[Federal Register: August 20, 2008 (Volume 73, Number 162)]
[Proposed Rules]
[Page 49141-49155]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr20au08-18]
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DEPARTMENT OF VETERANS AFFAIRS
48 CFR Parts 802, 804, 808, 809, 810, 813, 815, 819, 828, and 852
RIN 2900-AM92
VA Acquisition Regulation: Supporting Veteran-Owned and Service-
Disabled Veteran-Owned Small Businesses
AGENCY: Department of Veterans Affairs.
ACTION: Proposed rule.
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SUMMARY: This proposed rule would implement portions of the Veterans
Benefits, Health Care, and Information Technology Act of 2006 and
Executive Order 13360, Providing Opportunities for Service-Disabled
Veteran Businesses to Increase Their Federal Contracting and
Subcontracting. The Public Law and Executive Order authorize the
Department of Veterans Affairs (VA) to establish special methods for
contracting with service-disabled veteran-owned small businesses
(SDVOSBs) and veteran-owned small businesses (VOSBs). Under this
proposed rule, a VA contracting officer could restrict competition in
contracting for SDVOSBs or VOSBs under certain conditions. Likewise,
sole source contracts with SDVOSBs or VOSBs would be permitted under
certain conditions. The proposed rule would implement these special
acquisition methods as a change to the VA Acquisition Regulation
(VAAR).
DATES: Comments on the proposed rule should be submitted on or before
October 20, 2008 to be considered in the formulation of the final rule.
ADDRESSES: Written comments may be submitted through
www.Regulations.gov; by mail or hand-delivery to Director, Regulations
Management (02REG), Department of Veterans Affairs, 810 Vermont Ave.,
NW., Room 1068, Washington, DC 20420; or by fax to (202) 273-9026.
Comments should indicate that they are submitted in response to ``RIN
2900-AM92--VA Acquisition Regulation: Supporting Veteran-Owned and
Service-Disabled Veteran-Owned Small Businesses.'' All comments
received will be available for public inspection in the Office of
Regulation Policy and Management, Room 1063B, between the hours of 8
a.m. and 4:30 p.m., Monday through Friday (except holidays). Please
call (202) 461-4902 for an appointment. This is not a toll-free number.
In addition, during the comment period, comments are available online
through the Federal Docket Management System (FDMS) at
www.Regulations.gov.
FOR FURTHER INFORMATION CONTACT: Derek Underwood, Acquisition Policy
Division (049P1A), Office of Acquisition and Logistics, Department of
Veterans Affairs, 810 Vermont Ave., NW., Washington, DC, 20420,
telephone number (202) 461-6865 (not a toll-free number) or e-mail
Derek.Underwood@va.gov.
SUPPLEMENTARY INFORMATION:
Background
VA's mission is to serve veterans. Buying from SDVOSBs and VOSBs
directly supports VA's mission. Supporting service-disabled veterans
who own businesses contributes significantly in restoring their quality
of life while enhancing transition from active duty to civilian life.
Such acquisitions maintain the socioeconomic well-being of the Nation
and carry out VA's strategic goals. Section 1.102-2(d) of the Federal
Acquisition Regulation (FAR) (codified at 48 CFR chapter 1) provides
that the Federal Acquisition System ``must support the attainment of
public policy goals adopted by the Congress and the President.'' It is
public policy, as expressed in 15 U.S.C. 637 and 644 that SDVOSBs and
VOSBs, among others, shall have the maximum practicable opportunity to
participate in the
[[Page 49142]]
performance of contracts let by any Federal agency.
Sections 502 and 503 of Public Law 109-461, the Veterans Benefits,
Health Care, and Information Technology Act of 2006, (codified at 38
U.S.C. 8127 and 8128) contain provisions that authorize VA to create a
unique procurement program among Federal agencies. This program would
permit VA contracting officers to conduct acquisition actions limited
to SDVOSBs or VOSBs for the Department's requirements. The law requires
the Secretary to give priority to a small business concern owned and
controlled by veterans.
On October 20, 2004, the President issued Executive Order 13360,
Providing Opportunities for Service-Disabled Veteran Businesses to
Increase Their Federal Contracting and Subcontracting. The Executive
Order directs the heads of agencies to significantly increase
opportunities for service-disabled veteran businesses in Federal prime
contracting and subcontracting actions. To achieve that objective, the
Executive Order requires agencies to more effectively implement section
15(g) of the Small Business Act (15 U.S.C. 644(g)) through various
efforts, including the development of a strategic plan to implement
Executive Order 13360. VA has developed its strategic plan, which is
posted at the following Internet Web site: http://www.vetbiz.gov/fpp/
fpp.htm.
VA proposes to amend the VAAR to implement the changes required by
38 U.S.C. 8127 and 8128 and some rulemaking aspects of VA's strategic
plan for Executive Order 13360. Specifically, this proposed rule would
allow VA contracting officers to:
Under certain conditions, permit non-competitive sourcing
under the simplified acquisition threshold with SDVOSBs or VOSBs.
Require set-asides for SDVOSBs or VOSBs above the
simplified acquisition threshold when the contracting officer has a
reasonable expectation that two or more eligible SDVOSBs or VOSBs will
submit offers and that the award can be made at a fair and reasonable
price that offers the best value to the United States.
Under certain conditions, permit non-competitive sourcing
for SDVOSBs or VOSBs above the simplified acquisition threshold when
the contracting officer determines that a fair and reasonable price
will be obtained as a result of negotiations for requirements not to
exceed $5 million.
Include evaluation factors in negotiated acquisitions that
give preference to SDVOSBs and VOSBs and preference to offerors who
propose to include such businesses as subcontractors.
Require offerors who propose to use SDVOSBs or VOSBs as
subcontractors to utilize eligible businesses.
Require VOSBs participating in the Department's
acquisitions to register in VetBiz.gov's Vendor Information Pages (VIP)
database and verify that the business meets eligibility requirements.
Establish a VA Mentor-Prot[eacute]g[eacute] Program and
give large businesses that participate in the program a preference in
the award of VA prime contracts.
Encourage prime contractors and mentors to assist SDVOSBs
and VOSBs in obtaining bonding when required.
Revise the eligibility definition for ``service-disabled
veteran-owned small business concerns'' to include a spouse who obtains
ownership rights upon the death of a 100 percent service-disabled
veteran or a veteran who died as a direct result of a service-connected
injury for a period of 10 years unless the spouse remarries or sells
the interest in the business.
Recommend debarment of any business that willfully or
deliberately misrepresents ownership and control of the business for
purposes of registering in the VetBiz.gov Vendor Information Pages
database or other Federal databases.
Under certain conditions, authorize Contracting Officers
to acquire supplies and services from SDVOSBs and VOSBs in lieu of
Federal Prison Industries (FPI) and the Government Printing Office
(GPO).
Section 802.101 Definitions
In proposed section 802.101, VA adopts and incorporates various
statutory definitions. FAR 2.101 defines ``service-disabled veteran-
owned small business (SDVOSB) concern'' and ``veteran-owned small
business (VOSB) concern.'' Prime and subcontracting actions conducted
under the authority of 38 U.S.C. 8127, as implemented in VAAR subpart
819.70, revise the definition of ``service-disabled veteran-owned small
business concern'' and require that SDVOSBs and VOSBs must be
registered in the Vendor Information Pages (VIP) and that the ownership
and control of such businesses has been verified by VA. In addition,
section 8127(h) enables a surviving spouse who obtains ownership rights
to a business upon the death of a veteran with a service-connected
disability rated at 100 percent, or a veteran who dies as a direct
result of a service-connected disability, to have VA treat the business
as a ``service-disabled veteran-owned small business'' for a 10-year
period after the death of the veteran, unless the surviving spouse
remarries, sells the interest in the business or the business outgrows
the small business size standards. This section also includes a
definition of VIP.
Section 804.1102 Vendor Information Pages
FAR 4.1102 currently requires all businesses to be registered in
the Central Contractor Registration (CCR). Proposed section 804.1102
would require VOSBs, including SDVOSBs, to register in the VIP
database, available at http://www.VetBiz.gov, in order to be eligible
to participate in set-asides for SDVOSBs and VOSBs issued by VA
contracting officers. In completing registration, businesses would
provide information establishing that the business is owned and
controlled by eligible parties, according to the criteria defined in 38
U.S.C. 8127 and FAR 19.1403.
Section 808.603 Purchase Priorities
Under certain conditions, this section would authorize contracting
officers to purchase supplies and services produced or provided by FPI
from eligible SDVOSBs and VOSBs, in accordance with procedures set
forth in proposed VAAR subpart 819.70, without seeking a waiver from
FPI. We interpret section 8128 and the legislative history to mean that
SDVOSBs and VOSBs must receive priority in VA contracting opportunities
without regard to other provisions of law concerning contracting
preferences. This interpretation conflicts with the current contracting
priorities in law, and as implemented in the FAR, for Federal agencies
buying from FPI. VA finds that section 8128, being directly applicable
solely to VA and providing authority without regard to any other
provision of law, requires VA contracting officers to have the
authority to override other statutory contracting preferences to
provide priority to SDVOSBs and VOSBs to meet VA's socioeconomic goals
for such concerns. Therefore, proposed section 808.603 is the only
means available to VA to implement the requirement in section 8128 that
veterans' small businesses have priority in VA acquisitions that would
normally be awarded under FPI.
Section 808.803 Priority for Acquisition of Printing and Related
Supplies
This section would authorize contracting officers to acquire
government printing from eligible service-disabled veteran-owned small
businesses and veteran-owned small businesses, in accordance with
[[Page 49143]]
procedures set forth in VAAR subpart 819.70, in lieu of the Government
Printing Office (GPO). We interpret section 8128 and the relevant
legislative history as authorizing VA to give priority in contracting
to SDVOSBs and VOSBs without regard to other provisions of law
concerning contracting preferences. This interpretation conflicts with
the current contracting priority in law, and as implemented in the FAR,
which provides that Federal agencies buying printing services must
procure such services from GPO. VA finds that section 8128, being
directly applicable solely to VA and providing authority for priority
in VA contracting without regard to any other provision of law,
requires VA contracting officers to have the authority to override the
statutory contracting preference for GPO services and instead provide
priority in contracting to SDVOSBs and VOSBs for printing services and
related supplies. Therefore, proposed section 808.803 is the only means
available to VA to implement section 8128.
