined in ) is the preferred type of subcontracting plan for contractors furnishing commercial items. Once a contractor’s commercial plan has been approved, the Government shall not require another subcontracting plan from the same contractor while the plan remains in effect, as long as the product or service being provided by the contractor continues to meet the definition of a commercial item. The contractor shall—
Submit the commercial plan to either the first contracting officer awarding a contract subject to the plan during the contractor’s fiscal year, or, if the contractor has ongoing contracts with commercial plans, to the contracting officer responsible for the contract with the latest completion date. The contracting officer shall negotiate the commercial plan for the Government. The approved commercial plan shall remain in effect during the contractor’s fiscal year for all Government contracts in effect during that period; 2) Submit a new commercial plan, 30 working days before the end of the Contractor’s fiscal year, to the contracting officer responsible for the uncompleted Government contract with the latest completion date. The contractor must provide to each contracting officer responsible for an ongoing contract subject to the plan, the identity of the contracting officer that will be negotiating the new plan;
Only approve plan if FAR Part 12 is used.

17. INDIVIDUAL PLAN FAR 19.701 & FAR 19.704(c)
Covers the entire contract period (including options, with goals/dollars stated separately)
Specific to one contract
Goals are based on the offeror’s planned subcontracting in support of the specific contract, except that indirect costs incurred for common or joint purposes may be allocated on a prorated basis to the contract.
FAR “Individual contract plan” means a subcontracting plan that covers the entire contract period (including option periods), applies to a specific contract, and has goals that are based on the offeror’s planned subcontracting in support of the specific contract, except that indirect costs incurred for common or joint purposes may be allocated on a prorated basis to the contract.

18. MASTER PLAN FAR & (b)
Contains all the required elements of an Individual Plan, except goals/dollars
Eventually evolves into an Individual Plan (when goals/dollars are added), provided the Master Plan has been approved Include other Agency Approval Document, if applicable
FAR “Master plan” means a subcontracting plan that contains all the required elements of an individual contract plan, except goals, and may be incorporated into individual contract plans, provided the master plan has been approved.
FAR (b) Contractors may establish, on a plant or division-wide basis, a master plan (see 19,701) that contains all the elements required by the clause at , Small Business Subcontracting Plan, except goals. Master plans shall be effective for a 3-year period after approval by the contracting officer; however, it is incumbent upon contractors to maintain and update master plans. Changes required to update master plans are not effective until approved by the contracting officer. A master plan, when incorporated in an individual plan, shall apply to that contract throughout the life of the contract.
FAR (e) or CLAUSE (i) - A contract may have no more than one plan. When a modification meets the criteria in for a plan, or an option is exercised, the goals associated with the modification or option shall be added to those in the existing subcontract plan.
Individual vs. Master Plan for MACs, why? (example)

19. The Eleven Subcontracting Statutory Requirements
FAR
Identification Data
Type of Plan
Goals
Program Administrator
Equitable Opportunity
Assurances of Clause Inclusion and Flow Down
Reporting and Cooperation
Recordkeeping
Statutory Requirements
Description of Good Faith Effort
Signature Required

20. CONTRACTOR IDENTIFICATION DATA COMMERCIAL PLAN
Company Name and Address
Date Prepared
Description of Products/Services: general summary of commercial business to be covered by this plan for any government contract, awarded during the same fiscal year
Commercial Plan Period: (Insert dates of offeror’s Fiscal Year)
Estimated annual sales

21. CONTRACTOR IDENTIFICATION DATA INDIVIDUAL PLAN
Company Name and Address
Date Prepared
Description of Product/Service covered by this specific contract
Place of Performance/DUNS Number (under contract awarded)
Solicitation Number
Contract Number (if available)
Individual Plan/Contract Period (stated separately for base and each option period) Base: Date Of Award – ?? Years; Option 1: ________; Option 2: ________; Option 3: ___________; Option 4: ___________ (N/A for MAS)
Estimated Contract Value $______ (separate estimates for base & each option)

22. FISCAL YEAR 2010 & 2011 GSA WIDE SUBCONTRACTING GOALS
Goaling Category Goal
Small Business
Veteran-owned Small Business
Service-Disabled Veteran-owned small business
HUBZone Small Business
Small Disadvantaged Business
Women-owned Small Business
All Contracting Officials are to encourage contractors to use the GSA wide target goals or higher if they can. Goals are just that---Goals. We cannot mandate what the goals must will be but they shall reflect best faith efforts of each contractor as detailed in the liquidated damages section of FAR and the clause at for subcontracting plans.
Contracting Officers are acknowledging “reasonableness” of realistic goals and should be forceful in negotiating goals just as you would for negotiating the plan and a contract. Remember that a positive goal is required to establish a gauge for measuring results and to provide an incentive for continuing efforts to increase the dollar value of subcontracts. Zero is not a goal! Scrutinize any category where the offeror does not specify a goal or proposes extremely low goals. If counseling does not help or every attempt has been used to increase goals, the contractor(s) must explain in the subcontracting plan, their situation and inability to propose higher goals.

