Small Business Guide

Subcontracting Plans

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 concern will have the maximum practicable opportunity to participate in contract performance consistent with its efficient performance.

In negotiated acquisitions, each solicitation of offers to perform a contract or contract modifications, that individually is expected to exceed $650,000 ($1,500,000 for construction) and that has subcontracting possibilities, shall require the apparent successful offer or to submit an acceptable subcontracting plan. If it is determined thereare no subcontracting opportunities, the determination must be approved a level above the CO.

Subcontracting plan requirements (FAR 19.704)

Subcontracting Plans are not required from small businesses, personal services contracts and contracts performed entirely outside the U.S. and outlying areas.

• Separate percentage goals for using small business, veteran-owned 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; Goals less than 5% must be approved one level above the CO.
• A statement of the total dollars planned to be subcontracted and a statement of the total dollars planned to be subcontracting to small business, veteran-owned small business, service-disabled veteran owned small business, HUBZone small business, small disadvantaged business, and women-owned small business concerns;
• A description of the principal types of supplies and services to be subcontracted and services to be subcontracted and identification of types planned for subcontracting to small business, veteran-owned small business, service-disabled, veterans-owned small business, HUBZone small business, small disadvantaged business, and women-owned small business concerns.
• A description of the method used to develop the subcontracting goals;
• A description of the method used to identify potential sources for solicitation purposes;
• A statement as to whether or not the offer or included indirect costs establishing subcontracting goals and a description of the method used to determine the proportionate share of indirect costs to be incurred with small business, veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, small disadvantaged business, a women-owned small business concerns;
• The name of an individual employed by the offer or who will administer the Offer's subcontracting program, and a description of the duties of the individual;
• A description of the efforts the offer or will make to ensure that small business, veteran-owned small business, service-disabled HUBZone small business small disadvantaged business and women-owned, small business concern has an equitable opportunity to compete for subcontracts;
• Assurance that the offer or will include the clause at 52.219-8, Utilization of Small Business Concerns (see 19.708(a), in all subcontracts that offer further subcontracting opportunities, and that the offeror or will require all subcontracts (Except small business concern) that receive subcontractor in excess of $650,000 ($1,500,000 for construction) to adopt a plan that complies with the Requirements of the clause at 52.219-9, Small Business Subcontracting Plan (see 19.708)(b));
• Cooperate in any studies or survey as may required:
• Submit periodic reports so that the Government can determine the extent of compliance by the offer or with the subcontracting plan;
• Submit periodic reports so that the Government can plan determine the extent of compliance by the offer or with the subcontracting plan.
• Submit Standard Form (SF) 294, Subcontracting Report for Individual Contracts, and SF 295, Summary Subcontract Report, following the
• Instructions on the forms or as provided in agency regulations; and
• Ensure that its subcontractor agree to submit SF 294 and SF 295.

Subcontracting plans should be an evaluation factor.

The Office of Small Business Programs (OSBP) shall review the apparent successful offer or subcontracting plan. Therefore the contracting Officer shall provide a copy to the OSBP.

Type of Subcontracting Plan (FAR 19.7/52.219-9)

Subcontract means any agreement (other than one involving an employer-employee relationship) entered into by a Government prime contractor or subcontractor calling for supplies and/or services required for performance of the contract, contract modification, or subcontract.

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 offer or's planned subcontracting in support of the specific contract, except that indirect cost incurred for common or joint purposes may be allocated on a prorated basis to the contract.

Master Plan-means subcontracting plans that contain 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.

Commercial Plan-means a subcontracting plan (including goals) that covers the offeror's fiscal year and that applies to the entire productions of commercial items sold by either the entire company or portion thereof (e.g., division, planet, 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.