|
SEC. 861. Amendment to Mentor-Protege
Program.
(a) In general.—Section 831 of the
National Defense Authorization Act for Fiscal Year 1991
(Public Law 101–510; 104 Stat. 1607; 10 U.S.C.
2302 note) is
amended—
(1) in subsection (b), by striking
“designed to enhance” and all that follows through the
period at the end and inserting the following: “designed to—
“(1) enhance the capabilities of
disadvantaged small business concerns to perform as
subcontractors and suppliers under Department of Defense
contracts and other contracts and subcontracts; and
“(2) increase the participation of such business concerns
as subcontractors and suppliers under Department of
Defense contracts, other Federal Government contracts, and
commercial contracts.”;
(2) in subsection (c)(2), by
striking “to receive such assistance at any time” and
inserting “concurrently, and the authority to enter into
agreements under subsection (e) shall only be available to
such concern during the 5-year period beginning on the date
such concern enters into the first such agreement”;
(3) in subsection (d)—
(A) by redesignating paragraphs
(1) and (2) as clauses (i) and (ii), respectively (and
conforming the margins accordingly); and
(B) by inserting before clause (i) (as so redesignated)
the following:
“(1) the mentor firm is not
affiliated with the protege firm prior to the approval
of that agreement; and
“(2) the mentor firm demonstrates that it—
“(A) is qualified to provide
assistance that will contribute to the purpose of the
program;
“(B) is of good financial health and character and
does not appear on a Federal list of debarred or
suspended contractors; and
“(C) can impart value to a protege firm because of
experience gained as a Department of Defense
contractor or through knowledge of general business
operations and government contracting, as demonstrated
by evidence that—”;
(4) by amending subsection (e)(1) to
read as follows:
“(1) A developmental program for the protege firm, in such
detail as may be reasonable, including—
“(A) factors to assess the protege
firm's developmental progress under the program;
“(B) a description of the quantitative and qualitative
benefits to the Department of Defense from the agreement,
if applicable; and
“(C) goals for additional awards that protege firm can
compete for outside the Mentor-Protege Program.”;
(5) in subsection (f)—
(A) in paragraph (1)(A), by
striking “business development,”;
(B) by striking paragraph (6); and
(C) by redesignating paragraph (7) as paragraph (6);
(6) in subsection (g)—
(A) in paragraph (2)—
(i) in subparagraph (A), by
striking “paragraphs (1) and (7) of subsection (f)” and
inserting “paragraphs (1) and (6) of subsection (f)
(except as provided in subparagraph (D))”;
(ii) in subparagraph (B), by striking “under subsection
(l)(2)”; and
(iii) by adding at the end the following new subparagraph:
“(D) The Secretary may not reimburse any fee assessed by
the mentor firm for services provided to the protege firm
pursuant to subsection (f)(6) or for business development
expenses incurred by the mentor firm under a contract
awarded to the mentor firm while participating in a joint
venture with the protege firm.”; and
(B) in paragraph (3)(B)(i), by striking “subsection
(f)(7)” and inserting “subsection (f)(6)”;
(7) in subsection (h)(1), by
inserting “(15 U.S.C. 631 et seq.)” after “Small Business
Act”;
(8) in subsection (j)—
(A) in paragraph (1), by striking
“September 30, 2015” and inserting “September 30, 2018”;
and
(B) in paragraph (2), by striking “September 30, 2018” and
inserting “September 30, 2021”;
(9) by redesignating subsection (l)
as subsection (n);
(10) by inserting after subsection (k) the following new
subsections:
“(l) Report by mentor firms.—To comply with section 8(d)(7)
of the Small Business Act (15 U.S.C.
637(d)(7)), each mentor
firm shall submit a report to the Secretary not less than
once each fiscal year that includes, for the preceding
fiscal year—
“(1) all technical or management
assistance provided by mentor firm personnel for the
purposes described in subsection (f)(1);
“(2) any new awards of subcontracts on a competitive or
noncompetitive basis to the protege firm under Department
of Defense contracts or other contracts, including the
value of such subcontracts;
“(3) any extensions, increases in the scope of work, or
additional payments not previously reported for prior
awards of subcontracts on a competitive or noncompetitive
basis to the protege firm under Department of Defense
contracts or other contracts, including the value of such
subcontracts;
“(4) the amount of any payment of progress payments or
advance payments made to the protege firm for performance
under any subcontract made under the Mentor-Protege
Program;
“(5) any loans made by mentor firm to the protege firm;
“(6) all Federal contracts awarded to the mentor firm and
the protege firm as a joint venture, designating whether
the award was a restricted competition or a full and open
competition;
“(7) any assistance obtained by the mentor firm for the
protege firm from one or more—
“(A) small business development
centers established pursuant to section 21 of the Small
Business Act (15 U.S.C.
