Office of Acquisition and Logistics (OAL)
Part 819 - Small Business Programs
|« VAAR Part 817||VAAR Table of Contents||VAAR Part 822 »|
|819.202-1||Encouraging small business participation in acquisitions.|
|819.202-5||Data collection and reporting requirements.|
|819.202-71||Additional contracting officer responsibilities.|
|819.203-70||Priority for service-disabled Veteran-owned small business/Veteran-owned small business contracting preferences.|
|819.302||Protesting a small business representation or rerepresentation.|
|819.307||SDVOSB/VOSB Small Business Status Protests.|
|819.501-70||General principles for setting aside VA acquisitions.|
|819.502||Setting aside acquisitions.|
|819.502-2||Total small business set-asides.|
|819.502-4||Multiple-award contracts and small business set-asides.|
|819.602-3||Resolving differences between VA and the Small Business Administration.|
|819.704||Subcontracting plan requirements.|
|819.705||Appeal of Contracting Officer Decisions.|
|819.7004||Contracting Order of Priority.|
|819.7005||VA service-disabled Veteran-owned small business set-aside procedures.|
|819.7006||VA Veteran-owned small business set-aside procedures.|
|819.7007||Sole source awards to a verified service-disabled Veteran-owned small business.|
|819.7008||Sole source awards to a verified Veteran-owned small business.|
|819.7105||Incentives for mentor participation.|
|819.7106||Eligibility of Mentor and Protégé firms.|
|819.7107||Selection of Protégé firms.|
|819.7109||VA review of application.|
|819.7111||Obligations under the Mentor-Protégé Program.|
|819.7114||Measurement of program success.|
|819.7201||Scope of subcontracting compliance reviews.|
|819.7202||Types of subcontracting compliance reviews.|
AUTHORITY: 38 U.S.C. 8127 and 8128; 40 U.S.C. 121(c) and (d); 48 CFR 1.301–1.304; and 15 U.S.C. 637(d)(4)(E).
[Deviation per Class Deviation–Authority to approve the submission of a request for a Nonmanufacturer Rule Waiver to the Small Business Administration (SBA) and use of other than competitive procedures or restricted competition as defined in 38 U.S.C. § 8127, for procurements where the SBA has issued a class waiver to the Nonmanufacturer Rule, dated February 17, 2017, to add section VAAR 819.102(f)(4) and (5). This requires the Head of the Contracting Activity (HCA) to 1) approve any request for a Nonmanufacturer Rule waiver prior to submission to the Small Business Administration (SBA) for class waivers or for a specific solicitation; and 2) the use of other than competitive procedures or restricted competition as defined in 38 U.S.C. § 8127, for procurements where SBA has issued a class waiver to the Nonmanufacturer Rule. Expires when incorporated into the VAAR or the VAAM or is otherwise rescinded.]
(f)(4) A contracting officer must receive approval from the Head of Contracting Activity (HCA) prior to submitting any request for a Nonmanufacturer Rule waiver to the Small Business Administration (SBA) pursuant to 13 C.F.R. 121.1204. This authority cannot be re-delegated.
(5) Where the SBA has issued a class waiver to the Nonmanufacturer Rule, a contracting officer must receive approval from the HCA prior to utilizing other than competitive procedures or restricted competition as defined in 38 U.S.C. § 8127. This authority cannot be redelegated.
[Deviation per Class Deviation–Veterans First Contracting Program (VFCP 2016), dated July 25, 2016, amends implementation of the Veterans First Contracting Program in VAAR 819.201 and 819.202, to include emphasizing that attainment of the Secretary’s annual goals for SDVOSBs/VOSBs does not limit the applicability of the Veterans First Contracting Program. This deviation is effective until incorporated into the VAAR or the VAAM or is otherwise rescinded.]
(a) It is the Department of Veteran Affairs (VA) policy that small business concerns owned and controlled by veterans shall have maximum practicable opportunity to participate in VA acquisitions, consistent with efficient contract performance and the priorities and preferences established under 38 U.S.C. 8127 and 8128.
(1) To carry out this policy the Secretary establishes annual goals for service-disabled veteran-owned small business (SDVOSB) and veteran-owned small business (VOSB) participation in VA contracting. The VA SDVOSB goal shall be no less than the government-wide goal for SDVOSBs.
(2) In support of these goals, each administration and staff office shall in turn establish annual goals for each subordinate contracting activity that present, for that activity, the maximum practicable opportunity for small business concerns, and particularly SDVOSBs/VOSBs, to participate in the performance of the activity’s contracts and subcontracts.
(3) The attainment of these goals or the use of interagency acquisition vehicles does not limit the applicability of the Veterans First Contracting Program and priorities in subpart 819.70.
(b) Each Head of the Contracting Activity (HCA) shall develop, in coordination with the Office of Small and Disadvantaged Business Utilization (OSDBU), an annual small business operating plan to increase the share of contracts and purchase orders awarded under the small business programs prescribed in FAR Part 19 and this part. The HCA shall also ensure that an annual procurement forecast of contracting opportunity is developed pursuant to Section 501 of Public Law 100-656.
OSDBU is responsible for reviewing procurement strategies and making recommendations to assist contracting officers in the implementation of this part. These responsibilities shall be conducted within the VA hierarchy of small business program preferences established by 38 U.S.C. 8127(i) (see subpart 819.70), which requires VA to consider preferences for verified SDVOSBs first, then preferences for verified VOSBs. The attainment of contracting goals or the use of Government-wide or multi-agency contract vehicles does not preclude the applicability of these preferences. Contracting officers shall use VA Form 2268, Small Business Program and Contract Bundling Review to document actions and recommendations. Searches and results of the Vendor Information Pages (VIP) database shall be saved and attached to the VA Form 2268 along with accompanying market research report or information.
