BIDEN SMALL BUSINESS PLANS COULD IMPACT LARGE PRIMES
Large contractors could see both increased small business set-asides and enhanced sub-contracting requirements if early indications from the incoming Biden Administration are any guide. Contractors need to start looking at some of the proposed policies and how they could impact the way in which federal business gets done with less than two weeks to go before the new team comes into power. One likelihood is a new emphasis on small business participation in federal contracting, potentially including a $400 billion plan “to support small businesses and tackle inequities in the federal contracting system.” The basic idea is to increase small business prime contract opportunities, especially for small, disadvantaged businesses. The Biden campaign website called for tripling the current 5% goal for prime contract awards to such firms by 2025. Large business sub-contracting goals with disadvantaged businesses could also increase. Biden’s team has also been discussing “contract bundling”. Despite existing rules that limit bundling, contractors could see more regulations that further direct federal agencies to break larger procurements into smaller pieces so that more small primes can participate. The bottom line for prime contractors is to expect more competition via set-asides and potentially increased costs, depending on which proposals are actually adopted. Remember, too, that executive orders have become the favored way to implement a wide swath of policy changes. These can be implemented quickly, with minimal time for industry to challenge or shape their basic structure. Be prepared.