[Code of Federal Regulations]

[Title 48, Volume 1]

[Revised as of October 1, 2005]

From the U.S. Government Printing Office via GPO Access

[CITE: 48CFR19.502-2]



[Page 366-367]

 

            TITLE 48--FEDERAL ACQUISITION REGULATIONS SYSTEM

 

                CHAPTER 1--FEDERAL ACQUISITION REGULATION

 

PART 19_SMALL BUSINESS PROGRAMS--Table of Contents

 

               Subpart 19.5_Set-Asides for Small Business

 

Sec. 19.502-2  Total small business set-asides.



    (a) Except for those acquisitions set aside for very small business 

concerns (see Subpart 19.9), each acquisition of supplies or services 

that has an anticipated dollar value exceeding $2,500 ($15,000 for 

acquisitions as described in 13.201(g)(1)), but not over $100,000 

($250,000 for acquisitions described in paragraph (1) of the Simplified 

Acquisition Threshold definition at 2.101), is automatically reserved 

exclusively for small business concerns and shall be set aside for small 

business unless the contracting officer determines there is not a 

reasonable expectation of obtaining offers from two or more responsible 

small business concerns that are competitive in terms of market prices, 

quality, and delivery. If the contracting officer does not proceed with 

the small business set-aside and purchases on an unrestricted basis, the 

contracting officer shall include in the contract file the reason for 

this unrestricted purchase. If the contracting officer receives only one 

acceptable offer from a responsible small business concern in response 

to a set-aside, the contracting officer should make an award to that 

firm. If the contracting officer receives no acceptable offers from 

responsible small business concerns, the set-aside shall be withdrawn 

and the requirement, if still valid, shall be resolicited on an 

unrestricted basis. The small business reservation does not preclude the 

award of a contract with a value not greater than $100,000 under Subpart 

19.8, Contracting with the Small Business Administration, under 

19.1007(c), Solicitations equal to or less than the ESB reserve amount, 

or under 19.1305, HUBZone set-aside procedures.

    (b) The contracting officer shall set aside any acquisition over 

$100,000 for small business participation when there is a reasonable 

expectation that (1) offers will be obtained from at least two 

responsible small business concerns offering the products of different 

small business concerns (but see paragraph (c) of this subsection); and 

(2) award will be made at fair market prices. Total small business set-

asides shall not be made unless such a reasonable expectation exists 

(but see 19.502-3 as to partial set-asides). Although past acquisition 

history of an item or similar items is always important, it is not the 

only factor to be considered in determining whether a reasonable 

expectation exists. In making R&D small business set-asides, there must 

also be a reasonable expectation of obtaining from small businesses the 

best scientific and technological sources consistent with the demands of 

the proposed acquisition for the best mix of cost, performances, and 

schedules.

    (c) For small business set-asides other than for construction or 

services,



[[Page 367]]



any concern proposing to furnish a product that it did not itself 

manufacture must furnish the product of a small business manufacturer 

unless the SBA has granted either a waiver or exception to the 

nonmanufacturer rule (see 19.102(f)). In industries where the SBA finds 

that there are no small business manufacturers, it may issue a waiver to 

the nonmanufacturer rule (see 19.102(f) (4) and (5)). In addition, SBA 

has excepted procurements processed under simplified acquisition 

procedures (see part 13), where the anticipated cost of the procurement 

will not exceed $25,000, from the nonmanufacturer rule. Waivers permit 

small businesses to provide any firm's product. The exception permits 

small businesses to provide any domestic firm's product. In both of 

these cases, the contracting officer's determination in paragraph (b)(1) 

of this subsection or the decision not to set aside a procurement 

reserved for small business under paragraph (a) of this subsection will 

be based on the expectation of receiving offers from at least two 

responsible small businesses, including nonmanufacturers, offering the 

products of different concerns.

    (d) The requirements of this subsection do not apply to acquisitions 

over $25,000 during the period when small business set-asides cannot be 

considered for the designated industry groups (see 19.1007(b)).



[60 FR 34757, July 3, 1995, as amended at 61 FR 39209, July 26, 1996; 63 

FR 70270, Dec. 18, 1998; 64 FR 10536, Mar. 4, 1999; 65 FR 16275, Mar. 

27, 2000; 67 FR 56121, Aug. 30, 2002; 67 FR 70522, Nov. 22, 2002; 68 FR 

4050, Jan. 27, 2003; 69 FR 8314, Feb. 23, 2004; 70 FR 11742, Mar. 9, 

2005]