Small Business Subcontracting Plans

This page provides guidance on the preparation and reporting required for Small Business Subcontracting Plans (SBSP), and to set out the responsibilities of the various parties involved in their preparation and submission.

The University of Chicago is committed to providing enhanced opportunities for minority-owned, women-owned, and small business enterprises to participate in the economic opportunities arising from the University’s business activities (see University Financial Policy 1205, Minority-owned, Women-owned, and Small Business Enterprises Procurement Policy). In addition, the University has accepted a number of federal government contracts with provisions requiring small business subcontracting plans, or similar requirements for documenting affirmative steps taken to utilize small business, Veteran-owned small business, Service-disabled veteran-owned business, HUBZone small business, and Women-owned small business.

A SBSP is required on federal contracts to the University or its subcontractors that  exceed $750,000 ($1,500,000 for construction) for the entire period of performance, per Federal Acquisition Regulations (FAR).

The SBSP should include all estimated costs for supplies or services obtained from outside The University of Chicago. This includes supplies purchased from vendors, professional service contracts routed through Procurement, and subcontracts issued to collaborators. Procurement Services can assist you in finding qualified suppliers to help you meet the federal goals stated in the RFP. Please be mindful there are penalties for not meeting the small business spending commitment made under the small business subaward plan.

Federal agencies have established subcontracting goals and generally include them with each RFP; the goals are also often set out in the sample form for a subcontracting plan. A SBSP is generally required to be submitted with the proposal and may be subject to negotiation. At the time of the proposal, it is generally sufficient to prepare the subcontracting plan for the total cost of a multi-year proposal.

Roles and Responsibilities of University Parties in Creating a SBSP:

Departmental Administrator Responsibilities

  • Prepare SBSP, consult with Procurement Services for suppliers (as needed), receives approval from Procurement Services, and submit to URA for final review and signature
  • Prepare and submit required reports through eSRS: visit the site for guidelines and information
  • Maintain a list of vendors used to create the SBSP, and update the list as needed
  • Monitor plan performance and adjust as necessary to achieve the plan goals
  • Provide feedback to Procurement Services concerning vendor performance
  • Cooperate in compliance reviews or audit situations

URA Responsibilities

  • Review and obtain appropriate signature for the SBSP to be submitted with proposal (Pre-Award).
  • Notify Procurement Services when a contract has been awarded that has a SBSP (Post-Award).

Procurement and Payment Services Responsibilities

Procurement Services and the Office of Business Diversity will:

  • Make every effort to consult and assist in the identification of small business suppliers for inclusion and use under the SBSP
  • Develop and maintain a list of current University vendors that meet SBA criteria to satisfy the SBSP requirements - SBA Subcontracting Plan Vendor Directory.

Sample Plans


Resources


Frequently Asked Questions

Why is the SBSP required?

To comply with federal law (FAR subpart 19.7), all federally sponsored contracts in excess of $750,000 require implementation of a subcontracting plan with established goals for expenditures to small businesses.

How do I find a certified small business?

Who is responsible for tracking, managing, and reporting on small business contracts?

The PI/Department is responsible for managing and tracking expenditures as outlined in their SBSP. Accurate expenditures are necessary for future reporting obligations. Procurement will assist PIs with reporting requirements; post-award assists with submission as needed.

What if the PI does not meet the spending goals detailed in the SBSP?

The sponsor may determine that the PI and team have not made good faith efforts to procure small businesses. The University could be held liable for fines and be required to return/refund the full amount of the contract.

It is important to formulate a realistic SBSP and execute its budgeting details. There are potential monetary penalties for not meeting goals (see FAR 19.702). Moreover, non-compliance issues, such as not meeting goals set in the SBSP are documented by federal agencies and could affect all future funding applicants at the University.

The fact that goods and services from a small business vendor may cost more is not considered by the government to be an acceptable excuse for not using them, unless the cost is prohibitive.

What are the benefits of using a Small Business? 

  • Quality goods and services to meet the needs of the University

  • Potential cost savings through competition

  • Support for small and local businesses

  • Creating jobs in the community

  • Ensuring fairness