Answer to Question 4.pdf
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Federal Emergency Management Agency
About this file
This is a question and answer document addressing FEMA's small business subcontracting requirements and policies for federal contract opportunities.
FEMA prioritizes small business utilization and follows Department of Homeland Security small business goals, targeting 30.00% overall small business subcontracting for fiscal year 2026, with specific emphasis on Small Disadvantaged Businesses (SDB), Service-Disabled Veteran-Owned Small Businesses (SDVOSB), Women-Owned Small Businesses (WOSB), and HUBZone concerns. For disaster response and recovery requirements, prime contractors must implement mandated subcontracting plans at the second and third tiers. A subcontracting plan is required for prime contracts exceeding $900,000 (or $2,000,000 for construction) that offer subcontracting possibilities. Under Section 307 of the Stafford Act, FEMA has a statutory mandate to prioritize contracts with local businesses and firms in disaster areas. All subcontractors must maintain active System for Award Management profiles with current socio-economic certifications to receive goaling credit. When vendors team together, a clear teaming arrangement defining the prime contractor and roles of team members is required.
Prime contractor proposals must include separate percentage goals for Small Business, Small Disadvantaged Business, Women-Owned Small Business, HUBZone, and Veteran-Owned Small Business concerns; total dollar values of planned subcontracts broken down by business category; identification of the individual responsible for administering the subcontracting program; documentation of active good faith efforts to ensure small businesses have equitable competition opportunities; and agreement to flow down required subcontracting clauses to all subcontracts offering further subcontracting opportunities. Large businesses must submit Individual Subcontracting Reports and Summary Subcontracting Reports using the Electronic Subcontracting Reporting System per Federal Acquisition Regulation compliance requirements.
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Text version
Answer to Question #4
FEMA makes every attempt to utilize small business concerns whenever possible. FEMA follows the Department of Homeland Security (DHS) Small Business Goals and Achievements. For fiscal year 2026, the DHS small business subcontracting targets are generally expected to align with its historical benchmarks of 30.00% for overall small businesses, while maintaining specific emphasis on maximizing awards to Small Disadvantaged Businesses (SDB), Service-Disabled Veteran-Owned Small Businesses (SDVOSB), Women-Owned Small Businesses (WOSB), and HUBZone concerns.
For primary disaster response or recovery requirements, FEMA prime contractors carry these mandated subcontracting subcontracting plans for eligible small businesses at the second and third tiers.
Key guidelines and resources to keep in mind:
• The Stafford Act: Under Section 307 of the Stafford Act, FEMA has a statutory mandate to prioritize and contract with local businesses and firms located in the disaster area, making regional subcontractors highly attractive to large primes.
• FAR Compliance: Federal Acquisition Regulation clauses (such as FAR 52.219-9) require large businesses to submit Individual Subcontracting Reports (ISR) and Summary Subcontracting Reports (SSR) using the Electronic Subcontracting Reporting System.
• Registration: All subcontractors must be actively registered and have a validated System for Award Management profile with up-to-date socio-economic certifications to receive goaling credit.
A small business subcontracting plan is required for prime contracts that exceed $900,000 (or $2,000,000 for construction) and offer subcontracting possibilities. Prime contractors shall select subcontractors in accordance with specific contract requirements to satisfy small business concern goals. Subcontracting opportunities and details are between the prime and subcontractor only. When vendors are teaming, we would want a clear teaming arrangement that defines the Prime and roles of the team members https://www.google.com/url?sa=i&source=web&rct=j&url=https://www.dhs.gov/osdbu/goals-achievements&ved=2ahUKEwjB25nQ4-mVAxVq58kDHSthGEgQy_kOegoIAggACAAICRAB&opi=89978449&cd&psig=AOvVaw3BaG2_-5uuoRmJnLRQeyNV&ust=1784929752829000 https://www.google.com/url?sa=i&source=web&rct=j&url=https://www.dhs.gov/osdbu/goals-achievements&ved=2ahUKEwjB25nQ4-mVAxVq58kDHSthGEgQy_kOegoIAggACAAICRAB&opi=89978449&cd&psig=AOvVaw3BaG2_-5uuoRmJnLRQeyNV&ust=1784929752829000 https://www.google.com/url?sa=i&source=web&rct=j&url=https://www.acquisition.gov/far/subpart-19.7&ved=2ahUKEwjB25nQ4-mVAxVq58kDHSthGEgQy_kOegoIAggACAAIDBAB&opi=89978449&cd&psig=AOvVaw3BaG2_-5uuoRmJnLRQeyNV&ust=1784929752829000 https://www.google.com/url?sa=i&source=web&rct=j&url=https://www.acquisition.gov/far/52.219-9&ved=2ahUKEwjB25nQ4-mVAxVq58kDHSthGEgQy_kOegoIAggACAAIERAJ&opi=89978449&cd&psig=AOvVaw3BaG2_-5uuoRmJnLRQeyNV&ust=1784929752829000
Key Requirements of a Subcontracting Plan
If a plan is required, the Federal Acquisition Regulation (FAR) Subpart 19.7 mandates that the prime contractor's proposal includes:
• Percentage Goals: Separate goals for using Small Business (SB), Small Disadvantaged Business (SDB), Women-Owned Small Business (WOSB), HUBZone, and Veteran-Owned Small Business (VOSB) concerns.
• Total Dollars: The total dollar value of the planned subcontracts, broken down by business category.
• Administration: The name and duties of the individual in the contractor’s organization who will administer the subcontracting program.
• Good Faith Efforts: A description of the active steps your company will take to ensure small businesses have an equitable opportunity to compete.
• Flow-down Clauses: You must agree to include the required subcontracting clauses in all subcontracts that offer further subcontracting opportunities.
https://www.google.com/url?sa=i&source=web&rct=j&url=https://www.acquisition.gov/far/subpart-19.7&ved=2ahUKEwjHvYmw5OmVAxW8vSsGHZyxJgwQy_kOegoIAggACAAIEBAC&opi=89978449&cd&psig=AOvVaw3nzF3K-CXgXVd3Bea9HW-C&ust=1784929953890000
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