Section 809.406-2 Causes for Debarment
FAR 9.406-2 lists several reasons for which a debarring official
may initiate a debarment action. Proposed VAAR 809.406-2 adds one
additional reason: misrepresentation of status as an SDVOSB or a VOSB,
in accordance with section 8127(g).
Section 810.001 Market Research Policy
FAR 10.001 requires agencies to conduct market research on an
ongoing basis and to effectively identify the capabilities of small
businesses to meet agency requirements. VAAR section 810.001 would
establish that, when conducting market research, VA contracting teams
shall use the VIP database, in addition to other sources of
information.
Section 810.002 Market Research Procedures
This section would require contracting officers to record VIP
queries in the solicitation file.
Section 813.106 Soliciting Competition, Evaluation of Quotations or
Offers, Award and Documentation
This section would clarify that contracting officers may use other
than competitive procedures to enter into a contract with an SDVOSB or
VOSB when the amount is less than the simplified acquisition threshold
not to exceed $5 million. Contracting officers would give first
consideration to SDVOSBs.
Section 813.202 Purchase Guidelines
FAR 13.202(a)(1) provides that, to the extent practicable, open
market micro-purchases shall be distributed equitably among qualified
suppliers. The set-aside provisions of FAR Part 19 do not apply to
micro-purchases. However, in accordance with sections 8127 and 8128, VA
would make an exception to this FAR requirement when supplies are
available from SDVOSBs or VOSBs. We would add section 813.202 to allow
preference for SDVOSB and VOSB sources when making local open market
micro-purchases using the purchase card. In such cases, equitable
distribution of open market micro-purchases among all qualified
suppliers would not be required. Instead, open market micro-purchases
would be equitably distributed among all qualified SDVOSBs or VOSBs,
respectively, to the maximum extent practicable. We believe that this
change would assist VA in meeting its statutory goals for award of
contracts to SDVOSBs and VOSBs.
Sections 815.304 and 852.215-70 Evaluation Factors and Significant
Subfactors
To implement sections 8127 and 8128, VA would add sections 815.304
and 852.215-70 to require VA contracting officers to: (1) Include
provisions in negotiated solicitations giving preference to offers
received from VOSBs and additional preference to offers received from
SDVOSBs; (2) use past performance in meeting SDVOSB subcontracting
goals as a non-price evaluation factor in selecting offers for award;
(3) use the proposed inclusion of SDVOSBs or VOSBs as subcontractors as
an evaluation factor when competitively negotiating the award of
contracts or task or delivery orders; and (4) consider participation in
VA's Mentor-Prot[eacute]g[eacute] Program as an evaluation factor when
competitively negotiating the award of contracts or task or delivery
orders. VA is particularly interested in receiving comments on the
proposed mandatory inclusion of evaluation preferences for SDVOSBs and
VOSBs in negotiated acquisitions.
Section 815.304-70 Evaluation Factor Commitments
In accordance with section 8127(a)(4), we propose to require prime
contractors who offer to use one or more SDVOSBs or VOSBs as
subcontractors in accordance with proposed section 852.215-70, Veteran-
Owned Small Business Evaluation Factors, to actually use those
subcontractors or to replace any proposed subcontractor who is not used
for the specified subcontract with another SDVOSB or VOSB
subcontractor. This subsection would be implemented under proposed new
sections 815.304-70 and 852.215-71. Further, this subsection would help
ensure that SDVOSBs and VOSBs receive subcontract awards under VA prime
contracts, as prime contractors will be required to report only
utilization of companies appearing in the VIP database as ``verified''
to be owned and controlled by eligible veterans or surviving spouses.
Section 815.304-71 Solicitation Clauses
This section would prescribe insertion of certain contract clauses
in acquisitions from SDVOSBs and VOSBs, including section 852.215-70,
Service-Disabled Veteran-Owned and Veteran-Owned Small Business
Evaluation Factors, and section 852.215-71, Evaluation Factor
Commitments, for applicable solicitations and contracts.
Section 819.201 General Policy
This section would authorize the Secretary to establish goals for
each fiscal year for participation in Department contracts by SDVOSBs
and VOSBs. Furthermore, in order to establish contracting priority for
veteran-owned and -controlled small businesses in accordance with
section 8128, the Secretary may decrease other status-specific small
business goals set forth by section 15(g)(1) of the Small Business Act
(15 U.S.C. 644(g)(1)) upon consultation with the Administrator of the
U.S. Small Business Administration.
Section 819.307 Protests
FAR 19.307 contains instructions for processing protests of status
as a SDVOSB concern. Section 8127 contains additional eligibility
criteria for VA's processing of protests and authorizes VA to conduct
VOSB set-asides. Proposed VAAR section 819.307 would address protest
procedures and other information specific to VA's unique acquisition
program.
Section 819.704 Subcontracting Plan Requirements
In accordance with section 8127, proposed section 819.704 would
require contracting officers to include suggested subcontracting goals
in acquisitions that may require a subcontracting plan. To receive
subcontracting plan accomplishment credit for subcontracting with
SDVOSBs and VOSBs, prime contractors would be
[[Page 49144]]
required to use eligible businesses identified in the VIP database.
Section 819.705 Appeals of Contracting Officer Decisions
This section would prescribe procedures for appeals of VA
contracting officers' SDVOSB set-aside decisions, VOSB set-aside
decisions, and prime contractor credits for subcontracting.
Section 819.709 Contract Clause
This section would require contracting officers to insert the
clause in section 852.219-9, Small Business Subcontracting Plan Minimum
Requirements, for solicitations and contracts that include the FAR
clause at 52.219-9, Small Business Subcontracting Plan.
Subpart 819.70 Service-Disabled Veteran-Owned and Veteran-Owned Small
Business Acquisition Program
This subpart would establish sole source contracting procedures for
acquisitions under $5 million and create a new set-aside program for
SDVOSBs and VOSBs.
Subpart 819.71 VA Mentor-Prot[eacute]g[eacute] Program
In accordance with paragraph (3)(a) of VA's Executive Order 13360
strategic plan, we propose to establish a SDVOSB mentor-
prot[eacute]g[eacute] program within VA under new subpart 819.71,
consisting of sections 819.7101 through 819.7115, and at sections
852.219-71 and 852.219-72. We propose to establish this program to help
SDVOSBs receive developmental support from VA prime contractors in
order to increase the base of SDVOSBs eligible to perform VA prime
contracts and to participate as subcontractors on VA prime contracts.
Sections 828.106-71, 828.106-72, and 852.228-72 Assisting Service-
Disabled Veteran-Owned and Veteran-Owned Small Businesses in Obtaining
Bonds
In accordance with paragraph (3)(f) of VA's Executive Order 13360
strategic plan, we propose to add new sections 828.106-71, 828.107-72,
and 852.228-72, to encourage prime contractors to assist SDVOSBs and
VOSBs in obtaining subcontractor performance and payment bonds and to
encourage mentor firms to assist prot[eacute]g[eacute] SDVOSBs and
VOSBs in obtaining acceptable bid, payment, and performance bonds as
prime contractors. The ability to obtain acceptable surety bonds is one
of the major concerns for small businesses in contracting with the
Federal government for construction.
Regulatory Flexibility Act
This regulation may have a significant economic impact on a
substantial number of small entities within the meaning of the
Regulatory Flexibility Act, 5 U.S.C. 601, et seq., because the law
provides that the Secretary shall give priority to small business
concerns owned and controlled by veterans. Service-disabled veteran-
owned small businesses (SDVOSBs) and veteran-owned small businesses
(VOSBs) may benefit from this regulation. Other small businesses may be
indirectly affected if a greater portion of VA's small business
contracts are awarded to SDVOSBs and VOSBs. However, this regulation
may result in an increase in VA contracts awarded to the overall total
of small businesses.
An Initial Regulatory Flexibility Analysis (IRFA) has been prepared
and submitted to the Chief Counsel for Advocacy of the Small Business
Administration in accordance with 5 U.S.C. 603. Interested parties are
invited to submit comments on VA's regulatory flexibility analysis. The
analysis is as follows:
1. Description of the reasons why action by the agency is being
considered.
These proposed changes to the Veterans Affairs Acquisition
Regulation (VAAR) implement sections 502 and 503 of Public Law 109-461,
the Veterans Benefits, Health Care, and Information Technology Act of
2006 (38 U.S.C. 8127 and 8128). The changes will also implement the
rulemaking portions of VA's Strategic Plan for Executive Order 13360,
Providing Opportunities for Service-Disabled Veteran Businesses to
Increase Their Federal Contracting and Subcontracting (http://
www.vetbiz.gov/fpp/fpp.htm). VA exists to serve veterans, and buying
from SDVOSBs and VOSBs directly supports that mission. Such
acquisitions support the socioeconomic well-being of the Nation and
support VA's Strategic Goals. The proposed changes to the VA
Acquisition Regulation reflect the intent of Congress that VA fulfill
its special mission to serve veterans and enable them to realize the
American dream that they fought to protect, especially those who became
disabled while serving their country.
2. Succinct statement of the objectives of, and legal basis for,
the proposed rule.
Sections 502 and 503 of Public Law 109-461 require VA to create a
unique acquisition program among Federal agencies that permits
preferences for SDVOSBs and VOSBs. This proposed rule would permit VA
contracting officers to conduct acquisition actions with preferences
for SDVOSBs or VOSBs. Specifically, this proposed rule will allow VA
contracting officers to:
a. Under certain conditions, permit non-competitive sourcing under
the simplified acquisition threshold with SDVOSBs or VOSBs;
b. Require set-asides for SDVOSBs or VOSBs above the simplified
acquisition threshold when the contracting officer has a reasonable
expectation that two or more eligible SDVOSBs or VOSBs will submit
offers and that the award can be made at a fair and reasonable price
that offers the best value to the United States;
c. Under certain conditions, permit non-competitive sourcing for
SDVOSBs or VOSBs above the simplified acquisition threshold when the
contracting officer determines that a fair and reasonable price will be
obtained as a result of negotiations for requirements not to exceed $5
million;
d. Include evaluation factors in negotiated acquisitions that give
preference to SDVOSBs and VOSBs and preference to offerors who propose
to include such businesses as subcontractors;
e. Require offerors who propose to use SDVOSBs or VOSBs as
subcontractors to utilize eligible businesses;
f. Require VOSBs participating in the Department's acquisitions to
register in VetBiz.gov's Vendor Information Pages (VIP) database and
verify that the business meets eligibility requirements;
g. Establish a VA Mentor-Prot[eacute]g[eacute] Program and give
large businesses that participate in the program a preference in the
award of VA prime contracts;
h. Encourage prime contractors and mentors to assist SDVOSBs and
VOSBs in obtaining bonding when required;
i. Recommend debarment of any business that willfully or
deliberately misrepresents ownership and control of the business for
purposes of registering in the VetBiz.gov VIP database or other federal
databases; and
j. Under certain conditions, acquire supplies and services from
SDVOSBs and VOSBs in lieu of FPI and GPO.
