The Office of Management and Budget (OMB) issued a Policy Memoranda M-12-16 providing for the prompt payment to small business subcontractors. The Memoranda establishes a one-year initiative to temporarily accelerate Federal payments to prime contractors so they are able to expedite payments to their small business subcontractors. DHS has issues a Federal Acquisition Regulation deviation to allow DHS contracting officers to insert a new contract clause to DHS contracts, solicitations and resultant contracts. The new clause requires prime contractors, upon receipt of accelerated payments from the government to make accelerated payments to small business contractors to the maximum extent practicable after receipt of proper invoice and dcoumentation from the subcontractor. The Federal Acquisition Regulatory Council has opened a case to undertake a rule making and obtain public comment to further implement OMB’s policy.

The full Memoranda is available here.