[Federal Register Volume 77, Number 200 (Tuesday, October 16, 2012)]
[Notices]
[Pages 63298-63299]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2012-25367]


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DEPARTMENT OF DEFENSE

Defense Acquisition Regulations System


Accelerated Payments to Small Business Subcontractors

AGENCY: Defense Acquisition Regulations System, Department of Defense 
(DoD).

ACTION: Notice.

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SUMMARY: In accordance with the one-year temporary policy established 
in the OMB Memorandum, Providing Prompt Payment to Small Business 
Subcontractors (July 11, 2012), DoD has taken steps to accelerate 
Federal payments to prime contractors, so that prime contractors can 
expedite payments to their small business subcontractors.

DATES: Effective through July 10, 2013, unless otherwise rescinded or 
extended.

FOR FURTHER INFORMATION CONTACT: Mr. Mark Gomersall, telephone 571-372-
6099.

SUPPLEMENTARY INFORMATION: OMB Memorandum M-12-16, Providing Prompt 
Payment to Small Business Subcontractors (July 11, 2012) establishes 
the Administration's initiative to accelerate Federal payments to prime 
contractors, so that prime contractors can, in turn, expedite payments 
to their small business subcontractors. Faster payments to small 
business subcontractors can improve their cash flow and provide the 
capital resources needed to expand their business opportunities. This 
can lead to a stronger supplier base that supports Federal prime 
contractors in meeting the needs of their Federal customers in a timely 
and cost-effective manner. The Memorandum is available at http://www.whitehouse.gov/sites/default/files/omb/memoranda/2012/m-12-16.pdf.

[[Page 63299]]

    In accordance with the one-year temporary policy established in the 
OMB Memorandum, DoD has taken steps to make payments under the contract 
as soon as practicable, with the goal of paying its contractors within 
15 days. DoD strongly encourages all prime contractors to accelerate 
payments to small business subcontractors under existing contracts to 
the maximum extent practicable.
    The Federal Acquisition Regulatory Council (FAR Council) has 
recommended that Federal agencies issue deviations to the FAR, which 
permit immediate incorporation of the policy outlined in OMB Memorandum 
M-12-16 in solicitations and resultant contracts. In accordance with 
this recommendation, DoD has begun using a new contract clause, 
pursuant to Class Deviation 2012-O0014, ``Providing Accelerated Payment 
to Small Business Subcontractors.'' This class deviation requires prime 
contractors, upon receipt of accelerated payments from the Government, 
to make accelerated payments to small business subcontractors to the 
maximum extent practicable after receipt of a proper invoice and all 
proper documentation from the small business subcontractor, while also 
maintaining necessary DoD internal controls. The FAR Council has opened 
FAR case 2012-031 to undertake rulemaking and obtain public comments to 
further implement OMB's policy.

Manuel Quinones,
Editor, Defense Acquisition Regulations System.
[FR Doc. 2012-25367 Filed 10-15-12; 8:45 am]
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