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Cmmc Implementation: What It Means for Small Businesses (House Small Business subcommittee hearing, June 24, 2021)

Summary

Transcript of the House Committee on Small Business Subcommittee on Oversight, Investigations, and Regulations hearing CMMC Implementation: What It Means for Small Businesses, convened June 24, 2021 during the 117th Congress, First Session, published as Small Business Committee Document Number 117-021 (GPO 44-926). Opening statements were delivered by Hon. Dean Phillips and Hon. Beth Van Duyne. Witnesses were Jonathan T. Williams of PilieroMazza PLLC, Scott Singer of CyberNINES, Tina Wilson of T47 International, Inc., and Michael Dunbar of Ryzhka International LLC testifying for the HUBZone Contractors National Council, with appendix materials from Ho-Chunk Inc., IPC and the National Defense Industry Association.

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“Cmmc Implementation: What It Means for Small Businesses (House Small Business subcommittee hearing, June 24, 2021).” Original at www.govinfo.gov. Archived at Pandemic Darlings, https://pandemicdarlings.com/source-documents/cmmc-implementation-what-it-means-for-small-businesses-house-small-bus-388564396e/, SHA-256 3e81bd1246a10bf31ff5de99618b334714108a25ca02a3bbd6711423d6298acf.

Full text

                                                                   CMMC IMPLEMENTATION: WHAT IT MEANS FOR
                                                                              SMALL BUSINESSES


                                                                                                  HEARING
                                                                                                         BEFORE THE


                                                                     SUBCOMMITTEE ON OVERSIGHT,
                                                                   INVESTIGATIONS, AND REGULATIONS
                                                                                                            OF THE


                                                                       COMMITTEE ON SMALL BUSINESS
                                                                              UNITED STATES
                                                                        HOUSE OF REPRESENTATIVES
                                                                             ONE HUNDRED SEVENTEENTH CONGRESS
                                                                                                       FIRST SESSION


                                                                                                       HEARING HELD
                                                                                                        JUNE 24, 2021




                                                                                Small Business Committee Document Number 117–021
                                                                                  Available via the GPO Website: www.govinfo.gov



                                                                                           U.S. GOVERNMENT PUBLISHING OFFICE
                                                                    44–926                             WASHINGTON : 2021




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                                                                                    HOUSE COMMITTEE ON SMALL BUSINESS
                                                                                       NYDIA VELÁZQUEZ, New York, Chairwoman
                                                                                                JARED GOLDEN, Maine
                                                                                                JASON CROW, Colorado
                                                                                               SHARICE DAVIDS, Kansas
                                                                                              KWEISI MFUME, Maryland
                                                                                              DEAN PHILLIPS, Minnesota
                                                                                               MARIE NEWMAN, Illinois
                                                                                           CAROLYN BOURDEAUX, Georgia
                                                                                               TROY CARTER, Louisiana
                                                                                                 JUDY CHU, California
                                                                                            DWIGHT EVANS, Pennsylvania
                                                                                            ANTONIO DELGADO, New York
                                                                                          CHRISSY HOULAHAN, Pennsylvania
                                                                                                ANDY KIM, New Jersey
                                                                                               ANGIE CRAIG, Minnesota
                                                                                    BLAINE LUETKEMEYER, Missouri, Ranking Member
                                                                                               ROGER WILLIAMS, Texas
                                                                                              JIM HAGEDORN, Minnesota
                                                                                              PETE STAUBER, Minnesota
                                                                                              DAN MEUSER, Pennsylvania
                                                                                             CLAUDIA TENNEY, New York
                                                                                           ANDREW GARBARINO, New York
                                                                                                YOUNG KIM, California
                                                                                               BETH VAN DUYNE, Texas
                                                                                               BYRON DONALDS, Florida
                                                                                               MARIA SALAZAR, Florida
                                                                                            SCOTT FITZGERALD, Wisconsin

                                                                                          MELISSA JUNG, Majority Staff Director
                                                                                     ELLEN HARRINGTON, Majority Deputy Staff Director
                                                                                             DAVID PLANNING, Staff Director




                                                                                                                  (II)




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                                                                                                             CONTENTS
                                                                                                           OPENING STATEMENTS
                                                                                                                                                                                            Page
                                                              Hon. Dean Phillips ..................................................................................................           1
                                                              Hon. Beth Van Duyne .............................................................................................               3

                                                                                                                     WITNESSES
                                                              Mr. Jonathan T. Williams, Partner, PilieroMazza PLLC, Washington, DC .......                                                    5
                                                              Mr. Scott Singer, President, CyberNINES, Madison, WI .....................................                                      7
                                                              Ms. Tina Wilson, Chief Executive Officer, T47 International, Inc., Upper
                                                               Marlboro, MD .......................................................................................................           8
                                                              Mr. Michael Dunbar, President, Ryzhka International LLC, Pompano Beach,
                                                               FL, testifying on behalf of the HUBZone Contractors National Council .........                                                10

                                                                                                                      APPENDIX
                                                              Prepared Statements:
                                                                  Mr. Jonathan T. Williams, Partner, PilieroMazza PLLC, Washington,
                                                                    DC ..................................................................................................................    25
                                                                  Mr. Scott Singer, President, CyberNINES, Madison, WI .............................                                         33
                                                                  Ms. Tina Wilson, Chief Executive Officer, T47 International, Inc., Upper
                                                                    Marlboro, MD ................................................................................................            42
                                                                  Mr. Michael Dunbar, President, Ryzhka International LLC, Pompano
                                                                    Beach, FL, testifying on behalf of the HUBZone Contractors National
                                                                    Council ...........................................................................................................      44
                                                              Questions for the Record:
                                                                  None.
                                                              Answers for the Record:
                                                                  None.
                                                              Additional Material for the Record:
                                                                  Ho-Chunk Inc. ...................................................................................................          51
                                                                  IPC Report June 2021 ......................................................................................                59
                                                                  National Defense Industry Association (NDIA) .............................................                                 74




                                                                                                                             (III)




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                                                                   CMMC IMPLEMENTATION: WHAT IT MEANS
                                                                          FOR SMALL BUSINESSES

                                                                                            THURSDAY, JUNE 24, 2021

                                                                                   HOUSE OF REPRESENTATIVES,
                                                                                    COMMITTEE ON SMALL BUSINESS,
                                                                                          SUBCOMMITTEE ON OVERSIGHT,
                                                                                         INVESTIGATIONS, AND REGULATIONS,
                                                                                                               Washington, DC.
                                                                 The Subcommittee met, pursuant to call, at 10:01 a.m., in Room
                                                              2360, Rayburn House Office Building, Hon. Dean Phillips [chair-
                                                              man of the Subcommittee] presiding.
                                                                 Present: Representatives Phillips, Davids, Evans, Craig,
                                                              Hagedorn, Meuser, Van Duyne, and Fitzgerald.
                                                                 Chairman PHILLIPS. All right. Good morning, everybody. I call
                                                              this meeting to order.
                                                                 And without objection, the Chair is authorized to declare a recess
                                                              at any time.
                                                                 Let me start by saying that the standing House and Committee
                                                              rules and practice will continue to apply during hybrid proceedings.
                                                              All members are reminded that they are expected to adhere to
                                                              these standing rules, including decorum. House regulations require
                                                              members to be visible through a video connection throughout the
                                                              proceeding, so please keep your cameras on. And also, please re-
                                                              member to remain muted until you are recognized to minimize
                                                              background noise. And turn your microphone on when you are rec-
                                                              ognized, of course.
                                                                 If you have to participate in another proceeding, please exit this
                                                              one and log in later. In the event a member encounters technical
                                                              issues that prevent them from being recognized for their ques-
                                                              tioning, I will move to the next available member of the same party
                                                              and I will recognize that member at the next appropriate time slot,
                                                              provided that they have returned to the proceeding.
                                                                 For those members and staff physically present in the Committee
                                                              room today, we will continue to follow the most recent OAP guid-
                                                              ance. Masks are no longer required in our meeting spaces for mem-
                                                              bers and staff who have been fully vaccinated. All members and
                                                              staff who have not been fully vaccinated are still required to wear
                                                              masks and socially distance. I do hope that we do all our parts to
                                                              protect each other and our staff.
                                                                 With that, I will begin with my opening statement. Cyber attacks
                                                              have the potential to threaten public safety and undermine the
                                                              American economy and national security. The early months of 2021
                                                              have provided harsh reminders of this very fact. Over the past 6
                                                              months, hackers and other malicious actors have held an oil pipe-
                                                                                                                  (1)




