Rep. Veasey and Rep. Stauber Protect Small Business Construction Contractors

Washington, D.C. – Rep.Veasey (TX-33) and Rep. Stauber (MN-08) introduced H.R. 2344, the bipartisan Small Business Payment for Performance Act of 2019, which will remove the financial burdens small businesses face, and shift financial accountability to federal agencies for extra work ordered. H.R. 2344 will also hold federal agencies responsible for the financial burdens incurred from change orders on small construction contracts.

Small businesses are critical for a healthy, competitive, and innovative federal contracting marketplace. However, small business contractors and subcontractors in the construction industry are challenged daily with the complexities of the bidding process and often incur the cost of changes made by federal agencies to the scope of their contracts.
"Small business contractors and subcontractors in the construction industry continue to face many challenges, including receiving payment in a timely manner for extra work ordered by a federal agency," said Congressman Veasey. "This bill will provide a solution to this issue by ensuring agencies are held accountable for changed work, instead of diverting that financial burden to the small contractors. It will also provide critical reform to help small businesses continue to grow by requiring federal agencies to provide fair and ethical treatment of small construction contractors."
Right now, small businesses are not being paid in a timely manner for changed work, and in some instances, they aren't being paid at all. The result is fewer small businesses competing for federal contracts, thus reducing competition resulting in increased costs, and reducing the pool of qualified small construction contractors willing to do work with the federal government. This bill will prevent the current financial liabilities small businesses face.

"Changes to contracts are inevitable, especially for construction projects, but small businesses that are awarded federal contracts and requested to perform these "change orders" are often on the hook for out-of-pockets costs," said Congressman Stauber. "Small businesses are not being paid in a timely matter, or at all, for the changed work they complete, leaving many at great financial risk and often deterring small businesses from participating in the federal procurement marketplace. We need to incentivize small businesses to seek out federal contracts, not push them away. That is why I was proud to introduce H.R. 2344, the Small Business Pay for Performance Act of 2019 to ensure that federal agencies are required to pay for changes made to a contract in a timely fashion."

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This bill has the endorsement of the Construction Industry Procurement Coalition (CIPC), consisting of the following members: American Council of Engineering Companies, American Institute of Architects, American Society of Civil Engineers, American Subcontractors Association, Associated General Contractors of America, Construction Management Association of America, Council on Federal Procurement of Architectural and Engineering Services, Design-Build Institute of America, Independent Electrical Contractors, National Association of Surety Bond Producers, National Electrical Contractors Association, National Society of Professional Surveyors, Sheet Metal & Air Conditioning Contractors' National Association, Surety & Fidelity Association of America, Women Construction Owners & Executives. FCA International