Pentagon’s Vendor Payments Eyed In Bipartisan Bill

Senators have introduced a bipartisan bill targeted at accelerating payments made by the U.S. Department of Defense (DoD) to its small suppliers, according to Sheridan Media reports.

The publication said Wednesday (May 23) that Senator Ben Cardin of Maryland and Senator Mike Enzi of Wyoming introduced their bill earlier in the week that would require the DoD to pay small business contractors, as well as large contractors with small subcontractors, within 15 days of receiving an invoice whenever possible.

Reports said current law requires payment within 30 days.

The legislation would make current policy directives under the Office of Management and Budget into permanent law. The publication said Enzi noted that prompt payment to government contractors is “common sense,” citing his history as a small business owner and emphasizing the importance of timely invoice payments to manage cash flow.

The legislation was introduced as an amendment to the National Defense Authorization Act and is modeled under the Accelerated Payments for Small Businesses Act (APSBA) of 2018, reports noted.

The APSBA legislation was first introduced in March, co-sponsored by House Small Business Committee Chairman Steve Chabot (R-OH) and Ranking Member Nydia Velázquez (D-NY) and introduced by Rep. Steve Knight (R-CA) and Rep. Adriano Espaillat (D-NY). That bill also requires all government entities to pay their small suppliers within 15 days of invoice receipt.

“Small business contractors rely on a consistent and reliable flow of income in order to keep their operations running smoothly,” Knight said in a statement at the time. “The Accelerated Payments for Small Businesses Act will help ensure these businesses receive their payments in a timely and accountable manner. This consistency will enable businesses to focus on improving their services and expanding production.”

“Delays in payments to federal contracts are often untenable for small business contractors and their employers,” added Espaillat.