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                                                              line for ransom, breached the Nation’s largest transit network, and
                                                              attacked private companies to obtain sensitive customer data.
                                                                 According to the Council of Economic Advisers, malicious cyber
                                                              activity has cost the U.S. economy between 57- and $109 billion
                                                              since 2016. With our society’s reliance on technology and
                                                              digitization growing, there is no doubt that cyber attacks will only
                                                              become more prevalent moving forward.
                                                                 Recognizing the urgency of cyber threats, the Department of De-
                                                              fense has taken steps to protect sensitive defense information from
                                                              attacks aimed at over 300,000 companies that compose the Defense
                                                              Industrial Base, the DIB. One of these efforts has been the creation
                                                              of the Cybersecurity Maturity Model Certification. The CMMC is a
                                                              framework that seeks to improve the protection of different types
                                                              of sensitive, unclassified information through the implementation
                                                              of a unifying security standard across the DIB.
                                                                 The CMMC framework consists of a tiered system with a series
                                                              of processes and practices at each level. The program was designed
                                                              based on numerous cybersecurity standards and frameworks.
                                                              CMMC relies on third-party certification to assess the relative cy-
                                                              bersecurity maturity of DIB companies, thus when the initiative is
                                                              finally implemented and all contracts and requirements incor-
                                                              porated a specific CMMC level, only those contractors who have
                                                              achieved the required CMMC level through the certification process
                                                              will be eligible for an award.
                                                                 The need for cybersecurity is unquestionable. It is vital that com-
                                                              panies in the DIB become more resilient and prepared for cyber at-
                                                              tacks. With that said, the CMMC Initiative has the potential of
                                                              driving many small businesses out of the Defense Industrial Base,
                                                              therefore, we must get this right. To that end, it is important to
                                                              pay attention to the numerous red flags that small businesses have
                                                              raised about this initiative.
                                                                 For example, many have a concern about the significant cost as-
                                                              sociated with CMMC compliance. Guarding against cyber attacks
                                                              can be cost prohibitive for many small businesses. And firms that
                                                              seek to abide by CMMC must purchase new hardware and soft-
                                                              ware, replace outdated technical systems, and pay the costs of ini-
                                                              tial certification and maintenance amongst other expenditures.
                                                                 Small businesses often run on thin margins as we know, and the
                                                              cost of CMMC has the potential to leave many small firms in the
                                                              sector without a chance to compete for government contracts. Many
                                                              small businesses also don’t have the capacity to deal with the com-
                                                              plexity of the initiative. Employers at small enterprises often wear
                                                              many hats and have limited regulatory or compliance resources.
                                                              This means that independent firms will be forced to turn to outside
                                                              specialists for help to navigate the program. For many small con-
                                                              tractors, this will not be feasible.
                                                                 According to Department plans, the DOD will implement the
                                                              CMMC initiative on select contracts between fiscal year 2021 and
                                                              2025. In addition, in March, DOD initiated an internal assessment
                                                              of CMMC partially guided by an effort to manage cybersecurity
                                                              costs for small businesses. This is a very timely hearing, as it al-
                                                              lows us to take a closer look at the program and its implications
                                                              for small businesses. There is no doubt that contractors working
                                                              with the DOD must have adequate systems in place to handle




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                                                              cyber threats. At the same time, we cannot allow the program re-
                                                              quirements to drive small businesses out of the defense procure-
                                                              ment space.
                                                                 With that, I would like to yield to the Ranking Member, Ms. Van
                                                              Duyne, for her opening statement.
                                                                 Ms. VAN DUYNE. Thank you, Mr. Chairman. We should have
                                                              compared notes before we gave our opening statements, because I
                                                              am going to echo many of the sentiments that you just shared.
                                                                 Just a few short weeks ago, we saw how a malicious ransomware
                                                              attack perpetuated by foreign actors on the Colonial Pipeline can
                                                              cause chaos across the entire Eastern Seaboard. And not long after
                                                              that, another attack shut down one of the leading meat producers
                                                              in the United States. The potential for profit and opportunity to
                                                              disrupt U.S. critical infrastructure has invited a number of cyber
                                                              criminals to target U.S. network vulnerabilities and one of the soft-
                                                              est targets to obtain valuable Department of Defense information
                                                              is through our small contractors.
                                                                 Recognizing the increased vulnerabilities of small contractors,
                                                              the DOD initiated new cybersecurity assessment framework, called
                                                              the Cybersecurity Maturity Model Certification, to assess con-
                                                              tractor implementation of cybersecurity requirements. While no one
                                                              disputes the Federal Government’s need to address the growing cy-
                                                              bersecurity risks facing our Nation, I am deeply concerned that the
                                                              CMMC has created yet another hurdle to keep small businesses
                                                              from competing in the defense marketplace, exactly what we just
                                                              heard from our Chairman.
                                                                 A major concern is the cost of compliance. No matter how you
                                                              look at it, adding stringent cybersecurity requirements will be a
                                                              costly endeavor for small businesses that are already recovering
                                                              from a pandemic. With limited resources compared to the competi-
                                                              tors in the defense contracting space, small businesses are under-
                                                              standably wary of deploying that capital without assurance that
                                                              their investment will return in future work.
                                                                 The Federal Government has already experienced a 38 percent
                                                              decline in its industrial base for the past decade and measures like
                                                              this will only exasperate this exodus. Simply put, we need to en-
                                                              sure a competitive contracting environment for small business.
                                                              This would not only benefit our small employers, but would be a
                                                              net benefit for our national defense.
                                                                 I also have major concerns with the rollout of the CMMC for a
                                                              number of reasons. First, the assessments may be inconsistent and
                                                              unfair because the new process is being handled by many newly
                                                              trained assessors. There are also many questions outstanding
                                                              about how subcontractors will be treated under this new frame-
                                                              work.
                                                                 And, finally, I am worried that small contractors will be shut out
                                                              of the conversation entirely, and forced to the end of the line.
                                                                 The fact is that this new process may threaten the livelihood of
                                                              many small businesses. No assistance, no assessment means no
                                                              certification, and no certification means no work. Small businesses
                                                              rightly fear that they won’t be given a fair share, left to fend for
                                                              themselves, as we have too often seen when it comes to sweeping
                                                              government reforms.




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                                                                 Dealing with cyber threats is an extremely nuanced issue that
                                                              will require continued collaboration, and while the DOD may have
                                                              good intentions with the CMMC initiative, we must ensure that the
                                                              voices of small businesses operating in the Defense Industrial Base
                                                              are heard and have their concerns addressed. I look forward to
                                                              hearing the testimony of the witnesses today.
                                                                 And I yield back.
                                                                 Chairman PHILLIPS. Thank you, Ms. Van Duyne. The
                                                              gentlelady yields back.
                                                                 And I will just take a moment to explain how the hearing will
                                                              proceed.
                                                                 Each witness will have 5 minutes to provide a statement and
                                                              each Committee member will have 5 minutes for questions. Please
                                                              ensure that your microphone is on when you begin speaking and
                                                              that you return to mute when you are finished.
                                                                 With that, I would like to introduce our witnesses.
                                                                 Our first witness is Mr. Jonathan T. Williams, partner with the
                                                              law firm of PilieroMazza in Washington, D.C. As Chair of their
                                                              government contracts group, he counsels companies on a variety of
                                                              Federal acquisition regulation compliance issues. Mr. Williams is
                                                              also a member of PilieroMazza’s cybersecurity and data privacy
                                                              team. In this role, Jon works with Federal contractors, particularly
                                                              those who contract with the DOD, on managing cybersecurity and
                                                              establishing compliant and effective safeguards. We appreciate
                                                              your expertise on today’s topic.
                                                                 Our second witness is Mr. Scott Singer, president of
                                                              CyberNINES with offices in both Wisconsin and Minnesota. Mr.
                                                              Singer is a retired U.S. Navy captain bringing over 30 years of
                                                              military experience in both Active Duty and Reserve roles, along
                                                              with 26 years of industry experience. His company, CyberNINES,
                                                              is a service-disabled veteran-owned small business, focused on cy-
                                                              bersecurity services and a candidate third-party assessment organi-
                                                              zation for CMMC. We appreciate you as well, Mr. Singer, for your
                                                              contributions to today’s discussion.
                                                                 Our third witness is Ms. Tina Wilson, founder and Chief Execu-
                                                              tive Officer of T47 International, located in Upper Marlboro, Mary-
                                                              land. Ms. Wilson is an Air Force veteran, and T47 International is
                                                              an 8(a) veteran-owned, and women-owned small business, offering
                                                              a wide range of professional support services to the defense com-
                                                              munity. We thank you also for sharing your story today.
                                                                 With that, our Ranking Member, Ms. Van Duyne, will introduce
                                                              Mr. Dunbar.
                                                                 Ms. VAN DUYNE. Okay. Hold on just a minute. Thank you very
                                                              much.
                                                                 I would like to welcome our final witness, Mr. Michael Dunbar.
                                                              Mr. Dunbar is the president of Ryzhka International, a service-dis-
                                                              abled, veteran-owned small business founded in May of 2011, and
                                                              a HUBZone certified firm as of February of 2014. They have lubri-
                                                              cants and fuel oil to government, commercial, and maritime clients
                                                              worldwide, and proudly provide 100 percent American-made prod-
                                                              ucts. From its initial founding to today, the company has grown
                                                              from one to six employees and successfully serves clients ranging
                                                              from the U.S. Army Corps of Engineers, the Department of Vet-
                                                              erans Affairs, the U.S. Navy and Coast Guard, the National Oce-




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                                                              anic and Atmospheric Administration, various shipyards in many
                                                              of the dredging community.
                                                                 Ryzhka International has been the proud recipient of several
                                                              awards. This is the Department of Defense’s award for support of
                                                              the Guard and Reserve. And in addition to its businesses, the com-
                                                              pany’s secondary mission is to provide gainful employment opportu-
                                                              nities to qualified individuals from disadvantaged segments of soci-
                                                              ety, such as minorities, women, people with disabilities, and vet-
                                                              erans.
                                                                 Chairman PHILLIPS. And we will begin with Mr. Williams—oh,
                                                              I am sorry.
                                                                 Ms. VAN DUYNE. Sorry. You are good. You are good. The sec-
                                                              ondary focus is no surprise considering Mr. Dunbar’s own military
                                                              service in the U.S. Navy Nuclear Power program and its status as
                                                              a service-disabled veteran. After his military service, Mr. Dunbar
                                                              went on to spend the summer working on the solid rocket boosters
                                                              for National Aeronautics and Space Administration’s space shuttle.
                                                                 Following that summer, he attended the University of Utah,
                                                              went on to have a successful career as an executive in the biotech
                                                              industry, and afterwards, started his own company. Mr. Dunbar
                                                              will be speaking today on behalf of the HUBZone Contractors Na-
                                                              tional Council, which is a nonprofit trade association advocating for
                                                              policies bringing opportunities to HUBZone certified small busi-
                                                              nesses and the economically disadvantaged communities in which
                                                              these companies are based.
                                                                 Mr. Dunbar, thank you for your participation today. We look for-
                                                              ward to hearing your testimony.
                                                                 I yield back.
                                                                 Chairman PHILLIPS. Thank you, Ms. Van Duyne. The
                                                              gentlelady yields back.
                                                                 Sorry, Mr. Dunbar. My bio is about one sentence long, so I am
                                                              not accustomed to two pages.
                                                                 With that, we are going to recognize Mr. Williams for 5 minutes
                                                              for your opening statement. Mr. Williams.
                                                              STATEMENTS OF JONATHAN T. WILLIAMS, PARTNER,
                                                               PILIEROMAZZA   PLLC;    SCOTT   SINGER, PRESIDENT,
                                                               CYBERNINES; TINA WILSON, CHIEF EXECUTIVE OFFICER,
                                                               T47 INTERNATIONAL, INC.; AND MICHAEL DUNBAR, PRESI-
                                                               DENT, RYZHKA INTERNATIONAL LLC, TESTIFYING ON BE-
                                                               HALF OF THE HUBZONE CONTRACTORS NATIONAL COUNCIL

