Small Business Set Aside FAQs
Agencies must take the following four steps:
a. Perform market research. Determine if there are small businesses capable of performing the desired work. Given that there are more than 15,000 small business Schedule contract holders, and Schedule contracts focus exclusively on commercial products and services, agencies should easily be able to identify small businesses that are capable and competitive.
b. Include a statement in the RFQ for an order or BPA that will be set aside. The contracting officer should include the following language in the RFQ: “This is a notice that this order is a total set-aside for (insert either “small business concerns” or specify a subset of small business concern). Only quotes submitted by (insert either “small business concerns” or specify a subset of small business concerns) will be accepted by the government. Any quote that is submitted by a contractor that is not (insert either “a small business concern” or specify a subset of small business concern) will not be considered for award.” If using eBuy, this statement will be added automatically to the set-aside RFQ posting. See the response to question #12 for more details.
c. Use the same competition rules as provided in FAR 8.405, except limit consideration only to small businesses.
|Size of BPA/Order||Competition Strategy||Any special documentation required?|
|BPA/order exceeds the Micro-Purchase Threshold but not the Simplified Acquisition Threshold (SAT)||Agency posts a quote on eBuy||No|
|Agency considers reasonably available information about at least three small businesses||No|
|BPA/order exceeds the SAT||Agency posts a quote on eBuy||No|
|Agency sends quote out to enough small businesses to receive quotes from at least three small businesses||No|
Some of the small business programs identified in FAR Part 19 have special circumstances under which you can set aside an acquisition. For example, for an order to be set aside under the Women-Owned Small Business (WOSB) Program, the requirement needs to be:
- Under $6.5 million if it is for manufacturing, and under $4 million for all other requirements; and
- Fall within the scope of those specific North American Industrial Classification Systems (NAICS) code industries in which the Small Business Administration (SBA) has determined that women-owned small business concerns are underrepresented or substantially underrepresented in federal procurement (see FAR Subpart 19.15, WOSB Program for additional requirements).
In order to facilitate the set-aside of orders in eBuy, the system has been changed to remove an RFQ from the view of those Schedule contractors that are not eligible to respond to a particular set-aside order. For example, if an RFQ is set aside for service-disabled veteran-owned small business concerns, only those Schedule holders that are awarded the relevant Schedule and SIN(s), and are service-disabled veteran-owned small businesses will be able to view it. Other Schedule-holders will not be able to view the set-aside RFQ.
Note that contracting officers still have to comply with the ordering procedures in FAR 8.405-1, 8.405-2, or 8.405 -3 before proceeding with a set-aside (i.e., make sure there are sufficient contractors eligible to participate in the set-aside or follow the requirements for limiting sources in FAR 8.405-6).
The set-aside RFQ posting on eBuy will include a label identifying what kind of a set-aside it is, and language stating that quotes from Schedule contractors who are not eligible for the set-aside will not be considered for award. For more information on this functionality, visit our Interact Blog Post eBuy is "Set-Aside" Ready!
All members of the CTA must be small (or whatever sub-set the order is set-aside for) for the CTA to be eligible for that order. It is important to note, that for an MAS CTA, all team members must hold a Schedule contract, they each are responsible for their portion of the work, and each member maintains privity of contract. These rules apply in both an order and BPA environment against Federal Supply Schedules.
NOTE:Important Interim Guidance for Ordering Activities on FPDS Reporting for Contractor Team Arrangements (CTAs):
- Interim Guidance: Ordering activities are responsible for accurately achieving and reporting on their small business goals, including accurate reporting to the Federal Procurement Data System (FPDS). Under CTAs, each contractor has privity of contract with the ordering activity. When an MAS order is awarded with a CTA, small business achievement in contractual terms is based upon the dollar amount of the work the small business contractors perform under the order. FPDS currently will only accept information relating to one contractor per order. The ordering activity must determine which CTA member is realizing the preponderance of the revenue on an order and report that contractor's information to FPDS.
- Future Guidance: GSA is working with the Office of Federal Procurement Policy (OFPP) and the Small Business Administration (SBA) to provide further clarity around the use of CTAs, and anticipates issuing final guidance in the future.