Urges Department of Defense to pay small businesses within 15 days of invoice

(Washington, DC) – U.S. Senator Ben Cardin (D-MD), the Ranking Member of the U.S. Senate Committee on Small Business & Entrepreneurship, and U.S. Senator Mike Enzi (R-WY), the Chairman of the Senate Budget Committee, today introduced bipartisan legislation to speed payments to small contractors doing business with the federal government.

The bill directs the Departments of Defense to make every effort to pay small business prime contractors and large prime contractors with small business subcontractors within 15 days of receiving an invoice.  Current law requires payment in 30 days.  The Cardin/Enzi bill would codify longstanding Office of Management and Budget policy directives, permanently ensuring prompt payments to small businesses working as federal contractors across the Defense Department.

“It’s pretty basic: when a contractor delivers a product or completes a job for the federal government, they should be paid on time.  Small business contractors are a critical component of our defense supply chain, and whether or not they get paid on time can make or break their ability to reinvest in their business and create new jobs,” said Senator Cardin.  “Small contractors in Maryland and across the country rely on a steady and predictable cash flow from their customers.  The federal government should help facilitate job growth and not serve as an obstacle.  Ensuring that small business contractors are paid promptly supports a diverse industrial base and strengthens our economy.”

“Wyoming has many small businesses that contract with the Department of Defense and ensuring that they receive their payments promptly for their work seems like a common sense decision,” Senator Enzi said.  As a former small business owner, I know that receiving timely payments on a contract can make a world of difference.  Small businesses play a critical role in our economy and we should treat them appropriately.”

This bill was included as an amendment in the House version of the National Defense Authorization Act (H.R. 5515) and modeled after Rep. Steve Knight’s (R-CA) Accelerated Payments for Small Businesses Act of 2018 (H.R. 5337).

The Cardin/Enzi legislation is supported by the National Defense Industrial Association and the Professional Services Council.