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-Part 19 - Small Business ...........................................................................................................53+Part 19 - Small Business
+FC 19.1 Innovative approaches to reduce bid and proposal burdens for increased small
+business opportunities.
+There are many opportunities to apply innovative techniques on the Periodic Table of
+Acquisition Innovations (PTAI) to maximize small business opportunities. The techniques and
+approaches found on the PTAI benefit small business in the following ways:
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+● Reduced barriers to entry through simplifying the request for quote and request for
+proposal process, lowering bid and proposal costs, streamlining submission processes,
+and more clearly explaining the evaluation criteria and approach.
+● Faster contract awards can help small businesses which may not be able to sustain
+cash flows for burdensome, lengthy acquisition timelines.
+● Commercial procurements, modular contracting, and agile procurement methods may
+align more with how small businesses operate.
+● Emphasizing solutions and mission over compliance attracts companies of all sizes and
+affords companies to showcase their unique capabilities.
+The PTAI has a finder feature that filters innovative acquisition approaches and techniques
+which benefit small businesses.
+FC 19.101(b) Encouraging small business participation in acquisitions.
+There are many ways to encourage small business participation in acquisitions in addition to the
+acquisition strategies outlined in FAR 19.101(b), which include, but are not limited to the
+following actions that a contracting officer may consider:
+● Identify opportunities to break down complex requirements into simpler parts whenever
+possible, or divide proposed acquisitions of supplies and services (except construction)
+into reasonably small lots (not less than economic production runs) to permit offers on
+quantities less than the total requirement.
+● Establish realistic delivery schedules that will encourage small business participation to
+the extent consistent with the actual requirements of the government.
+● Allow the maximum amount of time practicable for the submission of offers.
+● Provide relevant information with solicitations that is necessary for the preparation of
+quotes or proposals (e.g. specifications, plans, system designs, drawings).
+FC 19.103(b) Determining the appropriate NAICS code for the solicitation.
+When determining the appropriate NAICS code for the solicitation, it may be useful to consider
+the industry descriptions in the U.S. NAICS Manual, the product or service descriptions in the
+solicitation, the relative value and importance of the components of the requirement making up
+the end item being procured, and the function of the goods or services being purchased. A
+procurement is usually classified according to the component that accounts for the greatest
+percentage of contract value. In the event of a NAICS code appeal, more information
+concerning appeals of NAICS code designations can be found in the SBA’s regulations, and is
+located at 13 CFR 121.1002 and 13 CFR part 134.
+FC 19.104-1(f) Identification of manufacturers.
+For the purposes of applying the nonmanufacture rule, the manufacturer, processor, or producer
+is the concern that manufacturers, processes, or produces an end item with its own facilities
+(e.g., transforms raw materials, miscellaneous parts, or components into the end item being
+acquired). See 13 CFR 121.406(b)(2). In an acquisition for multiple items, if a small business
+offeror is both a manufacturer of item(s) and a nonmanufacturer of other item(s), the contracting
+officer should apply the manufacturer size standard.
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+FC 19.108-11(a)(2) Release from the 8(a) program.
+A requirement is automatically released from the 8(a) program if a follow-on procurement is set
+aside for the HUBZone, SDVOSB, or WOSB programs, or a mandatory source is identified to
+meet the requirement per FAR 19.108-11(a)(1). In such cases, a formal release request is not
+necessary. This ensures that follow-on procurements remain within the small business program.
+FC 19.109 Small business subcontracting plans.
+When a subcontracting plan is required in accordance with FAR 19.109, the contracting officer
+may require the submission of a subcontracting plan with the initial offers or at any other time
+prior to award. From an efficiency perspective, unless proposed small business subcontracting
+is a required evaluation factor in accordance with FAR 15.104(c)(2), or other extenuating
+circumstances that warrant the evaluation of subcontracting plans apply, it is appropriate to only
+require submission of a subcontracting plan by the apparent successful offerer and negotiate
+the terms of the subcontracting plan with the apparent successful offeror prior to award. If
+handled as a negotiation with the apparent successful offeror, the subcontracting plan
+negotiation is separate and distinct from other negotiations that may occur under source
+selection.
+FC 19.110 Price evaluation preference for HUBZone small business concerns.
+When evaluating price for HUBZone small business concerns, the factor of 10 percent should
+be applied on a line item basis or to any group of items on which an award may be made. Other
+evaluation factors, such as transportation costs or rent-free-use of government property, should
+be added to the offer to establish the base offer before adding the factor of 10 percent.
+When the two highest-rated offerors are a HUBZone small business concern and a large
+business, and the evaluated offer of the HUBZone small business concern is equal to the
+evaluated offer of the large business after considering the price evaluation preference, the
+contracting officer should award the contract to the HUBZone small business concern.
+FC 19.111-2 Set-asides for orders under multiple-award contracts.
+The contracting officer is encouraged to consider, but has the discretion to decide, whether or
+not to set aside an order under multiple-award contracts for small business concerns.
+Accordingly, the “rule of two” (see FAR 19.104-1(a)) does not apply to orders placed under
+multiple-award contracts, or to orders under the Federal Supply Schedules.