3. Description of, and, where feasible, estimate of the number of
small entities to which the proposed rule will apply.
VA cannot accurately determine how many concerns would be
participating in these SDVOSB/VOSB contract awards because there is
insufficient data on SDVOSBs/VOSBs that are ready and able to perform
under VA requirements to support a reasonable estimate.
To establish the likely number of SDVOSBs or VOSBs that may benefit
from VA's unique procurement authority there are two principal data
sources, the Central Contractor
[[Page 49145]]
Registration (CCR) database, in which a business must be listed to
receive a payment from a Federal agency, and VA's VetBiz.gov VIP
database. A CCR Dynamic Small Business Search query conducted on March
13, 2008, returned 40,163 VOSBs, including 11,465 SDVOSBs. A VIP query
returned 10,695 VOSBs, including 6,354 SDVOSBs. The VIP database
requires that businesses answer eligibility questions before they are
permitted to register their business. The CCR is a self-representation
database.
Under this proposed rule, VA contracting teams will be required to
give priority consideration to SDVOSBs and VOSBs when using other
contracting programs, like set-asides for the Historically
Underutilized Business (HUB) Zone Program or 8(a) Business Development
Program reserved actions or the Small Business Set-aside program. A CCR
Dynamic Small Business Search conducted on March 13, 2008, returned
13,848 active HUBZone firms. Of this population, 2,565, or 19 percent,
are also VOSBs. A search of active 8(a) businesses identified 9,822
current firms, which includes 1,285 VOSBs, or 14 percent of the total
population. There are 63,395 woman-owned small businesses (WOSBs) in
the Central Contractor Registration, of which 4,471 appear to also be
VOSBs. VA notes that the SBA is in the process of establishing a WOSB
set-aside program, making the percentage of WOSBs who are also VOSB
eligible of interest to the Department.
There are some concerns that the proposed rule will displace
business opportunities for non-veteran-owned businesses, based on the
following speculations:
Additional businesses may be opened by veterans seeking to
participate in the sole source or set-aside procurement actions;
Veteran-owned small businesses not currently in the
Federal market may be expected to explore selling to VA;
The VOSB population may increase as these businesses
register in the VetBiz.gov VIP database;
Public Law 109-461 procurement authority also requires
that VA's large prime contractors use eligible businesses in order to
receive subcontracting program credit for VOSBs and SDVOSBs; and
On June 6, 2008, the Office of Federal Procurement Policy
issued new guidance regarding Interagency Agreements. Under this
policy, other Federal agencies with which VA executes such agreements
will be governed by the procurement rules contained in this regulation.
In FY 2007, interagency acquisitions were approximately $15,444,709.39,
or 0.13% of total contract dollars.
The Department of Veterans Affairs has a strong commitment to
supporting all types of small businesses, as demonstrated in the
procurement chart below:
----------------------------------------------------------------------------------------------------------------
FY 2006 FY 2007
-------------------------------------------------------------
($) (%) ($) (%)
----------------------------------------------------------------------------------------------------------------
Total Procurement................................. 10,282,566,304 ........... 11,784,896,886 ...........
Total Small Business.............................. 3,028,055,461 29.45 3,878,901,724 32.91
Small and Disadvantaged Business.................. 507,442,123 4.93 603,502,602 5.12
8(a).............................................. 402,659,565 3.92 406,996,187 3.45
Woman-Owned Small Business........................ 513,104,216 4.99 573,355,381 4.87
Veteran-Owned Small Business...................... 666,825,417 6.49 1,193,853,547 10.13
Service-Disabled Veteran-Owned Small Business..... 348,077,159 3.39 818,698,785 6.95
HUBZone........................................... 336,856,889 3.28 381,875,493 3.24
----------------------------------------------------------------------------------------------------------------
The preliminary Total Small Business procurement for FY2007 was
$3,878,901,724.00 or 32.91%. Procurement totals for SDVOSBs and VOSBs
were $2,012,552,332.00 or 17.08% and procurement totals for non-
veteran-owned businesses were $1,965,729,663.00 or 16.68%, a mere .40%
difference. Although, SDVOSBs and VOSBs gained 7.2% of procurements
from FY2006 to FY2007 and non-veteran-owned businesses lost .44% of
procurements, the non-veteran-owned businesses still received increased
procurement dollars totaling $205,666,870.00 from FY2006 to FY2007.
Assuming this trend and/or this new procurement authority does increase
procurement percentages for SDVOSBs and VOSBs and the procurement
percentages for non-veteran-owned businesses decrease, as previously
demonstrated from FY2006 to FY2007, the contracting dollars and/or
opportunities for non-veteran-owned businesses were not adversely
impacted economically. VA also estimates that it would be unrealistic
for SDVOSBs and VOSBs to absorb the entire 16.68% of procurements that
are currently being awarded to the non-veteran-owned businesses. The
SDVOSBs and VOSBs are more likely to sub-contract with the non-veteran-
owned businesses with existing contracts rather than investing in
costly business expansions. Based on prior procurement trends, VA
believes there would not be an adverse economic impact on non-veteran-
owned businesses, but requests comment from the public on other
possible impacts this rule may have on small entities.
This rule also creates a Mentor-Prot[eacute]g[eacute] Program for
SDVOSBs and VOSBs. It is the expectation that at such time as this rule
is finalized, those Prot[eacute]g[eacute] entities would directly
benefit from the forms of Mentoring described in this proposed rule. VA
believes there would not be an adverse economic impact on small
contractors or subcontractors, but requests comment from the public on
other possible impacts this rule may have on small entities. Comments
will be used as a factual basis upon which VA would certify that this
rule will not have a significant economic impact on a substantial
number of small entities.
For the reasons outlined above, given the relatively small number
of businesses owned and controlled by veterans in the Federal
marketplace and with the understanding that this rule would apply only
to VA and its large prime contractors, VA believes this rule would not
have a major impact on small entities doing business in the Federal
marketplace.
VA welcomes comments concerning the potential number of small
entities that could become eligible under this rule. VA also
specifically requests comments concerning the rule's impact on small
entities that are not VOSBs.
4. Description of projected reporting, recordkeeping, and other
compliance requirements of the proposed rule, including an estimate of
the classes of small entities which will be subject to the requirement
and the type of professional skills necessary for preparation of the
report or record.
[[Page 49146]]
There are two categories of coverage in this proposed rule that
could potentially require the collection of information from
contractors. VA will collect information from prime contractors seeking
a preference for subcontracting with SDVOSBs or VOSBs. That information
would include identity of the SDVOSBs or VOSBs, the approximate dollar
value of the proposed subcontracts, and confirmation that the proposed
subcontractors are eligible SDVOSBs or VOSBs as verified by the
VetBiz.gov VIP database. VA estimates the cost to an individual
business to be less than $100.00 for 70-75% of the businesses seeking
verification, and the average cost to the entire population of veterans
seeking to become verified is less than $325.00 on average. VA also
will collect information in conjunction with preferences associated
with the VA Mentor-Prot[eacute]g[eacute] Program. That information
would include the program agreement, developmental plan, and reports on
the success of the program.
5. Identification, to the extent practicable, of all relevant
Federal rules which may duplicate, overlap, or conflict with the
proposed rule.
The VAAR (48 CFR chapter 8) supplements the FAR (48 CFR chapter 1).
This proposed rule would affect 48 CFR parts 802, 804, 808, 809, 810,
813, 815, 819, 828, and 852 and corresponding parts of the FAR.
6. Description of any significant alternatives to the proposed rule
which would accomplish the stated objectives of applicable statutes and
which would minimize any significant economic impact of the proposed
rule on small entities. This proposed rule is designed to benefit
SDVOSBs and VOSBs. There are no alternatives which would accomplish the
stated objectives of sections 502 and 503 of Public Law 109-461 to give
contracting priority to SDVOSBs and VOSBs.
Executive Order 12866
Executive Order 12866 directs agencies to assess all costs and
benefits of available regulatory alternatives and, when regulation is
necessary, to select regulatory approaches that maximize net benefits
(including potential economic, environmental, public health and safety,
and other advantages; distributive impacts; and equity). The Executive
Order classifies a ``significant regulatory action,'' requiring review
by the Office of Management and Budget (OMB) unless OMB waives such
review, as any regulatory action that is likely to result in a rule
that may: (1) Have an annual effect on the economy of $100 million or
more or adversely affect in a material way the economy, a sector of the
economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or tribal governments or
communities; (2) create a serious inconsistency or otherwise interfere
with an action taken or planned by another agency; (3) materially alter
the budgetary impact of entitlements, grants, user fees, or loan
programs or the rights and obligations of recipients thereof; or (4)
raise novel legal or policy issues arising out of legal mandates, the
President's priorities, or the principles set forth in the Executive
Order.
The economic, interagency, budgetary, legal, and policy
implications of this proposed rule have been examined, and it has been
determined to be a significant regulatory action under Executive Order
12866 because it is likely to result in a rule that may raise novel
legal or policy issues arising out of legal mandates, the President's
priorities, or principles set forth in the Executive Order.
Unfunded Mandates
The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C.
1532, that agencies prepare an assessment of anticipated costs and
benefits before developing any rule that may result in an expenditure
by State, local, or tribal governments, in the aggregate, or by the
private sector, of $100 million or more (adjusted annually for
inflation) in any given year. This proposed rule would have no such
effect on State, local, or tribal governments, or the private sector.
Paperwork Reduction Act
Under the Paperwork Reduction Act (PRA) of 1995 (44 U.S.C. 3501-
3521), collections of information are contained in this proposed rule.
These collections are contained in new sections that were not
previously contained in the VAAR. This notice is to obtain an OMB
control number for these new sections. As required under section
3507(d) of the Act, VA has submitted a copy of this rulemaking action
to OMB for its review of the collection of information.