                                                                                 STATEMENT OF JONATHAN T. WILLIAMS
                                                                 Mr. WILLIAMS. Good morning, Chairman Phillips, and other
                                                              distinguished members of the Subcommittee. My name is Jonathan
                                                              Williams, and I am a partner with the law firm PilieroMazza,
                                                              which represents government contractors. Many of our clients are
                                                              small businesses that work with the Department of Defense as
                                                              prime contractors and subcontractors. It is an honor to participate
                                                              in this hearing on DOD Cybersecurity Maturity Model Certification
                                                              to share my perspective on the CMMC Initiative.
                                                                 DOD’s focus on cybersecurity has been steadily building for many
                                                              years, with measures ranging from implementation of new regula-
                                                              tions and contract clauses to the elevation of cybersecurity as the




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                                                              fourth pillar of DOD’s acquisition planning. DOD has left no doubt
                                                              about the importance it has placed on enhancing cybersecurity for
                                                              the Defense Industrial Base, and with good reason, as recent
                                                              events like the pipeline shutdown demonstrate.
                                                                CMMC marks a significant change in DOD’s evolving approach
                                                              to cybersecurity. With CMMC, contractors will no longer be allowed
                                                              to use the honor system by self-certifying their cybersecurity. In-
                                                              stead, contractors will have to apply for certification from a third-
                                                              party assessor. These so-called C3PAOs will evaluate the contrac-
                                                              tor’s cybersecurity against established benchmarks and decide
                                                              whether to certify the contractor in one of five levels.
                                                                The lowest level of CMMC is level one, which requires the fewest
                                                              and most basic cybersecurity measures. The level one requirements
                                                              are things all businesses should be doing, like spam filters and
                                                              antivirus software. The cost and complexity of the requirements in-
                                                              creases significantly at the higher levels of CMMC.
                                                                DOD has said it intends to start requiring CMMC on a few con-
                                                              tracts this fiscal year with that number increasing steadily over the
                                                              next several years until fiscal year 2026, when all DOD contractors
                                                              will be required to have CMMC.
                                                                However, the implementation schedule has slipped a few times
                                                              already and remains in flux. Approximately 2 years into the
                                                              CMMC Initiative, many practical questions that small businesses
                                                              are asking remains unanswered. These are basic questions like,
                                                              when will I need CMMC? How much will it cost? What level do I
                                                              need? And how do I get it?
                                                                Many small businesses will not be able to adequately prepare for
                                                              CMMC until these questions are answered. For example, DOD esti-
                                                              mates that most small businesses will only need level one; how-
                                                              ever, that is not guaranteed. DOD agencies are more likely to re-
                                                              quire at least level three for many of their contracts, and prime
                                                              contractors may flow down the same level to their subcontractors.
                                                                Given the substantial difference in cost and technological know-
                                                              how between level one and level three, many small businesses will
                                                              be unable to compete if more than a level one is required. From my
                                                              discussions with the small businesses we represent, I have several
                                                              suggestions for how to make the CMMC Initiative more manage-
                                                              able for small businesses, including the SBA and DOD mentor-pro-
                                                              tege programs should be utilized to ensure that mentors provide
                                                              small businesses with resources and guidance to obtain CMMC.
                                                                Joint ventures, a popular tool for small businesses to pursue gov-
                                                              ernment work, should not be required to have CMMC when the
                                                              member companies are certified. C3PAOs should be required to
                                                              fast-track CMMC applications when the applicant is a small busi-
                                                              ness that is in line for award of a contract.
                                                                DOD contract clauses should prohibit prime contractors from im-
                                                              posing a more stringent level of CMMC on a subcontractor than is
                                                              necessary based on the scope of the subcontract.
                                                                And finally, DOD and prime contractors should explore alter-
                                                              native ways to give small businesses access to sensitive information
                                                              that will enable more small businesses to participate on DOD con-
                                                              tracts with a level one certification.
                                                                In closing, I believe the CMMC Initiative appropriately aims to
                                                              improve our Nation’s cybersecurity posture. I do not think small




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                                                              businesses would debate the importance of cybersecurity, or that
                                                              doing business with the Federal Government is a privilege that re-
                                                              quires investments in compliance and infrastructure.
                                                                At the same time, the worthy goals of the CMMC Initiative must
                                                              be calibrated to avoid creating an unnecessarily high barrier to
                                                              entry for small businesses, which are the engine of our economy
                                                              and critical partners with the Federal Government for innovation
                                                              and provision of many necessary services and supplies.
                                                                This concludes my testimony. Thank you, again, for the oppor-
                                                              tunity to appear before you today.
                                                                Chairman PHILLIPS. Thank you, Mr. Williams. A perfect 5 min-
                                                              utes at that. We appreciate it.
                                                                Now we recognize Mr. Singer for 5 minutes.
                                                                                       STATEMENT OF SCOTT SINGER
                                                                 Mr. SINGER. Thank you, Representative Phillips, Ranking Mem-
                                                              ber Representative Van Duyne, and members of the Subcommittee,
                                                              for inviting me to testify this morning. I look forward to providing
                                                              information that will help ensure we have a secure Defense Indus-
                                                              trial Base and find cost-effective solutions to allow small business
                                                              to fully comply with CMMC.
                                                                 My name is Scott Singer, and I am the owner and president of
                                                              CyberNINES. CyberNINES was founded only in June of 2020; how-
                                                              ever, thanks to the interim final rule released on November 30,
                                                              2020, we have been really busy. And I have done assessments in
                                                              the districts of some of the members of this Subcommittee. Small
                                                              businesses do not have purchasing or IT departments. They do not
                                                              have compliance or regulatory departments. We need to make this
                                                              easier for them. Primes, certified third-party assessors, registered
                                                              provider organizations, all can assist these small businesses get
                                                              compliant and reduce the complexity for them.
                                                                 Having a program where the primes take a strong guiding hand
                                                              of their supply chain is critical to maintaining these small busi-
                                                              nesses as DOD suppliers. Of the last 33 basic assessments
                                                              CyberNINES has conducted, the average compliance score was
                                                              minus 105. Plus 110 is perfect. We have found that on average,
                                                              they are about only 34 percent of the way toward meeting all the
                                                              risk controls. Cost models put forth by the government assume that
                                                              companies are much further along on this journey, and they actu-
                                                              ally should be by this point.
                                                                 Assuming full compliance to NIST, the DOD has put out that
                                                              this will cost $26,000 to complete the 20 additional practices fol-
                                                              lowed by an additional $29,000 to be assessed by a C3PAO. As dis-
                                                              cussed above, small businesses that we have assessed are only
                                                              partway there, and we have come up with costs more to the tune
                                                              of about $130,000 for these businesses to be able to be compliant.
                                                                 Last week, I conducted a basic assessment of a small manufac-
                                                              turer in Minnesota. They had only six employees, one small manu-
                                                              facturing space with three machines, and they do excellent innova-
                                                              tive work. I spent a good majority of my time doing the assessment
                                                              actually from the owner’s house. This year, he expects to make
                                                              875K in revenue. My estimate is that if he wants to stay a DOD
                                                              contractor, he will have to spend 10 percent of his revenue over the
                                                              next 3 years alone on getting compliant.




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                                                                Small businesses have been directed to add their allowable costs
                                                              to get compliant to their indirect rates. Most don’t do cost reim-
                                                              bursement contracting for DOD. Moreover, market factors around
                                                              competition for orders will require them to compete and lower
                                                              prices. Established contractors will be more likely to be able to pro-
                                                              vide a lower bid and win the order from the prime. There should
                                                              be a process separate from the competitive marketplace to allow
                                                              small businesses to get paid for the reasonable, necessary, and al-
                                                              lowable cyber compliance expenses.
                                                                Companies further ahead should not be penalized and be able to
                                                              recoup their past expenses, too. In addition to the difficulty small
                                                              businesses have funding this effort, there are bottlenecks for get-
                                                              ting enough assessors. In doing the math, I just don’t see how—
                                                              and this is my opinion—we can get enough C3PAOs and assessors
                                                              through the process to assess 300,000 DIB companies by October
                                                              1, 2025. I saw one estimate that we would need over 8,000 assess-
                                                              ment team members working full-time from today on to make this
                                                              happen.
                                                                To get more C3PAOs through the process, I recommend there be
                                                              a relaxation for the initial C3PAOs. Assess candidate C3PAOs to
                                                              maturity level one or two now, and then require level three in the
                                                              future. The requirement for tier three background investigations
                                                              for assessment and support staff creates another bottleneck. I
                                                              would recommend allowing an interim clearance process for that.
                                                                In conclusion, the majority of the 300,000 contractors in the DIB
                                                              are small businesses. Without monetary support and clear regu-
                                                              latory guidance, the DOD will lose small businesses as they will
                                                              look to find business in the commercial sector. A balance must be
                                                              struck between risk and cost. Too much cost, we lose suppliers; too
                                                              much risk, and we hurt our national security.
                                                                Thank you for allowing me to testify, and I look forward to your
                                                              questions.
                                                                Chairman PHILLIPS. Thank you, Mr. Singer. And now we recog-
                                                              nize Ms. Wilson for 5 minutes.