Contracting officers may negotiate payment terms of less than 30 calendar days to encourage small business participation. A period of less than 7 days may not be prescribed (see FAR 32.908(c)(2)). The contracting officer and the local fiscal officer must be in agreement on the negotiated payment terms before awarding the contract.
(a) Administration heads, staff office directors, and HCAs must, in addition to the responsibilities designated in FAR 19.202-5, cooperate with OSDBU in formulating specific small business program goals and providing other data necessary for goal assessment.
(b) Each VA acquisition activity shall establish goals for the expenditure of funds with preferred businesses within their projected annual budget. OSDBU is responsible for Department-wide goals and accomplishments and will approve or adjust each acquisition activity’s goals.
(c) A Procurement Preference Program Goals Report (Report Control Symbol 00-0427) shall be submitted annually by each acquisition activity to reach OSDBU by November 1. Each report shall contain total expenditure estimates and goals for the current fiscal year and explanations of the methods utilized to arrive at each proposed goal. Anticipated problems in the attainment of the proposed goal in any category shall also be identified. This information will be used in negotiating the Department goals with the Small Business Administration (SBA).
(e) Upon review by OSDBU of the proposed goals, each acquisition activity will be notified of the acceptance of goals as submitted, or of any deficiencies. If the goals are not acceptable, the acquisition activity will be requested to submit further written justification for the goals submitted. Based on documents submitted, OSDBU will make a final determination on the goal assignment.
An HCA must perform the following functions in support of the small business program. These functions cannot be delegated without written approval of the Director, OSBDU:
(a) Develop, on an annual basis, a plan of operation to increase the share of contracts and purchase orders awarded to the small business programs prescribed in FAR Part 19. This plan must also include Veteran-owned and service-disabled Veteran-owned small business concerns.
(b) Promote goals for the small business programs set forth in FAR Part 19. This must also include Veteran-owned and service-disabled Veteran-owned small business concerns.
(d) Review class set-asides, established in accordance with criteria in FAR 19.503, at least annually to determine whether items or services procured under a unilateral or joint set-aside should be modified or withdrawn.
(f) If the acquisition activity is assigned to an SBA Procurement Center Representative, assure that the representative is provided logistical support, cooperation, and access to all reasonably obtainable contract information directly pertinent to the SBA Procurement Center Representative’s official duties.
In addition to the duties designated in FAR 19.202 through 19.202-6, contracting officers must perform the following functions in support of the small business program:
[Deviation per Class Deviation–Veterans First Contracting Program (VFCP 2016), dated July 25, 2016, amends implementation of the Veterans First Contracting Program by adding 819.203-70, and to include emphasizing attainment of the Secretary’s annual goals for SDVOSBs/VOSBs does not limit the applicability of the Veterans First Contracting Program. This deviation is effective until incorporated into the VAAR or the VAAM or is otherwise rescinded.]
(a) 38 U.S.C. 8127 and 8128 require the VA to provide priority and establish special acquisition methods to increase contracting opportunities for SDVOSBs and VOSBs. These priorities and special acquisition methods are set forth in subpart 819.70 and shall be applied by VA contracting officers before other priorities and preferences in FAR 19.203.
(b) When using a contracting preference under FAR part 19 (for example, a women-owned small business set-aside), contracting officers shall give priority to small business concerns verified as owned and controlled by Veterans pursuant to subpart 819.70, if such business concern(s) also meet the requirements of that contracting preference. Contracting officers shall include the provision and clause prescribed at 815.304-71 in solicitations.
(c) The attainment of goals or the use of interagency vehicles or Governmentwide contract vehicles (i.e., Federal Supply Schedules (FSS)) does not relieve the contracting officer from using SDVOSB/VOSB set-asides and other preferences as required by subpart 819.70. 38 U.S.C. 8127(j) requires that if the VA enters into a contract, agreement, or other arrangement with any governmental entity to acquire goods or services, the entity acting on behalf of the VA through such an interagency acquisition or other agreement will comply, to the maximum extent feasible, with the provisions of the program of preferences and priorities for verified SDVOSBs and VOSBs.
[Deviation per Class Deviation from VAAR parts 803, 819, 827, 847, and 849 Regarding Certified Mail Receipt Requested and Mail Requirements, dated September 28, 2020, provides an exception to certified mail receipt requested and mail requirements. This deviation expires once incorporated into the VAAR or is otherwise rescinded.]
(a) All protests relating to whether a Service-Disabled Veteran-Owned Small Business (SDVOSB) or Veteran-Owned Small Business (VOSB) is a “small” business for the purposes of any Federal program are subject to 13 CFR part 121 and must be filed in accordance with that part. SDVOSB and VOSB status shall be determined in accordance with 38 CFR part 74.
(b) A contracting officer or an interested party may protest the apparently successful offeror’s SDVOSB or VOSB status. “Interested party” for the purpose of filing a status protest is an actual offeror whose direct economic interest would be affected by the award of a contract or by the failure to award a contract.
(c) All status protests shall be in writing and shall state all specific grounds for the protest. Assertions that a protested concern, without setting forth specific facts or allegations, are insufficient. An interested party must submit its status protest to the contracting officer by close of business on the fifth business day after bid opening (in sealed bid acquisitions) or by close of business on the fifth business day after notification by the contracting officer of the apparently successful offeror (in negotiated acquisitions). An interested party must deliver their protest in person, by electronic mail, by facsimile, by express delivery service, or by the U.S. Postal Service within the applicable time period to the contracting officer. Any status protest received after these time limits is untimely. Any status protest received prior to bid opening or notification of intended award, whichever applies, is premature and shall be returned to the protester. Except for premature status protests, the contracting officer must forward to the Director, Center for Verification and Evaluation (CVD), any status protest received.
(d) The Director, CVE, will notify the protester and the contracting officer of the date the status protest was received by CVE and whether the status protest will be processed or dismissed for lack of timeliness or specificity.
