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 $650,000 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 University of Maryland has an approved Master Subcontracting Plan, but each contract will have its own set of subcontracting goals.   The Master Subcontracting Plan is referenced and the specific Exhibit I is submitted when the PI responds to a Federal RFP.  The PI must work with the Subcontracting Program Administrator, James Haley(jhaley@umd.edu),  to develop specific spending goals for each category of small business. The goals are submitted to the federal agency  using Exhibit I, template provided below in two formats:


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  • Your ORA contact may provide guidance to the federal agency's concerns and expectations for subcontracting plan goals.
  • 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, justification will be needed for missing these goals.
  • Should the University receive the contract, the goals are subject to approval by the federal agency.

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 DSBS, the Small Business Agency's database of small businesses. If a vendor is listed, see if the firm meets the criteria for a small business for the service or item you wish to buy.  Additional information for each firm is provided, identifying if the firm is also an 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. Individual Subcontracting Reports (”ISR”), and the Summary Subcontracting Report (SSR) of actual dollars spent in each small business category must be submitted electronically to the appropriate federal agency, twice a year.  A few agencies still require the paper reports, SF294 and SF295, to be sent.

  • With help from the PI and his/her staff, the Subcontracting Program Administrator will prepare each subcontracting report and submit them electronically to the federal funding agency.    
  • The University also submits the summary reports, which summarizes campus-wide spending for all federal contracts from the agencies requiring the individual reports.

Note that if the University should subcontract more than $650,000 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 its ISR 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 and University of Maryland - Eastern Shore
Once the contract is awarded, it is the PI's responsibility to help ensure the subcontract goals are met. If using Procurement Cards to purchase items, you must actively seek a small business to meet your goals.    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.

When requested, the PI must assist the Subcontracting Administrator so the ISR and SSR reports can be submitted accurately and on time.
 
 


 

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