23. TOTAL DOLLARS AND PERCENTAGE GOALS FAR 19.704(a)(1) & (2)
Separate Goals (percentage) for:
Small Business
Veteran Owned Small Business (VOSB)
Service-Disabled Veteran-Owned Small Business (SDVOSB)
Women-Owned Small Business (WOSB)
Historically Underutilized Business Zone (HUBZ) Small Business
Small Disadvantaged Business (SDB)
including HBCU/MI, Hispanic Serving Institution,
Tribal Colleges and Universities, 8(a) companies, Alaska Native Corporations (ANC’s)
FAR   Subcontracting plan requirements.
Each subcontracting plan required under19.702(a)(1) and (2) must include—
Separate percentage goals for using small business (including ANCs and Indian tribes), veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business (including ANCs and Indian tribes) and women-owned small business concerns as subcontractors;
A statement of the total dollars planned to be subcontracted and a statement of the total dollars planned to be subcontracted to small business (including ANCs and Indian tribes), veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business (including ANCs and Indian tribes) and women-owned small business concerns.

24. GOALS FAR 19.704(a)(2) Subcontracting Amounts:
Total Dollars planned to be subcontracted
Total Dollars planned to be subcontracted to each business group
The dollar amounts planned for subcontracting to each of these categories must be expressed in the subcontracting plan as percentages of the total subcontracting dollars to both large and small businesses.
19.704(a)(2)   A statement of the total dollars planned to be subcontracted and a statement of the total dollars planned to be subcontracted to small business (including ANCs and Indian tribes), veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business (including ANCs and Indian tribes), and women-owned small business concerns.

25. TOTAL DOLLARS AND PERCENTAGE GOALS
INDIVIDUAL PLAN
Dollar figures below are only examples to show the actual GSA target percentage goals
BASE GOALS are expressed in dollars and percentages of total planned subcontracted dollars.
PLANNED SUBCONTRACTING TO:
DOLLARS $
PERCENT %
1. Total Dollars to be Subcontracted (2 + 3 = 1) large and all small business must equal total amount to be subcontracted
$100,000,000
100%
2. Large Businesses (Other than Small)
$ 70,000,000
70%
3. All Small Businesses
$ 30,000,000
30%
4. Veteran-Owned Small Businesses (VOSB)
$ 3,000,000 3%
5. Service-Disabled Veteran-Owned Small Businesses (SDVOSB)
6. HUBZone Small Businesses (HUBZone)
7. Small Disadvantaged Businesses (SDB)
$ 5,000,000 5%
8. Women-Owned Small Businesses (WOSB)
Reminder:
Dollar goals shall be stated separately for base and each option period and cover the entire contract period (depending on the type of contract).
For example, MAS contracts are awarded for a base 5 years and possibility of three additional 5 year option periods. Do NOT provide annual estimates of spend for outsourced items in support of the contract under MAS contracts.
Educate contractors that they can “double-count” dollars toward their goals (i.e., a business can be a WOSB/HUBZ/VOSB so contractors can count dollars for this contract in all three areas: $100 contract counted three times is worth $300 subcontracting credit toward goals).
Goals for options are also required if applicable (N/A for Commercial Plans).
Complete Individual Plan or Commercial Section in its entirety.
See example of “indirect/direct overhead costs” later in this presentation.

26. TOTAL DOLLARS AND PERCENTAGE GOALS COMMERCIAL PLAN
1. Estimated TOTAL dollars planned to be subcontracted; i.e. to all types of business concerns:
Annual Commercial Expenditures: $_12,000,000__________= 100% subcontracted
2. Planned subcontracting to large business concerns (those classified as other than small):
Annual Commercial Expenditures: $__8,400,000__________ = _70_ % of TOTAL above
3. Planned subcontracting to ALL small business concerns (including ANCs & Indian tribes, VOSB, SDVOSB, HUBZone small, SDB (including ANCs & Indian tribes), and WOSB):
Annual Commercial Expenditures: $__3,600,000__________ = _30_ % of TOTAL
4. Planned subcontracting to veteran-owned small business concerns (which includes service-disabled veteran-
owned small business):
Annual Commercial Expenditures: $____360,000_________ = _3_ % of TOTAL
5. Planned subcontracting to service-disabled veteran-owned small business concerns (also a subset of total
VOSB and cannot be higher than VOSB above):
Annual Commercial Expenditures: $_____360,000______ = _3_ % of TOTAL
6. Planned subcontracting to HUBZone small business concerns:
Annual Commercial Expenditures: $_____360,000____ = _3_ % of TOTAL
7. Planned subcontracting to small disadvantaged business concerns (including ANCs & Indian tribes):
Annual Commercial Expenditures: $______600,000_____ __= _5_ % of TOTAL
8. Planned subcontracting to women-owned small business concerns:
Annual Commercial Expenditures: $_____600,000_____ = _5_ % of TOTAL