(e) The Director, CVE, will determine the SDVOSB or VOSB status of the protested concern based upon the totality of circumstances within 21 business days after receipt of the status protest. If the Director, CVE, does not contact the contracting officer within 21 business days, the contracting officer may award the contract to the apparently successful offeror, unless the contracting officer has granted the Director, CVE, an extension. The contracting officer may award the contract after receipt of a status protest if the contracting officer determines in writing that an award must be made to protect the public interest. The contracting officer shall document this determination for the contract file.
(f) A denial decision by the Director, CVE, that is based on the failure to meet any service-disabled Veteran or Veteran criterion as defined in 38 CFR 74.1 is not subject to an appeal to the Executive Director, Office of Small and Disadvantaged Business Utilization (OSDBU), and is a final decision.
(g) The Director, CVE, will notify the contracting officer, the protestor, and the protested concern of its determination. The determination is effective immediately and is final unless overturned on appeal by the Executive Director, OSDBU. The determination may be sent by mail, commercial carrier, facsimile transmission, or other electronic means.
(h) If the Director, CVE, sustains an SDVOSB or VOSB status protest and the contract has already been awarded, then the awarded contract shall be deemed void ad initio and the contracting officer shall rescind the contract and award the contract to the next SDVOSB or VOSB in line for the award. The ineligible SDVOSB or VOSB concern shall not be permitted to submit another offer as a SDVOSB or VOSB on a future SDVOSB or VOSB procurement under this part, unless it successfully appeals the determination of the Director, CVE, to the Executive Director, OSDBU, or unless it applies for and receives verified SDVOSB or VOSB status in accordance with 38 CFR part 74.
(i) Except as provided in subsection (f), the protestor or the protested SDVOSB or VOSB concern may file an appeal of the status protest determination with the Executive Director, OSDBU. The Executive Director must receive the appeal no later than 5 business days after the date of receipt of the status protest determination. The Executive Director will dismiss any appeal received after the 5-day period. “Filing” means a document is received by the Executive Director by 5:30 p.m., Eastern Standard Time, on that day. Documents may be filed by hand delivery, mail, commercial carrier, or facsimile transmission. Hand delivery and other means of delivery may not be practicable during certain periods due to, for example, security concerns or equipment failures. The filing party bears the risk that the delivery method chosen will not result in timely receipt by the Executive Director, OSDBU. Submit appeals to: Executive Director, OSDBU (00VE), U.S. Department of Veterans Affairs, 810 Vermont Avenue, NW, Washington, DC 20420.
(j) The appeal must be in writing. The appeal must identify the status protest determination being appealed and must set forth a full and specific statement as to why the decision was based on clear error of fact or law.
(k) The party appealing the determination must provide notice of the appeal to the contracting officer. The Executive Director will decide all appeals under this subpart solely on a review of the evidence in the written protest file, arguments made in the appeal petition and response(s) filed thereto.
(l) The Executive Director will make a decision within 10 business days of the receipt of the appeal, if practicable, and will base the decision only on the information and documentation in the protest record as supplemented by the appeal. The Executive Director will provide a copy of the decision to the contracting officer and the protested SDVOSB or VOSB concern. The Executive Director’s decision, if received before the award, will apply to the pending acquisition. If the Executive Director decides in favor of the appealing party and the decision is received after the award, the contracting officer may terminate the contract or not exercise the next option. The Executive Director’s decision is the final decision. The decision may be sent by mail, commercial carrier, facsimile transmission, or other electronic means.
[78 FR 59865, Sept. 30, 2013]
[Deviation per Class Deviation–Veterans First Contracting Program (VFCP 2016) dated July 25, 2016, amends implementation of the Veterans First Contracting Program by adding 819.501-70 and 819.502-4, to include general principles for setting aside VA acquisitions and that the principles apply, as well as emphasizing that attainment of the Secretary’s annual goals for SDVOSBs/VOSBs does not limit the applicability of the Veterans First Contracting Program. VAAR 819.502-4 emphasizes that subpart 819.70 applies to VA orders and BPAs under Federal Supply Schedule (FSS) and other vehicles. This deviation is effective until incorporated into the VAAR or the VAAM or is otherwise rescinded.]
(1) Before setting aside or reserving an acquisition for small businesses under FAR subpart 19.5, contracting officers shall refer to 819.203-70 and subpart 819.70 for VA SDVOSB/VOSB priorities and preferences.
(2) Set-asides under the Veterans First Contracting Program in subpart 819.70 (see 819.7005 and 819.7006) have precedence over other small business set-asides referenced in FAR part 19, both above and below the simplified acquisition threshold (SAT). SDVOSB and VOSB set-asides also satisfy the requirement to reserve actions below the SAT for small business.
(3) Set-asides for verified SDVOSB and VOSB are mandatory whenever a contracting officer has a reasonable expectation of receiving two or more competitive offers/quotes at a fair and reasonable price that offers best value to the Government. Because only verified SDVOSBs and VOSBs can participate on such set-asides, the contracting officer should start by identifying firms listed as verified in the VIP database and then determine what acquisition strategy and priorities in 808.004(a), including FSS, is most appropriate.
(4) When a procurement requirement will not be set aside or otherwise awarded to verified SDVOSBs or VOSBs pursuant to subpart 819.70, the contracting officer shall document the file in accordance with OSDBU guidance and include SDVOSB/VOSB evaluation preferences in the solicitation as set forth in 815.304.
(c) Any reference to small business preferences/set-asides in FAR subpart 19.5 is to be construed to include verified SDVOSBs and VOSBs, unless it clearly conflicts with this subpart.
When, in accordance with the provisions of FAR 19.502-3, the contracting officer determines that a particular procurement will be partially set aside for small business participation, the solicitation for bids shall include the appropriate product or service classification and appropriate size standard, and the following statement shall be placed on the face page:
Notice of partial set-aside, page _____, applies to item _____ through item _____ in this solicitation.
