wittman brief09june2011

Approved for Public Release 1

Center for Workforce & Community Education

Government Contracting Seminar

Distribution Statement A:Approved for Public Release;

Distribution is Unlimited

Kris Parker & Pat Canciglia(540) 653-4806(540) 653-7958

09 June 2011

2

Agenda

•Introduction•Small Business Defined•Small Business Programs & Associated Changes

•Jobs Act/Accelerated Payments•Better Buying Power•Efforts at Dahlgren•Questions

Approved for Public Release


Brief SB Program History

• Began as a response to WWII needs• Small Business Mobilization Act of 1942 – Response by

Congress to help small plants compete with larger ones.– Act authorized a price premium to be paid in contracting with

small firms– Applicable only during wartime

• Armed Services Production Act of 1947 – provided that “…a fair proportion of total Federal purchases and contracts be placed with Small Business concerns…”– Act extended provisions of the SB Mobilization act to peacetime

• Defense Production Act of 1950 – provided that awards could be made to small businesses at other than the lowest possible price

• Small Business Act of 1953 – Created the Small Business Administration (SBA) as and independent agency of the Executive Branch– The Government should aid, counsel, assist, and protect, insofar

as possible, the interests of small business concerns to…ensure that a fair proportion of the total purchases be place with small business

4

What is a Small Business?

• A concern that:– Is FOR Profit– Is independently owned and operated– Is not dominant in the field of operation in which it is bidding on

Government Contracts– Can qualify under the size standards

• Size Standards:– Established by U.S. Small Business Administration (SBA) on an industry-

by-industry basis using North American Industry Classification System (NAICS) codes

– Size standards are based on:• For manufacturing, number of employees• For services and construction, average annual receipts for three

preceding accounting years• Example: NAICS 541330, Engineering Services, size standard is $27

million

• Federal Small Business concerns differ from state/local


Small Business Preference

• Federal Acquisition Regulations Provide:–Set Asides–Sole Source/Direct Award (for certain

concerns)–Mandatory % of $ to Small Business–Subcontracting requirements–Most provisions detailed in FAR 19


6

Small Business Programs

Conventional Small BusinessSmall

DisadvantagedBusiness

(SDB)

Section 8(a)

HUBZone

Woman-OwnedSmall Business

(WOSB)

Veteran-OwnedSmall Business

(VOSB)

Service-Disabled VOSB(SDVOSB)

Minority Institutions


7

SDB

• Small Disadvantaged Business (SDB)– Small Business 51% owned and operated by socially and

economically disadvantaged individuals– 8(a) Business Development Program is a Subset of SBD– As of 01 October 2008, Standard SDB criteria is a Self-

Certifying criteria


8

The 8(a) Program

• Section 8(a) of the Small Business Act established a Business Development Program for SDBs– An 8(a) SDB can be in the program for up to 9 years

• Exception: Native Alaskan and American Indian firms never graduate

• 8(a) provisions allow for set-aside and sole source efforts• 8(a) firms can receive direct, sole-source awards up to

following thresholds; – Manufacturing: $6.5 million (Increased from $5.5 million)– Services: $4.0 million (Increased from $3.5 million)– 8(a) competition normally used above these levels

• Exception: Native Alaskan/American Indian firms – no ceiling• SBA is legally the prime contractor for 8(a) contracts; however, DoD

activities execute contracts for the SBA under special partnership agreements


9

The 8(a) Program

• DoD/Navy Policy: once 8(a), always 8(a)– Assuming no material change to a requirement, a

graduated firm may no longer be able to compete for the work it performed

• 8(a) Status requires SBA Certification• IMPORTANT TO NOTE

– 8(a) Status must be valid at time of Contract Award for Sole Source Efforts

– 8(a) Status must be valid at time of Proposal Submission for 8(a) Competitive Set-Asides

– 13 CFR § 124


The 8(a) Program

• Recent Regulatory Updates enacted by the SBA effective 14 March 2011

• Changes include:–Clarification on factors determining

economic disadvantage– Increased reporting requirements for

Tribally-owned firms–New Ownership and Control

Requirements–Suspension for call-ups to active duty


11

WOSB/EDWOSB

• Women-Owned Small Business– Small Business Reauthorization Act of 2000 set stage for

WOSB Set-Asides– Criteria Divided in two categories:

• Woman Owned Small Business (WOSB)• Economically Disadvantaged Woman Owned Small Business

(EDWOSB)

– WOSB & EDWOSB Small Business concerns must be 51% owned and operated by one or more women

– Current regulations effective 04 February 2011– New FAR Clause 19.15 recently included to provide

guidance – NO SOLE SOURCE Provisions


12

WOSB/EDWOSB

• Women-Owned Small Business– Current Proposal Allows for WOSB Set-Asides as of 04

February 2011• Manufacturing: $6.5 million• All Others: $4.0 million

– Set-Asides Eligible ONLY for 83 Designated NAICS Codes• 45 Determined to be Underrepresented• 38 Determined to be Substantially Underrepresented

– WOSB is a Self-Certifying Criteria


13

VOSB/SDVOSB

• Veteran-Owned Small Business– Small Business 51% owned and operated by one or more

veterans

– Veterans Administration is the only Federal Agency with VOSB Set-Aside authority