OMB assigns control numbers to collections of information it
approves. VA may not conduct or sponsor, and a person is not required
to respond to, a collection of information unless it displays a
currently valid OMB control number.
Comments on the collection of information should be submitted to
OMB, Attention: Desk Officer for the Department of Veterans Affairs,
Office of Information and Regulatory Affairs, Office of Management and
Budget, Washington, DC 20503, with copies to the Director, Regulations
Management (00REG), Department of Veterans Affairs, 810 Vermont Ave.,
NW., Washington, DC 20420. Comments should indicate that they are
submitted in response to ``RIN 2900-AM92.''
There are categories of coverage in this proposed rule that could
potentially require the collection of information from contractors: (1)
Section 852.215-70, Veteran-Owned Small Business Evaluation Factors;
and (2) subpart 819.71, VA Mentor-Prot[eacute]g[eacute] Program,
specifically sections 819.7101 through 819.7115 and the related clauses
at sections 852.219-71 and 852.219-72. There is no information
available upon which to judge the impact of these PRA requirements, but
since the provisions are limited to SDVOSBs and VOSBs, rather than to
all small businesses, collection efforts are estimated to be minimal.
Title and section number: 852.215-70, Veteran-Owned Small Business
Evaluation Factors.
Summary of collection of information: VA is proposing to give
preference to prime contractors who offer to subcontract with SDVOSBs
or VOSBs. VA must collect information from offerors regarding: (1)
Proposed SDVOSB and VOSB subcontractors; (2) the approximate dollar
value of the proposed subcontracts; and (3) eligibility of the proposed
subcontractors as verified in VetBiz.gov VIP database (http://
www.VetBiz.gov).
Description of need for information and proposed use of
information: The information is submitted on a voluntary basis by those
offerors who wish to qualify for this evaluation factor. The
information will be used by the contracting officer to determine
whether or not the offeror qualifies for extra credit in the selection
of the contract awardee. Those offerors who qualify will be afforded a
preference in the selection.
Description of likely respondents: Any offeror, on a negotiated
solicitation that includes the applicable evaluation factor, who
intends to subcontract with one or more SDVOSBs or VOSBs and who wishes
to obtain a preference in the award selection.
Estimated number of respondents: 125.
Estimated frequency of responses: 1 response for each solicitation.
Estimated average burden per collection: 5 minutes.
Estimated total annual reporting and recordkeeping burden: 10
hours.
Title and section number: Subpart 819.71, VA Mentor-
Prot[eacute]g[eacute] Program, subpart 819.71's related sections
[[Page 49147]]
819.7101 through 819.7115, and the related clauses at section 852.219-
71, VA Mentor-Prot[eacute]g[eacute] Program, and section 852.219-72,
Evaluation Factor for Participation in the VA Mentor-
Prot[eacute]g[eacute] Program.
Summary of collection of information: VA is proposing to institute
a Mentor-Prot[eacute]g[eacute] Program, whereby a large business agrees
to provide developmental support to a VOSB or SDVOSB. VA must approve
the Mentor-Prot[eacute]g[eacute] Agreement entered into by the two
parties, and VA requires both parties to report on the success of the
program. Mentors can qualify for additional preference on negotiated
solicitations by furnishing evidence of participation in the program
with their offer.
Description of need for information and proposed use of
information: The information is needed for the review and evaluation of
mentor applications for realism, validity, and accuracy of provided
information and for conducting a mid-term evaluation at the mid-point
interval to measure prot[eacute]g[eacute] progress against the
developmental plan contained in the approved agreement. The information
will also be used to evaluate the status of a business as a participant
in VA's Mentor-Prot[eacute]g[eacute] Program for possible credit in
negotiated contracts.
Description of likely respondents: Large business prime contractors
and SDVOSBs or VOSBs.
Estimated number of respondents: 50.
Estimated frequency of responses: Each prot[eacute]g[eacute]
program participant will be required to submit 3 sets of data
consisting of the application and the mid- and end-term reports. Each
mentor program participant will be required to submit 4 sets of data
consisting of the application, the mid- and end-term reports, and, when
submitting an offer, information to verify their participation in the
program in order to receive evaluation credit.
Estimated average burden per collection: 1 hour weighted average
per data submission.
Estimated total annual reporting and recordkeeping burden: 200
hours (4 data submissions @ 1 hour each times 50 program participants).
The Department considers comments by the public on collections of
information in--
Evaluating whether the collections of information are
necessary for the proper performance of the functions of the
Department, including whether the information will have practical
utility;
Evaluating the accuracy of the Department's estimate of
the burden of the collections of information, including the validity of
the methodology and assumptions used;
Enhancing the quality, usefulness, and clarity of the
information to be collected; and
Minimizing the burden of the collections of information on
those who are to respond, including through the use of appropriate
automated, electronic, mechanical, or other technological collection
techniques or other forms of information technology, e.g., permitting
electronic submission of responses.
OMB is required to make a final decision concerning the collection
of information contained in this proposed rule between 30 and 60 days
after publication of this document in the Federal Register. Therefore,
a comment to OMB is best assured of having its full effect if OMB
receives it within 30 days of publication. This does not affect the
deadline for the public to comment on the proposed rule.
List of Subjects
48 CFR Parts 802, 804, 809, 810, 813, and 815
Government procurement, Reporting and recordkeeping requirements.
48 CFR Part 819
Administrative practice and procedure, Government procurement,
Reporting and recordkeeping requirements, Small business, Veterans.
48 CFR Part 828
Government procurement, Insurance, Surety bonds.
48 CFR Part 852
Government procurement, Reporting and recordkeeping requirements.
Approved: April 21, 2008.
James B. Peake,
Secretary of Veterans Affairs.
Editorial Note: This document was received at the Office of the
Federal Register on August 15, 2008.
For the reasons set out in the preamble, the Department of Veterans
Affairs proposes to amend 48 CFR Chapter 8 as follows:
CHAPTER 8--DEPARTMENT OF VETERANS AFFAIRS
Subchapter A--General
PART 802--DEFINITIONS OF WORDS AND TERMS
1. The authority citation for part 802 is revised to read as
follows:
Authority: 38 U.S.C. 8127 and 8128; 40 U.S.C. 121(c) and (d);
and 48 CFR 1.301-1.304.
2. Section 802.101 is amended by adding in alphabetical order the
following terms:
802.101 Definitions.
* * * * *
Service-disabled veteran-owned small business concern (SDVOSB) has
the same meaning as defined in FAR Part 2.101, except for businesses
participating in set-asides or subcontracts authorized by VAAR subpart
819.70. These businesses must be listed as verified on the Vendor
Information Pages (VIP) at http://www.vetbiz.gov. In addition, some
businesses may be owned and controlled by a surviving spouse.
* * * * *
Surviving Spouse means an individual who has been listed in the
Department of Veterans Affairs' (VA) Veterans Benefits Administration
(VBA) database of veterans and family members. To be eligible for
inclusion in the VetBiz.gov VIP database, the following conditions must
apply:
(1) If the death of the veteran causes the small business concern
to be less than 51 percent owned by one or more service-disabled
veterans, the surviving spouse of such veteran who acquires ownership
rights in such small business shall, for the period described below, be
treated as if the surviving spouse were that veteran for the purpose of
maintaining the status of the small business concern as a service-
disabled veteran-owned small business.
(2) The period referred to above is the period beginning on the
date on which the veteran dies and ending on the earliest of the
following dates:
(i) The date on which the surviving spouse remarries;
(ii) The date on which the surviving spouse relinquishes an
ownership interest in the small business concern;
(iii) The date that is 10 years after the date of the veteran's
death; or
(iv) The date on which the business concern is no longer small
under Federal small business size standards.
(3) The veteran must have had a 100 percent service-connected
disability rating or the veteran died as a direct result of a service-
connected disability.
* * * * *
Vendor Information Pages (VIP) means the VetBiz.gov Vendor
Information Pages at http://www.vetbiz.gov.
Veteran-owned small business concern (VOSB) has the same meaning as
defined in FAR Part 2.101, except for businesses participating in set-
asides or subcontracts authorized by VAAR Part 819.7001. These
businesses must be
[[Page 49148]]
listed as verified on the VetBiz.gov VIP database.
* * * * *
PART 804--ADMINISTRATIVE MATTERS
3. The authority citation for part 804 is revised to read as
follows:
Authority: 38 U.S.C. 8127 and 8128; 40 U.S.C. 121(c) and (d);
and 48 CFR 1.301-1.304.
4. Section 804.1102 is added to read as follows:
804.1102 Vendor Information Pages (VIP) Database.
In addition to registering in the Central Contractor Registration
(CCR), all VOSBs, including SDVOSBs, must register in the VIP database,
available at http://www.VetBiz.gov, to be eligible to participate in
VA's Veteran-owned Small Business prime contracting and subcontracting
opportunities programs.
PART 808--REQUIRED SOURCES OF SUPPLIES AND SERVICES
5. The authority citation for part 808 is revised to read as
follows:
Authority: 38 U.S.C. 8127 and 8128; 40 U.S.C. 121(c) and (d);
and 48 CFR 1.301-1.304.
6. Subpart 808.6 and section 808.603 are added to read as follows:
Subpart 808.6--Acquisition From Federal Prison Industries, Inc.
(FPI)
808.603 Purchase priorities.
Contracting officers may purchase supplies and services produced or
provided by FPI from eligible service-disabled veteran-owned small
businesses and veteran-owned small businesses, in accordance with
procedures set forth in VAAR subpart 819.70, without seeking a waiver
from FPI, in accordance with 38 U.S.C. 8128, Small business concerns
owned and controlled by veterans: Contracting priority.
Subpart 808.8--Acquisition of Printing and Related Supplies
7. Section 808.803 is added to read as follows:
808.803 Priority for acquisition of printing and related supplies.
Contracting officers may acquire government printing from eligible
service-disabled veteran-owned small businesses and veteran-owned small
businesses, in accordance with procedures set forth in VAAR subpart
819.70, in lieu of the Government Printing Office (GPO), in accordance
with 38 U.S.C. 8128, small business concerns owned and controlled by
veterans: Contracting priority (See FAR 8.802(a)(4)).
PART 809--CONTRACTOR QUALIFICATIONS
8. The authority citation for part 809 is revised to read as
follows:
Authority: 38 U.S.C. 8127 and 8128; 40 U.S.C. 121(c) and (d);
and 48 CFR 1.301-1.304.
