The National Defense Authorization Act (“NDAA”) for FY 2016 (H.R. 1735) currently sits on the president’s desk awaiting signature. Following are the sections that will impact small businesses, if he signs it:

• Sections 862 and 863 deal with the bundling and consolidation of contracts. Agencies must identify and justify the practice; the rationale will be laid out at the beginning of solicitation.
• Section 864 prohibits the application of the non-manufacturer rule to small service contractors. This reverses a 2014 Court of Federal Claims case that had expanded the application of the same rule beyond manufacturing and made it applicable to the procurement of services as well.
• Section 865 ensures small business procurement advocates at the SBA have the proper skills and training.
• Section 867 will help small businesses compete as team members and joint ventures by allowing the past performance of all team members to be considered when competing for large contracts.
• Section 868 improves the scoring of agencies and their small business utilization.
• Section 869 creates an independent office to hear size challenges and to review the SBA’s process to decide size standards.
• Section 871 creates accountability for agency executives to meet their subcontracting goals.
• Section 872 requires the Department of Defense to report any small business subcontracting shortfalls.
• Section 873 makes it easier for small businesses to obtain compliant bonds.

President Obama has vowed to veto the NDAA.

This law update was co-authored by Taft partner Barbara Duncombe and Taft paralegal Christina Heidecker.