27. DESCRIPTION OF SUPPLIES/SERVICES FAR 19.704(a)(3)
Large
Small
VOSB
SDVOSB
HUBZone
SDB
WOSB
Janitorial X
Printing
Transportation
Office Supplies
Graphics
Temporary Services
Food Services
FAR (a)(3) A description of the principal types of supplies and services to be subcontracted and an identification of types planned for subcontracting to small business (including ANCs and Indian tribes), veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business (including ANCs and Indian tribes), and women-owned small business concerns.

28. DESCRIPTION OF SUPPLIES/SERVICES
Large
Small
VOSB
SDVOSB
HUBZone
SDB
WOSB
Lease Construction:
Excavation X
Drywall Installation
Demolition
Lease Services:
Lock and Key
Janitorial
Refuge Removal
Do not allow them to “X” every category because checking all boxes does not indicate the contractor has thought out his options. This table should show the contractor have his options some thought. Ensure “good faith effort.” Advise them of the Dynamic Small Business Search at to use as a tool to find small business concerns.

29. DESCRIPTION OF METHOD USED TO DEVELOP SUBCONTRACTING GOALS FAR 19
Statement that contractor has reviewed his prior subcontracting efforts, or previous history on similar contracts.
FAR (a)(4) A description of the method used to develop the subcontracting goals;
This is where the contractor can explain their low goals, challenges that limit opportunities, or attempt at increasing goals. They may also provide written examples of their unique situation(s).

30. DESCRIPTION OF METHOD USED TO IDENTIFY POTENTIAL SOURCES FAR 19
DESCRIPTION OF METHOD USED TO IDENTIFY POTENTIAL SOURCES FAR (5) & FAR (d)(5)
Examples:
Attended conferences and networking sessions
Used existing suppliers
Researched minority directories
Central Contractor Register (CCR) at: GSA e-Library web site at:
FAR (a)(5) A description of the method used to identify potential sources for solicitation purposes.
FAR (d)(5) A description of the method used to identify potential sources for solicitation purposes (e.g., existing company source lists, the Central Contractor Registration database (CCR), veterans service organizations, the National Minority Purchasing Council Vendor Information Service, the Research and Information Division of the Minority Business Development Agency in the Department of Commerce, or small, HUBZone, small disadvantaged, and women-owned small business trade associations). A firm may rely on the information contained in CCR as an accurate representation of a concern’s size and ownership characteristics for the purposes of maintaining a small, veteran-owned small, service-disabled veteran-owned small, HUBZone small, small disadvantaged, and women-owned small business source list. Use of CCR as its source list does not relieve a firm of its responsibilities (e.g., outreach, assistance, counseling, or publicizing subcontracting opportunities) in this clause.

31. INDIRECT COSTS FAR 19.704(a)(6)
Provide a statement as to whether or not the offeror included indirect costs in establishing subcontracting goals, and
Provide a description of the method used to determine the proportionate share of indirect costs to be incurred with all small business concerns.
FAR (a)(6) A statement as to whether or not the offeror included indirect costs in establishing subcontracting goals, and a description of the method used to determine the proportionate share of indirect costs to be incurred with small business (including ANCs and Indian tribes), veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business (including ANCs and Indian tribes), and women-owned small business concerns.
FAR – Definition – “Indirect cost” means any cost not directly identified with a single final cost objective, but identified with two or more final cost objectives or with at least one intermediate cost objective. Indirect costs represent the expenses of doing business that are not readily identified with a particular grant, contract, project functions or activity, but are necessary for the general operation of the organization and the conducting of activities it performs.
Three types of indirect costs are: 1-Fringe benefits provided to employees, 2-overhead (i.e. facilities, misc. supplies), and 3- General/Admin (G&A) related to overall operation.

