Members of Small Business Committee add provisions to support economic development and job creation, bolster cybersecurity and improve access to government contracting

(Washington, DC) – Senator Jeanne Shaheen (D-NH) and members of the Senate Committee on Small Business & Entrepreneurship added several provisions to the National Defense Authorization Act (NDAA) to help small businesses create jobs, improve cybersecurity defenses and compete for government contracts.  The annual defense bill passed the Senate today.  Shaheen is the panel’s lead Democrat and a senior member of the Senate Armed Services Committee. 

“Small businesses are the job-creating backbone of our economy and play a vital role in helping our military meet its mission at home and abroad,” said Shaheen.  “Helping our small businesses better compete for business is a win-win—supporting job creation and providing value for defense agencies.  I am pleased this legislation includes several provisions to boost the competitiveness of the small businesses that are essential to our defense industrial base.”

The Senate’s NDAA bill:

  • Helps more small businesses qualify for the Historically Underutilized Business Zone program

The bill includes the Invest in Rural Small Business Act, Shaheen’s legislation to expand a key small business program in rural New Hampshire and across the country.  The U.S. government is the world’s largest buyer of goods and services, but small businesses often have difficulty accessing the federal marketplace.  The amendment increases the ability of rural small businesses to qualify for the Small Business Administration’s (SBA) Historically Underutilized Business Zone (HUBZone) program. 

The current one-size-fits-all formula for determining a HUBZone leaves many otherwise eligible communities outside the program.  The law requires 3 percent of contracts be awarded annually to HUBZone firms, but in 2016, only 1.67 percent of federal contracting dollars were awarded to these businesses. 

Shaheen’s amendment expands the pool of HUBZone eligible communities and enhances the program’s ability to be a targeted economic development tool.  Shaheen introduced this legislation in April after being contacted by Costa Precision Manufacturing in Claremont, New Hampshire about qualifying for the HUBZone program.   

A separate amendment by Senator Ben Cardin (D-MD) increases the amount of time (from three to seven years) that a geographic area may temporarily keep its status as a HUBZone when the area no longer meets the program’s criteria (due to changing census data, for example). 

  • Provides cybersecurity assistance and training for small business defense contractors

In order to secure sensitive defense technology, the Department of Defense recently issued a mandatory cybersecurity standard it expects all military contractors (large and small) to meet.  The complex cyber standard has proven to be challenging for many small businesses to understand and implement.

Shaheen’s amendment directs the Department of Defense to provide more outreach and low-cost cybersecurity assistance (through universities and other organizations) to small businesses handling military technology on non-federal information systems. 

The amendment was added after Milpower, a small aerospace and defense contractor in Belmont, New Hampshire, told Shaheen the Department of Defense was not providing adequate information about how to comply with the Pentagon’s new cybersecurity rules.

  • Includes more small business products at American military retail exchanges

Shaheen’s amendment encourages military exchanges (retail stores), including the Army & Air Force Exchange Service (AAFES) on 3,100 U.S. Army and Air Force installations worldwide, to select more small business suppliers for its convenience and department stores.

Shaheen contacted the Department of Defense and added the language after learning that Smoky Quartz Distillery in Seabrook, New Hampshire was unable to get AAFES to add its products to its marketplace and supply chain, even though it is a veteran-owned small business.

  • Help more small businesses compete (and win) government contracts

SBA contracting staff (Commercial Market Representatives) around the country are tasked with helping small businesses compete for the nearly $500 billion in government contracts and subcontracts awarded each year.

Senator Tammy Duckworth’s (D-IL) Commercial Market Representatives Clarification Act of 2017 provides additional clarity and direction to contracting personnel that assist small businesses comply with regulations and navigate challenges such as lack of capacity, resources or information. 

Specifically, Duckworth’s amendment will instruct prime federal government contractors on methods to identify small businesses capable of performing subcontracts, as well as counsel contractors on their responsibility to maximize subcontracting opportunities for small businesses.

  • Streamlines process to buy small business technology developed by Small Business Innovation Research program

SBA’s highly competitive Small Business Innovation Research (SBIR) program encourages domestic small businesses to engage in federal research and development that has commercialization potential.  Shaheen’s amendment will make it easier for federal agencies to buy technology developed by innovative small businesses through the SBIR program. 

Last year, Shaheen extended the SBIR program an additional five years.  Three New Hampshire small businesses recently received SBIR funding to develop cutting-edge energy technology, including: Ground Energy Support in Durham, Creare in Hanover, and Subsurface Insights in Hanover.