(c) The requirements in subpart 819.70 apply to VA orders and BPAs under Federal Supply Schedules (FSS), Government-wide Acquisition Contracts (GWACS) and Multi-Agency Contracts (MACs) awarded by another agency. A set-aside restricted to verified SDVOSBs or VOSBs pursuant to subpart 819.70 satisfies competition requirements in FAR part 6, as well as the fair opportunity requirements in FAR 16.505 (see FAR 16.505(b)(2)(i)(F)).
The Director, OSDBU, is the VA liaison with the SBA. Information copies of correspondence sent to the SBA seeking a certificate of competency determination must be concurrently provided to the Director, OSDBU. Before appealing a certificate of competency, the HCA must seek concurrence from the Director, OSDBU.
(a) The contracting officer shall ensure that any subcontracting plans submitted by offerors include a goal that is at least commensurate with the annual VA SDVOSB prime contracting goal for the total value of planned subcontracts.
(b) The contracting officer shall ensure that any subcontracting plans submitted by offerors include a goal that is at least commensurate with the annual VA VOSB prime contracting goal for the total value of all planned subcontracts.
(c) VA’s OSDBU shall review all prime contractor’s subcontracting plan achievement reports to ensure that, in the case of a subcontract that is counted for purposes of meeting a goal in accordance with subparagraphs (a) and (b) of this section, the subcontract was actually awarded to a business concern that is eligible to be counted toward meeting the goal, as provided in 804.1102.
(b) When an interested party intends to appeal a contracting officer’s decision to not use the set-aside authority contained in subpart 819.70, the party shall notify the contracting officer, in writing, of its intent to challenge the decision. The contracting officer has 5 working days to reply to the challenge by either revising the strategy or indicating the rationale for not settingaside the requirement. Upon receipt of the decision, the interested party may appeal to the Head of the Contracting Activity (HCA). Such appeal shall be filed within 5 working days of receipt of the contracting officer’s decision. The HCA has 5 working days to respond to the appeal. The contracting officer shall suspend action on the acquisition unless the HCA makes a written determination that urgent circumstances exist which would significantly affect the interests of the government. The decision of the HCA shall be final.
(c) Prime contractors submitting businesses declared ineligible for credit in SDVOSB and/or VOSB subcontracting plans may appeal to the Executive Director, Office of Small and Disadvantaged Business Utilization and Center for Veterans Enterprise (00VE), U.S. Department of Veterans Affairs, 810 Vermont Avenue, NW., Washington, DC 20420, within 5 working days of receipt of information declaring their subcontractor ineligible. The Executive Director shall have 5 working days to respond. The decision of the Executive Director may be appealed to the Senior Procurement Executive (SPE) within 5 working days. The SPE shall have 15 working days to respond and that decision shall be final.
The contracting officer shall insert VAAR clause 852.219–9, Small Business Subcontracting Plan Minimum Requirements, in solicitations and contracts that include FAR clause 52.219–9, Small Business Subcontracting Plan.
(a) No contract will be entered into with SBA under section 8(a) of the Small Business Act (15 U.S.C. 637(a)) unless a certification is made by the Administrator of that agency, or designee, that SBA is competent to perform the contract.
(b) When it is determined that the requirements of VA are appropriate for inclusion in this program, the contracting officer will make this fact known to proper officials of the SBA regional office servicing his/her area. However, when projects funded from minor construction appropriation (between $400,000 and $2 million) are proposed for 8(a) acquisition, the Director, OSDBU (00SB), shall be contacted by telephone or notified in writing in order to afford the OSDBU an opportunity to identify possible 8(a) sources prior to apprising SBA officials. If the certification required by paragraph (a) of this section is received, the VA contracting officer will secure from SBA the name(s) and location(s) of their subcontractor(s) and the unit price(s) to be paid. Should these prices be within a range acceptable to VA, the contracting officer will notify SBA of acceptance.
[Deviation per Class Deviation–Veterans First Contracting Program (VFCP 2016), dated July 25, 2016, revises VAAR subpart 819.70 in its entirety to fully implement the Veterans First Contracting Program to comply with 38 U.S.C. 8127 and 8128 and the U.S. Supreme Court decision. This deviation is effective until incorporated into the VAAR or the VAAM or is otherwise rescinded.]
[Deviation per Class Deviation from VA Acquisition Regulation Part 819–Small Business Programs and Part 852-Solicitation Provisions and Contract Clauses, dated July 12, 2019 revises VAAR subparts 819.7001(a) and (b), 819.7003(a), and (c) through (g), and 819.7009. The class deviation effectively updates the language set forth in Class Deviation–Veterans First Contracting Programs (VFCP 2016), Attachment 9–VAAR Part 819, Small Business Programs, and Attachment 10–VAAR Part 852, Solicitation Provisions and Contract Clauses, dated July 25, 2016. The remaining text in Attachments 9 and 10 in Class Deviation VFCP 2016, continues to be in effect. The class deviation incorporates the Small Business Administration’s regulatory and legislative changes and clarifies the applicability of limitations on subcontracting and nonmanufacturer requirements to contracts awarded under the VFCP. This deviation is effective until incorporated into the VAAR or the VAAM or is otherwise rescinded.]
[Deviation per VA Acquisition Regulation (VAAR) Class Deviation to Implement Service-Disabled Veteran-Owned Small Business (SDVOSB) and Veteran-Owned Small Business (VOSB) Certification Requirements—VAAR Part 819 and Part 852, dated September 15, 2021. The class deviation implements the requirements of P.L. 116-183, Protecting Business Opportunities for Veterans Act of 2019 to amend 38 U.S.C. 8127. The class deviation adds: 1) language at 819.7001 regarding responsibilities and the requirement for certifications; 2) compliance with limitations on subcontracting requirements for eligibility at 819.7003; 3) prescriptions for two new VAAR classes at 819.7009; and, 4) the two new clauses at 852.219-77 and 852.219-78. This deviation is effective until incorporated into the VAAR or the VAAM or is otherwise rescinded.]