648);
“(B) entities providing procurement technical assistance
pursuant to
chapter 142 of title 10, United States Code;
or
“(C) historically Black colleges or universities or
minority institutions of higher education;
“(8) whether there have been any
changes to the terms of the mentor-protege agreement; and
“(9) a narrative describing the success assistance
provided under subsection (f) has had in addressing the
developmental needs of the protege firm, the impact on
Department of Defense contracts, and addressing any
problems encountered.
“(m) Review of report by the Office of Small Business
Programs.—The Office of Small Business Programs of the
Department of Defense shall review the report required by
subsection (l) and, if the Office finds that the mentor-protege
agreement is not furthering the purpose of the Mentor-Protege
Program, decide not to approve any continuation of the
agreement.”; and
(11) in subsection (n) (as so redesignated)—
(A) in paragraph (1), by
striking “means a business concern that meets the
requirements of section 3(a) of the Small Business Act
(15 U.S.C.
632(a)) and the regulations promulgated
pursuant thereto” and inserting “has the meaning given
such term under section 3 of the Small Business Act (15 U.S.C.
632)”;
(B) in paragraph (2)—
(i) by striking “means:” and
inserting “means a firm that has less than half the
size standard corresponding to its primary North
American Industry Classification System code, is not
owned or managed by individuals or entities that
directly or indirectly have stock options or
convertible securities in the mentor firm, and is—”;
(ii) in subparagraph (D), by striking “the severely
disabled” and inserting “severely disabled
individuals”;
(iii) in subparagraph (G), by striking “Small Business
Act.” and inserting “Small Business Act (15 U.S.C.
632(p)); or”; and
(iv) by adding at the end the following new
subparagraph:
“(H) a small business concern
that—
“(i) is a nontraditional
defense contractor, as such term is defined in
section
2302 of title 10, United States Code; or
“(ii) currently provides goods or services in the
private sector that are critical to enhancing the
capabilities of the defense supplier base and
fulfilling key Department of Defense needs.”;
(C) by amending paragraph (8) to
read as follows:
“(8) The term ‘severely disabled
individual’ means an individual who is blind (as defined
in
section 8501 of title 41, United States Code) or a
severely disabled individual (as defined in such
section).”; and
(D) by adding at the end the
following new paragraph:
“(9) The term ‘affiliated’, with
respect to the relationship between a mentor firm and a
protege firm, means—
“(A) the mentor firm shares,
directly or indirectly, with the protege firm ownership
or management of the protege firm;
“(B) the mentor firm has an agreement, at the time the
mentor firm enters into a mentor-protege agreement under
subsection (e), to merge with the protege firm;
“(C) the owners and managers of the mentor firm are the
parent, child, spouse, sibling, aunt, uncle, niece,
nephew, grandparent, grandchild, or first cousin of an
owner or manager of the protege firm;
“(D) the mentor firm has, during the 2-year period
before entering into a mentor-protege agreement,
employed any officer, director, principal stock holder,
managing member, or key employee of the protege firm;
“(E) the mentor firm has engaged in a joint venture with
the protege firm during the 2-year period before
entering into a mentor-protege agreement, unless such
joint venture was approved by the Small Business
Administration prior to making any offer on a contract;
“(F) the mentor firm is, directly or indirectly, the
primary party providing contracts to the protege firm,
as measured by the dollar value of the contracts; and
“(G) the Small Business Administration has made a
determination of affiliation or control under subsection
(h).”.
(b) Application.—
(1) IN GENERAL.—The amendments made
by subsection (a) shall apply to a mentor-protege agreement
made pursuant to section 831 of the National Defense
Authorization Act for Fiscal Year 1991 (Public Law 101–510;
104 Stat. 1607; 10 U.S.C.
2302 note) entered into after the
date of the enactment of the National Defense Authorization
Act for Fiscal Year 2016.
(2) RETROACTIVITY OF REPORT AND REVIEW REQUIREMENTS.—The
amendments made by subsection (a)(10) shall apply to a
mentor-protege agreement made pursuant to section 831 of the
National Defense Authorization Act for Fiscal Year 1991
(Public Law 101–510; 104 Stat. 1607; 10 U.S.C.
