SMALL BUSINESS PURCHASING PLANS FOR FEDERAL CONTRACTS

While all funded purchases are subject to regulations including socio-economic initiatives, federal law PL95-507 adds formal reporting and approval requirements involving the University's Principal Investigator (PI). This law requires federal contracts in excess of $500,000 to have a subcontracting plan. The plan establishes a goal for purchases from Small Business (SB), and also breaks down this amount into goals for Small Disadvantaged Business (SDB), Small Women Owned Business (WOSB), firms located in Historically Underutilized Business Zones (HUBZone), Historically Black Colleges and Universities/Minority Institutions (HCBU/Ml), Veteran Owned Small Business (VOSB) and Service Disabled Veteran Owned Small Business (SDVOSB). The subcontracting plan is submitted with the response to a Federal RFP, and should the University receive the contract, is subject to approval by the federal agency. While the University of Maryland has an approved Master Subcontracting Plan, each PI must work with the Subcontracting Program Administrator to develop specific spending goals for each category of small business for that proposal . The goals are submitted to the federal agency on the Master Subcontracting Plan by following one of the links below for Exhibit I, provided in three formats:

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  • Your ORAA contact may provide guidance to the federal agency's concerns and expectations for subcontracting plan goals.
  • The Subcontracting Program Administrator, James Haley(jhaley@purchase.umd.edu), in consultation with the PI, will develop the specific goals for the Exhibit. The completed form will be included in the UM proposal.
  • Use caution against being either too optimistic or too conservative. If the goals are too low for SDB, WOSB, HUBzone, VOSB and SDVOSB the funding agency may reject the plan. If the goals are set too high, justifications may be needed if the goal is missed.

SMALL BUSINESS CLASSIFICATIONS
During the Vendor Registration process, Procurement & Supply classifies each vendor as Large, Small, Small Women-Owned, Small Disadvantaged, HUBZone or HBCU/MI, Veteran Owned Small Business or Service Disabled Veteran Owned Small Business. Call the Procurement and Supply buyers if you need help in finding small vendors. You may also check the federal Small Business Agency's database of small businesses (http://www.pro-net.sba.gov). If a vendor is listed, the firm meets the criteria for a small business. Additional information for each firm is provided, identifying if the firm is also 8A firm or disadvantaged, women-owned, etc. The database can also provide a list of small vendors for a certain commodity or service, or located in local HUBZones.

SMALL BUSINESS PURCHASING REPORTS FOR FEDERAL CONTRACTS
If a contract requires a Small Business Subcontracting Plan, then the University has additional reporting duties once the contract is awarded. Federal SF 294 and SF295 reports of actual dollars spent in each small business category must be submitted to the federal agency twice a year.

  • The Subcontract Program Administrator will prepare each SF 294 report and submit them to the federal funding agency.
  • The University also submits the SF 295 reports, which are summaries of campus-wide spending for all federal contracts from the agencies requiring the SF294 reports.

Note that if the University should subcontract more than $500,000 in federal contract funds to a large business or organization, then that large entity must also submit a subcontracting plan to the University. Then the large business must submit periodic SF294 reports to the federal agency and provide copies to the University of Maryland.


PI RESPONSIBILITIES
The PI's job starts with the proposal preparation. It is wise to use at least one subcontractor classified as SB, WOSB, SDB, VOSB or SDVOSB as it is easier to meet the goals with a large subcontract than by making many low dollar purchases from small businesses. It is very helpful to seek research partners with the HBCUs and MIs, as a subcontract with a HCBU/MI also counts toward the small business goals for DOD and NASA awards. Local institutions which qualify as HBCU or MI are Bowie State University, Coppin State College, Morgan State University, Sojourner-Douglass College, University of Maryland - Eastern Shore and Salisbury State University.

Once the contract is awarded, it is the PI's responsibility to help ensure the subcontract goals are met. When submitting a requisition for goods or services for the contract, suggest small vendors. If you do not know any small vendors, ask the buyer to solicit small firms. The buyers understand and support the goals of the subcontracting program.


If requested, the PI should provide help to the Subcontracting Administrator so the SF294 and SF295 reports can be submitted accurately and on time.

  

 

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