1. Federal Acquisition Service U.S. General Services Administration July 2011

2.  The FAR  The Basics  Policy  Frequently Asked Questions  Sample RFQ Language  Helpful Links 2 Objectives

3. Per the FAR, Federal Supply Schedule (FSS) contracts are not applicable for set aside acquisitions as prescribed in FAR part 19. 19.502-1 Requirements for setting aside acquisitions. (b) This requirement does not apply to purchases of $3,000 or less ($15,000 or less for acquisitions as described in 13.201(g)(1)), or purchases from required sources of supply under Part 8 (e.g., Committee for Purchase From People Who are Blind or Severely Disabled, and Federal Supply Schedule contracts). In accordance with the OFPP Act, the FAR has historically provided for application of FAR Part 19 small business programs to FSS contracts, but not orders, through procedures that balance the program needs of SBA and GSA. 3 The FAR Part 19: Small Business Programs

4. The FAR exempts Subpart 8.4 purchases from the applicability of Part 19 small business programs. 8.405-5 Small business. (a) Although the mandatory preference programs of Part 19 do not apply, orders placed against schedule contracts may be credited toward the ordering activity’s small business goals.Part 19  Ordering activities should rely on the small business representations made by Schedule contractors at the contract level.  Agencies do not need to make a separate size determination at the order level but the GAO has upheld agencies’ right to request a recertification at the order level (CMS Information Services Inc., B-290541, Aug. 7, 2002). 4 The FAR Subpart 8.4: Federal Supply Schedules

5. 8.405-5 Small business. (b) Ordering activities may consider socio-economic status when identifying contractor(s) for consideration or competition for award of an order or BPA. At a minimum, ordering activities should consider, if available, at least one small business, veteran-owned small business, service disabled veteran-owned small business, HUBZone small business, women-owned small business, or small disadvantaged business schedule contractor(s). GSA Advantage! and Schedules e-Library contain information on the small business representations of Schedule contractors. Agencies are encouraged to consider at least one small business prior to placing an order under the program. Agencies are advised that they may establish evaluation criteria which give preference to socio-economic factors in their best value analysis. 5 The FAR Subpart 8.4: Federal Supply Schedules

6. 8.405-5 Small business. (c) For orders exceeding the micro-purchase threshold, ordering activities should give preference to the items of small business concerns when two or more items at the same delivered price will satisfy the requirement. Ordering activities should give preference to items of small business concerns when those items satisfy agency requirements at the same delivered price as items offered by large business concerns. 6 The FAR Subpart 8.4: Federal Supply Schedules

7. SBA policy allows agencies to include in their procurement base and goals, the dollar value of orders expected to be placed against GSA Schedule contracts. Actual Orders may be reported as accomplishments and credited toward ordering activities’ small business goals. 7 The Basics: Socioeconomic Credit

8. GSA Advantage! GSA Advantage! and GSA eLibrary contain information on a broad array of supplies (product) and services offered by small business concerns. Ordering activities can utilize the small business program indicators that state the socioeconomic status of each of the Multiple Award Schedule (MAS) contracts.GSA eLibrary This information should be used as a tool to assist agencies in providing the maximum practicable opportunities for small businesses. The next few slides contain snapshots of GSA Advantage! and GSA eLibrary. 8 The Basics: MAS Contractors’ Catalogs/Pricelists

9. 9 The Basics: GSA Advantage! (See notes for details on the functionality of GSA Advantage!)

10. 10 The Basics: eLibrary (See notes for details on the functionality of eLibrary.)

11. 11 The Basics: eBuy (See notes for details on the functionality of eBuy.)

12. GSA also provides specific Special Item Numbers (SINs) within certain Schedules that are solely set aside for small business Schedule contractors. Below is a sample of these SINs: 12 The Basics: Set-Aside Special Item Numbers ScheduleSINDescription 00CORP: The Consolidated Schedule C 7125AShelving, Bookcases, Display Racks C 7460Card Files, Cabinets C R422S Marketing Research and Public Opinion Services C R704TAuditing Services C R708SPublic Relations Services C T001Arts/Graphics Services C T015Commercial Photography 520: Financial and Business Solutions (FABS) 520 10Transportation Audits 520 14Audit and Financial Training Services For the full list of set-aside SINs and an article on using these SINs, read our blog article on set-asides.read our blog article

13.  There is no statute, regulation, or policy restricting a Contracting Officer’s reasonable discretion in using a Schedule contractor’s socioeconomic status as a best value evaluation factor, even including giving primary weight to such a non-price factor as part of a tradeoff analysis. There is no governing regulation or policy limiting the use of a socioeconomic status evaluation factor to only that of a tie-breaker for quotes of equal price.  There is case law that has upheld the use of socioeconomic status as an evaluation factor. For example:  Synergetics, Inc. B-299904, Sep 14, 2007B-299904  Optimus Corporation, B- 400777, Jan 26, 2009B- 400777 13 Policy