2302 note)
entered into before, on, or after the date of the enactment
of the National Defense Authorization Act for Fiscal Year
2016.
|
Amendment to Mentor-Protege Program
(sec. 861)
The House bill contained a provision (sec. 831) that would
codify the Department of Defense Mentor-Protege Pilot Program in
Title 10 United States Code as a permanent program.
The Senate amendment contained a provision
(sec. 877) that would extend the authorization for Department of
Defense Mentor-Protege Pilot Program by 1 year.
The House recedes with an amendment that
would clarify the eligibility requirements, forms of assistance,
extension of the authorization and reporting requirements.
The conferees note that the
Congressionally-mandated Mentor-Protege program is intended to
support efforts of small and disadvantaged businesses to partner
with established defense suppliers to improve their ability to
deliver needed technologies and services to the Department of
Defense. The committee is concerned that the program may not
always be executed to most effectively achieve mandated goals.
Analysis of this program indicates that in some cases, protege
firms participating in this program had received millions of
dollars in federal prime contract awards prior to the
establishment of their Mentor-Protege agreements, indicating
they may have possessed sufficient ability to market their goods
and services to federal customers without the need for
additional developmental assistance.
The conferees direct the Secretary of
Defense to report to the House Committee on Armed Services and
the Senate Committee on Armed Services, within 90 days of the
enactment of this Act, on changes to program policy and metrics
that would ensure the program meets the goal of enhancing the
defense supplier base in the most effective and efficient
manner. The
report shall include recommendations to better direct the
developmental assistance to the most appropriate disadvantaged
small business concerns, including nontraditional defense
contractors currently providing goods or services in the private
sector that are most critical to enhancing the capabilities of
the defense supplier base and fulfilling key Department needs.
The report shall describe how the Department will strengthen the
review processes of program investments to ensure activities
proposed in developmental plans are necessary for the protege's
development, taking into account the protege's reported prime
contract and subcontract awards, and that mentors are obtaining
the best value for all reimbursed activities. The report shall
also assess alternate models for incentives for participation by
mentor companies in the program other than direct reimbursement,
and shall detail program metrics that would enable the
Department to evaluate the program's return on investment and
the actual impact of the development assistance on the protege's
ability to support DOD
needs. The conferees recommend that the Secretary ensure that
the annual reports generated by the Defense Contract Management
Agency are sufficient to be used to evaluate team performance
and mentor reimbursement.
Further, the conferees direct the U.S.
Comptroller General of the United States, within 1 year of
enactment of this Act, report to the House Committee on Armed
Services and the Senate Committee on Armed Services, with an
assessment of the efficacy of the DOD Mentor-Protege pilot
program, recommend ways to harmonize the DOD Mentor-Protege
pilot program with the Small Business Administration's Mentor-Protege
program, and discuss whether the reimbursement mechanism for the
DOD Mentor-Protege pilot program should be maintained.
House Report
114-102 to accompany H. R. 1735 as it was reported out of
the House Armed Services Committee.
Section 831--Codification and
Amendment of Mentor-Protege Program
This section would revise and codify
section 831 the National Defense Authorization Act for Fiscal
Year 1991 (Public Law 101-510).
The committee is aware that the
Department of Defense Mentor-Protege Program was established in
1991 to allow small businesses, or proteges, to partner with
large companies, or mentors, under individual, project-based
agreements to position those proteges to better compete for
prime contract or subcontract awards. Mentors benefit by
expanding their sourcing plans to these small firms; proteges
benefit by developing needed business and technical capabilities
to diversify their customer base. Past reviews by the Government
Accountability Office have indicated that ``the Mentor-Protege
Program was a valuable experience and enhanced business
development'' and that ``[n]inety-three percent of responding
proteges reported the Mentor-Protege Program enhanced, at least
to some degree, their firms'' overall capabilities.'' The
committee believes that the Mentor-Protege Program is a valuable
tool for the Department of Defense and is helpful in creating a
strong foundation to see it used more broadly by the military
services and agencies, and improve linkages between small,
non-traditional contractors and larger, mainstream defense
contractors.
Senate Report
114-49 to accompany S. 1376 as it was reported out of the
Senate Armed Services Committee.
Extension of the Department of
Defense Mentor-Protege pilot program (sec. 877)
The committee recommends a provision
that would extend by 1 year the authority in section 831(j) of
the National Defense Authorization Act for Fiscal Year 1991
(Public Law 101-510). |