9. Section 809.406-2 is added to read as follows:
809.406-2 Cause for debarment.
Misrepresentations of VOSB or SDVOSB eligibility may result in
action taken by VA officials to debar the business concern for a period
not to exceed 5 years from contracting with VA as a prime contractor or
a subcontractor.
10. Part 810 is added to read as follows:
PART 810--MARKET RESEARCH
Sec.
810.001 Market research policy.
810.002 Market research procedures.
Authority: 38 U.S.C. 8127 and 8128; 40 U.S.C. 121(c) and (d);
and 48 CFR 1.301-1.304.
810.001 Market research policy.
When conducting market research, VA contracting teams shall use the
VIP database, at http://www.VetBiz.gov, in addition to other sources of
information.
810.002 Market research procedures.
Contracting officers shall record VIP queries in the solicitation
file by printing the results of the search(es) along with specific
query used to generate the search(es).
PART 813--SIMPLIFIED ACQUISITION PROCEDURES
11. The authority citation for part 813 is revised to read as
follows:
Authority: 38 U.S.C. 8127 and 8128; 40 U.S.C. 121(c) and (d);
and 48 CFR 1.301-1.304.
12. Section 813.106 is revised to read as follows:
813.106 Soliciting competition, evaluation of quotations or offers,
award and documentation.
Contracting officers may use other than competitive procedures to
enter into a contract with an SDVOSB or VOSB when the amount is less
than the simplified acquisition threshold. Contracting officers shall
give first consideration to SDVOSBs.
13. Section 813.202 is added to read as follows:
813.202 Purchase guidelines.
Open market micro-purchases shall be equitably distributed among
all qualified SDVOSBs or VOSBs, respectively, to the maximum extent
practicable.
PART 815--CONTRACTING BY NEGOTIATION
14. The authority citation for part 815 is revised to read as
follows:
Authority: 38 U.S.C. 8127 and 8128; 40 U.S.C. 121(c); and 48 CFR
1.301-1.304.
15. Section 815.304 is added to read as follows:
815.304 Evaluation factors and significant subfactors.
(a) In an effort to assist SDVOSBs and VOSBs, contracting officers
shall include evaluation factors in competitively negotiated
solicitations that are not set aside for SDVOSBs or VOSBs.
(b) Additional consideration shall also be given to any offeror,
regardless of size status, that proposes to subcontract with SDVOSBs or
VOSBs.
16. Section 815.304-70 is added to read as follows:
815.304-70 Evaluation factor commitments.
(a) VA contracting officers shall:
(1) Include provisions in negotiated solicitations giving
preference to offers received from VOSBs and additional preference to
offers received from SDVOSBs;
(2) Use past performance in meeting SDVOSB subcontracting goals as
a non-price evaluation factor in selecting offers for award;
(3) Use the proposed inclusion of SDVOSBs or VOSBs as
subcontractors as an evaluation factor when competitively negotiating
the award of contracts or task or delivery orders; and
(4) Consider participation in VA's Mentor-Prot[eacute]g[eacute]
Program as an evaluation factor when competitively negotiating the
award of contracts or task or delivery orders.
(b) If an offeror proposes to use an SDVOSB or VOSB subcontractor
in accordance with the clause at 852.215-70, Service-Disabled Veteran-
owned and Veteran-owned Small Business Evaluation Factors, the
contracting officer shall ensure that the offeror, if awarded the
contract, actually does use the proposed subcontractor or another
SDVOSB or VOSB subcontractor for that subcontract or for work of
similar value.
17. Section 815.304-71 is added to read as follows:
[[Page 49149]]
815.304-71 Solicitation provision and clause.
(a) The contracting officer shall insert the provision at 852.215-
70, Service-Disabled Veteran-owned and Veteran-owned Small Business
Evaluation Factors, in competitively negotiated solicitations that are
not set aside for SDVOSBs or VOSBs.
(b) The contracting officer shall insert the clause at 852.215-71,
Evaluation Factor Commitments, in solicitations and contracts that
include the clause at 852.215-70, Service-Disabled Veteran-owned and
Veteran-owned Small Business Evaluation Factors.
PART 819--SMALL BUSINESS PROGRAMS
18. The authority citation for part 819 is revised to read as
follows:
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).
Subpart 819.2--Policies
19. Section 819.201 is revised to read as follows:
819.201 General policy.
The Secretary shall establish goals for each fiscal year for
participation in Department contracts by SDVOSBs and VOSBs. In order to
establish contracting priority for veteran owned and controlled small
businesses in accordance with 38 U.S.C. 8128, the Secretary may
decrease other status-specific small business goals set forth by
section 15(g)(1) of the Small Business Act (15 U.S.C. 644(g)(1)) upon
consultation with the Administrator of the U.S. Small Business
Administration.
20. Section 819.307 is added to read as follows:
819.307 Protests.
For acquisitions under the authority of VAAR part 819.70, regarding
eligibility of SDVOSB and VOSB concerns, contracting officers shall
forward all protests to the Associate Administrator for Government
Contracting AA/GC, U.S. Small Business Administration (ATTN: Veterans
Business Program Protest), 409 3rd Street, SW., Washington, DC 20416,
for disposition.
21. Section 819.704 is added to read as follows:
819.704. Subcontracting plan requirements.
(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 Office of Small and Disadvantaged Business Utilization
(OSDBU) shall review all prime contractors' 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) above, the subcontract was actually awarded
to a business concern that is eligible to be counted toward meeting the
goal, as provided in VAAR 804.1102.
22. Section 819.705 is added as follows:
819.705 Appeal of Contracting Officer Decisions.
(a) Acquisitions not exceeding the SAT and sections 819.7007 and
819.7008 are excluded from this section.
(b) When an interested party intends to appeal a contracting
officer's decision to not use the set-aside authority contained in VAAR
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 setting-aside 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
Director, Office of Small and Disadvantaged Business Utilization
(OSDBU), within 5 working days of receipt of information declaring
their subcontractor ineligible. The Director, OSDBU, shall have 5
working days to respond. The decision of the Director, OSDBU, 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.
23. Section 819.709 is added to read as follows:
819.709 Contract clause.
The contracting officer shall insert the clause at 852.219-9, Small
Business Subcontracting Plan Minimum Requirements, in solicitations and
contracts that include the FAR clause at 52.219-9, Small Business
Subcontracting Plan.
24. Subpart 819.70 is revised to read as follows:
Subpart 819.70--Service-Disabled Veteran-Owned and Veteran-Owned
Small Business Acquisition Program
819.7001 General.
(a) The Veterans Benefits, Health Care, and Information Technology
Act of 2006 (38 U.S.C. 8127) created an acquisition program for small
business concerns owned and controlled by service-disabled veterans and
those owned and controlled by veterans for VA.
(b) The purpose of the program is to provide contracting assistance
to SDVOSBs and VOSBs.
819.7002 Applicability.
This subpart applies to VA contracting activities and to its prime
contractors.
819.7003 Eligibility.
(a) Eligibility of SDVOSBs and VOSBs continues to be governed by
the Small Business Administration regulations, 13 CFR subparts 125.8
through 125.13, as well as the FAR, except where expressly directed
otherwise by the VAAR, and 38 CFR verification regulations for SDVOSBs
and VOSBs.
(b) At the time of submission of offer, the offeror must represent
to the contracting officer that it is a--
(1) Service-disabled veteran-owned small business concern or
veteran-owned small business concern;
(2) Small business concern under the North American Industry
Classification System (NAICS) code assigned to the acquisition; and
(3) Verified for eligibility in the Vendor Information Pages
database.
(c) A joint venture may be considered an SDVOSB or VOSB concern
if--
(1) At least one member of the joint venture is an SDVOSB or VOSB
concern, and makes the representations in paragraph (b) of this
section;
(2) Each other concern is small under the size standard
corresponding to the NAICS code assigned to the procurement;
[[Page 49150]]
(3) The joint venture meets the requirements of paragraph 7 of the
size standard explanation of Affiliates in FAR 19.101; and
(4) The joint venture meets the requirements of 13 CFR 125.15(b),
modified to include veteran-owned small businesses where this CFR
section refers to SDVOSB concerns.
(d) Any SDVOSB or VOSB concern (nonmanufacturer) must meet the
requirements in FAR 19.102(f) to receive a benefit under this program.
819.7004 Contracting order of priority.
In determining the acquisition strategy applicable to an
acquisition, the contracting officer shall consider, in the following
order of priority, contracting preferences that ensure contracts will
be awarded:
(a) To SDVOSBs;
(b) To VOSB, including but not limited to SDVOSBs;
(c) Pursuant to--
(1) Section 8(a) of the Small Business Act (15 U.S.C. 637(a)); or
(2) The Historically-Underutilized Business Zone (HUBZone) Program
(15 U.S.C. 657a); and
(d) Pursuant to any other small business contracting preference.
819.7005 Service-disabled veteran-owned small business set-aside
procedures.
(a) The contracting officer shall consider SDVOSB set-asides before
considering VOSB set-asides. Except as authorized by 819.7007 and
819.7008, the contracting officer shall set-aside an acquisition for
competition restricted to SDVOSB concerns upon a reasonable expectation
that--
(1) Offers will be received from two or more eligible SDVOSB
concerns; and
(2) Award will be made at a fair and reasonable price.
(b) When conducting SDVOSB set-asides, the contracting officer
shall ensure--
(1) Eligibility is extended to businesses owned and operated by
surviving spouses; and
(2) Businesses are registered and verified as eligible in Vendor
Information Pages prior to making an award.
(c) If the contracting officer receives only one acceptable offer
at a fair and reasonable price from an eligible SDVOSB concern in
response to a SDVOSB set-aside, the contracting officer should make an
award to that concern. If the contracting officer receives no
acceptable offers from eligible SDVOSB concerns, the set-aside shall be
withdrawn and the requirement, if still valid, set aside for VOSB
competition, if appropriate.
819.7006 Veteran-owned small business set-aside procedures.
(a) The contracting officer shall consider SDVOSB set-asides before
considering VOSB set-asides. Except as authorized by 819.7007 and
819.7008, the contracting officer shall set aside an acquisition for
competition restricted to VOSB concerns upon a reasonable expectation
that--
(1) Offers will be received from two or more eligible VOSB
concerns; and
(2) Award will be made at a fair and reasonable price.
