The FAR will Soon Allow Small Business Set-Asides Outside the US

Small business federal contractors may soon want to think about getting new luggage. The FAR will be updated to allow for–but not require–small business set-asides in overseas procurements. This has the potential to open up a substantial number of contracting opportunities to small businesses who have the capabilities to compete. The final rule will be effective May 26, 2022. Here are some of the key details to know about.

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Back to Basics: The Nonmanufacturer Rule

To qualify as a small business under most set-aside or sole-source contracts seeking manufactured products or supplies, SBA’s regulations require an offeror to be the item’s manufacturer or, alternatively, comply with the nonmanufacturer rule.

In this post, we’ll discuss qualifying under the nonmanufacturer rule.

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IHS Issues Final Rules Implementing the Buy Indian Act

On January 13, 2022 the Secretary of the Department of Health and Human Services (HHS) issued its Final Rule governing the implementation of the Buy Indian Act (Act). This rule clarifies the preference for Indian-owned and controlled businesses and removes barriers by alleviating unnecessary regulatory burdens. If you’re a frequent visitor to our blogs, you may be thinking, “wait what, didn’t you just blog about this last November?” Actually, the subject of the blog about the Buy Indian Act from November was the proposed rules governing the Buy Indian Act issued by the Department of Interior (DOI) covering procurements of the Bureau of Indian Affairs (BIA). HHS’s Final Rules issued on January 13th  (Final Rule) supplement and amend regulations guiding implementation of the Buy Indian Act for procurements by the Indian Health Service (IHS).

Given the long scattershot implementation of the  Buy Indian Act, how the Act it is applied to different agencies, the multiple notices of proposed changes to the Buy Indian Act, along with the general decentralized structure of procurement regulations, it can all be a bit confusing. A bit of background may help to put it all in context.

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Department of the Interior Proposes Rules to Remove Barriers in Buy Indian Act Contracting Opportunities

The Department of the Interior (DOI) proposes to revise regulations implementing the Buy Indian Act, which provides the Department with authority to set aside procurement contracts for Indian-owned and controlled businesses. The proposed rule is to revise current procurement regulations that have created barriers to Indian Economic Enterprises (IEEs) from full participation in the DOI’s procurement process. The proposed rule is here.

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GAO: Agency Has Discretion on Type of Socioeconomic Set-Aside for Procurement

From a recent GAO decision it appears that the ends can, in fact, justify the means; at least when it comes procurement set-asides for HUBZone companies. The decision is Foxhole Technology, Inc. B-419577 (May 12, 2021). In this matter, Foxhole Technology, Inc., a service-disabled veteran-owned small business, protested the Department of Education’s decision to set aside an RFQ to supply cybersecurity services for HUBZone businesses. In its protest, Foxhole argued that the agency’s decision to set aside the procurement for HUBZone small business concerns was based on inadequate market research and was therefore not justified. GAO denied the protest.

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IHS (Finally) Proposes Stronger Rules for Buy Indian Act

The Indian Health Service has released a proposed rule that will strengthen requirements for IHS to set aside contracts for businesses owned by tribal companies. The new rule should result in increased opportunities for native-owned businesses by bringing Buy Indian Act purchasing preferences in line with other purchasing policies such as the small business Rule of Two, and it’s about time, as this purchasing preference has been law for 110 years with little clarity on how agencies would enforce it.

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GSA’s Federal Acquisition Service Over-Reported Small Business Contracts by $89 Million

Every year, when the SBA releases its annual Small Business Procurement Scorecard, I hear from a few folks who mistrust the data. “I think small business awards are being over-reported,” is a pretty common theme for Scorecard skeptics.

A new GSA Office of Inspector General report is a reminder that it’s not paranoia if people are really out to get you. According to the GSA OIG, the GSA’s Federal Acquisition Service over-reported small business contracts by a whopping $89 million in just two fiscal years.

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