14. Consistent with FAR language and intent, GSA has publicly stated its organizational policy regarding broad and permissive use of socioeconomic status as a best value evaluation factor, and given the permissible use of that factor as a primary evaluation factor. Reference: GSA Acquisition Letter V-05-12GSA Acquisition Letter V-05-12 (Office of the Chief Acquisition Officer, D. Drabkin), “Socio-Economic Programs Under Schedules,” dated June 6, 2005. 14 Policy

15. Other examples of high level official GSA policy statements or special ordering procedures on this issue include: GSA Office of General Counsel Memorandum “Protest of FitNet Purchasing Alliance, B-309911” (Thedlus L. Thompson, Senior Assistant General Counsel), dated September 14, 2007, after discussing why the set-aside provisions of FAR part 19 do not apply to Schedule orders and BPAs, recognized this well-established agency policy on best value evaluation and the socioeconomic factor. (See speaker notes for excerpt from Memo.) 15 Policy

16. GSA Deputy Associate Administrator Michael J. Rigas, in October 29, 2007 public testimony before the U.S. Senate Committee on Small Business and Entrepreneurship echoed the same agency policy on the broad use of socioeconomic status in Schedules ordering as found in GSA Acquisition Letter V-05-12.public testimony GSA Multiple Award Schedules Desk Reference the widely distributed primary agency reference for Schedules ordering includes special ordering procedures with regards to small business utilization.Multiple Award Schedules Desk Reference (See speaker notes for excerpts from these documents.) 16 Policy

17. There does not appear to be any controlling authority prohibiting the designation and weighting of a “Socioeconomic Status” evaluation factor for Schedule BPAs and orders, nor is there any restriction on the use of such a factor only to break ties on quotes of equal price. In view of the clear FAR intent and consistent GSA policy on broad, discretionary use of such a best-value factor, the inclusion of socioeconomic status as an evaluation factor appears to be a matter within the reasonable discretion of the Contracting Officer. 17 Policy (Conclusion)

18. Can ordering activities complete a small business set-aside through the Federal Supply Schedules?  No. Currently both FAR Part 19 and FAR Subpart 8.4 mirror each other to state that the Federal Supply Schedules are not applicable for small business set-asides.  If an ordering activity decides to compete an RFQ specifically as a small business set-aside, they should utilize open market authorities such as FAR Parts 12, 13, 14 and 15. 18 Frequently Asked Questions

19. If ordering activities don’t utilize a small business set-aside, can ordering activities reserve or limit the RFQ for a Schedule order to small business?  If market research indicates that small businesses are capable of meeting the requirement in the RFQ, ordering activities may consider only soliciting quotes from small businesses. Note that ordering activities must provide a copy of the RFQ to any Schedule contractor that requests a copy.  All quotes received from Schedule contractors are required to be evaluated, using the evaluation criteria provided in the RFQ, regardless of business size. 19 Frequently Asked Questions

20. (continued)  In the case of a requirement for supplies or services not requiring a statement of work, ordering activities can simply review the pricelists of 3 small business Schedule-holders and place the order with the Schedule-holder that represents best value. Note that effective May 16, 2011, new competition requirements of Section 863 changed the ordering procedures for orders not requiring a statement of work.(See FAR 8.405-1.)  GAO case law explicitly decided that set-aside provisions do not apply to Schedules orders (Edmond Computer Company; Edmond Scientific Company, B-402863; B-402864, August 25, 2010). 20 Frequently Asked Questions

21. What can ordering activities do to promote offers from small business contractors?  Review eLibrary to determine if your requirement is covered by the scope of the numerous small business set-aside SINs.  Provide copies of the RFQ to small businesses only and encourage them to submit a quote. Note that ordering activities have to provide the RFQ to any Schedule contractor that requests it.  Make socioeconomic status (i.e. business size) a primary evaluation factor in the RFQ. 21 Frequently Asked Questions

22. What sort of documentation is involved with small business utilization under Schedules?  Ordering activities must document any small business consideration in the Acquisition Plan.  If applicable, socioeconomic status must clearly be identified as a primary evaluation factor in the RFQ.  Per FAR 8.405-2(e), the ordering activity should document the evaluation methodology used in selecting the winning contractor and the rationale for any tradeoffs (i.e. socioeconomic status and price) in making award. 22 Frequently Asked Questions

23. How often do GSA contractors re-certify their business size status?  All GSA contractors must re-certify their business size during the renewal period of their contract. This occurs every five (5) years.  In addition, Schedule contractors are required to re-certify their business size within 30 days after a Novation Agreement and after a merger or acquisition. 23 Frequently Asked Questions