32. EXAMPLES OF INDIRECT COSTS FAR 19.704(a)(6)
Landscaping Janitorial Printing
Graphics Advertising Signage
Business Cards Promotion Items Photography
Telephone Education Training
Travel Agency Office Supplies Office
Equipment
Office Furniture Courier Service Security Service
Temporary Service Consulting Audit services
Food service Cleaning/Laundry Freight
Office repairs Legal services Conference/Trade
shows
Equipment rental
Depending on the type of contract or the industry involved, some costs might be considered direct for one contract and indirect for another.
For example: A PBS contract might include landscaping and janitorial as a direct cost; however, the same items would be indirect for a FAS IT contract.

33. NAME OF PROGRAM ADMINISTRATOR AND DUTIES FAR 19. 704(a)(7) & 52
NAME OF PROGRAM ADMINISTRATOR AND DUTIES FAR (a)(7) & (e)
Description of Possible Duties
Developing and promoting company policy that demonstrates the company’s support for awarding contracts to SB, VOSB, SDVOSB, HZSB, SDB, and WOSB, concerns.
Ensuring that subcontract procurements are structured to permit the maximum possible participation
Preparing and submitting ISR and SSR Reports
Coordinating the company’s activities during compliance reviews by Federal agencies
FAR (a)(7) The name of an individual employed by the offeror who will administer the offeror’s subcontracting program, and a description of the duties of the individual.
Please add contact information as well, such as telephone number, fax number, and/or address.

34. EQUITABLE OPPORTUNITY FAR 19.704(a)(8)
Provide a description of the efforts the offeror will make to ensure that small business, have an equitable opportunity to compete for subcontracts.
Outreach events to locate sources
Internal efforts to guide and encourage purchasing personnel to subcontract with small business concerns
Highly encourage the statement somewhere that says something similar to “will monitor activities to evaluate compliance with the subcontracting plan” under internal efforts.

35. ASSURANCES THAT THE OFFEROR WILL INCLUDE CLAUSE FLOWDOWN
FAR (a)(9)
FAR Clause , Utilization of Small Business Concerns
FAR Clause , Small Business Subcontracting Plan
FAR (a)(9) Assurances that the offeror will include the clause at , Utilization of Small Business Concerns (see (a), in all subcontracts that offer further subcontracting opportunities, and that the offeror will require all subcontractors (except small business concerns) that receive subcontracts in excess of $550,000 ($1,000,000 for construction) to adopt a plan that complies with the requirements of the clause at , Small Business Subcontracting Plan (see (b)).
On October 1, 2010, the threshold for prime contractor subcontracting plan (19.702) floor is raised from $550,000 to $650,000, and from $1,000,000 to $1,500,000 for construction.

36. THE OFFEROR WILL: FAR 19.704(a)(10)
CONTINUED
THE OFFEROR WILL: FAR (a)(10)
(iii) Submit the Individual Subcontract Report (ISR), and the Summary Subcontract Report (SSR) using the Electronic Subcontracting Reporting System (eSRS) ( following the instructions in the eSRS;
(iv) Ensure that its subcontractors with subcontracting plans agree to submit the ISR and/or the SSR using the eSRS;
Through coordination with PBS Acquisition Management, PBS contracting officials have been informed and trained regarding subcontracting reporting procedures and have monitored achievements and accepted reports for year-end FY 2010 and are on track to do so again for FY 2011.
A memo to Linda Smith, FAS Program Development Branch, was sent Guidance o[J1] n how to accept summary subcontract reports in eSRS, along with procedures for the Small Disadvantaged and Business Year-End Supplementary Report and a power point illustrating the process. In addition, training has been provided to the FAS acquisition workforce.
In January 20102, OSBU’s Subcontracting Program Manager and Central Office SBTA will work with the newly organized Central Office Contracting to provide training and clarify roles for monitoring and review of eSRS reports.

37. THE OFFEROR WILL: FAR 19.704(a)(10)
CONTINUED
THE OFFEROR WILL:
FAR (a)(10)
(v) Provide its prime contract number and its DUNS number and the address of the Government or Contractor official responsible for acknowledging or rejecting the reports, to all first-tier subcontractors with subcontracting plans so they can enter this information into the eSRS when submitting their reports; and
Ensure that the contractor use the flow down clauses so that lower tier prime contractor’s may enter subcontracting data in eSRS.

38. THE OFFEROR WILL: FAR 19.704(a)(10)
CONTINUED
THE OFFEROR WILL: FAR (a)(10)
(vi) Require that each subcontractor with a subcontracting plan provide the prime contract number and its own DUNS number, and the address of the Government or Contractor official responsible for acknowledging or rejecting the reports, to its subcontractors with subcontracting plans.