(a) Sections 502 and 503 of Public Law 109-461, the Veterans Benefits, Health Care, and Information Technology Act of 2006, as amended (38 U.S.C. 8127- 8128), authorize a VA specific acquisition program to increase contracting opportunities for eligible small business concerns owned and controlled by Veterans with service connected disabilities and small business concerns owned and controlled by Veterans. These businesses are also referred to as service-disabled Veteran-owned small businesses (SDVOSBs) and Veteran-owned small businesses (VOSBs). SDVOSBs/VOSBs must have their ownership and control verified by VA and be listed in the Vendor Information Pages (VIP) at the time of submission of offers/quotes, and prior to award of any contracts.
(b) The program as implemented in this subpart shall be known as the Veterans First Contracting Program (VFCP). The purpose of the program is to provide contracting assistance to SDVOSBs/VOSBs, so they can fully participate in the VA contracting process. Eligible SDVOSBs qualify for VOSB preferences under this subpart.
(c) 38 U.S.C. 8127 (b), (c) and (d) provide the authority for VA contracting officers to make awards to verified SDVOSBs/VOSBs using set-asides, as well as other than full and open competition (sole source), when certain conditions are met.
(d) Contracting officers shall award contracts on the basis of competition restricted to small business concerns owned and controlled by Veterans (see 819.7005 and 819.7006), to the maximum extent practicable. The contracting officer may also use other SDVOSB/VOSB preferences in this subpart as appropriate.
(e) The Office of the Small and Disadvantaged Business Utilization (OSDBU) and Chief Acquisition Officer (CAO), pursuant to Pub. L. 116-183, will monitor compliance with the requirement in 38 U.S.C. 8127(k) (see 819.7003(f)) for the contracting officer to obtain a certification from an SDVOSB/VOSB concern that the offeror will comply with the limitations on subcontracting certification requirements at 819.7009(b) and (c) as provided in the solicitation and resulting contract. The OSBDU and CAO shall refer any violations or suspected violations to the VA Office of Inspector General.
(f) If the Secretary or designee determines in consultation with the Inspector General that an SDVOSB/VOSB awarded a contract pursuant to 38 U.S.C. 8127 did not act in good faith with respect to the requirements described in 819.7003 paragraph (f), such SDVOSB/VOSB shall be subject to any or all of the following—
(g) Pursuant to Pub. L. 116-183, the Inspector General shall report to the Congress annually on the number of referred violations and suspected violations, and the disposition of such violations, including the number of small business concerns suspended or debarred from federal contracting or referred for Department of Justice prosecution.
This subpart applies to VA contracting activities and to all contracts (see FAR 2.101, Definitions), including BPAs and orders, under FAR Subpart 8.4 and FAR part 12 that are not otherwise excluded by law. In addition, this subpart applies to any government entity that has a contract, agreement, or other arrangement with the VA to acquire goods and services on behalf of the VA in accordance with 817.502.
(a) SDVOSB/VOSB size eligibility, status challenges, and appeals, are governed by regulations at 13 CFR parts 121, 125, and 134, except where expressly directed otherwise by this part, or 38 CFR part 74 - Veterans Small Business Regulations.
(3) SDVOSB/VOSB listed as verified in VIP database at: https://www.vip.vetbiz.va.gov.
(1) At least one member of the joint venture is a verified SDVOSB or VOSB and makes the representations in paragraph (b) of this section;
(2) Except for a large firm participating in a mentor-protégé-agreement approved by SBA under 13 CFR 125.9(d)(1), each other concern is small under the size standard corresponding to the NAICS code assigned to the procurement;
(3) The joint venture meets the requirements of 13 CFR 125.18(b), modified to include VIP verified VOSBs where this CFR section refers to a service-disabled Veteran-owned small business concern (SDVO SBC);
(d) To receive a benefit under the Veterans First Contacting Program (VFCP), an otherwise eligible SDVOSB/VOSB must meet Small Business Administration (SBA) regulations requirements for small business size and government contracting programs at 13 CFR part 121 and part 125, including the nonmanufacturer requirements at 13 CFR 121.406(b).
(e) A contract awarded under this subpart is subject to the SBA limitations on subcontracting requirements in 13 CFR 125.6, provided that only VIP-listed SDVOSBs are considered eligible and/or “similarly situated” under an SDVOSB sole source or set-aside. In addition, a VOSB is subject to the same limitations on subcontracting that apply to an SDVOSB, and only VIP-listed Veteran-owned small businesses are considered eligible and/or “similarly situated” under a VOSB sole source or set-aside. The nonmanufacturer rule (see 13 CFR 121.406) and the limitations on subcontracting requirements apply to all SDVOSB and VOSB set-aside and sole source contracts.
Pursuant to the authority of 38 U.S.C. 8127(k)(2), a contracting officer may award a contract under 38 U.S.C. 8127 only after obtaining from the offeror a certification that the offeror will comply with the limitations on subcontracting requirement as provided in the solicitation and which shall be included in the resultant contract (see 819.7009). The formal certification must be completed, signed, and returned with the offeror’s bid, quotation, or proposal. The Government will not consider offers from offerors that do not provide the certification, and all such responses will be deemed ineligible for evaluation and award.
(g) In some instances, SDVOSB eligibility may be extended to businesses owned and operated by surviving spouses, as set forth in 802.101;
(h) Pursuant to 38 USC 8127(g), any business concern that is determined by VA to have willfully and intentionally misrepresented its SDVOSB/VOSB status is subject to debarment from contracting with the Department for a period of not less than five years. This debarment includes all principals in the business. See 809.406, Debarment.
In determining the acquisition strategy applicable to a procurement requirement the contracting officer shall consider, in the following order of priority, contracting preferences prescribed in this part for awarding VA contracts to:
(b) Eligible small business concerns owned and controlled by Veterans that are not covered by paragraph (a);
(c) Small business concerns using priorities and preferences in 819.203-70 and this subpart.