                                                                                           STATEMENT OF TINA WILSON
                                                                Ms. WILSON. Chairman Phillips, Ranking Member Van Duyne,
                                                              and members of the Subcommittee, thank you for the invitation to
                                                              testify today. I am Tina Wilson, CEO, T47 International, and I am
                                                              honored to have the opportunity to provide some insight regarding
                                                              the implementation of DOD CMMC Initiative.
                                                                As a business owner with over 260 employees located in 28
                                                              States and overseas, T47 provides a variety of staffing services
                                                              from budget and finance, janitorial, inventory management, air-
                                                              craft tools, maintenance to mail room, and nonclinical medical and
                                                              dental case managers. The diversity of services offered puts me in
                                                              a unique position to provide a different perspective regarding this
                                                              subject.
                                                                As CMMC standards continue to be developed and incorporated
                                                              into contract agreements and modifications, it is essential that the
                                                              Small Business Committee be aware of the policy impact. If the
                                                              CMMC standards are not clearly communicated and monitored for
                                                              fraud, the financial ramifications to the over 300,000 Defense In-




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                                                              dustrial Base of contractors, and specifically to the small business
                                                              community, could be devastating.
                                                                 Based on this statement, I will cover three main subject areas of
                                                              concern and offer recommendations.
                                                                 Cost to secure CMMC. As of today there is no set cost to obtain
                                                              CMMC. The CMMC accreditation body has stated that the market-
                                                              place will need to define the cost, which leaves it wide-open for in-
                                                              terpretation what this cost will be. Whether it is a tiered cost based
                                                              on the size of the business, or a set cost regardless of the size,
                                                              there will be initial and sustained cost that will impact small busi-
                                                              nesses’ ability to secure the certification.
                                                                 A similar certification offered by the International Organization
                                                              for Standardization, ISO, is standard 27,000, which is information
                                                              technology and focuses on security for any kind of digital informa-
                                                              tion. This certification costs between 28- to $35,000 to obtain, and
                                                              takes approximately 6 to 8 months to implement. This is a tremen-
                                                              dous cost burden to add to a very tight budget for most small busi-
                                                              nesses.
                                                                 Cost of not having CMMC. While unknown as of today, what has
                                                              been communicated to the entire Defense Industrial Base is that
                                                              if you don’t have CMMC at the basic level, you will not be eligible
                                                              for a Federal contract. Many small businesses may not even be
                                                              aware this new requirement and failure to obtain certification
                                                              means ending contract work as a service provider to the DOD.
                                                                 Additionally, as the prime contractor, it will be our responsibility
                                                              to flow down the requirements to our subcontractors. If the subcon-
                                                              tractor does not have certification, we would be required to end
                                                              subcontract agreements to remain compliant with the DOD CMMC
                                                              standards.
                                                                 Audit imposters. I raise this subject as an awareness to inform
                                                              the Subcommittee. When the DOD presented the CMMC as the
                                                              new way of life for all businesses within the Defense Industrial
                                                              Base in the summer of 2019, many business owners asked a lot of
                                                              questions of why? Who will conduct the implementation and audit?
                                                              How much? When will it happen? Implications, or if you do not
                                                              have it, and many more questions.
                                                                 Before the CMMC accreditation body was formed in the latter
                                                              part of 2019, audit imposters with no training and not accredited,
                                                              start advertising that they will certify your company as cyber com-
                                                              pliant for thousands of dollars to get a company ready. For many
                                                              small businesses that are just now hearing about this standard,
                                                              may in a moment of panic and fear of losing their government con-
                                                              tract, may fall prey to an audit imposter.
                                                                 As I close, I recommend that the Subcommittee members closely
                                                              monitor this very important implementation of CMMC Initiative.
                                                              While I know there are so many other issues to focus on, CMMC
                                                              has ramifications that reach far beyond what we can realize at this
                                                              moment.
                                                                 It is important that, one, cost is articulated clearly to reduce
                                                              price gauging and to allow the small businesses to plan; number
                                                              two, a balanced cost approach that does not reduce small business
                                                              participation in the Federal marketplace; number three, DOD con-
                                                              tinues to work closely with various advocacy groups to ensure that
                                                              the Defense Industrial Base contractors, known at the Office of




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                                                              Small Business, is aware of this implication to this new initiative;
                                                              and four, DOD and the Office of Small Business start as soon as
                                                              possible to put various roadblocks in place to reduce the number
                                                              of audit imposters.
                                                                 Thank you for your time in addressing this very important sub-
                                                              ject that impacts thousands of small businesses that do business
                                                              with the Department of Defense.
                                                                 Chairman PHILLIPS. Thank you, Ms. Wilson.
                                                                 And now I recognize Mr. Dunbar for 5 minutes.

                                                                                     STATEMENT OF MICHAEL DUNBAR
                                                                 Mr. DUNBAR. Chair Phillips, Ranking Member Van Duyne, and
                                                              members of the Subcommittee, thank you for the opportunity to
                                                              testify before you today. My name is Michael Dunbar, and I am the
                                                              president of Ryzhka International, located in Pompano Beach, Flor-
                                                              ida.
                                                                 Ryzhka International provides lubricants, fuel oil in bulk quan-
                                                              tities, package quantities to the Federal Government, commercial
                                                              maritime industries. I am a proud service-disabled, veteran-owned
                                                              small business, as well as a HUBZone certified small business.
                                                                 I am testifying today on behalf of the HUBZone Contractors Na-
                                                              tional Council, a nonprofit trade association providing information
                                                              and support for companies and professionals interested in the
                                                              Small Business Administration’s HUBZone program. We would like
                                                              to thank the Committee for its commitment to small business and
                                                              for advancing policies that support small businesses doing business
                                                              with the Federal Government.
                                                                 In a recent hearing, Deputy Assistant Secretary of Defense of In-
                                                              dustrial Policy, Jesse Salazar, said it best: The Department’s ap-
                                                              proach to cybersecurity must balance the need for accountability
                                                              with the recognition of the challenges facing small businesses.
                                                                 Small businesses understand the importance of cybersecurity,
                                                              and the very real threats facing their companies. We are not look-
                                                              ing for a way to opt out or ignore this problem. We want to secure
                                                              our companies. According to the DOD’s contracting data, 74 percent
                                                              of the Defense Industrial Base are small businesses. These contrac-
                                                              tors are critical to the government, and are not a group that can
                                                              be ignored.
                                                                 The Federal Government has long identified the need to safe-
                                                              guard sensitive information and understands that cybersecurity is
                                                              dynamic issue. Small businesses, however, are experts on the goods
                                                              and services they provide. We do our best to focus on supplying a
                                                              product, making a profit, and retaining employees. Most small
                                                              businesses are not IT professionals. We are not cybersecurity spe-
                                                              cialists either. I am—right here is the assessment guide. This is for
                                                              cybersecurity CMMC model level three. It is full of stuff I have no
                                                              idea and don’t understand. I have to hire somebody to figure this
                                                              out.
                                                                 The initial cost for me to start my business was less than $1,000.
                                                              The cost to start a new government-focused business with this,
                                                              10,000, 100,000; we really don’t know. Access to capital can be a
                                                              very challenging issue for small businesses, and we have to use sig-
                                                              nificant capital now to become CMMC certified.




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                                                                 The segments hurt most are the segments that can least afford
                                                              it. The Federal Government already has challenges meeting those
                                                              goals. If we reduce the number of companies that qualify, you also
                                                              reduce opportunity for people to start up new businesses in those
                                                              sectors.
                                                                 The council makes the following recommendations to improve the
                                                              rollout of CMMC, and maintain a strong industrial base. Increased
                                                              cost transparency and put guardrails on rising compliance costs for
                                                              small business. One of the biggest frustrations for small business
                                                              throughout the rollout has been cost transparency. Some small
                                                              businesses have estimated costs in excess of $100,000 to prepare
                                                              for level three certification. That doesn’t include the assessment
                                                              costs. I have heard of assessment costs already estimated at above
                                                              $150,000 for a 50-person company.
                                                                 Establish clear communication on CMMC efforts. A lack of trans-
                                                              parency, clear, consistent communication by the DOD, and the roll-
                                                              out of CMMC and its implementation by the CMMC accreditation
                                                              body has been concerning. The council suggests putting together a
                                                              more clear, consistent delivery of information through a central
                                                              government platform or website.
                                                                 Streamline new and existing standards for contractors. The Fed-
                                                              eral Government lacks unified cybersecurity standards across all
                                                              agencies. The council encourages the DOD to work closely with in-
                                                              dustry, particularly small businesses, to streamline these require-
                                                              ments allowing companies to have a plan of action and milestones
                                                              after a CMMC assessment would help these burdens.
                                                                 Create a system for oversight and equitable rollout. Many small
                                                              businesses worry that they will be put at the back of the line and
                                                              face massive delays as companies serve the subcontractors, and eq-
                                                              uitable rollout is important to these companies as well.
                                                                 In conclusion, the Federal Government has a long and complex
                                                              history of governing cybersecurity regulations and compliance with
                                                              its contractors. A streamlined approach needs to be taken for con-
                                                              tractors to navigate all of these standards and system successfully.
                                                                 Thank you for the opportunity to testify today, and I look for-
                                                              ward to your questions.
                                                                 Chairman PHILLIPS. Thank you, Mr. Dunbar, and to all of our
                                                              witnesses for being with us today and we appreciate your testi-
                                                              mony on the CMMC Initiative.
                                                                 I will begin the hearing now by recognizing myself for 5 minutes.
                                                              I will start with Mr. Williams.
                                                                 I think we all understand the importance of cybersecurity, and
                                                              ensuring that the most vulnerable small businesses in the DIB
                                                              supply chain are protected. However, it is clear that the cost of
                                                              CMMC could be terribly burdensome for small businesses. So how
                                                              should we be looking at this? How can we strike the right balance
                                                              between enhancing cybersecurity, and ensuring that small busi-
                                                              nesses can participate in DOD acquisitions?
                                                                 Mr. WILLIAMS. Yes. Excellent question. Thank you. I think one
                                                              of my top suggestions there is to try to make good on DOD’s esti-
                                                              mate that most small businesses will only need level one. As I said
                                                              in my testimony, that is not guaranteed, but if we can keep as
                                                              many small businesses as possible at level one, that will strike the
                                                              right balance between ensuring that these small businesses have




