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Washington Business Journal: House bill looks to get smaller federal contractors paid more quickly

By. Katishi Maake

A bill introduced last week in the House of Representatives would accelerate payments to small businesses that do work for the federal government.

The Accelerated Payments for Small Business Act of 2019 would direct federal agencies to disburse payments within 15 days of receiving a proper invoice if a specific payment date is not established, rather than the current 30-day standard. The bill impacts only small businesses, defined as those have fewer than 500 employees.

David Glazier, owner and CEO of Alexandria-based Fleet Transportation, told the Washington Business Journal during the 35-day government shutdown that ended in January he had to front employee checks, as one of the company's largest clients is a government agency.

At the time, he said a mechanism to more quickly distribute funds to contractors was necessary to avoid these types of payment delays.

“Comprising 99.9% of firms, small businesses are a driving force of the American economy, yet regularly struggle to make ends meet,” Rep. Troy Balderson, R-Ohio, the bill's sponsor, said in a statement. “This legislation will ensure small businesses have timely access to essential capital, helping these businesses pay their employees and foster growth.”

The Professional Services Council, an organization that represents businesses in the government services sector, came out strongly in favor of the legislation, calling it a "critical lifeline for small businesses who work in the federal market," in a letter PSC Executive Vice President and Counsel Alan Chvotkin penned to the committee.

In fiscal year 2017, 23.9% of all federal contracting dollars went to small businesses, down from 24.3% in fiscal 2016 and 25.8% in fiscal 2015, according to the U.S. Small Business Administration.

As of Monday afternoon, the bill, which has been referred to the House Committee on Oversight and Reform, has four cosponsors — Reps. Chrissy Houlahan, D-Hawaii, Jason Crow, D-Colo., Steve Chabot, R-Ohio, and Adriano Espaillat, D-New York.

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