H.R.3485 - To amend the Small Business Act to eliminate certain requirements relating to the award of construction subcontracts within the county or State of performance. (119th Congress)
Summary
H.R.3485 aims to amend the Small Business Act by eliminating requirements that construction subcontracts be awarded within the county or state where the project is performed. This bill targets Section 8(a) of the Small Business Act (15 U.S.C. 637(a)), specifically paragraph (11), which dictates geographical restrictions on subcontracting. The bill was introduced in the House of Representatives on May 19, 2025, and referred to the Committee on Small Business.
Expected Effects
The primary effect of this bill would be to remove the geographical limitations on awarding construction subcontracts under the Small Business Act. This could lead to broader competition for subcontracts, potentially lowering costs and increasing efficiency. It may also affect local businesses that previously benefited from the geographical preference.
Potential Benefits
- Increased Competition: Removing geographical restrictions could foster more competition among subcontractors.
- Potential Cost Savings: Broader competition may lead to lower bids and reduced project costs.
- Greater Efficiency: Contractors can choose subcontractors based on expertise and efficiency, not just location.
- Flexibility for Small Businesses: Small businesses may have more opportunities to participate in projects outside their immediate area.
- Streamlined Processes: Eliminating the geographical requirement could simplify the subcontracting process.
Potential Disadvantages
- Reduced Opportunities for Local Businesses: Local subcontractors may face increased competition from larger, out-of-state firms.
- Potential Job Losses: Local economies could suffer if subcontracts are awarded to companies outside the area.
- Increased Travel Costs: Subcontractors from outside the area may incur higher travel and logistical expenses.
- Reduced Local Economic Impact: Projects may contribute less to the local economy if subcontracts are not awarded locally.
- Quality Control Concerns: Managing subcontractors from a distance could pose challenges for quality control.
Constitutional Alignment
The bill appears to align with the Commerce Clause (Article I, Section 8, Clause 3) by promoting interstate commerce through the removal of geographical restrictions on subcontracting. It does not appear to infringe upon any specific constitutional rights or limitations. The bill focuses on modifying existing legislation related to small business administration, which falls under the purview of Congress's legislative powers.
Impact Assessment: Things You Care About ⓘ
This action has been evaluated across 19 key areas that matter to you. Scores range from 1 (highly disadvantageous) to 5 (highly beneficial).