We regularly get questions about sole source awards, and we have received several questions over the years asking for clarity on when an agency must notify contractors about a planned sole source award. This is a very good question, as such notice requirements can significantly impact the ability to challenge such decisions. We think it’s high time that we help provide some clarity on one of the more complex areas of federal contracting: When an agency must publish notice of its plan to sole source a contract.
The FAR
There is a good bit to cover, so we will get right to it. First, it is helpful to understand the general rule that requires agencies to publicize contract actions. FAR 5.101(a)(1) notes that, if the procurement value is expected to exceed $25,000, the government at least has to give a synopsis in the Governmentwide Point of Entry, which presently is SAM. FAR 5.101(a)(2) notes that if the value is expected to exceed $20,000 but not $25,000, a general public notice is fine.
As to when the notice must be published, it depends. In general, the notice for a proposed sole source under FAR 6.302 (which has subsections on the situations in which an agency can make a sole source award) must be published at least 15 days prior to that proposed sole source contract per FAR 5.203(a). There are many exceptions to this, as you might expect.
One in particular is that shorter periods can apply for acquisitions of commercial products and services. FAR 5.203 itself says agencies can establish a shorter time period than the 15-day rule for commercial acquisitions. But this exception itself has exceptions. For one, FAR 13.105, which governs the simplified acquisition procedures, states that “[t]he contracting officer must comply with the public display and synopsis requirements of 5.101 and 5.203 unless an exception in 5.202 applies.” This indicates that even for commercial procurements, if they are made with the simplified acquisition procedures, the 15-day rule applies. But, if those procedures do not apply, then, theoretically, if a sole source award is permitted, the agency as discretion to shorten the notice period as it wishes, although the language in FAR 5.203 that the contracting officer may “establish a shorter period” suggests there must be at least some notice period.
As for more generally applicable exceptions, the most unsurprising is where a sole source is being issued for reasons of unusual or compelling urgency under FAR 6.302-2. FAR 5.202(a)(2) notes that, in such cases, the awarding agency does not need to publish a notice at all where “the Government would be seriously injured if the agency complies” with the 15-day rule from 5.203. Another unsurprising exception to the notice requirement is with FAR 5.202(1): Where the synopsis would compromise national security, such as by disclosing classified information, the agency need not publish notice.
There is also an exception for sole sources made or required to be made through another government agency, or through a specific source (with the example of a workshop for the blind under the Committee for Purchase from People Who Are Blind or Severely Disabled). This is particularly notable with regards to SBA’s 8(a) Program. Now, FAR 5.205(f) provides that notice must still be given for 8(a) competitive acquisitions. But it says nothing about sole sources. As such, the understanding is that prior notice need not be given for 8(a) sole source awards.
There is additionally an exception at FAR 5.202(a)(13) that if the procurement is above the $25,000 threshold but under the simplified acquisition threshold, a prior notice is not required where the contract action is place on SAM and permits the public to respond to the solicitation electronically. Whether this would then apply to a sole source, for which there are no offers, is unclear.
Finally, among the most relevant exceptions, we note that there is an exception for orders placed under FAR subpart 16.5, which concerns orders placed under IDIQ contracts.
The RFO
The RFO seeks to change many things about federal procurement. When notice must be made regarding intent to sole source is no exception, although it retains much of the rules from the FAR. But there are some notable differences. First, under RFO 5.101(d), the new language clarifies that for contracts between $20,000 and $25,000, a 10-day prior notice must be given. For procurements above $25,000 up to the simplified acquisition threshold, 15-day notice must be given, although there remains that exception if the solicitation is posted on SAM and offerors can respond electronically. But the language clarifies that such only applies where offers themselves can be submitted electronically, which may suggest it does not apply to sole source awards. Now, if it’s above the simplified acquisition threshold, it depends. If the procurement is a commercial acquisition, it states that the notice may be combined with the solicitation, suggesting no prior notice is required. If it is non-commercial, then the typical 15-day rule applies.
Thus, the notice timelines are quite similar to the FAR. With regards to sole source awards, things are a little different. RFO 5.101(b)(2) provides that agencies do not need to provide a prior notice when “[u]sing other than full and open competition (see 6.103), except for the authorities at 6.103-1 (only one responsible source) and 6.103-6 (national security).” Now, as you may recall, an exception already applied for sole sources made for urgency, thus, for the bulk of sole source awards, the rule isn’t terribly different. But the exception for certain awards authorized or required by statute remains, and here, there is a key difference. RFO 6.103-5 clarifies that the exception to notice for 8(a) sole sources now extends to “[s]ole-source awards of certain socio-economic small business concerns (see 15 U.S.C. chapter 14A).” This suggests that the exception now also applies to sole sources to WOSBs, SDVOSBs, and HUBZone Program participants. Thus, the exceptions have been expanded. This appears to be the most significant difference between the old rule and the RFO on this topic.
Summary
The rules regarding notice of intent to sole source are complex to say the least, with several exceptions and then several exceptions to those exceptions. We are hopeful this post provides some insight into the matter, but always advise caution. The moment you learn of a potential sole source (or that a sole source has been made) and want to challenge, it is best to consult with a government contract attorney as soon as possible to determine whether the notice (or lack thereof) was proper. It may mean the difference between a successful and an unsuccessful challenge.
Questions about this post? Email us. Need legal assistance? Call us at 785-200-8919.
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