(a) The contracting officer shall consider SDVOSB set-asides, before considering VOSB set-asides. Except as authorized by 813.106, 819.7007 and 819.7008, the contracting officer shall set-aside an acquisition for competition restricted to verified SDVOSB concerns upon a reasonable expectation based on market research that:
(2) Offerors affirmatively represent their small business status based on the size standard corresponding to the North American Industrial Classification System (NAICS) code assigned to the solicitation/contract, as set forth in 819.7003(b) and/or (c).
(c) If the contracting officer receives only one acceptable offer at a fair and reasonable price from a verified SDVOSB in response to a SDVOSB set-aside, the contracting officer should make an award to that SDVOSB. If the contracting officer receives no acceptable offers/quotes from verified SDVOSBs, the set-aside shall be withdrawn and the requirement, if still valid, set aside for VOSB competition, or otherwise procured using the most appropriate strategy based on the results of market research.
(a) The contracting officer shall consider SDVOSB set-asides before considering VOSB set-asides. Except as authorized by 813.106, 819.7007 and 819.7008, the contracting officer shall set aside an acquisition for competition restricted to SDVOSBs or VOSBs upon a reasonable expectation, based on market research, that:
(2) Offerors affirmatively represent their SDVOSB/VOSB and small business status based on the size standard corresponding to the North American Industrial Classification System (NAICS) code assigned to the solicitation/contract as set forth in 819.7003(b) and/or (c).
(c) If the contracting officer receives only one acceptable offer at a fair and reasonable price from a verified SDVOSB/VOSB in response to a SDVOSB or VOSB set-aside, the contracting officer should make an award to that SDVOSB or VOSB. If the contracting officer receives no acceptable offers/quotes from verified SDVOSBs or VOSBs, the SDVOSB or VOSB set-aside shall be withdrawn and the requirement, if still valid, set aside for other small business programs or otherwise procured using the most appropriate strategy based on the results of market research.
(b) The contracting officer’s determination to make a sole source award is a business decision wholly within the discretion of the contracting officer. To ensure that opportunities are available to the broadest number of verified SDVOSBs, this authority is to be used judiciously and only when in the best interest of the Government.
(c) A determination that only one SDVOSB can meet the requirement is not required. However, in accordance with FAR 6.302-5(c)(2)(ii), contracts awarded using this authority shall be supported by a written justification and approval described in FAR 6.303 and 6.304, as applicable.
(d) When conducting a SDVOSB sole source acquisition, the contracting officer shall ensure the business meets eligibility requirements in 819.7003.
(b) The contracting officer’s determination whether to make a sole source award is a business decision wholly within the discretion of the contracting officer. To ensure that opportunities are available to the broadest number of verified SDVOSB/VOSBs, this authority is to be used judiciously and only when in the best interest of the government.
(c) A determination that only one VOSB can meet the requirement is not required. However, in accordance with FAR 6.302-5(c)(2)(ii), contracts awarded using this authority shall be supported by a written justification and approval described in FAR 6.303 and 6.304, as applicable.
(d) When conducting a VOSB sole source acquisition, the contracting officer shall ensure the business meets eligibility requirements 819.7003.
(a) The contracting officer shall insert clause 852.219-10, VA Notice of Total Service-Disabled Veteran-Owned Small Business Set-Aside, or clause 852.219-11, VA Notice of Total Veteran-Owned Small Business Set-Aside, as applicable, in solicitations and contracts, including BPAs and orders, for acquisitions that are evaluated, set-aside or awarded on a sole source basis under this subpart. This includes multiple-award contracts when orders may be set aside for service-disabled Veteran-owned small business concerns as described in FAR 8.405-5 and FAR 16.505(b)(2)(i)(F).
(b) The contracting officer shall insert the clause at 852.219-77, VA Notice of Limitations on Subcontracting—Certificate of Compliance for Services and Construction, in solicitations and contracts for services and construction, including BPAs and orders, for acquisitions that are evaluated, set-aside, or awarded on a sole source basis under this subpart. This includes orders awarded under multiple-award contracts to SDVOSBs/VOSBs.
(c) The contracting officer shall insert the clause at 852.219-78, VA Notice of Limitations on Subcontracting—Certificate of Compliance for Supplies and Products, in solicitations and contracts for supplies or products, including BPAs and orders, for acquisitions that are evaluated, set-aside, or awarded on a sole source basis under this subpart. This includes orders awarded under multiple-award contracts to SDVOSBs/VOSBs. The contracting officer shall appropriately tailor the clause as set forth in paragraph (a)(2)(iii).
The VA Mentor-Protégé Program is designed to assist service-disabled Veteran-owned small businesses (SDVOSBs) and Veteran-owned small businesses (VOSBs) in enhancing their capabilities to perform contracts and subcontracts for VA. The Mentor-Protégé Program is also designed to improve the performance of VA contractors and subcontractors by providing developmental assistance to protégé entities, fostering the establishment of long-term business relationships between SDVOSBs, VOSBs and prime contractors, and increasing the overall number of SDVOSBs and VOSBs that receive VA contract and subcontract awards. A firm’s status as a protégé under a VA contract shall not have an effect on the firm’s eligibility to seek other prime contracts or subcontracts.
(a) A Mentor is a contractor that elects to promote and develop SDVOSBs and/or VOSBs by providing developmental assistance designed to enhance the business success of the protégé. A mentor may be a large or small business concern.
(b) OSDBU is the Office of Small and Disadvantaged Business Utilization. This is the VA office responsible for administering, implementing and coordinating the Department’s small business programs, including the Mentor-Protégé Program.
(d) Protégé means a SDVOSB or VOSB, as defined in 802.101, which meets federal small business size standards in its primary NAICS code and which is the recipient of developmental assistance pursuant to a Mentor-Protégé agreement.