(b) If the contracting officer receives only one acceptable offer
at a fair and reasonable price from an eligible VOSB concern in
response to a VOSB set-aside, the contracting officer should make an
award to that concern. If the contracting officer receives no
acceptable offers from eligible VOSB concerns, the set-aside shall be
withdrawn and the requirement, if still valid, set aside for other
small business programs, as appropriate.
(c) When conducting VOSB set-asides, the contracting officer shall
ensure the business is registered and verified as eligible in the
Vendor Information Pages prior to making an award.
819.7007. Sole source awards to service-disabled veteran-owned small
business concerns.
(a) A contracting officer may award contracts to SDVOSB concerns on
a sole source basis provided--
(1) The anticipated award price of the contract (including options)
will not exceed $5 million;
(2) The requirement is synopsized in accordance with FAR part 5;
(3) The SDVOSB concern has been determined to be a responsible
contractor with respect to performance; and
(4) Award can be made at a fair and reasonable price.
(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. A determination that only one service-disabled
veteran-owned small business concern is available to meet the
requirement is not required. No protest is authorized in connection
with the issuance or proposed issuance of a contract under this
section, on the basis that more than one service-disabled veteran-owned
small business concern is available to meet the requirement.
(c) When conducting a SDVOSB sole source acquisition, the
contracting officer shall ensure businesses are registered and verified
as eligible in the Vendor Information Pages prior to making an award.
819.7008 Sole source awards to veteran-owned small business concerns.
(a) A contracting officer may award contracts to VOSB concerns on a
sole source basis provided--
(1) The anticipated award price of the contract (including options)
will not exceed $5 million;
(2) The requirement is synopsized in accordance with FAR part 5;
(3) The VOSB concern has been determined to be a responsible
contractor with respect to performance;
(4) Award can be made at a fair and reasonable price; and
(5) No responsible SDVOSB concern has been identified.
(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. A determination that only one veteran-owned small
business concern is available to meet the requirement is not required.
No protest is authorized in connection with the issuance or proposed
issuance of a contract under this section, on the basis that more than
one veteran-owned small business concern is available to meet the
requirement.
(c) When conducting a VOSB sole source acquisition, the contracting
officer shall ensure businesses are registered and verified as eligible
in the Vendor Information Pages prior to making an award.
819.7009 Contract clauses.
The contracting officer shall insert the clause 852.219-10, Notice
of Total Service-Disabled Veteran-Owned Small Business Set-Aside or
852.219-11, Notice of Total Veteran-Owned Small Business Set-Aside in
solicitations and contracts for acquisitions under this subpart.
25. Subpart 819.71, consisting of sections 819.7101 through
819.7115, is added to read as follows:
Subpart 819.71--VA Mentor-Prot[eacute]g[eacute] Program
Sec.
819.7101 Purpose.
819.7102 Definitions.
819.7103 Non-affiliation.
819.7104 General policy.
819.7105 Incentives for mentor participation.
819.7106 Eligibility of Mentor and Prot[eacute]g[eacute] firms.
819.7107 Selection of Prot[eacute]g[eacute] firms.
819.7108 Application process.
819.7109 VA review of application.
819.7110 Developmental assistance.
819.7111 Obligations under the Mentor-Prot[eacute]g[eacute] Program.
819.7112 Internal controls.
819.7113 Reports.
819.7114 Measurement of program success.
[[Page 49151]]
819.7115 Solicitation provisions.
Authority: 38 U.S.C. 501.
Subpart 819.71--VA Mentor-Prot[eacute]g[eacute] Program
819.7101 Purpose.
The VA Mentor-Prot[eacute]g[eacute] 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-
Prot[eacute]g[eacute] Program is also designed to improve the
performance of VA contractors and subcontractors by providing
developmental assistance to Prot[eacute]g[eacute] 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 Prot[eacute]g[eacute] under a VA contract shall not
have an effect on the firm's eligibility to seek other prime contracts
or subcontracts.
819.7102 Definitions.
(a) A Mentor is a prime contractor that elects to promote and
develop SDVOSB and/or VOSB subcontractors by providing developmental
assistance designed to enhance the business success of the
Prot[eacute]g[eacute]. 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-Prot[eacute]g[eacute] Program.
(c) Program refers to the VA Mentor-Prot[eacute]g[eacute] Program
as described in this Chapter.
(d) Prot[eacute]g[eacute] means a service-disabled veteran-owned
small business or veteran-owned small business, as defined in VAAR
802.101, which meets Federal small business size standards in its
primary North American Industrial Classification System (NAICS) code
and which is the recipient of developmental assistance pursuant to a
Mentor-Prot[eacute]g[eacute] agreement.
819.7103 Non-affiliation.
A Prot[eacute]g[eacute] firm will not be considered an affiliate of
a Mentor firm solely on the basis that the Prot[eacute]g[eacute] firm
is receiving developmental assistance from the Mentor firm under VA's
Mentor-Prot[eacute]g[eacute] Program. The determination of affiliation
is a function of the Small Business Administration.
819.7104 General policy.
(a) To be eligible, Mentors and Prot[eacute]g[eacute]s 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 Prot[eacute]g[eacute]s to perform as
prime contractors and/or subcontractors.
(b) VA reserves the right to limit the number of participants in
the program in order to ensure its effective management of the Mentor-
Prot[eacute]g[eacute] Program.
819.7105 Incentives for prime contractor participation.
(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 Prot[eacute]g[eacute] 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 may give Mentors evaluation credit under 852.219-52,
Evaluation Factor for Participation in the VA Mentor-
Prot[eacute]g[eacute] Program, considerations for subcontracts awarded
pursuant to their Mentor-Prot[eacute]g[eacute] Agreements and their
subcontracting plans. Therefore:
(1) Contracting officers may evaluate subcontracting plans
containing Mentor-Prot[eacute]g[eacute] arrangements more favorably
than subcontracting plans without Mentor-Prot[eacute]g[eacute]
Agreements.
(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 non-monetary award will be presented
annually to the Mentoring firm providing the most effective
developmental support of a Prot[eacute]g[eacute]. The Mentor-
Prot[eacute]g[eacute] Program Manager will recommend an award winner to
the OSDBU Director.
(e) OSDBU Mentor-Prot[eacute]g[eacute] Annual Conference. At the
conclusion of each year in the Mentor-Prot[eacute]g[eacute] Program,
Mentor firms will be invited to brief contracting officers, program
leaders, office directors and other guests on Program progress.
819.7106 Eligibility of Mentor and Prot[eacute]g[eacute] firms.
Eligible business entities approved as Mentors may enter into
agreements (hereafter referred to as ``Mentor-Prot[eacute]g[eacute]
Agreement'' or ``Agreement'' and explained in 819.7108) with eligible
Prot[eacute]g[eacute]s. Mentors provide appropriate developmental
assistance to enhance the capabilities of Prot[eacute]g[eacute]s to
perform as contractors and/or subcontractors. Eligible small business
entities capable of providing developmental assistance may be approved
as Mentors. Prot[eacute]g[eacute]s 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.
(a) Eligibility. A Mentor: (1) May be either a large or small
business entity;
(2) Must be able to provide developmental assistance that will
enhance the ability of Prot[eacute]g[eacute]s to perform as prime
contractors or subcontractors; and
(3) Will be encouraged to enter into arrangements with entities
with which it has established business relationships.
(b) Eligibility. A Prot[eacute]g[eacute]:
(1) Must be a service-disabled veteran-owned small business or
veteran-owned small business as defined in VAAR 802.101;
(2) Must meet the size standard corresponding to the NAICS code
that the Mentor prime contractor believes best describes the product or
service being acquired by the subcontract; and
(c) Prot[eacute]g[eacute]s may have multiple Mentors.
Prot[eacute]g[eacute]s participating in Mentor-Prot[eacute]g[eacute]
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 Prot[eacute]g[eacute] 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 prot[eacute]g[eacute] in the VetBiz.gov Vendor
Information Pages database. Prot[eacute]g[eacute]s must maintain
verified status throughout the term of the Mentor-
[[Page 49152]]
Prot[eacute]g[eacute] Agreement. Failure to do so shall result in
cancellation of the Agreement.
819.7107 Selection of Prot[eacute]g[eacute] firms.
(a) Mentor firms will be solely responsible for selecting
Prot[eacute]g[eacute] firms. Mentors are encouraged to select from a
broad base of service-disabled veteran-owned small business or veteran-
owned small business firms whose core competencies support VA's
mission; and choose SDVOSB and/or VOSB prot[eacute]g[eacute]s in
addition to firms with whom they have established business
relationships.
(b) Mentors may have multiple Prot[eacute]g[eacute]s. However, to
preserve the integrity of the Program and assure the quality of
developmental assistance provided to Prot[eacute]g[eacute]s, VA
reserves the right to limit the total number of Prot[eacute]g[eacute]s
participating under each Mentor firm for the Mentor-
Prot[eacute]g[eacute] Program.
(c) The selection of Prot[eacute]g[eacute] 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 Federal Acquisition Regulation (FAR) and the
Small Business Administration regulations.
819.7108 Application process.
(a) Firms interested in becoming approved Mentor-
Prot[eacute]g[eacute] participants must submit a joint written VA
Mentor-Prot[eacute]g[eacute] Agreement to the VA OSDBU for review and
approval. The proposed Mentor-Prot[eacute]g[eacute] 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.
(b) The Mentor-Prot[eacute]g[eacute] Agreement must contain:
(1) Names, addresses, phone numbers, and e-mail addresses (if
available) of the Mentor and Prot[eacute]g[eacute] firm(s) and a point
of contact for both Mentor and Prot[eacute]g[eacute] who will oversee
the agreement;
(2) A statement from the Prot[eacute]g[eacute] firm that the firm
is currently eligible as a SDVOSB or VOSB to participate in VA's
Mentor-Prot[eacute]g[eacute] Program;
(3) A description of the Mentor's ability to provide developmental
assistance to the Prot[eacute]g[eacute] 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 Prot[eacute]g[eacute] firm;
(4) Duration of the Agreement, including rights and
responsibilities of both parties (Mentor and Prot[eacute]g[eacute]),
with bi-annual reviews;
(5) Termination procedures, including procedures for the parties'
voluntary withdrawal from the Program. The Agreement shall require the
Mentor or the Prot[eacute]g[eacute] to notify the other firm and VA
OSDBU in writing at least 30 days in advance of its intent to
voluntarily terminate the Agreement;
(6) A schedule with milestones for providing assistance;
(7) Criteria for evaluation of the Prot[eacute]g[eacute]'s
developmental success;
(8) A plan addressing how the Mentor will increase the quality of
the Prot[eacute]g[eacute] firm's technical capabilities and contracting
and subcontracting opportunities;
(9) An estimate of the total cost of the planned mentoring
assistance to be provided to the Prot[eacute]g[eacute];
(10) An agreement by both parties to comply with the reporting
requirements of VAAR 819.7113;
(11) A plan for accomplishing unfinished work should the agreement
be voluntarily cancelled;
(12) Other terms and conditions, as appropriate; and
(13) Signatures and date(s).