24. How can ordering activities utilize the evaluation factor of business size effectively and ethically?  Provide in the quote a specific statement that demonstrates that a primary evaluation factor will be the business size. If the ordering activity weighs the different small business programs differently provide details on how they are weighed. Also be aware that the business size evaluation factor should not be a “go/no-go” criteria that would eliminate large business entirely.  Later slides provide sample RFQ language that used socioeconomic status as an evaluation factor. 24 Frequently Asked Questions

25. How can ordering activities still get small business participation if market research indicates no small business is capable of meeting the requirement alone?  Encourage contractor teaming arrangements (CTAs) in the RFQ. This way, if a small business can perform part of the requirement, they can team with another contractor and propose a total solution.  Designate socioeconomic status as an evaluation factor in the RFQ and give credit to CTAs with small businesses as Team Members. See slide 28 for sample RFQ language. 25 Frequently Asked Questions

26. When can an agency take credit for Schedule orders to small business?  Agencies can take credit for the small business status listed on the awarded Schedule contractor’s GSA contract.  Currently there is only one small business program that ordering activities cannot get credit for through the Schedule contracts: 8(a). However, there is no longer any statutory goal for 8(a) businesses specifically.  Since, by definition, 8(a) firms are small disadvantaged businesses, ordering activities will get credit towards their small disadvantaged business goals for orders to 8(a) contractors. 26 Frequently Asked Questions

27. Do Schedule contracts include the Limitations on Subcontracting clause? If not, can ordering activities incorporate the clause at the task order level?  Some Schedule contracts do include the Limitations on Subcontracting clause. These Schedules are those with small business set-aside SINs; the clause applies only to those contractors awarded the set-aside SINs under those Schedules and does not apply to contractors awarded the non-set-aside SINs.  For all other Schedules and the non set-aside SINs, ordering activities cannot incorporate the clause at the task order level since the clause is applicable when requirements are being set-aside and set-asides are not allowed under a FAR Subpart 8.4 buy. 27 Frequently Asked Questions

28. HUD Single Award Schedule C.2 Evaluation of Proposals The following Factors will be used by the Government to evaluate proposals in descending order of importance: FACTOR 1: Socio-Economic FACTOR 2: Technical Approach FACTOR 3: Management Work Plan & Key Personnel FACTOR 4: Past Performance FACTOR 5: Price 28 Sample RFQ Language

29. HUD Single Award Schedule (cont.) C.3 Evaluation Factors Factor 1: Socio-Economic Factor Socio-Economic status of the Vendor shall be considered as a primary evaluation factor for award with the goal of achieving one of the Agency’s socio-economic goals to increase small business participation as prime contractors. HUD is strongly committed to ensuring that small businesses, veteran-owned small businesses, service- disabled veteran-owned small businesses, HUB Zone small businesses, disadvantaged businesses, women-owned and 8a small businesses have maximum opportunities to participate as prime contractors. For vendors proposing GSA Schedule Contractor Teaming Arrangements (CTAs), an allocation taking into consideration the appropriate weight based on their planned performance of each Team member will be used. For example, a CTA made up of small and large businesses where the small businesses will be performing 75% of the work would receive a rating of 75% of the maximum “Excellent” rating. 29 Sample RFQ Language

30. HUD Single Award Schedule (cont.) The following list details the preference level for each socio-economic goal sought. 30 Sample RFQ Language Socio-Economic StatusRating Service Disabled Veteran Owned Small BusinessExcellent 8(a) BusinessExcellent Woman-Owned Small BusinessExcellent HUBZone BusinessExcellent Small Disadvantaged BusinessExcellent Small BusinessExcellent Large BusinessFair

31. GSA Multiple Award BPA Construction Management Services D.3 Format For Submission D.3.4 Socioeconomic Status Your quote shall identify the business size and socioeconomic status of each team member, based upon both your basic GSA PES/00CORP Schedule and your self- certification at time of RFQ closing. The Contracting Officer will compare your self- certification against what is designated for your firm within CCR, and in the event of a conflict, may refer any final Small Business determinations to the Small Business Administration. If the size status listed in CCR is different than the size status in the Schedule contract, this difference should be explained in narrative form. Task Order contracting officers may, at their discretion, allow re-certifications for individual Task Orders but are under no obligation to do so. This submission shall not exceed two pages in length. 31 Sample RFQ Language

32. For additional sample RFQ language on using socio-economic status as an evaluation factor, click here.click here 32 Sample RFQ Language

33. 33 Schedules and Small Business Utilization in a Snapshot You can access the full-length version on this pagethis page

34. Additional information on small business utilization under the Multiple Award Schedule program can be found using the following links:  GSA Schedules Small Business Utilization GSA Schedules Small Business Utilization  Multiple Award Schedules blog and new media at Schedules News & Resources Schedules News & Resources  Office of Small Business Utilization Overview Office of Small Business Utilization Overview 34 Helpful Links