How a few words could change small-business set-aside picture

The Obama administration wants contracting officers to set aside solicitations for research and development for small business if they expect that capable companies exist and would be interested, according to a proposed rule. But the wording of a provision in the Federal Acquisition Regulation regarding research and development procurements is raising concern at the Small Business Administration, according to Federal Register notice published Aug. 10.

The FAR states:

“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.”

Acquisition officials at the Defense Department, NASA, and the General Services Administration have proposed a revision that removes the phrase: “consistent with the demands of the proposed acquisition for the best mix of cost, performances, and schedules.”

SBA officials say agencies see this is an additional and unique condition that contracting officers have to establish before they can proceed with small-business set-asides. But, they say, it shouldn't be. The proposed new wording makes clear that the contracting officer need only determine that there are small businesses capable of handling the specialized work -- based on market research -- in order to justify the set-aside. (The other two conditions for a set-aside, that there be at least two small businesses that can compete, and that fair-market prices are in effect, also apply.)

The proposed rule is intended to remove any potential barriers for small businesses.

Officials are accepting comments on the proposed rule through Oct. 9.