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                                                              at least the basic cybersecurity protections in place, but will allow
                                                              them to avoid, as Mr. Dunbar said, the significant additional costs
                                                              when you go from a level one to a level three.
                                                                 And I think managing the level one versus level three distinction
                                                              is probably one of the most critical ways to keep the cost down for
                                                              small businesses. That could be done through flow-down protec-
                                                              tions. Make sure that primes are not flowing down higher than
                                                              level one if their subcontractors only need level one. And I would
                                                              like to see more flexible approaches where the small businesses
                                                              don’t need to take the controlled unclassified information into their
                                                              own network, because that is what then causes the jump from level
                                                              one to level three.
                                                                 Let’s look at ways that either the DOD and their own systems,
                                                              or the prime contractors and their own systems, can maintain this
                                                              information, and let’s maybe be more creative and flexible in how
                                                              we allow small businesses to participate on those programs without
                                                              having to take that information into their network, and then cause
                                                              them to have to go up to a level three.
                                                                 Chairman PHILLIPS. Appreciate that. Are there any funding
                                                              streams of which you are aware that can help small businesses
                                                              with the costs of CMMC? And if there is anything that Congress,
                                                              DOD, or even SBA could do to help in that regard, no matter how
                                                              significant the expenses might be?
                                                                 Mr. WILLIAMS. I am not aware of specifically targeted funding
                                                              stream at CMMC. I think it would be a fantastic idea if there was
                                                              the wherewithal for a grant program for small businesses to help
                                                              them on their way with the upfront investments needed for CMMC.
                                                                 The larger small businesses will be able to make that investment
                                                              and get it on the back end when they are paid on their contracts
                                                              with the government, but for the smaller firms, even the several
                                                              thousand dollars of the investment needed for a level one might be
                                                              too difficult to make upfront.
                                                                 And I think the existing mentor-protege programs, as I men-
                                                              tioned, those are fantastic programs. They work very well in many
                                                              respects at the SBA and DOD for small businesses and large busi-
                                                              nesses. There are a lot of incentives that large business mentors
                                                              get from participating in those programs.
                                                                 We could be clearer, more well-defined that mentors, when they
                                                              are permitted to access those programs, have to ensure that one of
                                                              the things they are doing for their proteges is to provide financial
                                                              resources and technical assistance to ensure their proteges are
                                                              ready for CMMC.
                                                                 Chairman PHILLIPS. Thank you very much.
                                                                 Ms. Wilson, I would love to hear from you about your experience.
                                                              How were you made aware of CMMC? How difficult is it for you
                                                              and T47 to understand, and do you envision having to engage a
                                                              consultant or specialist to help you navigate it?
                                                                 Ms. WILSON. Sure. Thank you for the question. I learned about
                                                              CMMC when attending a DISA Industry Day in 2019 up in Balti-
                                                              more. I understand completely how it works and, you know, from
                                                              a broader perspective, but, you know, protecting supply chain, in-
                                                              telligence, assets, IT infrastructure and, you know, things that
                                                              matter to protect in our Nation.




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                                                                 And for T47, the critical part is, we have to secure a specialist,
                                                              which I have already engaged, because it is very complex. And for
                                                              someone that is non-IT like myself—I am a business owner. I know
                                                              how to go get contracts and build a company, but to build an IT
                                                              infrastructure that impacts a lot of employees and be able to main-
                                                              tain it and go into other secured areas, it is a challenge.
                                                                 So to actually have an expert to help us is going to be critical,
                                                              and I have engaged in that process already.
                                                                 Chairman PHILLIPS. Thank you very much. My time is expired,
                                                              and now I recognize the Ranking Member, Ms. Van Duyne, for 5
                                                              minutes.
                                                                 Ms. VAN DUYNE. Thank you very much. Mr. Dunbar, okay,
                                                              hold that up one more time. You need two hands. That is—I mean,
                                                              I completely understand your frustration right now. Do you believe
                                                              that the CMMC duplicates any of the multiple standards in cyber-
                                                              security programs that currently exist? Do you find that there is
                                                              a bunch of stuff that is already existing right now that is in that
                                                              book that you are going to have to do more of? And is there a way
                                                              to further streamline these disparate processes?
                                                                 Mr. DUNBAR. Thank you very much for the question here. From
                                                              what I understand—and I am not a technical expert, so I will an-
                                                              swer from a layman’s perspective—CMMC added, I believe, 20 ad-
                                                              ditional items to NIST 800-171, which is currently the law of the
                                                              land and what exists today. So what is being projected to be our
                                                              new standard is built on an existing standard, and part of me ques-
                                                              tions why we had to go so much further.
                                                                 The reasoning behind putting CMMC in place, part of it was be-
                                                              cause we were doing self-assessments before for companies instead
                                                              of having a third-party assessment. Why could they not institute
                                                              some part of third-party assessment to an existing standard? Why
                                                              create a whole new standard that people have to learn and under-
                                                              stand to begin with?
                                                                 And I didn’t have to deal with the first standard because most
                                                              of my business is what they call is called COTS, which is
                                                              Commerical-Off-The-Shelf products; however, fuel recently, as we
                                                              just saw with Colonial Pipeline, has become a very critical item. Is
                                                              supplying fuel by truck, by whatever method all of a sudden going
                                                              to become a CMMC level four like the infrastructure piece of it
                                                              might potentially need to be? That is going to impact a significant
                                                              number of small businesses like mine.
                                                                 So by adding these additional items, we ask our question as to
                                                              why, and how do we streamline this? I have in place security right
                                                              now that covers 77 of the NIST items—covers 77 of the CMMC
                                                              items, but covers 90 percent of the risk. So is that additional cost-
                                                              benefit, and we are talking 80 to $100,000 of additional cost to get
                                                              that other 10 percent realistic for small business?
                                                                 Ms. VAN DUYNE. I am concerned that the critical information
                                                              about CMMC is being conveyed in a conflicting and potentially in-
                                                              formal manner. What are small businesses currently going to seek
                                                              information or guidance on CMMC? Where are you going to find
                                                              more information? And then, what would be the ideal method or
                                                              platform of communication from the DOD to the contracting com-
                                                              munity? How can we make it easier?




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                                                                 Mr. DUNBAR. The main place that we have been receiving infor-
                                                              mation tends to be LinkedIn. We have had members of DOD com-
                                                              municating directly through LinkedIn, members of the CMMC
                                                              board communicating through LinkedIn. That tends to be the larg-
                                                              est location or community of folks getting information on this pro-
                                                              gram. We get very little from DOD directly. They have had some
                                                              town halls that they call it. You don’t really get much notice, if
                                                              any.
                                                                 Just the other day was mentioned a project spectrum, I believe
                                                              it is called, that I had never heard of, that was put in place, it
                                                              looks like some time in 2020. Most small businesses are unaware
                                                              of this as well, and this is supposed to help us somehow, it is a
                                                              DOD program, but we are not even aware of it.
                                                                 Ms. VAN DUYNE. Your being sent to a website is probably not
                                                              going to help you?
                                                                 Mr. DUNBAR. Correct. And that is just—there is no consistent
                                                              method or message coming out from DOD on where to get things.
                                                              Even if you go to the CMMC-AB frequently-asked-questions page,
                                                              sometimes they say Oh, that is a DOD responsibility, and that has
                                                              been a lot of the kickback is pointing fingers between the CMMC-
                                                              AB and DOD saying, Well, they are responsible for X; they are re-
                                                              sponsible for Y.
                                                                 Ms. VAN DUYNE. Specifically for the small business community,
                                                              I didn’t mean to cut you off, if you had anything else to add.
                                                                 Mr. DUNBAR. No, ma’am.
                                                                 Ms. VAN DUYNE. Specifically for the small business community,
                                                              and I hate to add another agency in here, but do you see a role
                                                              that SBA could possibly play in helping to be an intermediary be-
                                                              tween the three?
                                                                 Mr. DUNBAR. I definitely—there should be a role for the SBA
                                                              in here. I don’t feel that the SBA has been able to be involved. I
                                                              feel that the DOD has sidelined them, at least in my opinion, in
                                                              the same manner that I think a lot of small businesses have been
                                                              ignored when we have raised questions or raised issues. And that
                                                              has basically been kept to a very small group of people that are
                                                              running all of this, and then we get told later on, Here is what is
                                                              happening.
                                                                 Ms. VAN DUYNE. Thank you very much.
                                                                 I yield back.
                                                                 Chairman PHILLIPS. The gentlelady’s time is expired.
                                                                 And now I recognize the gentleman from Pennsylvania, Mr.
                                                              Evans, for 5 minutes.
                                                                 Mr. EVANS. Thank you, Mr. Chairman. I would like to ask a
                                                              question to Ms. Wilson. Small businesses are frequently targeted
                                                              by cyber criminals. What would the ideal situation be for you in
                                                              terms of the Department of Defense ensuring that cybersecurity
                                                              taken care of its small business base?
                                                                 Ms. WILSON. Thank you so much, sir. I think one simple solu-
                                                              tion to offer, and it could be reasonable cost and possibly free. It
                                                              is the offer of maybe cyber tools that are already approved by DOD
                                                              to the small business community as a first line of defense. It could
                                                              be offered up from the CMMC level one up to possibly level two.
                                                              And then, at least this way, DOD has a level of comfort to say,
                                                              Okay, at least we have some tool out there now, it is up to the mar-




