The draft 2020 National Defense Authorization Act includes a number of provisions that will affect government contractors, especially small business contractors, including the three provisions featured in this post. Read on for how the 2020 draft NDAA impacts annual small business reporting by the SBA, cybersecurity training for small businesses, and evaluation of past performance to focus on workforce development.

Cybersecurity Assistance

Another proposed section provides additional resources for small business cyber security. Section 876 would amend the Small Business Act to introduce a SBA cyber security training program. It would have SBA create a “cyber counseling certification program . . . to certify employees of lead small business development centers to provide cyber planning assistance to small business concerns.” Cyber planning assistance is designed to “improve the cybersecurity infrastructure, awareness of cyber threat indicators, and cyber training programs for employees of a small business concern.”

While there’s not much detail here, SBA would provide funds to allow for increased cybersecurity planning for small businesses. If this comes to pass, it would result in free and much-needed assistance for small businesses in the realm of cybersecurity, which is important for all businesses, especially those dealing with sensitive government materials. Interestingly, the local Lawrence, Kansas Small Business Development Center was at the forefront of cybersecurity assistance (as we’ve written about), but it had been one of the only centers in the country with a special focus on cybersecurity.

Best in Class Small Business Reporting

Section 874 of the draft NDAA provides for additional data that SBA must provide as part of its Annual Small Business Procurement Scorecard, a breakdown for small businesses and socioeconomic set-aside businesses for each “best in class designation.” The draft NDAA would require SBA to track whether small businesses are receiving a fair share of best in class contracts. This could confirm SBA’s suspicion that use of category management and best in class contracts has reduced the number of small businesses receiving contracts.

“Best in class” is defined by the Office of Management and Budget (OMB). According to OMB, best in class is closely linked to the concept of category management, as we’ve written about. Category management “refers to the business practice of buying common goods and services as an enterprise to eliminate redundancies, increase efficiency, and deliver more value and savings from the Government’s acquisition programs.”

Best in class, per the OMB’s March 2019 memo, refers to contracts “that have been identified through a collaborative interagency process by acquisition category experts within the Government as offering the best pricing and terms and conditions within the Federal marketplace and reflecting the strongest contract management practices.” In other words, contracts that OMB has identified as very good models that can be used across agencies to acquire goods and services.

Workforce Development Investment

Section 843 of the draft NDAA would create incentives for contractors to develop their workforce. Under it, the Department of Defense (DoD) would provide “workforce development investment incentives for a contractor that implements a qualified training program to develop the workforce of the contractor in a manner consistent with” DoD needs.

Of particular note, DoD acquisition rules and past performance evaluation would have to focus on how the contractor developed its workforce development program. The DFARS would be amended to “require that the system used by the Federal Government to monitor or record contractor past performance includes an analysis of the availability, quality, and effectiveness of a qualified training program of an offeror as part of the past performance rating of such offeror.”

While the idea would need to be fleshed out further, likely in the DFARS, this amendment seems to call for direct incentives for workforce development as well as a new past performance evaluation mechanism looking at workforce development. It’s unclear what the incentives would consist of, perhaps proposal evaluation credit or something similar to the subcontracting credit. But if passed, this change could have an impact on many federal contractors.

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Remember, these are just draft provisions. But if kept in the final act, they will have some important impacts on small business contractors. We’ll keep you updated on the final implementation of the 2020 NDAA and advise if there are any major changes.

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