National Association of Government Contractors

Small Business Change Order Proposal Passes House

This past week the U.S. House of Representatives approved the bipartisan Change Order Transparency for Federal Contractors Act, H.R. 4754, introduced by U.S. Rep. Don Bacon (R-NE), legislation designed to help small to medium-sized businesses plan by increasing transparency on federal construction projects.
"I am happy to see the House pass my bill to continue our ongoing commitment and support for our nation's small businesses," said Rep. Bacon, who introduced H.R. 4754 on Jan. 10.
The bill would amend the Small Business Act to provide prospective construction contractors with information about a federal agency's policies on the administration of change orders to allow them to make informed business decisions regarding the pricing of bids or proposals, according to the congressional record summary.
H.R. 4754 also would require federal contracting agencies to provide details on their change order procedures and their historical performance data with solicitations, according to a statement from Rep. Bacon's staff, who noted that a lack of transparency has created problems for federal contractors trying to prepare for change orders during the life cycle of a construction project.
Federal construction contractors have grown progressively more aggravated by the federal bureaucracy's slow change order approval process and lack of payment for change orders, according to the congressman's office, and they've been forced to pay their own bills while waiting for payments from the federal government.
"We must ensure the federal government pays its bills on time and is accountable for its actions," Rep. Bacon said. "H.R. 4754 does this by promoting greater transparency for small businesses."
Rep. Bacon added that numerous small businesses in Nebraska and across the United States have wasted valuable time and money waiting for change order approval requests while maintaining work at their federal job sites. "Our small businesses deserve to have the opportunity to compete on a level playing field and continue growing their businesses," he said.
U.S. Rep. Steve Chabot (R-OH), chairman of the U.S. House Small Business Committee, commended Rep. Bacon's efforts to help small business contractors "fully know what they're getting into before they bid on a project."
Many times, small contractors are already cash strapped, Rep. Chabot noted, so major construction changes that result in delayed payments can put them out of business. "H.R. 4754 safeguards these contractors and requires agencies to publish their change order process up front, in their solicitations, so they have all of the information they need that can affect their bottom line," he said.
Original cosponsors of the House-approved H.R. 4754 include U.S. Reps. Steve Knight (R-CA) and Al Lawson (D-FL). On May 9, the U.S. Senate Small Business and Entrepreneurship Committee received the bill for consideration.

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