39. RECORDKEEPING FAR 19.704(a)(11) & 52.219-9(d)(11)
Description of the Types of Records
FAR (a)(11) A description of the types of records that will be maintained concerning procedures adopted to comply with the requirements and goals in the plan, including establishing source lists; and a description of the offeror’s efforts to locate small business, veteran-owned small business, service-disabled veteran-owned small business, HUBzone small business, small disadvantaged business, and women-owned small business concerns and to award subcontracts to them.

40. STATUTORY REQUIREMENTS FAR 19.702
Ensure indication of compliance with all:
Maximum practicable opportunity;
Timely payment;
Failing to comply in good faith;
Failure to make a good faith effort shall result in the imposition of liquidated damages

41. GOOD FAITH EFFORT FAR 19.705-5(a)(5) and U.S.C. 637(d)(4)(F)
Maximum practicable utilization of SB, SDB, HUBZone, WOSB, VOSB and SDVOSB concerns as subcontractors in Government contracts is a matter of national interest with both social and economic benefits. When a contractor fails to make a good faith effort to comply with a subcontracting plan, these objectives are not achieved, and the above regulations directs that liquidated damages shall be paid by the contractor.
The contractor MUST have a narrative that is “reasonable and strong.”
Must ensure per FAR (a)(5) that an acceptable plan is incorporated into and made a material part of the contract. This statement is recommended: (Company Name) understands that this subcontracting plan will be made a material part of the contract and the submission electronically of the ISR and SSR will be made a line item deliverable in the contract.
GSA/SBTAs can help encourage and facilitate subcontractor industry days for projects requiring subcontracting plans.
GSA/SBTAs can leverage their network of small business advocates to provide information regarding capable firms (including SBA, Minority Business Development Agency, Procurement Technical Assistance Centers, Department of Veteran Affairs, etc).

42. ALL PLANS MUST BE SIGNED AND DATED
BY A COMPANY OFFICIAL
Must have signature, title, and date – minimum.
If a revised Plan is requested, secure a revised date on, at least the revised page(s).
Person signing the Plan should not be the Program Administrator already named in the Plan. At a minimum, it should be someone a level above the Program Administrator and part of the same company.
Require electronic subcontracting plan submission for FAS/PBS.
Plans must be signed and dated by a company official who, at a minimum, is a higher level than the Plan Administrator. This ensures company “buy-in” of Plan contents and administration of those contents.

43. “Teamwork is the ability to work together toward a common vision
“Teamwork is the ability to work together toward a common vision. The ability to direct individual accomplishments toward organizational objectives. It is the fuel that allows common people to attain uncommon results.”
        ~Andrew Carnegie

44. CHECKLIST FOR REVIEW OF SUBCONTRACTING PLAN
Guides you through the plan to ensure that each of the eleven required elements have been included
Where the CO, Small Business Technical Advisor, and the Small Business Administration review/sign
Note: The checklist does not currently have a form number (formerly GSA Form 3584). Watch for Acquisition Letters and GSAM Updates
Block # 1: Point of Contact, Address, Phone & FAX Numbers
Block # 2: Administrative Contracting Office, Address, Phone & FAX Numbers
Block # 3: Solicitation Number
Block # 4: Contract Number
Block # 5: Contractor Name, Address, Duns Number, and contact information Block # 6: Subcontracting Plan Administrator, Name, Address, and Contact Information Block #7: Administrative Contracting Office – Address – Phone Number Block #8: Type of Contract
Block # 9a: Contact Period (Base and/or Each Option if applicable)
Block # 9b: Original Date of Award Plus Date Option Period Exercised
Block # 10: Contract Dollar Value or Estimated Sales for this contract Block # 11: Description of Types of Supplies and Services
Block # 12: Type of Plan indicated
Block # 13: Complete Items a-f; begin with goals in both dollars and percents for each category, then indicate CO acceptable for each item down the column
Remarks: Provide Specific Comments or Explanations to bring to reviewers attention Reviewed by: CO Sign and Date
SBTA: Sign and Date SBA/PCR: Sign and Date

45. EVALUATING THE SUBCONTRACTING PLAN
Subcontracting Plans & Goals Should:
Be realistic and achievable
Provide a challenge (and build upon prior achievements)
Include positive goals
Reflect best faith efforts & maximum practicable opportunities

46. EVALUATING THE SUBCONTRACTING PLAN
UPON RECEIPT OF A SUBCONTRACTING PLAN, CO MUST REVIEW TO ENSURE ADEQUACY AND THAT IT MEETS THE REQUIREMENTS OF FAR AND GSAM (SEE CLAUSE )
Ensure goals and dollar amounts are calculated correctly
Find that Small Business Concerns are included in all applicable categories (allowed to double & triple count $$)
Require an Offeror to justify or explain why their proposed goals are lower than the agency goals or the government-wide goals. If you cannot negotiate higher goals due to a unique situation, the plan should state how this reflects their best faith effort and what their challenges reside.