(c) The Agreement defines the relationship between the Mentor and
the Prot[eacute]g[eacute] firms only. The Agreement does not create any
privity of contract between the Mentor and VA or the
Prot[eacute]g[eacute] and VA.
819.7109 VA review of application.
(a) VA OSDBU will review the information to establish the Mentor
and Prot[eacute]g[eacute] eligibility and to ensure that the
information that is in section 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-Prot[eacute]g[eacute] 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 provide a copy
of the Mentor-Prot[eacute]g[eacute] Agreement to the VA contracting
officer 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 Prot[eacute]g[eacute] and request correction of
deficiencies to be provided within 15 days.
819.7110 Developmental assistance.
The forms of developmental assistance a Mentor can provide to a
Prot[eacute]g[eacute] include, but are not limited to, the following:
(a) Guidance relating to--
(1) Financial management;
(2) Organizational management;
(3) Overall business management/planning;
(4) Business development; and
(5) Technical assistance.
(b) Loans.
(c) Rent-free use of facilities and/or equipment.
(d) Property.
(e) Temporary assignment of personnel to a Prot[eacute]g[eacute]
for training.
(f) Any other types of permissible, mutually beneficial assistance.
819.7111 Obligations under the Mentor-Prot[eacute]g[eacute] Program.
(a) A Mentor or Prot[eacute]g[eacute] may voluntarily withdraw from
the Program. However, in no event shall such withdrawal impact the
contractual requirements under any prime contract.
(b) Mentors and prot[eacute]g[eacute]s shall submit reports to VA
OSDBU in accordance with 819.7113.
819.7112 Internal controls.
(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:
(1) Reviewing and evaluating Mentor applications for validity of
the provided information;
(2) Reviewing bi-annual progress reports submitted by Mentors and
Prot[eacute]g[eacute]s on Prot[eacute]g[eacute] development to measure
Prot[eacute]g[eacute] progress against the plan submitted in the
approved Agreement;
(3) Reviewing and evaluating financial reports and invoices
submitted by the Mentor to verify that VA is not charged by the Mentor
for providing developmental assistance to the Prot[eacute]g[eacute];
and
(4) Limiting the number of participants in the Mentor-
Prot[eacute]g[eacute] Program within a reporting period, in order to
insure the effective management of the Program.
[[Page 49153]]
(b) VA may rescind approval of an existing Mentor-
Prot[eacute]g[eacute] 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 Prot[eacute]g[eacute] after approval by the OSDBU Director.
Rescission of an Agreement does not change the terms of any subcontract
between the Mentor and the Prot[eacute]g[eacute].
819.7113 Reports.
(a) Mentor and Prot[eacute]g[eacute] entities shall submit to VA's
Office of Small and Disadvantaged Business Utilization bi-annual
reports on progress under the Mentor-Prot[eacute]g[eacute] Agreement.
VA will evaluate reports by considering the following:
(1) Specific actions taken by the Mentor during the evaluation
period to increase the participation of their Prot[eacute]g[eacute](s)
as suppliers to VA, other government agencies and to commercial
entities;
(2) Specific actions taken by the Mentor during the evaluation
period to develop technical and administrative expertise of a
Prot[eacute]g[eacute] as defined in the Agreement;
(3) The extent to which the Prot[eacute]g[eacute] has met the
developmental objectives in the Agreement;
(4) The extent to which the Mentor's participation in the Mentor-
Prot[eacute]g[eacute] Program impacted the Prot[eacute]g[eacute]'(s')
ability to receive contract(s) and subcontract(s) from private firms
and Federal agencies other than VA; and, if deemed necessary;
(5) Input from the Prot[eacute]g[eacute] on the nature of the
developmental assistance provided by the Mentor.
(b) OSDBU will submit annual reports to the relevant contracting
officer regarding participating prime contractor'(s') performance in
the Program.
(c) In addition to the written progress report in paragraph (a) of
this section, at the mid-term point in the Mentor-Prot[eacute]g[eacute]
agreement, the Mentor and the Prot[eacute]g[eacute] shall formally
brief the VA OSDBU regarding program accomplishments as pertains to the
approved agreement.
(d) Mentor and Prot[eacute]g[eacute] 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.
819.7114 Measurement of program success.
The overall success of the VA Mentor-Prot[eacute]g[eacute] Program
encompassing all participating mentors and prot[eacute]g[eacute]s will
be measured by the extent to which it results in:
(a) An increase in the quality of the technical capabilities of the
prot[eacute]g[eacute] firm.
(b) An increase in the number and dollar value of contract and
subcontract awards to prot[eacute]g[eacute] firms since the time of
their entry into the program attributable to the Mentor-
Prot[eacute]g[eacute] relationship (under VA contracts, contracts
awarded by other Federal agencies and under commercial contracts.)
819.7115 Solicitation provisions.
(a) Insert the provision at 852.219-71, VA Mentor-
Prot[eacute]g[eacute] Program, in solicitations that include the FAR
clause at 52.219-9, Small Business Subcontracting Plan.
(b) Insert the provision at 852.219-72, Evaluation Factor for
Participation in the VA Mentor-Prot[eacute]g[eacute] Program, in
solicitations that include an evaluation factor for participation in
VA's Mentor-Prot[eacute]g[eacute] Program in accordance with 819.7105
and that also include the FAR clause at 52.219-9, Small Business
Subcontracting Plan.
PART 828--BONDS AND INSURANCE
26. The authority citation for part 828 is revised to read as
follows:
Authority: 38 U.S.C. 501, 8127, 8128 and 8151-8153; 40 U.S.C.
121(c); and 48 CFR 1.301-1.304.
27. Section 828.106-71 is added to read as follows:
828.106-71 Assisting service-disabled veteran-owned and veteran-owned
small businesses in obtaining bonding.
VA prime contractors are encouraged to assist SDVOSB concerns and
VOSB concerns in obtaining subcontractor performance and payment bonds.
Mentors are especially encouraged to assist their
Prot[eacute]g[eacute]s in obtaining bid, payment, and performance bonds
as prime contractors and bonds as subcontractors when bonds are
required.
28. Section 828.106-72 is added to read as follows:
828.106-72 Contract provision.
Insert the provision at 852.228-72, Assisting Service-Disabled
Veteran-Owned and Veteran-Owned Small Businesses in Obtaining Bonds, in
solicitations that include the FAR clause at 52.228-1, Bid Guarantee.
PART 852--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
29. The authority citation for part 852 is revised to read as
follows:
Authority: 38 U.S.C. 501, 8127, 8128, and 8151-8153; 40 U.S.C.
121(c); and 48 CFR 1.301-1.304.
30. Section 852.215-70 is added to read as follows:
852.215-70 Service-Disabled Veteran-Owned and Veteran-Owned Small
Business Evaluation Factors.
As prescribed in 815.304-71(a), insert the following clause:
Service-Disabled Veteran-Owned and Veteran-Owned Small Business
Evaluation Factors (Date)
(a) In an effort to achieve socioeconomic small business goals,
depending on the evaluation factors included in the solicitation, VA
may evaluate offerors based on their service-disabled veteran-owned
or veteran-owned small business status and their proposed use of
eligible service-disabled veteran-owned small businesses and
veteran-owned small businesses as subcontractors.
(b) Eligible service-disabled veteran-owned offerors will
receive full credit, and offerors qualifying as veteran-owned small
businesses will receive partial credit for the Service-Disabled
Veteran-Owned and Veteran-Owned Small Business Status evaluation
factor. To receive credit, an offeror must be registered and
verified in Vendor Information Pages. (http://www.VetBiz.gov).
(c) Non-veteran offerors proposing to use service-disabled
veteran-owned small businesses or veteran-owned small businesses as
subcontractors will receive some consideration under this evaluation
factor. Offerors must state in their proposals the names of the
SDVOSBs and VOSBs with whom they intend to subcontract and provide a
brief description of the proposed subcontracts and the approximate
dollar values of the proposed subcontracts. In addition, the
proposed subcontractors must be registered and verified in the
VetBiz.gov Vendor Information Pages (VIP) (http://www.vetbiz.gov).
(End of Clause)
31. Section 852.215-71 is added to read as follows:
852.215-71 Evaluation Factor Commitments.
As prescribed in 815.304-71(b), insert the following clause:
Evaluation Factor Commitments (Date)
The offeror agrees, if awarded a contract, to use the service-
disabled veteran-owned small businesses or veteran-owned small
businesses proposed as subcontractors in accordance with clause
852.215-70, Service-Disabled Veteran-Owned and Veteran-Owned Small
Business Evaluation Factors, or to substitute one or more service-
disabled veteran-owned small businesses or veteran-owned small
businesses for subcontract work of the same or similar value.
(End of Clause)
32. Section 852.219-9 is added to read as follows:
[[Page 49154]]
852.219-9 VA Small Business Subcontracting Plan Minimum Requirements.
As prescribed in 819.9, insert the following clause:
VA Small Business Subcontracting Plan Minimum Requirements (Date)
(a) This clause does not apply to small business concerns.
(b) If the offeror is required to submit an individual
subcontracting plan, the minimum goals for award of subcontracts to
service-disabled veteran-owned small business concerns and veteran-
owned small business concerns shall be at least commensurate with
the Department's annual service-disabled veteran-owned small
business and veteran-owned small business prime contracting goals
for the total dollars planned to be subcontracted.
(c) For a commercial plan, the minimum goals for award of
subcontracts to service-disabled veteran-owned small business
concerns and veteran-owned small businesses shall be at least
commensurate with the Department's annual service-disabled veteran-
owned small business and veteran-owned small business prime
contracting goals for the total value of projected subcontracts to
support the sales for the commercial plan.