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                                                              ketplace, the small business community to go out and secure addi-
                                                              tional certification, if necessary, to ensure that, you know, at least
                                                              we are taken care of, and that shows an effort that the DOD cares.
                                                              That is a critical part. We just need to know that DOD is here to
                                                              help you.
                                                                 Mr. EVANS. I would like to follow up. For many small business,
                                                              cybersecurity certification is just one of the many requirements of
                                                              certification they need to comply with as part of being a defense
                                                              contract. Can you mention just a few of the other certifications you
                                                              have to comply with, and how does the cybersecurity certification
                                                              compare to other certification in terms of its levels of burdens?
                                                                 Ms. WILSON. Sure, sir. So for T47, we have actually invested in
                                                              securing the ISO certifications, three certifications. We are doing
                                                              that currently. That is a very costly investment. We will also have
                                                              the SBA 8(a) certification that is due annually. And because of our
                                                              size now, we now must incur additional cost for audits that are
                                                              necessary to keep the certification.
                                                                 We have the woman-owned small business certification, and then
                                                              as a clear facility, we have the defense counterintelligence security
                                                              certifications as well to keep our clearance.
                                                                 So, in comparison to all those other certifications was just a
                                                              small list for us. To be perfectly clear and frank with you, the
                                                              CMMC has been the most challenging, because it is just a lack of
                                                              not understanding exactly what is needed, and it is a cost that is
                                                              involved. There is no transparent cost set aside for, like, small
                                                              business mid or large.
                                                                 And I know this is a new initiative because any time you roll out
                                                              a new policy, there is always going to be bumps in the road, but
                                                              at the same token, there needs to be more of a clear communication
                                                              from DOD, and those that are managing this process on what it is
                                                              going to take for small businesses, or all businesses to have the
                                                              certifications necessary.
                                                                 And that is going to take a concerted effort for everyone to un-
                                                              derstand. CMMC, to be quite honest with you, it is new, but it is
                                                              a challenge. And it must be worked out pretty quick because you
                                                              are going to start rolling these things out into contracts, and the
                                                              fear could be real once it starts happening.
                                                                 Mr. EVANS. I thank you.
                                                                 And I yield back the balance of my time.
                                                                 Thank you, Mr. Chairman.
                                                                 Chairman PHILLIPS. The gentleman yields back.
                                                                 And now I recognize the Ranking Member of the Subcommittee
                                                              for Underserved, Agricultural, and Rural Business Development,
                                                              Mr. Hagedorn of Minnesota for 5 minutes.
                                                                 Mr. HAGEDORN. Mr. Chairman, thank you for that, Ranking
                                                              Member Van Duyne. It is good to be with you today. Thanks to the
                                                              witnesses. This seems to be one of these issues, and even the big
                                                              agencies the Federal Government want to impose a lot of things on
                                                              small businesses that they themselves don’t handle appropriately.
                                                                 It doesn’t take—you don’t have to think too long and hard to re-
                                                              alize that the DOD has lost technology outright, giving it away in
                                                              some cases, our Federal Government, to China. Economic tech-
                                                              nology, of course, gets lost a lot by big companies. OPM went and
                                                              took 25 million records of Federal employees. I was one of those




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                                                              folks that they stole from during the Obama administration, and
                                                              now they come along and say, Well, if you want to do business with
                                                              us, you have to go through a bunch of gyrations, spend a bunch of
                                                              money, and some of it, it seems, could be reasonable.
                                                                 You look at recently, we had some issues with, obviously—and
                                                              these things are very important. We had a big meat packing com-
                                                              pany that does 25 percent of the beef in the United States; have
                                                              a pork manufacturing plant in Worthington, Minnesota, where I
                                                              represent, they went down and you see how critical things can be.
                                                              We can lose our food supply and everything else in the blink of an
                                                              eye, but Mr. Dunbar, I think—wouldn’t it make more sense if the
                                                              Federal Government just imposed some reasonable standard and
                                                              said if you want to do business with us, you got to try to do every-
                                                              thing possible in order to make sure there is security here, and
                                                              that you protect these digital ways that you do business? I mean,
                                                              rather than have you go through all these hoops. I mean, you say
                                                              it costs up to $100,000, it doesn’t seem reasonable to me.
                                                                 Mr. DUNBAR. Thank you, sir, for the question. Yes, I agree. I
                                                              think the keyword there is the definition of reasonable. I believe
                                                              the DOD believes that their numbers and that their requirements
                                                              are reasonable. Small businesses would probably disagree with
                                                              that when you have a company like mine of six people that has to
                                                              spend $100,000 to comply with something.
                                                                 There are, as I mentioned, standards out there currently that are
                                                              being used every day. I mean, right now, a small business—you
                                                              walk into a small business and we hear advertisements on TV and
                                                              such saying, We have got your security, Have your internet service
                                                              through us, we got you covered. Well, that is what a small business
                                                              thinks. Okay. They got our security for us. No problem. Then we
                                                              see something like this and say, Well, we really don’t have security,
                                                              do we? We need something in between those two items.
                                                                 My security that I currently have in place is, as I mentioned, cov-
                                                              ers 77 of the items that are being requested in 90 percent of the
                                                              problems, and it is costing me about $15,000 a year to $20,000 a
                                                              year to do that. I could get away with a little bit less, but I have
                                                              insurance and other things on it that get tossed into there to cover
                                                              in case I get hacked.
                                                                 So there are standards out there that could cover reasonably well
                                                              what we are all looking for, and meet a level, I think, that would
                                                              provide security for anything but the greatest items out there. As
                                                              was mentioned by Mr. Williams, having access into a system pro-
                                                              vided for us for companies that don’t need to take something or
                                                              machine it, but actually just need that data and that information
                                                              can go into the government system sort of like the National Guard
                                                              does. They have their little wall garden, we call it. A member of
                                                              the National Guard can go in, get their CUI information in there,
                                                              go out, be it their VPN, and now they have all the information that
                                                              they need, and it has been in a secure environment.
                                                                 Mr. HAGEDORN. So I worked a little bit in the Treasury De-
                                                              partment, and I have seen bureaucracies in action and usually the
                                                              bureaucrats come up with lots of ideas in order to make sure that
                                                              if something goes wrong they can, as you say, point the finger at
                                                              somebody else. And I see a lot of that here. I see a lot of expense




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                                                              being pushed along to you, and just because if something goes
                                                              wrong, they don’t want to be blamed for it.
                                                                And I think, you know, it is kind of telling when government
                                                              comes up with these ideas here, we are going to put this regulation
                                                              on you, we are going to make you do all these types of things, and
                                                              oh, it is going to cost some money so, well, now let’s go find funding
                                                              streams in order to help you pay for that. I mean, we see this all
                                                              day long.
                                                                I think a reasonable standard would make sense. Most busi-
                                                              nesses, even the big ones, have issues here. They all need to do bet-
                                                              ter in compliance and I think that people can figure that out. So
                                                              thanks very much, by the way, for your service to the country and
                                                              you had a very impressive resume. Took our Ranking Member an
                                                              extra shot at it just to get it out.
                                                                Thanks very much.
                                                                Mr. DUNBAR. Thank you, sir.
                                                                Chairman PHILLIPS. The gentleman yields back.
                                                                And now we recognize the Ranking Member of the Subcommittee
                                                              on Economic Growth, Tax, and Capital Access, Mr. Meuser, for 5
                                                              minutes.
                                                                Mr. MEUSER. Well, thank you, Mr. Chairman. Thank the Rank-
                                                              ing Member very much for holding this hearing. Thank you to the
                                                              witnesses as well. So there are reports—we all know that cyberse-
                                                              curity is clearly an issue. Reports are, that I have reviewed, that
                                                              6 percent of U.S. military and aerospace contractors reported data
                                                              breaches between 2016 and 2018. Ransomware attacks are up over
                                                              100 percent in 2020. All industries, by the way. That is for all in-
                                                              dustries. So it is a concern.
                                                                DOD, however, seems to have created the CMMC mandates that
                                                              are a major concern to all small businesses and contractors cer-
                                                              tainly sitting here, and in my district. In fact, it seems that some
                                                              of the focus on compliance with these mandates is even truncating
                                                              your actual ability to focus on actual cybersecurity. And as being
                                                              in business for a lot of years, I understand that. These mandates
                                                              coming from Washington, in this case the Department of Defense,
                                                              don’t take what your business about fully into consideration. How
                                                              could they possibly, right? I mean, it is a one-size-fits-all approach.
                                                                So, I am definitely not happy to hear that the Department of De-
                                                              fense is also not offering forums to have this discussion with you,
                                                              right? Perhaps in a hearing maybe we can do that or create access
                                                              so they can better understand your concerns. And, again, I have
                                                              DOD suppliers in my district that have already, just in the last
                                                              couple of years, spent tens of thousands of dollars living up to these
                                                              requirements and trying to achieve them. And meanwhile, they
                                                              don’t necessarily even know what level they are at, and they are
                                                              very concerned, even their midlevel suppliers of those who are sup-
                                                              plying them, being able to maintain those costs. Everything that
                                                              you are discussing sharing here.
                                                                So Mr. Dunbar, I will just ask you this: Level one, we are talking
                                                              about level one here, what is—do we have the Department of De-
                                                              fense’s feedback on if level one is satisfactory, and for how long it
                                                              will be because I know they are trying to roll into this with a—in
                                                              a managed way over the next several years, right?