47. EVALUATING THE SUBCONTRACTING PLAN
CONTINUED
EVALUATING THE SUBCONTRACTING PLAN
Also consider past subcontracting history and goal attainment --overall compliance & efforts should be considered, not merely whether goals were met
Obtain SBTA review, advice & recommendations
Obtain SBA’s Procurement Center Representative (PCR) review and concurrence
Ensure the CO finds the Subcontracting Plan acceptable and incorporates it into and makes it a material part of the contract.

48. SUBCONTRACTING PLAN IS A MATERIAL
PART OF THE CONTRACT
Subcontracting Plans must be:
Approved prior to award
Made a material part of the contract at the time of award
Failure to submit an acceptable Subcontracting Plan to CO makes the offeror ineligible for award.
File APPROVED plan with Checklist (formerly called GSA Form 3584) under Tab 23(b)

49. DETERMINED THAT NO SUBCONTRACTING POSSIBILITIES EXIST? FAR 19.705-2(c)
Must be approved at a level above the contracting officer and placed in the contract file.

50. DETERMINED THAT NO SUBCONTRACTING POSSIBILITIES EXIST. GSAM 519
DETERMINED THAT NO SUBCONTRACTING POSSIBILITIES EXIST? GSAM (d)
FAR (c) If it is determined that there are no subcontracting possibilities, the determination must be approved at a level above the contracting officer and placed in the contract file.
GSAM (d) Notify the AAOSBU after receipt of offers if you determine that an apparent successful offeror’s proposal has no subcontracting opportunities.
(1) Coordinate the notice through your Small Business Technical Advisor. In a regional contracting activity, also coordinate the notice through the regional small business staff.
(2) Obtain AAOSBU concurrence on the determination prior to contract award.

51. GENERAL SERVICES ADMINISTRATION DETERMINATION AND FINDINGS (If a subcontracting plan do not exist, a sample D&F may include)
Example: Authority to Contract without a Subcontracting Plan
I hereby find the following:
Xxxxxxxxxxxxxxxxxxxxxxxx
Based on the above findings, I hereby determine:
Prepared by :_______________________ Approved by_____________________
Contracting Officer Division Director or Office Title/Symbol Center Director
Concurrence:____________________________ Concurrence:__________________________
Insert Name of SBTA Insert Name of Associate Administrator
Small Business Technical Advisor Associate Administrator
Office of Small Bus Utilization (E)
Even if the company, on a previous contract, had no subcontracting opportunities, each new award must be examined for new opportunities.
Note: This should not happen very often and if it does, prior to each option we suggest the CO reevaluate this determination and provide a justification for the contract file when appropriate.
An alternative would be to submit a company-wide plan, to take advantage of all commercial business and purchases made during a fiscal year to support company-wide operations.

52. TRUE OR FALSE DO WE REQUEST A NEW INDIVIDUAL PLAN FOR EACH OPTION PERIOD?
Subk
Plan
Subk Plan
ANSWER: FALSE
FAR (e) or CLAUSE (i)
A contract may have no more than one plan. When a modification meets the criteria in for a plan, or an option is exercised, the goals associated with the modification or option shall be added to those in the existing subcontract plan.

53. TRUE OR FALSE AN OFFEROR MUST USE THE MODEL SUBCONTRACTING PLAN?
ANSWER: FALSE
GSAM (a) – Model Plan
You may provide offerors a model subcontracting plan when you determine it appropriate, e.g., when it may facilitate evaluation or negotiation. You may use the model plan developed by the Office of Small Business Utilization (E) in Appendix 519A. Include the following notice on the transmittal, if you provide a model in response to a single request, or in the solicitation, if you include it as an attachment.
Notice to Offerors: “GSA provides this model plan as a tool. You must adapt this model plan to fit your subcontracting situation. The plan is NOT a fill-in-the-blank form and you must remove instructional language. This model does not establish minimum requirements for an acceptable plan. The model reflects objectives GSA encourages contractors to adopt.” Plans may be submitted using the Model plan format or the company’s own creation as long as all required information is included.