A Protégé firm will not be considered an affiliate of a mentor firm solely on the basis that the protégé firm is receiving developmental assistance from the mentor firm under VA’s Mentor-Protégé Program. The determination of affiliation is a function of the SBA.
(a) To be eligible, mentors and protégés must not be listed on the Excluded Parties List System, located at http://www.epls.gov. Mentors will provide appropriate developmental assistance to enhance the capabilities of protégés to perform as prime contractors and/or subcontractors.
(a) Under the Small Business Act, 15 U.S.C. 637(d)(4)(e), VA is authorized to provide appropriate incentives to encourage subcontracting opportunities for small business consistent with the efficient and economical performance of the contract. This authority is limited to negotiated procurements. FAR 19.202–1 provides additional guidance.
(b) Costs incurred by a mentor to provide developmental assistance, as described in 819.7110 to fulfill the terms of their agreement(s) with a protégé firm(s), are not reimbursable as a direct cost under a VA contract. If VA is the mentor’s responsible audit agency under FAR 42.703–1, VA will consider these costs in determining indirect cost rates. If VA is not the responsible audit agency, mentors are encouraged to enter into an advance agreement with their responsible audit agency on the treatment of such costs when determining indirect cost rates.
(c) In addition to subparagraph (b) of this section, contracting officers shall give mentors evaluation credit under 852.219-52, Evaluation Factor for Participation in the VA Mentor-Protégé Program, considerations for subcontracts awarded pursuant to their Mentor-Protégé Agreements and their subcontracting plans. Therefore:
(2) Contracting officers may assess the prime contractor’s compliance with the subcontracting plans submitted in previous contracts as a factor in evaluating past performance under FAR 15.305(a)(2)(v) and determining contractor responsibility 19.705–5(a)(1).
(d) OSDBU Mentoring Award. A nonmonetary award will be presented annually to the mentoring firm providing the most effective developmental support to a protégé. The Mentor-Protégé Program Manager will recommend an award winner to the OSDBU Director.
(e) OSDBU Mentor-Protégé Annual Conference. At the conclusion of each year in the Mentor-Protégé Program, mentor firms will be invited to brief contracting officers, program leaders, office directors and other guests on program progress.
Eligible business entities approved as mentors may enter into agreements (hereafter referred to as “Mentor-Protégé Agreement” or “Agreement” and explained in 819.7108) with eligible protégés. Mentors provide appropriate developmental assistance to enhance the capabilities of protégés to perform as contractors and/or subcontractors. Eligible small business entities capable of providing developmental assistance may be approved as mentors. Protégés may participate in the program in pursuit of a prime contract or as subcontractors under the mentor’s prime contract with VA, but are not required to be a subcontractor to a VA prime contractor or be a VA prime contractor.
(1) Must be a SDVOSB or VOSB as defined in 802.101;
(c) Protégés may have multiple mentors. Protégés participating in mentor-protégé programs in addition to VA’s Program should maintain a system for preparing separate reports of mentoring activity so that results of VA’s Program can be reported separately from any other agency program.
(d) A protégé firm shall self-represent to a mentor firm that it meets the requirements set forth in paragraph (b) of this section. Mentors shall confirm eligibility by documenting the verified status of the protégé in the VetBiz.gov VIP database. Protégés must maintain verified status throughout the term of the Mentor-Protégé Agreement. Failure to do so shall result in cancellation of the Agreement.
(a) Mentor firms will be solely responsible for selecting protégé firms. Mentors are encouraged to select from a broad base of SDVOSB or VOSB firms whose core competencies support VA’s mission; and choose SDVOSB and/or VOSB protégés in addition to firms with whom they have established business relationships.
(b) Mentors may have multiple protégés. However, to preserve the integrity of the Program and assure the quality of developmental assistance provided to protégés, VA reserves the right to limit the total number of protégés participating under each mentor firm for the Mentor-Protégé Program.
(c) The selection of protégé firms by mentor firms may not be protested, except that any protest regarding the size or eligibility status of an entity selected by a mentor shall be handled in accordance with the FAR and SBA regulations.
(a) Firms interested in becoming approved mentor-protégé participants must submit a joint written VA Mentor-Protégé Agreement to the VA OSDBU for review and approval. The proposed Mentor-Protégé Agreement will be evaluated on the extent to which the mentor plans to provide developmental assistance. Evaluations will consider the nature and extent of technical and managerial support as well as any proposed financial assistance in the form of equity investment, loans, joint-venture, and traditional subcontracting support.
(3) A description of the mentor’s ability to provide developmental assistance to the protégé and the type of developmental assistance that will be provided, to include a description of the types and dollar amounts of subcontract work, if any, that may be awarded to the protégé firm;
(5) Termination procedures, including procedures for the parties’ voluntary withdrawal from the Program. The Agreement shall require the mentor or the protégé to notify the other firm and VA OSDBU in writing at least 30 days in advance of its intent to voluntarily terminate the Agreement;
(10) An agreement by both parties to comply with the reporting requirements of 819.7113;
(a) VA OSDBU will review the information to establish the mentor and protégé eligibility and to ensure that the information that is in VAAR 819.7108 is included. If the application relates to a specific contract, then OSDBU will consult with the responsible contracting officer on the adequacy of the proposed Agreement, as appropriate. OSDBU will complete its review no later than 30 calendar days after receipt of the application or after consultation with the contracting officer, whichever is later. There is no charge to apply for the Mentor-Protégé Program.
(b) After OSDBU completes its review and provides written approval, the mentor may execute the Agreement and implement the developmental assistance as provided under the Agreement. OSDBU will post a copy of the Mentor-Protégé Agreements to a VA Web site to be accessible to VA contracting officers for review for any VA contracts affected by the Agreement.
(c) If the application is disapproved, the mentor may provide additional information for reconsideration. OSDBU will complete review of any supplemental material no later than 30 days after its receipt. Upon finding deficiencies that VA considers correctable, OSDBU will notify the mentor and protégç and request correction of deficiencies to be provided within 15 days.
