25 Year-Old Pentagon Test Program Described As A "Sham" By Legal Scholar

American Small Business League Launches National Campaign to Kill Sham Pentagon Test Program

Sep 11, 2014, 07:00 ET from American Small Business League

PETALUMA, Calif., Sept. 11, 2014 /PRNewswire-USNewswire/ -- A 25 year-old Pentagon test program known as the Comprehensive Subcontracting Plan Test Program (CSPTP) has been described by Professor Charles Tiefer, one of the nation's leading experts on federal contracting law, as a "sham and its extension will be seriously harmful to vital opportunities for small businesses to get government contracting work."

Professor Tiefer goes on to say, "To summarize: the Comprehensive Subcontracting Plan Test Program (CSPTP or "Test Program")(1) reduces vital opportunities for small businesses; and (2) has a background of doubt and criticism. CSPTP is seriously harmful to small businesses. It should not have gotten its more than 20 years of extension as a never-tested "Test Program". Let it expire."

The CSPTP was adopted by the Pentagon in 1989 under the guise of increasing subcontracting opportunities for small businesses. In reality it created a colossal loophole in federal law for 25 years that has allowed the Pentagon's largest prime contractors to circumvent federal law establishing the 23% small business contracting goal.

Prior to the CSPTP, Pentagon prime contractors were required to submit a small business subcontracting plan on all major contracts. These small business subcontracting plans were available to the public and could be used by small businesses to land subcontracting opportunities. The CSPTP eliminated this valuable tool for small businesses.

Prior to the CSPTP, all Pentagon prime contractors were required to submit semi-annual and annual small business subcontracting reports (SF 294 and SF 295). These reports were available to the public and could be used to track a contractor's compliance with their small business subcontracting goals. The CSPTP also eliminated this valuable tool for small businesses.

Lastly, prior to the implementation of the CSPTP, Pentagon prime contractors could face "liquidated damages" for failing to make a good faith effort to achieve their small business subcontracting goals. Under the CSPTP, participating contractors are exempt from "liquidated damages" and all other penalties for non-compliance with their small business subcontracting goals.

Under the guise of "increasing subcontracting opportunities for small businesses" the CSPTP actually eliminated all transparency and penalties for non-compliance on small business subcontracting programs for the Pentagon's largest prime contractors since 1990.

Only GovEx and The Hill have published stories on the issue.

A 2004 investigation by the Government Accountability Office found no evidence the CSPTP has ever helped small businesses.

The Chairman's mark of the 2015 National Defense Authorization Act (NDAA) acknowledged there has never been any evidence the CSPTP had ever achieved its goal of helping small businesses.

Both the House and Senate versions of the FY15 NDAA have renewed the CSPTP into its 28th year of testing until 2017.

The Senate Armed Services Committee is scheduled to meet with the Pentagon on September 11 to discuss the future of the program.

The American Small Business League has lost a national campaign to block the renewal of the CSPTP.

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SOURCE American Small Business League