Senate passes Defense Authorization Act with new provision

The Senate has passed its fiscal 2010 National Defense Authorization Act (S. 1390) with a provision that would remove the “shall” in the law that some government attorneys say gives small businesses in historically underutilized business zones (HUBZones) first preference when a contracting officer considers setting aside a contract for small businesses.

The mandatory “shall” would become a “may,” which would give the officers more discretion in awarding the contracts.

The Government Accountability Office, the Small Business Administration and the Office of Management and Budget have been wrestling with the issue since May. Read the story. The Senate passed the legislation July 23.

Also regarding acquisition reforms, the bill would require a Defense Department contracting officer to justify why a contract worth more than $20 million should be awarded on a sole-source basis. For example, the officer would have to show that the anticipated costs are fair and reasonable. The bill would also tighten restrictions on public/private competitions for government work. The competitions pit the two sectors against each other to see who can do the work best for the lowest price.

The House passed its version of the bill in June. A conference committee of senators and House members will work out the differences before sending the legislation to the president.