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FY2025 NDAA: Department of Defense Small

Business Contracting



August 26, 2024


Congress has authorized the Department of Defense (DOD) to promote small business contracting,
including set-asides under certain conditions, and to award sole-source contracts to small businesses,
often through the annual National Defense Authorization Act (NDAA). Throughout its history, DOD has
relied on contractors to support a wide range of military operations, including contracts and subcontracts
with small businesses, such as small businesses owned by socially and economically disadvantaged
individuals (SDBs), women-owned small businesses (WOSBs), small businesses located within
Historically Underutilized Business Zones (HUBZones), and service-disabled veteran-owned small
businesses (SDVOSBs).
This product provides an overview of selected small business DOD contracting-related provisions in the
House-passed and Senate Armed Services Committee (SASC)-reported versions of an FY2025 NDAA
(H.R. 8070 and S. 4638). For more information on DOD contractors, see CRS In Focus IF10600, Defense
Primer: Department ofDefense Contractors; and for more information on small business contracting, see
CRS  Report R45576, An Overview ofSmall Business Contracting.

Legislative   Proposals

The FY2025 House-passed and SASC-reported NDAA  versions both include provisions related to small
business contracting. In past NDAAs, Congress has established, disestablished, amended, or directed
study of elements of and processes related to small business initiatives, including set-asides and
contracting goals. The House-passed and SASC-reported versions of an FY2025 NDAA include multiple
proposals pertaining to DOD small business contracting, including small business contracting goals,
procurement processes, and reporting and oversight requirements. Table 1 summarizes selected
provisions from H.R. 8070 and S. 4368.

     Table I. Selected Small Business Contracting Proposals in the FY2024  NDAA   Bills
             House-Passed H.R. 8070                        SASC-Reported S. 4638
                       Proposals Related to Small Business Contracting Goals

                                                               Congressional Research Service
                                                                 https://crsreports.congress.gov
                                                                                    IN12416

CRS INSIGHT
Prepared for Members and
Committees of Congress

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