52.219-9
Small Business Subcontracting Plan
Large contractors must develop, implement, and report on a detailed plan to maximize subcontracting opportunities for small businesses, or risk losing contract eligibility and facing compliance penalties.
Overview
FAR 52.219-9 requires large business contractors (not small businesses) to develop, submit, and comply with a Small Business Subcontracting Plan when awarded certain federal contracts. The clause establishes detailed requirements for the content, negotiation, and administration of these plans, aiming to maximize subcontracting opportunities for small businesses, including specific socioeconomic categories (e.g., veteran-owned, HUBZone, women-owned, disadvantaged, ANCs, and Indian tribes). It mandates reporting, recordkeeping, and good faith efforts to ensure small business participation and timely payment.
Key Rules
- Applicability
- Applies to contracts above the FAR 19.702 threshold, except for small business concerns.
- Plan Requirements
- The plan must set separate goals (in dollars and percentages) for each small business category, describe methods for goal development and source identification, and outline recordkeeping and reporting procedures.
- Reporting and Recordkeeping
- Contractors must use the Electronic Subcontracting Reporting System (eSRS) to submit required reports (ISR, SSR), maintain detailed records, and cooperate with government reviews.
- Good Faith Efforts and Payment
- Contractors must make good faith efforts to use small businesses named in proposals, pay small business subcontractors promptly, and notify the contracting officer of reduced or late payments.
- Flowdown and Subcontractor Requirements
- The clause must be flowed down to certain subcontracts, and subcontractors with further subcontracting opportunities must also adopt compliant plans.
Responsibilities
- Contracting Officers: Ensure plans are submitted, negotiated, and approved; monitor compliance and reporting.
- Contractors: Develop, implement, and update subcontracting plans; meet goals; report via eSRS; maintain records; pay small business subcontractors on time; flow down requirements.
- Agencies: Oversee compliance, review reports, and enforce remedies for noncompliance.
Practical Implications
- This clause drives accountability for large contractors to support federal small business goals, with significant administrative and reporting obligations. Noncompliance can result in ineligibility for award or other penalties. Common pitfalls include incomplete plans, missed reporting deadlines, and failure to make good faith efforts or timely payments.