• Service-disabled VOSB (SDVOSB)– SDVOSB provisions allow for set-aside and sole source

efforts– Subset of VOSB can receive direct (sole-source) awards

up to following thresholds;• Manufacturing: $6.0 million (Increased from $5.5 million)• Services: $3.5 million (Increased from $3.0 million)


VOSB/SDVOSB

• For SDVOSB sole source efforts:– Contracting Officer must determine that there is

only one qualified SDVOSB available

• The effort must not be currently performed by an 8(a) Small Business

• Both VOSB & SDVOSB are Self-Certifying concerns

14Approved for Public Release

15

HUBZone

• HUBZone Small Business• HUBZone provisions allow for set-aside and sole source

efforts• HUBZone firms can receive direct, sole-source awards up to

following thresholds; – Manufacturing: $6.5 million (Increased from $5.5 million)– Services: $4.0 million (Increased from $3.5 million)– Purchases must be >$150k for sole source provisions to be

exercised

• For HUBZone sole source efforts:– Contracting Officer must determine that there is only one

qualified HUBZone available

• The effort must not be currently performed by an 8(a) Small Business

• HUBZone Status requires SBA Certification Approved for Public Release

HUBZone

• IMPORTANT TO NOTE– HUBZone Status must be valid at time of Proposal

Submission and Contract Award– HUBZone Mapping to be updated later this year


Small Business Jobs Act

• Public Law 111-240, singed into effort 27 September 2010

• Officially restored “Parity”– Removed “Shall” from HUBZone verbiage and

replaced it with “May”

• Established Government-wide policy on Bundling

• Calls for annual Size Standard Certification• Significant federal financial investments and

tax incentives for Small Business


Accelerated Payment

• Interim Rule effective 27 April 2011• Modifies DFAR & Associated Payment

Systems to make Accelerated Payment to ALL Small Business

• Removes the term “Disadvantaged” from the DFAR Verbiage

• Current FPDS data reflects approx. 60,000 active Small Business contracts

• Targeted payment date of 7-10 days


19

Set-Aside Considerations

• All procurements between $3k and $150K automatically SB Set-Asides (FAR 19.502-2)

• Procurements >$150K shall be set-aside if two or more qualified small businesses available

• Repetitive procurements should follow suit unless market research indicated otherwise, e.g., an 8(a) set-aside is re-procured as 8(a), etc.

• Help us help you!


20

Sole Source Considerations

• Governed by FAR 6.3• Very high scrutiny• Only concerns w/Sole Source provisions:

– 8(a) – SDVOSB– HUBZone

• Local Sole Source Signature Authority to $12.5m


Fundamental Thoughts

• LEAD with your Capabilities –LEVERAGE your Concern

• Know your Market– Internal – Be familiar with the target

ordering office–External – Know your competition

• Focus your talents• Have a future plan with contingencies


Policy Trend:Better Buying Power

“Better Buying Power” - USD(AT&L) memo of 14Sep10-- Dr. Carter outlined his acquisition initiatives to deliver better value to the

taxpayer and our warfighters. They were organized under these topics: 1. Target Affordability and Control Cost Growth2. Incentivize Productivity and Innovation in Industry3. Promote Real Competition4. Improve Tradecraft in Service Acquisitions5. Reduce Non-Productive Processes and Bureaucracy

“Implementation Directive for Better Buying Power (USD(AT&L) memo 03Nov10)

-- Directs implementation of specific actions with regard to the five initiatives above.


Specific Direction Affecting Small Business

• Reinvigorate Industry IR&D/Protect DoD Technology Base– Enhance SBIR Program to Promote Role of Small

Business in Supporting DoD IRAD Needs• Increase Dynamic Small Business Role in

DoD Marketplace Competition– For All Competitive and Non-Competitive

Procurements, Seek Increased SB Participation Through Weighting Factors in Past Performance and in Fee Construct

• Increase Small Business Participation in Providing Services– Seek Opportunities to Compete Multiple-Award

ID/IQ Contracts Among Small Businesses



Competition & Small Business Opportunity at Dahlgren

• SeaPort Pre-Solicitation Announcements- Have become a practice at NSWCDD Contracts- Announcements allow companies more time to

prepare for the upcoming effort• SeaPort Sources Sought Announcements

- Posted whenever practicable- Provide every opportunity for Small Business

participation• Industry Days

• Highly encouraging early involvement with Program Managers and Industry Partners

• Acquisition Planning• Early identification of follow-on efforts;

concurrent with final option exercise

FY 2010 Contracting for NSWCDD Departments

Dollars Obligated Contract Actions


83%

17%

54%

46%

Services

Supplies

25

$-

$20,000

$40,000

$60,000

$80,000

$100,000

$120,000

$140,000

$160,000

$180,000

Thou

sand

s

FY 2010 Obligations - Top 10 FSC Groups ($000)

Top Ten FSC’s Account for 90% of

Obligations


NSWCDDCONTRACTING DOLLARS (INCLUDING PURCHASE CARDS) VS TOTAL OBLIGATIONAL AUTHORITY


WORK PRODUCT METRICS(NSWCDD)

*DATA INCLUDES CDSA, OTHER NASP TENANTS, PURCHASE CARDS, GRANTS AND OTHER TRANSACTIONS


Questions?


wittman brief09june2011

Education

small business wosb

small plants

small businesses

business development

small firms applicable

public release distribution

public release6

public release11