Overview
This section establishes the regulatory basis for the Indian Incentive Program, which implements 25 U.S.C. 1544 to encourage prime contractors to engage Indian-owned entities as subcontractors.
Key Rules
- Statutory Implementation: The subpart is the formal implementation of 25 U.S.C. 1544.
- Incentive Focus: It provides a specific financial incentive to prime contractors for utilizing qualifying subcontractors.
- Eligible Subcontractors: The incentive applies only when the subcontractors are specifically defined as "Indian organizations" or "Indian-owned economic enterprises."
Practical Implications
- Prime contractors can increase their total contract profit by receiving an incentive payment (typically 5% of the amount paid to the qualifying subcontractor) for diversifying their supply chain with Native American-owned businesses.
- This provision serves as a powerful marketing tool for Indian-owned enterprises when bidding for subcontracts on large federal projects.