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                                                                So what do they say about you and suppliers that you know
                                                              about maintaining level one at this point?
                                                                Mr. DUNBAR. Well, I think you reached part of the problem, is
                                                              we are not really hearing a lot. We have got some estimated dollars
                                                              and some numbers out there tossed around to level one, and yet
                                                              how long is it supposed to last, any of the real detail on it? We
                                                              don’t get a lot of that. As you mentioned, the technology, is that
                                                              going to keep up, or are we going to keep chasing technology as we
                                                              go along, and, therefore, chasing more regulations and more rules
                                                              that we have to get reassessed for along the way which are just
                                                              going to continue to increase costs?
                                                                Mr. MEUSER. Speaking of cost, what is the cost difference,
                                                              would you estimate, from level one, which many are saying here
                                                              they believe would secure your systems and your companies versus
                                                              say level three? Can you put a number on that?
                                                                Mr. DUNBAR. Easily ten- to twenty-fold.
                                                                Mr. MEUSER. Wow. Okay. And how much more secure would it
                                                              be from level one to level three?
                                                                Mr. DUNBAR. I don’t really know specifically from a level one
                                                              to level three how much more secure it would be. I know from
                                                              where I am currently, and what I am paying for the setup I have,
                                                              which is a pretty secure setup, according to—the person who han-
                                                              dles my security is actually a past director at DCISC for the De-
                                                              partment of Defense, so he is the one who set mine up, and he is
                                                              the one who said that we have 77 of the 120 controls and have 90
                                                              to 95 percent of the issues.
                                                                So he believes for very small companies that you could be looking
                                                              at, you know, 5 to 10,000 a year maybe for your costs instead of,
                                                              you know, having to reach up to this level and that same company
                                                              could be at hundred-plus thousand dollars a year.
                                                                Mr. MEUSER. Well, I think we can conclude that these meas-
                                                              ures are overly harsh and we do need to create a forum to have
                                                              this discussion with DOD so we can work this out.
                                                                I yield back, Mr. Chairman.
                                                                Chairman PHILLIPS. The gentleman yields back.
                                                                And that completes our first round of questioning. So, therefore,
                                                              I will recognize myself for another 5 minutes.
                                                                Mr. Singer, while companies like yours in the pipeline become ac-
                                                              credited C3PAOs, there is a long ways to go until we have a sub-
                                                              stantial amount of them. So how likely is full implementation of
                                                              CMMC by 2026, if there is a lack of assessors?
                                                                Mr. Singer?
                                                                Mr. SINGER. I forgot to unmute.
                                                                Thanks for the question, sir.
                                                                I think it is very difficult to get there with the current progress
                                                              we are making. We have a hundred provisional assessors at this
                                                              time, and we have two C3PAOs already through the process from
                                                              doing a DOD assessment. And, by the way, the third-party asses-
                                                              sors are going through that level three assessment, so we have to
                                                              meet the 130 different practices.
                                                                So I think it is very difficult. The timeline is very stretched. As
                                                              I had said in my testimony, I think we need more than 8,000 as-
                                                              sessment team members to even make this happen, and that would
                                                              be starting from today. So the math just doesn’t work. I believe




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                                                              that there does need to be some flexibility in how we are rolling
                                                              this out to the third-party assessors, and we need to have some—
                                                              you know, if we are going to try and meet that deadline, there
                                                              needs to be quite a bit more flexibility by the DOD in trying to
                                                              ramp this up and move this out.
                                                                 I also feel pretty strongly that not everybody, as we have talked
                                                              about before, needs to be at level three. If you are a part compo-
                                                              nent maker, a small business, and you are doing, you know, special
                                                              processes like coatings, painting, and somebody—a prime flows
                                                              down a drawing to you and tells you, Put the label plate here on
                                                              this, you know, equipment, all of a sudden you have now had to
                                                              hit level three.
                                                                 So there is some work here that needs to be done on under-
                                                              standing the risk truly to the supply chain, and maybe a single
                                                              part maker of a bracket doesn’t need to be level three, but some-
                                                              body that is making sub assemblies and more complex parts does
                                                              need to be.
                                                                 So that would be my answer.
                                                                 Chairman PHILLIPS. Thank you, sir.
                                                                 And, Mr. Williams, while CMMC is a DOD initiative, we are be-
                                                              ginning to see it in other solicitations, particularly for government-
                                                              wide contracts like GSA’s 8(a) STARS III contract. So how con-
                                                              cerned should small businesses be of the CMMC Initiative being
                                                              adopted by civilian agencies and becoming a de facto baseline for
                                                              doing business with the Federal Government?
                                                                 Mr. WILLIAMS. Yes, I think that is certainly a possibility. You
                                                              know, the rollout with CMMC at DOD has experienced challenges,
                                                              as we have been covering in today’s hearing, and I think it remains
                                                              to be seen if they will hit the target of 2026 as Mr. Singer just said.
                                                              I would view what is happening at DOD as a trial balloon. And if
                                                              it went well at DOD, which certainly is an open question at this
                                                              point, I wouldn’t be surprised at all if it is expanded beyond DOD
                                                              to all of government.
                                                                 Chairman PHILLIPS. All right. Thank you, sir.
                                                                 And with that, I will now yield to Ms. Van Duyne for 5 minutes.
                                                                 Ms. VAN DUYNE. Thank you very much.
                                                                 Mr. Singer, I appreciate your testimony here today. I just have
                                                              a couple of questions.
                                                                 What is the penalty or the outcome for a small business that
                                                              can’t comply with the requirements?
                                                                 Mr. SINGER. Today, the penalty is that you are out of doing
                                                              business with the DOD, period.
                                                                 Ms. VAN DUYNE. Okay. I mean, that is—I am seeing Mr. Dun-
                                                              bar shake his head as well.
                                                                 So I am going to ask actually the whole panel, can you point to
                                                              one or two concrete things that we can do to make understanding
                                                              these flow-down requirements easier for small business? Mr.
                                                              Hagedorn had a great point, well, yes, we could just define reason-
                                                              able and move forward from there. Can we be a little bit more spe-
                                                              cific on what you would need?
                                                                 And, Mr. Singer, we will go ahead and start with you.
                                                                 Mr. SINGER. Sure. Thanks for the question.
                                                                 I think it is really—I think the primes really need to step up and
                                                              play a bigger role here. They have the resources and the teams,




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                                                              and they have done a lot of the background work on understanding
                                                              what is required. And instead of just sending out a rep and certs
                                                              or a letter to a small business saying you need to post a score in
                                                              the supplier performance risk system, I think there needs to be
                                                              more support and help for them and more of a guiding kind of proc-
                                                              ess program that they implement for their whole supply chain to
                                                              help them get compliant.
                                                                 Ms. VAN DUYNE. Ms. Wilson, do you have anything to add?
                                                                 Ms. WILSON. Yes, ma’am.
                                                                 To ensure that everyone is on the same page and have the same
                                                              information. What we have right now is pockets of information
                                                              going to various individuals, like I just heard from Mr. Dunbar,
                                                              said most of the information is being flowed through LinkedIn.
                                                              Some companies have LinkedIn and some companies do not. There
                                                              needs to be concerted effort of communicating what the standards
                                                              will be, what the costs will be across all industry, and filter down
                                                              to the small business, and maybe a regional approach to be able
                                                              to help understand that CMMC is here to stay, take away the fear,
                                                              but communicate clearly what it really means to have this certifi-
                                                              cation.
                                                                 Ms. VAN DUYNE. Awesome. Thank you.
                                                                 Mr. Williams?
                                                                 Mr. WILLIAMS. Thank you.
                                                                 Yes, I would like to make two points. First to address the com-
                                                              ment about flow down. The interim DFARS clause for CMMC
                                                              which was issued late last year directs prime contractors to flow
                                                              down the CMMC level that is appropriate for the information that
                                                              is being flowed down to the subcontractor. That gives a lot of dis-
                                                              cretion to the prime contractor to decide what is appropriate. I
                                                              would like to see the final DFARS clause for CMMC prohibit prime
                                                              contractors from flowing down a higher level than is absolutely
                                                              necessary based on the information that is being provided to the
                                                              subcontractor.
                                                                 And the second point I would like to make about the information
                                                              that is being disseminated to the small business community, my
                                                              experience has been that there have been town halls, as Mr. Dun-
                                                              bar mentioned, and I get the LinkedIn messages as well. There are
                                                              other ways that information is being pushed out, but I think the
                                                              problem—the challenge is that that messaging is blunted by the
                                                              fact that we still have no answers for many of the critical ques-
                                                              tions.
                                                                 So rather than focusing on creating more forums for dissemi-
                                                              nating information, I think we need to focus on providing real hard
                                                              information about how much this is going to cost and when are
                                                              small businesses going to need it, what level are they going to
                                                              need? Until we can answer those basic questions, I think, you
                                                              know, the forums are going to be largely lost on the small business
                                                              community.
                                                                 Ms. VAN DUYNE. Thank you very much, Mr. Williams.
                                                                 Mr. Dunbar, did you have anything to add?
                                                                 Mr. DUNBAR. Yes. One of the items with small business is a lot
                                                              of small businesses work from, I will say remote locations. You may
                                                              have an office where you have people working from home, several
                                                              people at various homes. One of the big items that was brought up