54. TRUE OR FALSE IF A MODEL PLAN IS PROVIDED IN THE SOLICITATION, THE BELOW STATEMENT SHOULD BE INCLUDED
Notice to Offerors: “GSA provides this model plan
as a tool. You must adapt this model plan to fit your subcontracting situation. The plan is NOT a fill-in-the-blank form and you must remove instructional language. This model does not establish minimum requirements for an acceptable plan. The model reflects objectives GSA encourages contractors to adopt.” Plans may be created using the Model plan format or be the company’s own creation.
ANSWER: TRUE
GSAM (a)

55. TRUE OR FALSE GSA FORM 3584 CANNOT BE FOUND AMONG THE AVAILABLE ELECTRONIC FORMS?
ANSWER: TRUE
This GSA form officially expired in the 1990’s and was removed from the electronic forms “library.” FAS, however, received a waiver from the Commissioner to continue using it, since the single-page format and content met our needs in reviewing subcontracting plans IAW FAR requirements.
The Checklist is kept up-to-date by the GSA Small Business team and the form number has been removed until or unless the form is officially reinstated.

56. TRUE OR FALSE A NEW CHECKLIST MUST BE PREPARED TO TRANSMIT SUBK PLAN REVISIONS FOR REVIEW?
ANSWER: FALSE
FOR MAS Please don’t. That wastes valuable time since earlier notes, log numbers, and highlighting from the prior review will have to be duplicated on the new form. A previously annotated “Checklist” alerts us that it is a resubmission and complete review is not needed. We will pick up where we left off and determine if the deficiencies were addressed. Neat pen-and-ink changes will be made on the original “Checklist” and the plan will be forwarded to the SBA Representative.
An exception would be if many blocks have changed such as new PCO, Plan Administrator, Company’s name, address and/or point of contact information, and revised goals.

57. TRUE OR FALSE CO’s MAY MAKE MINOR CHANGES TO THE CONTRACTORS SUBK PLAN AND SHOULD REFER CONTRACTORS TO THE SMALL BUSINESS OFFICE FOR QUESTIONS?
ANSWER: FALSE
For errors or missing information within the plan, revisions and corrections must be made by the company, not the CO or small business office.
Questions related to the small business office recommendations should be discussed or “negotiated” between the CO or Contract Specialist and the contractor. The CO should remain the primary point of contact with the company but obtain clarification, guidance and advice from the Small Business Staff as needed.
A conference call with the CO or Contract Specialist, Small Business staff, and Vendor may be held to discuss concerns or confusion on comments provided about rejecting the subcontracting plan.

58. TRUE OR FALSE IF THE SBTA OR SBA’s PCR DO NOT AGREE WITH THE PLAN, AND RETURNS THE CHECKLIST WITHOUT SIGNATURES, NOTHING CAN BE DONE?
Refer to FAR (c) & (d), and GSAM
ANSWER: FALSE
FAR (c) - In negotiated acquisitions, the contracting officer shall determine whether the plan is acceptable based on the negotiation of each of the 11 elements of the plan (see 19.704).
GSAM   - Awards involving subcontracting plans.
(a) For each contract that requires a subcontracting plan, both the SBTA and SBA PCR review the apparent successful offeror’s subcontracting plan. When you make multiple awards under a solicitation, submit the subcontracting plans of all apparent successful offerors.
(1) … provide the SBTA a copy of the plan at least 5 workdays before the anticipated award date.
(2) Consider any recommendations the SBTA or SBA PCR provides about whether to accept or reject a subcontracting plan. In the case of an unresolved disagreement, notify the AAOED and consider any subsequent advice the AAOED provides.

59. LIQUIDATED DAMAGES FAR 19.702(c) and 19.705-7
Maximum practicable utilization of small business, veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business, and women-owned small business concerns as subcontractors in Government contracts is a matter of national interest with both social and economic benefits. When a contractor fails to make a good faith effort to comply with a subcontracting plan, these objectives are not achieved, and 15 U.S.C. 637(d)(4)(F) directs that liquidated damages shall be paid by the contractor.

60. PAST PERFORMANCE FAR 42.15 WHY DO WE EVALUATE PAST PERFORMANCE?
To have relevant information for future source selection purposes regarding a contractor’s actions under previously awarded contracts.
Past performance evaluation shall include an assessment of contractor performance against, and efforts to achieve, the goals identified in the small business subcontracting plan when the contract includes the clause , Small Business Subcontracting Plan.

61. WHY DO WE EVALUATE PAST PERFORMANCE?
To have relevant information for future source selection purposes regarding a contractor’s actions under previously awarded contracts.
Past performance evaluation shall include an assessment of contractor performance against, and efforts to achieve, the goals identified in the small business subcontracting plan when the contract includes the clause , Small Business Subcontracting Plan.

62. SMALL BUSINESS JOBS ACT OF 2010
More accountability, integrity, and transparency for small businesses.
Enforces stronger subcontracting plan requirements for large prime contractors to ensure small businesses are utilized in subcontracting.
Discourages late payments to small subcontractors.