The forms of developmental assistance a mentor can provide to a protégé include, but are not limited to, the following:
(b) Mentors and protégés shall submit reports to VA OSDBU in accordance with 819.7113.
(a) OSDBU will oversee the Program and will work cooperatively with relevant contracting officers to achieve Program objectives. OSDBU will establish internal controls as checks and balances applicable to the Program. These controls will include:
(b) VA may rescind approval of an existing Mentor-Protégé Agreement if it determines that such action is in VA’s best interest. The rescission shall be in writing and sent to the mentor and protégé after approval by the OSDBU Director. Rescission of an Agreement does not change the terms of any subcontract between the mentor and the protégé.
(4) The extent to which the mentor’s participation in the Mentor-Protégé Program impacted the protégé’(s) ability to receive contract(s) and subcontract(s) from private firms and federal agencies other than VA; and, if deemed necessary;
(c) In addition to the written progress report in paragraph (a) of this section, at the mid-term point in the Mentor-Protégé Agreement, the mentor and the protégé shall formally brief the VA OSDBU regarding program accomplishments as pertains to the approved agreement.
(d) Mentor and protégé firms shall submit an evaluation to OSDBU at the conclusion of the mutually agreed upon Program period, the conclusion of the contract, or the voluntary withdrawal by either party from the Program, whichever comes first.
The overall success of the VA Mentor-Protégé Program encompassing all participating mentors and protégés will be measured by the extent to which it results in:
(b) An increase in the number and dollar value of contract and subcontract awards to prote´ge´ firms since the time of their entry into the program attributable to the mentor-protégé relationship (under VA contracts, contracts awarded by other Federal agencies and under commercial contracts.)
(a) Insert 852.219–71, VA Mentor-Protégé Program, in solicitations that include FAR clause 52.219–9, Small Business Subcontracting Plan.
(b) Insert 852.219–72, Evaluation Factor for Participation in the VA Mentor-Protégé Program, in solicitations that include an evaluation factor for participation in VA’s Mentor-Protégé Program in accordance with 819.7105 and that also include FAR clause 52.219–9, Small Business Subcontracting Plan.
[Deviation per Class Deviation to VA Acquisition Regulation (VAAR) 819.72, 852.219-74, 852.219-75, and 852.219-76, dated June 27, 2018, to add VAAR 819.72, VA Subcontracting Compliance Review Program and new clauses at 852.219-74, Limitations on Subcontracting—Monitoring and Compliance, 852.219-75, Subcontracting Commitments Monitoring and Compliances, and 852.219-76, Subcontracting Plans Monitoring and Compliance. VAAR 819.72 will implement VA’s Subcontracting Compliance Review Program. The deviation also rescinds Information Letter 001AL-11-15, Subcontracting Compliance Review Program, dated June 8, 2011. This deviation will remain in effect until incorporated into the VAAR or the VAAM, or is otherwise rescinded.]
(a) The Department of Veterans Affairs (VA) is required by Pub. L. 109-461, Executive Order 13360, and the Small Business Act, to establish special acquisition methods to increase contracting and subcontracting opportunities for small businesses, and, in particular, SDVOSBs and VOSBs, while protecting access to the programs by their intended beneficiaries.
(b) In an effort to maintain integrity of these programs, the VA has developed a Subcontracting Compliance Review Program (SCRP), which assesses contractor compliance with limitations on subcontracting requirements, subcontracting commitments, and subcontracting goals included in a VA prime contract.
(c) These reviews will be conducted by either VA or a third party contractor on behalf of the VA as set forth in this subpart and the VA Subcontracting Compliance Review Program manual. The SCRP manual sets forth guidelines and procedures for conducting compliance reviews under the program.
(d) Contracting officers shall notify prospective contractors that Risk Management and Compliance Service, and/or a third party (support contractor) will require access to VA contractor records, as needed, to assess contractor compliance as provided in paragraph (b) of this section, by incorporating the clauses at 819.7203 as applicable.
(a) Any small business concern receiving a VA contract on a sole source or set aside basis or under a small business evaluation preference, will be subject to a review to ensure they are in compliance with the limitations on subcontracting requirement or percentage of work performance requirement provided in the appropriate set-aside/preference clause.
(b) Moreover, VA will assess contractors for compliance, regardless of their size status, to ensure they are adhering to any subcontracting commitments included in VA contracts by virtue of VAAR clause 852.215-71.
(c) Prime contractors that are other than small business concerns will also be assessed for compliance with their subcontracting plans and small business commitments. In addition, as required by 38 USC 8127(a)(4), OSDBU will review prime contractor’s subcontracting plan reports to ensure only verified SDVOSB and VOSB firms are counted toward those plan goals.
(c) Compliance reviews may be conducted on-site or off-site, as appropriate. For purposes of this program, on-site compliance reviews mean reviews conducted at VA contractors’ sites or facilities. Off-site compliance reviews are conducted at either a Government location or another facility (e.g., at the support contractor’s facility conducting the reviews on behalf of VA).
In addition to other applicable clauses, contracting officers shall:
(a) Include clause 852.219-74 Limitations on Subcontracting–Monitoring and Compliance, in VA solicitations and contracts which are–
(1) Sole-source or set-aside for service-disabled Veteran-owned small businesses or Veteran-owned small businesses under subpart 819.70;
(3) Awarded based on an evaluation preference for being a small business (e.g., FAR 52.219-4, Notice of Price Evaluation Preference for HUBZone Small Business Concerns).
(b) Include clause 852.219-75, Subcontracting Commitments Monitoring and Compliance, in VA solicitations and contracts which will be issued on a competitively negotiated basis, including RFQs for task/delivery orders or BPAs, which:
(3) Include any evaluation criteria in addition to price, such as 852.215-70, SDVOSB/VOSB Evaluation Factors.
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