(d) To be credited toward goal achievements, businesses must be
verified as eligible in the Vendor Information Pages database. The
contractor shall annually submit a listing of service-disabled
veteran-owned small businesses and veteran-owned small businesses
for which credit toward goal achievement is to be applied for the
review of personnel in the Office of Small and Disadvantaged
Business Utilization.
(e) The contractor may appeal any businesses determined not
eligible for crediting toward goal achievements by following the
procedures contained in VAAR subpart 819.407.
(End of Clause)
33. Section 852.219-10 is added to read as follows:
852.219-10 VA Notice of Total Service-Disabled Veteran-Owned Small
Business Set-Aside.
As prescribed in 819.7009, insert the following clause:
VA Notice of Total Service-Disabled Veteran-Owned Small Business Set-
Aside (Date)
(a) Definition. For the Department of Veterans Affairs,
``Service-disabled veteran-owned small business concern''--
(1) Means a small business concern--
(i) Not less than 51 percent of which is owned by one or more
service-disabled veterans or, in the case of any publicly owned
business, not less than 51 percent of the stock of which is owned by
one or more service-disabled veterans (or eligible surviving
spouses);
(ii) The management and daily business operations of which are
controlled by one or more service-disabled veterans (or eligible
surviving spouses) or, in the case of a service-disabled veteran
with permanent and severe disability, the spouse or permanent
caregiver of such veteran;
(iii) The business meets Federal small business size standards
for the applicable North American Industry Classification System
(NAICS) code identified in the solicitation document; and
(iv) The business has been verified for ownership and control
and is so listed in the Vendor Information Pages, (http://
www.VetBiz.gov).
(2) ``Service-disabled veteran'' means a veteran, as defined in
38 U.S.C. 101(2), with a disability that is service-connected, as
defined in 38 U.S.C. 101(16).
(b) General.
(1) Offers are solicited only from service-disabled veteran-
owned small business concerns. Offers received from concerns that
are not service-disabled veteran-owned small business concerns shall
not be considered.
(2) Any award resulting from this solicitation shall be made to
a service-disabled veteran-owned small business concern.
(c) Agreement. A service-disabled veteran-owned small business
concern agrees that in the performance of the contract, in the case
of a contract for--
(1) Services (except construction), at least 50 percent of the
cost of personnel for contract performance will be spent for
employees of the concern or employees of other eligible service-
disabled veteran-owned small business concerns;
(2) Supplies (other than acquisition from a nonmanufacturer of
the supplies), at least 50 percent of the cost of manufacturing,
excluding the cost of materials, will be performed by the concern or
other eligible service-disabled veteran-owned small business
concerns;
(3) General construction, at least 15 percent of the cost of the
contract performance incurred for personnel will be spent on the
concern's employees or the employees of other eligible service-
disabled veteran-owned small business concerns; or
(4) Construction by special trade contractors, at least 25
percent of the cost of the contract performance incurred for
personnel will be spent on the concern's employees or the employees
of other eligible service-disabled veteran-owned small business
concerns.
(d) A joint venture may be considered a service-disabled
veteran-owned small business concern if--
(1) At least one member of the joint venture is a service-
disabled veteran-owned small business concern, and makes the
following representations: That it is a service-disabled veteran-
owned small business concern, and that it is a small business
concern under the North American Industry Classification Systems
(NAICS) code assigned to the procurement;
(2) Each other concern is small under the size standard
corresponding to the NAICS code assigned to the procurement; and
(3) The joint venture meets the requirements of paragraph 7 of
the explanation of Affiliates in 19.101 of the Federal Acquisition
Regulation.
(4) The joint venture meets the requirements of 13 CFR
125.15(b).
(e) Any service-disabled veteran-owned small business concern
(nonmanufacturer) must meet the requirements in 19.102(f) of the
Federal Acquisition Regulation to receive a benefit under this
program.
(End of Clause)
34. Section 852.219-11 is added to read as follows:
852.219-11 VA Notice of Total Veteran-Owned Small Business Set-Aside.
As prescribed in 819.7009, insert the following clause:
VA Notice of Total Veteran-Owned Small Business Set-Aside (Date)
(a) Definition. For the Department of Veterans Affairs,
``Veteran-owned small business concern''--
(1) Means a small business concern--
(i) Not less than 51 percent of which is owned by one or more
veterans or, in the case of any publicly owned business, not less
than 51 percent of the stock of which is owned by one or more
veterans;
(ii) The management and daily business operations of which are
controlled by one or more veterans;
(iii) The business meets Federal small business size standards
for the applicable North American Industry Classification System
(NAICS) code identified in the solicitation document; and
(iv) The business has been verified for ownership and control
and is so listed in the Vendor Information Pages (http://
www.VetBiz.gov).
(2) ``Veteran'' is defined in 38 U.S.C. 101(2).
(b) General.
(1) Offers are solicited only from veteran-owned small business
concerns. All service-disabled veteran-owned small businesses are
also determined to be veteran-owned small businesses if they meet
the criteria identified in paragraph (a)(1) of this section. Offers
received from concerns that are not veteran-owned small business
concerns shall not be considered.
(2) Any award resulting from this solicitation shall be made to
a veteran-owned small business concern.
(c) Agreement. A veteran-owned small business concern agrees
that in the performance of the contract, in the case of a contract
for--
(1) Services (except construction), at least 50 percent of the
cost of personnel for contract performance will be spent for
employees of the concern or employees of other eligible veteran-
owned small business concerns;
(2) Supplies (other than acquisition from a nonmanufacturer of
the supplies), at least 50 percent of the cost of manufacturing,
excluding the cost of materials, will be performed by the concern or
other eligible veteran-owned small business concerns;
(3) General construction, at least 15 percent of the cost of the
contract performance incurred for personnel will be spent on the
concern's employees or the employees of other eligible veteran-owned
small business concerns; or
[[Page 49155]]
(4) Construction by special trade contractors, at least 25
percent of the cost of the contract performance incurred for
personnel will be spent on the concern's employees or the employees
of other eligible veteran-owned small business concerns.
(d) A joint venture may be considered a veteran-owned small
business concern if--
(1) At least one member of the joint venture is a veteran-owned
small business concern, and makes the following representations:
That it is a veteran-owned small business concern, and that it is a
small business concern under the NAICS code assigned to the
procurement;
(2) 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 paragraph 7 of
the explanation of Affiliates in 19.101 of the Federal Acquisition
Regulation; and
(4) The joint venture meets the requirements of 13 CFR
125.15(b), except that the principal company may be a veteran-owned
small business concern or a service-disabled veterans-owned small
business concern.
(e) Any veteran-owned small business concern (nonmanufacturer)
must meet the requirements in 19.102(f) of the Federal Acquisition
Regulation to receive a benefit under this program.
(End of Clause)
35. Section 852.219-71 is added to read as follows:
852.219-71 VA Mentor-Prot[eacute]g[eacute] Program.
As prescribed in 819.7115(a), insert the following clause:
VA Mentor-Prot[eacute]g[eacute] Program (Date)
(a) Large businesses are encouraged to participate in the VA
Mentor-Prot[eacute]g[eacute] Program for the purpose of providing
developmental assistance to eligible service-disabled veteran-owned
small businesses and veteran-owned small businesses to enhance the
small businesses' capabilities and increase their participation as
VA prime contractors and as subcontractors.
(b) The program consists of:
(1) Mentor firms, which are prime contractors capable of
providing developmental assistance;
(2) Prot[eacute]g[eacute] firms, which are service-disabled
veteran-owned small business concerns or veteran-owned small
business concerns; and
(3) Mentor-Prot[eacute]g[eacute] Agreements approved by the VA
Office of Small and Disadvantaged Business Utilization.
(c) Mentor participation in the program means providing business
developmental assistance to aid Prot[eacute]g[eacute]s in developing
the requisite expertise to effectively compete for and successfully
perform VA prime contracts and subcontracts.
(d) Large business prime contractors serving as Mentors in the
VA Mentor-Prot[eacute]g[eacute] Program are eligible for an
incentive for subcontracting plan credit. VA will recognize the
costs incurred by a Mentor firm in providing assistance to a
Prot[eacute]g[eacute] firm and apply those costs for purposes of
determining whether the mentor firm attains its subcontracting plan
participation goals under a VA contract. The amount of credit given
to a Mentor firm for these Prot[eacute]g[eacute] developmental
assistance costs shall be calculated on a dollar-for-dollar basis
and reported by the large business prime contractor via the
Electronic Subcontracting Reporting System (eSRS).
(e) Contractors interested in participating in the program are
encouraged to contact the VA Office of Small and Disadvantaged
Business Utilization for more information.
(End of Clause)
36. Section 852.219-72 is added to read as follows:
852.219-72 Evaluation Factor for Participation in the VA Mentor-
Prot[eacute]g[eacute] Program.
As prescribed in 819.7115(b), insert the following clause:
Evaluation Factor for Participation in the VA Mentor-
Prot[eacute]g[eacute] Program (Date)
This solicitation contains an evaluation factor or sub-factor
regarding participation in the VA Mentor-Prot[eacute]g[eacute]
Program. In order to receive credit under the evaluation factor or
sub-factor, the offeror must provide with its proposal a copy of a
signed letter issued by the VA Office of Small and Disadvantaged
Business Utilization approving the offeror's Mentor-
Prot[eacute]g[eacute] Agreement.
(End of Clause)
37. Section 852.228-72 is added to read as follows:
852.228-72 Assisting Service-Disabled Veteran-owned and Veteran-owned
Small Businesses in Obtaining Bonds.
As prescribed in 828.106-71, insert the following clause:
Assisting Service-Disabled Veteran-Owned Small Businesses and Veteran-
Owned Small Businesses in Obtaining Bonds (Date)
Prime contractors are encouraged to assist service-disabled
veteran-owned and veteran-owned small business potential
subcontractors in obtaining bonding, when required. Mentor firms are
encouraged to assist Prot[eacute]g[eacute] firms under VA's Mentor-
Prot[eacute]g[eacute] Program in obtaining acceptable bid, payment,
and performance bonds, when required, as a prime contractor under a
solicitation or contract and in obtaining any required bonds under
subcontracts.
(End of Provision)
[FR Doc. E8-19261 Filed 8-19-08; 8:45 am]
BILLING CODE 8320-01-P