63. Subcontract Compliance and the Electronic Subcontracting Reporting System (eSRS)

64. Monitoring Subcontracting Compliance
Monitoring Compliance After Award
Compliance in eSRS
Small Business Program Compliance Review (SBPCR)
Seven Elements of a SBPCR

65. Monitoring Compliance – After Award
Contracting Officer notify the Small Business Administration (SBA)
Send copy to SBA Area Director where contractor is located
Provide copy of Subcontracting Plan to SBA, Procurement Center Representative (PCR)

66. Monitoring Compliance – After Award
Provide copy of award notice to SBTA within five days of contract award or contract modification
Forward a copy of each plan or determination that no plan is required to the Administrative Contracting Officer (ACO)
Ensure all reports, including Individual Subcontract Report (ISR) and Summary Subcontract Report (SSR) are submitted on time is complete and accurate
Partner with SBA and SBTA to conduct Subcontracting Compliance Reviews

67. Monitoring Subcontracting Compliance www.esrs.gov
SSR Status Report
ISR First Tier Report
Subcontracting Contractor Award Dollars
Time-Phased Individual Subcontract Report
5 Year Contractor Trend Report
Analysis of Subcontracting Plan Goal Attainment
Subcontracting Achievements by Federal Agency
ISR All Tiers Report
ISR Status Report

68. Monitoring Subcontracting Compliance
High dollar Recovery Projects
Government-wide multiple award contracts
Projects not meeting subcontracting goals (ISRs)
Validate data in FPDS and eSRS, including delegated administrative roles
Periodically provide progress updates and notify procurement teams of reports to review
Clarify lower-tier reporting processes

69. Small Business Program Compliance Review (SBPCR) Public Law , 13 CFR 125, and SBA/Standard Operating Procedures (SOP)
An on-site Small Business Program Compliance Review (SBPCR) is an objective and comprehensive formal evaluation of a Large Prime Contractor’s (LPC) compliance with it’s subcontracting plans.

70. SBPCR - continued
Preparation for a SBPCR is extremely important:
General background of the LPC’s history, size, major product line
Most recent ISR for agency contracts
Current year and historical summary subcontracting data for five years
List of sources referred to LPC
A notification letter and preparation checklist should be issued to the LPC 30 days prior to on-site visit.
Request the information be submitted two weeks in advance

71. The Seven Elements of a SBPCR
Sourcing
Validation of the subcontracting report for ISRs and SSRs
Five year trend analysis
Overall evaluation of Small Business Program
Subcontracting plan goal analysis
Sampling of subcontracts issued to large business
Follow-up agency/SBA’s prior recommendations

72. SBPCR - continued
Conducted properly, a SBPCR review can have a significant impact on the way a LPC administers its small business program. Follow up is key!!!

73. Electronic
Subcontracting
Reporting System
(eSRS)

74. eSRS What is eSRS? Who is required to use eSRS? How does eSRS work?
How can you register in eSRS?

75. Registering in eSRS:
Click on “Government” if you are a Federal employee
Have password ready

76. Registration

77. Registering in eSRS - continued

78. Registering in eSRS

79. Registering in eSRS - continued

80. Registering in eSRS - continued

81. Registering in eSRS - continued

82. Registering in eSRS - continued

83. Registration Complete

84. Accept/Reject ISRs and SSRs

85. Reporting Requirements
Individual Subcontract Report (ISR) (formerly SF 294)
Semi-annually for: Oct 1 – March 31
April 1 – Sept 30
(Plus one SSR for year-end due Oct 30)
Summary Subcontract Report (SSR) (formerly SF 295)
Annually Oct 1 – Sept 30
Year-End SDB Supplemental Report
Due annually and at contract completion for ISRs
Per 48 CFR (j)(2)
Report (3-digit NAICS subsector)
Optional Form 312 (FAR Clause )

86. Selecting A Report

87. Defining Your Search

88. Accept/Reject ISR

89. Accept/Reject SSR

90. Acceptance/Rejection Note

91. SSR SDB Dollars

92. Accept/Reject Year-End SDB

93. SDB Participation Report Optional Form 312

94. REPORTS
Pre-defined Reports
5 Year Contractor Trend Report
Analysis of Subcontracting Plan Goal Attainment
Subcontracting Achievements by Federal Agency
Ad Hoc Reports
Design report with more specific details

95. eSRS Resources
Central and Regional OSBU POCs
Quick Reference Guides
Sample Reports

96. GSA, Office of Small Business Utilization
Questions?
Thank you.