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                                                              recently by one of the board members for the CMMC was that we
                                                              will be subject to home inspections in order to pass CMMC.
                                                                 So now you have people doing home inspections in your own pri-
                                                              vate homes. The risks beyond that on there are just, you know, in-
                                                              calculable.
                                                                 Another item to me that really piqued my interest there was our
                                                              ability to protect ourselves during an assessment. Right now, an
                                                              answer on the Board FAQ site basically states that an RP that
                                                              helped us go ahead and put together our plan is not to be there
                                                              to defend our plan. So if we get—you know, fail it, we are supposed
                                                              to know this book again. We don’t have an expert to know it.
                                                                 Ms. VAN DUYNE. Excellent. Thank you very much.
                                                                 I yield back.
                                                                 Chairman PHILLIPS. The gentlelady yields back.
                                                                 And now I recognize the gentleman from Pennsylvania, Mr.
                                                              Evans, for 5 minutes.
                                                                 Mr. EVANS. Thank you, Mr. Chairman.
                                                                 Mr. Dunbar, what would you—what would be your recommenda-
                                                              tions for those businesses that are just learning about the Initia-
                                                              tive? I would like to ask all of the panel that question.
                                                                 I will start off with you, Mr. Dunbar.
                                                                 Mr. DUNBAR. I honestly don’t know that I have an answer for
                                                              that, because trying to know find the information, it has not been
                                                              clear enough to everybody where to get it. If I am getting it from
                                                              LinkedIn, I mean, I first heard about it at an Army Corps Small
                                                              Business Conference in 2019. Otherwise, I may not even know
                                                              about it today.
                                                                 Mr. EVANS. Does any other panel—any comments or thoughts
                                                              on that, any of the other panelists?
                                                                 Mr. SINGER. Sure, sir, I would like to make a comment.
                                                                 You know, I think one of the important things is for companies
                                                              to find reputable businesses to help support them through this
                                                              process, and, unfortunately, I think there is too much variation in
                                                              the help that they are getting, as Ms. Wilson spoke of earlier also.
                                                                 I think also that, especially now, I think a lot of the level three
                                                              companies are aware of this coming down, especially small manu-
                                                              facturers that are, you know, just now starting to really under-
                                                              stand this because the letters are coming out from the primes.
                                                                 But I think a big gap is the people that are going to have to meet
                                                              level one and they don’t know it right now, and I think that should
                                                              be a much more proactive reach-out to those folks. I mean, the
                                                              DOD knows who they are contracting with in these areas, and I
                                                              think they should take a more active role.
                                                                 Mr. WILLIAMS. Yes, Representative Evans, if I could just back
                                                              up Mr. Singer’s comments there, our primary recommendation to
                                                              our small business clients is to get level one ready. The level one
                                                              requirements really are basic things, like antivirus software and
                                                              spam filters that we think all companies should be doing, regard-
                                                              less of whether you work with the Federal Government. In this day
                                                              and age, you should be doing at least those basic requirements, and
                                                              they are already in the FAR. The FAR requires these basic safe-
                                                              guards. That has been the requirement for a long time.
                                                                 So, this really, frankly, shouldn’t be surprising, but I totally rec-
                                                              ognize that it is, because small businesses have so much to focus




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                                                              on. But these requirements are not new, and they are, generally
                                                              speaking, not difficult to obtain for small businesses. So, we would
                                                              like everyone to really focus on at least getting level one ready, be-
                                                              cause these are things you should be doing as a business.
                                                                 Ms. WILSON. And I would echo everyone’s comment that has
                                                              been made on the panel. I do make a concerted effort to share with
                                                              small business owners to mention CMMC, and I mention it in the
                                                              context of the necessary need for them to actually have it, but un-
                                                              derstand what it means and the implications, because right now,
                                                              we just have black and white implications of saying if you don’t
                                                              have it, and your contract comes up for renewal, then you run the
                                                              risk of losing your contract.
                                                                 And, so, putting that fear in them early on, maybe prompt them
                                                              to move forward. But also I think from our perspective at T47, we
                                                              have already proactively tried to secure something similar, certifi-
                                                              cation. It may not be directly related, but to at least get us ready
                                                              so that way when it comes down for us to have an audit, we are
                                                              in a position to actually, pass the audit.
                                                                 So it is a challenge, and right now, because we don’t have cohe-
                                                              siveness of information, it makes it a little more difficult for small
                                                              businesses that just now are recognizing that they need it, or they
                                                              know they need it but don’t know how to secure it.
                                                                 Mr. EVANS. I yield back, Mr. Chairman.
                                                                 Chairman PHILLIPS. The gentleman yields back.
                                                                 And now I recognize the gentleman from Wisconsin, Mr. Fitz-
                                                              gerald, for 5 minutes.
                                                                 Mr. FITZGERALD. Thank you, Mr. Chair.
                                                                 I am going to start, Mr. Singer, as a fellow Wisconsinite, I have
                                                              quite a bit of experience in working with obviously anywhere from
                                                              major corporations down to, you know, one and two person Ma &
                                                              Pa shops. But my question, I was talking a little bit to staff about
                                                              this yesterday. We were kind of kicking around the idea that there
                                                              might be a different level of security from State to State through-
                                                              out the Nation, and I just wanted to get maybe your perceptions
                                                              on, is there much interaction with the State of Wisconsin from your
                                                              perspective? And if there are, what are the influences there? Be-
                                                              cause I think it would be valuable for Members of Congress to
                                                              know kind of what is going on at the State level.
                                                                 Mr. SINGER. Thank you, sir.
                                                                 As a fellow Wisconsinite, it has been kind of fun starting a busi-
                                                              ness in Wisconsin, and Minnesota too. But as far as—I haven’t had
                                                              a lot of interaction with the State government. I counseled them a
                                                              little bit on CMMC. It has been new to them, in helping them to
                                                              try and understand the issues around this for small business.
                                                                 One of the organizations that we work very closely with are the
                                                              MEPs, the Manufacturing Extension Partnership programs. Every
                                                              State has one. There is—and Puerto Rico has one. We have been
                                                              working very closely with them to try and help get the small manu-
                                                              facturers in Wisconsin and Minnesota through the assessment so
                                                              that they can accept awards from the primes.
                                                                 So I think that is really actually a good avenue to help small
                                                              businesses is through the MEPs, especially the manufacturers. But
                                                              I don’t know that, you know, the States yet have really kind of fig-




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                                                              ured out any good mechanisms to help fund or support the small
                                                              businesses as of yet.
                                                                 Mr. FITZGERALD. Very good. Thank you.
                                                                 As anybody could probably answer this question, let me just di-
                                                              rect it to Mr. Dunbar, though. And I apologize if some version of
                                                              this was asked earlier. But cybersecurity, obviously, you can be a
                                                              consultant, quote/unquote ‘‘consultant,’’ and I am wondering if you
                                                              are seeing, because we are starting to hear that there are many
                                                              different versions of this, and obviously many different levels of
                                                              professionalism and knowledge.
                                                                 And I am just wondering if you could comment kind of, you know
                                                              what is your take, kind of what is going on out there on the street?
                                                                 Mr. DUNBAR. Thank you, sir.
                                                                 Yes, you are 100 percent correct. There is a large fear in the
                                                              small business community that the ‘‘consultants,’’ in quotations,
                                                              are not all equal. I get inundated with emails daily from companies
                                                              trying to convince me that I am not ready, I need to be—I am los-
                                                              ing my contracts. I mean, blatant lies in your inbox constantly from
                                                              companies. I call it the fear marketing.
                                                                 I have also seen things from—as one of the other members of the
                                                              committee had mentioned earlier, you know, companies that—there
                                                              are fraudulent companies out there, just that have no business.
                                                              There was one, I think, the College of India was creating, We can
                                                              get you CMMC certified.
                                                                 Mr. FITZGERALD. Right.
                                                                 Mr. DUNBAR. Like, okay, great. How is the College of India get-
                                                              ting me CMMC certified? And that is a fear. We don’t know where
                                                              to go. We have been told, Oh, well, the only great place, the only
                                                              authorized place is the CMMC-AB, if they are on their market-
                                                              place, that is the only place to get, that is legal, to get your con-
                                                              sulting from. That is a whole separate issue, I believe.
                                                                 Mr. FITZGERALD. Yes. And, you know, to dovetail on that, so
                                                              compliance, too, because it is kind of wide open as to what the cost
                                                              could be associated with that. You know, you hear figures thrown
                                                              around, like, Well, it costs a company $10,000 to comply, or it costs
                                                              them $1 million to comply. That is not necessarily a good gauge,
                                                              I don’t think, on, kind of, you know, whether or not somebody is
                                                              a legitimate consultant. But it sounds like that is kind of the range
                                                              that is out there when a lot of these small businesses are consid-
                                                              ering how to become not only compliant, but protect ourselves,
                                                              so——
                                                                 Mr. DUNBAR. And I think you raise a good point because there
                                                              is also a lot of companies out there trying to sell one-stop shopping,
                                                              like, Oh, we have this program. You buy this program, you are
                                                              CMMC-compliant.
                                                                 Mr. FITZGERALD. Right.
                                                                 Mr. DUNBAR. And that is not going to happen.
                                                                 Mr. FITZGERALD. Yes. Very good. Thank you very much.
                                                                 I yield back.
                                                                 Chairman PHILLIPS. The gentleman yields back, and that com-
                                                              pletes our questioning.
                                                                 So I will move to my closing statement. And I want to thank all
                                                              of our witnesses for a very compelling testimony today and for illu-




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                                                                                                              24

                                                              minating the very issues that small contracting firms are experi-
                                                              encing as they try to bolster their cybersecurity.
                                                                Recent high-profile attacks have made it very clear that the
                                                              threat of malicious cyber actors is growing, and that is why we
                                                              must ensure that companies in the DIB are prepared for all cyber
                                                              threats that might come their way. But it is equally vital, equally
                                                              vital that we do not deprive businesses like yours of critical oppor-
                                                              tunities in that process.
                                                                We have got to work as a committee to increase cybersecurity
                                                              preparedness across the DIB in a way that is not cost prohibitive
                                                              to small firms. By achieving this, the small businesses will still
                                                              have ample access to a lucrative marketplace while also protecting
                                                              themselves against 21st century threats.
                                                                I would ask unanimous consent that members have 5 legislative
                                                              days to submit statements and supporting materials for the record.
                                                                Without objection, so ordered.
                                                                And if there is no further business to come before the committee,
                                                              we are now adjourned.
                                                                Thank you.
                                                                [Whereupon, at 11:17 a.m., the subcommittee was adjourned.]




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                                                                                                   APPENDIX




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