New bill wants to speed up small biz payments

A group of House lawmakers put forth a bill that would speed up the time small businesses get paid for their federal contract work.

Four House lawmakers have introduced legislation that would shorten the amount of time small business wait to get paid by federal agencies for work done on contract.

Under the proposed “Accelerated Payments for Small Businesses Act,” small businesses working as prime contractors or subcontractors would get paid within 15 days versus the current standard of 30 days.

Reps. Troy Balderson (R-Ohio), Steve Chabot (R-Ohio), Jason Crow (D-Colorado) and Adriano Espaillat (D-NY) introduced the bill in a move that comes nearly three months after the end of a five-week partial government shutdown that shuttered many civilian agencies.

The shutdown highlighted the issue of unpaid invoices for contract work faced by businesses of all shapes and sizes, but especially by smaller firms. Many furloughed federal civilian employees were those responsible for processing invoices to pay contractors for their work.

This newly-proposed bill intends to build on and expand across government a provision in the Fiscal Year 2019 National Defense Authorization Act that requires accelerated payments for small businesses performing either prime or subcontract work for Defense Department agencies. That provision only applies to DOD, however.

Leading government contractor trade group Professional Services Council has endorsed the proposed bill.

“Accelerated payments can be a critical lifeline for small businesses who work in the federal marketplace -- helping to provide access to capital and enhancing growth opportunities,” PSC Executive Vice President and Counsel Alan Chvotkin said in a release announcing the legislation.