EXHIBIT F.-Department oF HEALTH, EDUCATION, AND WELFARE

Mr. Richard Clinkscales,

Director

Office of Small and Disadvantaged Business Utilization
Department of Health, Education, and Welfare

200 Independence Ave., SW

Washington, D.C. 20201

Dear Mr. Clinkscales:

At the close of my oversight subcommittee hearing held on the December 4, 1979 on government agency compliance with procurement provisions of P.L. 95-507, I indicated that I would be submitting further questions to each of the witnesses.

If you have any questions concerning this request, please contact Mr. George Neidich of my subcommittee staff at (202) 225-9321.

Sincerely,

JOHN J. LaFALCE
CHAIRMAN

1. GSA in its testimony before the subcommittee stated that it intended all civilian agencies to start compliance with section 211 of P.L. 95-507 as of April 10, 1978. As of what date is your agency undertaking a review of solicitations? If not April 10, please explain why not?

2.

Please describe the report you were requested to submit to SBA at the conclusion of FY 1979 on the extent of participation by small business in procurement contracts let by your agency. If your agency has not submitted such report, when will this be done?

3. Please describe your performance in meeting your agency's goals for participation by small business in subcontracts as required by section 211 of P.L. 95-507. Has your agency and the SEA failed to agree on established goals? If so, has this disagreement been submitted to OFPP for final determination?

4. Describe what studies or surveys your agency has conducted to determine the extent of contractor's compliance with the "best efforts" subcontracting clause. Have any guidelines been established for making this determination?

5. What incentives has your agency provided to encourage maximum subcontracting opportunities as required by section 211 of the law?

6. As of the date of your response to this letter, describe your compliance with the subcontracting provisions mandated by section 211 of P.L. 95-507 including (a) the number of deficient solicitations and contracts you have remedied since December 4, 1979, (b) the number of solicitations issued since December 4, 1979 which are deficient, and (c) the total number and dollar amount of prime contracts awarded since December 4, 1979 which do not contain required subcontracting plans.

In response to your letter of December 21, 1979, the following information is provided as requested:

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2.

3.

4.

5.

The Office of Federal Procurement Policy (OFPP) and the Small
Business Administration (SBA) have advised all civilian agencies
that contractual instruments issued from July 2, 1979 and later
without the provisions required by Section 211 of P.L. 95-507 are
legally deficient, and should be corrected. However, we in HEW
have decided to correct all contracts awarded subsequent to May 22, 1979
which do not contain the required provisions mentioned above. This
date was selected because it is the date that the GSA initially
instructed all civilian agencies to implement the new regulations.

The FY 79 report on the participation of small business in procurement
contracts has been submitted to SBA. The report shows $394 million
in direct awards to small business concerns and another $48 million
in awards to disadvantaged business concerns under Section 8(a) of
the Small Business Act.

We have proposed a small business subcontracting goal of $29
million to SBA for FY 80. As of this date, SBA has not responded
to our proposed goals for FY 80.

We have not conducted any studies or surveys to determine the
extent of contractor's compliance with the "best efforts" subcontracting
clause. However, we do collect data relative to subcontract awards
made to small and disadvantaged business firms by HEW's prime
contractors.

In accordance with instructions from OFPP, we are in the process of
developing a pilot program to test the effectiveness of various
incentives to encourage greater subcontracting with small and
disadvantaged businesses.

6.

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Appropriate policy guidance has been given to all departmental contracting offices relative to the implementation of Section 211 of P.L. 95-507. We are also taking appropriate steps to correct all contracts which have been awarded without the subcontracting provisions required by Section 211 of P.L. 95-507. An interim status report of corrective actions taken is due from each of our contracting offices on January 21. We will be happy to share this report with the Committee. We are not aware of any solicitations issued or contracts awarded subsequent to December 4, 1979 which are deficient.

If you have any questions or need additional information, please contact me on 245-8771.

Sincerely yours,

For Richard Clinks cales

Director, Office of Small and

Disadvantaged Business Utilization

Mr. Wilbert E. Cantey, Director

Office of Small and Disadvantaged Business Utilization

Department of Transportation

Washington, D.C.

Dear Mr. Cantey:

20590

At the close of my oversight subcommittee hearing held on December 4, 1979 on government agency compliance with the procurement provisions of P.L. 95-507, I indicated that I would be submitting further questions to each of the witnesses.

Kindly provide

attached questions by

to the Subcommittee
January 4, 1980.

responses to the

If you have any questions concerning this request, please contact Mr. George Neidich of my subcommittee staff at (202) 225-9321.

Sincerely,

JOHN J. LaFALCE
CHAIRMAN