+If the contracting officer decides to set aside an order for small business concerns, the specific
+program eligibility requirements identified in FAR part 19, as well as the ordering procedures for
+the Federal Supply Schedule (FAR subpart 8.4 and GSAR subpart 538.71) or a multiple-award
+contract (FAR subpart 16.5) must be followed. The set-aside may be a total set-aside or a
+partial set-aside (see FAR 19.104-2). When establishing a blanket purchase agreement under
+the Federal Supply Schedule, the contracting officer may also establish a reserve for small
+business (GSAR 538.7102-2(c)(1)).
+A contracting officer’s decision to set aside or not set aside an order for small business
+concerns is not a basis for protest (see 19.111-2(a)(2)). FAR 19.104-1(a) has been updated to
+use "contracts" instead of "acquisition" for greater clarity. This particular clarification aims to
+resolve a perceived conflict in interpretations between the Government Accountability Office
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+(GAO) and the U.S. Court of Federal Claims (COFC) around the application of the "Rule of
+Two" within the context of multiple-award contracts.
+Note that only small business concerns awarded contracts under partial set-aside multiple-
+award contracts may compete for orders issued under those portions of the multiple-award
+contract. However, small business awardees may compete against other than small business
+awardees for an order issued under the portion of the multiple-award contract that was not set-
+aside, if the small business received a contract award for the non-set-aside portion of the
+multiple-award contract.
+Below are examples of language for consideration in a solicitation should the contracting officer
+decide to set-aside an order under the Federal Supply Schedule or a multiple-award contract, or
+conduct a reserve under the Federal Supply Schedule. This language is intended to aid the
+contracting officer, and can and should be tailored to the specific acquisition, contract vehicle,
+and set-aside decision.
+FAR 8.4 or FAR 16.5: Total set-aside.
+This language is suitable when setting aside the entire requirement for a specific small business
+category.
+Example: Total Small Business Set-Aside
+"This order is a total set-aside for small business concerns. Only quotes submitted by
+contractors that are currently designated as a small business under their awarded [insert
+contract type, e.g., GSA MAS, IDIQ, etc.] will be considered for award. Any quote received from
+a contractor that is not an eligible small business concern will be deemed non-responsive and
+will not be evaluated."
+Example: Total Service-Disabled Veteran-Owned Small Business (SDVOSB) Set-Aside
+"This order is a total set-aside for Service-Disabled Veteran-Owned Small Businesses
+(SDVOSBs). In accordance with FAR 8.401(b) and GSAR 538.7102-2(c)(1) or FAR 16.505, only
+offers from SDVOSBs will be considered. Any offer submitted by a contractor that is not a
+certified SDVOSB will not be considered for award."
+FAR 16.5: Partial set-aside.
+This language may be used when soliciting an order or BPA under the set-aside portion of the
+multiple-award contract when the multiple-award contract itself contains a partial set-aside
+provision.
+Example: Partial set-aside under an existing multiple-award contract
+"This order is being solicited in accordance with the terms of the multiple-award contract [insert
+contract number], including FAR 52.219-7 and 52.219-13. Offers are being solicited for the set-
+aside portion of this requirement. In accordance with FAR 19.111-2, only small business
+concerns awarded contracts for the set-aside portion(s) are eligible to compete."
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+GSAR 538.702-2(c)(1): Reserve.
+This language may be applied to a competitive multiple-award BPA under the Federal Supply
+Schedule that includes a reserve for one or more small businesses.
+Example: Reserve under Federal Supply Schedule multiple-award BPA
+"This acquisition includes a reserve for one or more small businesses. In accordance with
+GSAR 538.7102-2(c)(1), the contracting officer intends to reserve BPAs for one or more small
+business concerns."
+Combined FAR 8.4 and FAR 16.5 set-aside statement.
+This statement can be added to the competitive announcement for orders under FSS or
+multiple-award contracts.
+Example: Notice of set-aside of orders
+"In accordance with FAR [insert 8.401(b)/GSAR 538.7102-2(c)(1) or 16.505, as applicable], the
+contracting officer has determined that this order will be set aside for [insert specific small
+business category, e.g., small business concerns, SDVOSB, HUBZone, etc.]. All eligible
+vendors holding a [insert contract type, e.g., GSA MAS, IDIQ, etc.] are invited to compete."
+Tips for contracting officers when deciding to set-aside an order for small business:
+● Specify the program: When creating the RFQ, specify the particular set-aside type (e.g.,
+Small Business, SDVOSB, WOSB, etc.) and insert the appropriate FAR clause to ensure
+that only eligible contractors respond.
+● Use eBuy features: For FSS orders, GSA's eBuy portal automatically includes the
+appropriate set-aside language and filters the solicitation so that only eligible contractors
+can view it.
+FC 19.302-1(d) Small business subcontracting goals for orders against multiple-award
+contracts.
+To evaluate subcontracting goals for an order in accordance with FAR 19.302-1(d), contracting
+officers should leverage the master subcontracting plan for the multiple-award contract, and not
+require an individual order level subcontracting plan unless elements of the plan are considered
+unacceptable for the order level requirement.