Contracting Officers have several tools at their disposal to make sole source awards to SDVOSBs. Both Federal Acquisition Regulation (“FAR”) and Veterans Affairs Acquisition Regulation (“VAAR”) permit federal Contracting Officers to award sole source contracts to Service-Disabled Veteran-Owned Small Businesses (“SDVOSBs”). Using direct authority under FAR Part 19, sole source awards in non-manufacturing NAICS codes can be made up to $3.5 million. The Veteran Affairs’ (VA’s) authority to make SDVOSB sole source awards extends to contracts of up to $5 million. Finally, under FAR Subpart 13.500, commercial items may be procured on a sole source basis up to $6.5 million, provided that an appropriate Justification and Approval (J&A) is executed.

There are three (3) ways in which Government agencies may make sole source awards to SDVOSBs:

1. SDVOSB Sole Source Awards under the FAR

What Criteria Must be Met

A SDVOSB sole source award is appropriate where the contracting officer “does not have a reasonable expectation that offers would be received from two or more service-disabled veteran-owned small business concernsThe anticipated award price cannot exceed $6 million or or $3.5 million depending depending on the NAICS codeThe requirement must not have been accepted for performance within the 8(a) Business Development ProgramAward must be “a responsible contractor with respect to performanceThe agency must be able to make the award “at a fair and reasonable price

When these five criteria are satisfied, a procuring agency may issue a sole source award to a SDVOSB. The Contracting Officer should consider a SDVOSB sole source award before establishing a small business set-aside competition.

FAR Guidance

The FAR and the SDVOSB regulations of the U.S. Small Business Administration (“SBA”) govern the SDVOSB set-aside authority of most procuring agencies. Under FAR 19.1406, “[a] contracting officer shall consider a contract award to a SDVOSB concern on a sole source basis…before considering small business set-asides,” provided that certain conditions exist.

2. SDVOSB Sole Source Awards under the VAAR

What Criteria Must Be Met

“determined to be a responsible source with respect to performance of such contract opportunity award price of the contract must exceed the simplified acquisition threshold, but may not exceed $5 million “contract award can be made at a fair and reasonable price that offers best value to the United States”requirement must be synopsized in accordance with FAR part 5

VAAR Guidance

VA no longer operates under the SDVOSB provisions of FAR Part 19 and the SBA’s regulations. Rather, the VA operates under special SDVOSB authority established by the Veterans Benefits, Health Care, and Information Technology Act of 2006, which created the Veterans First Contracting Program. The rules implementing this program provide that a VA contracting officer may make a sole source award to a SDVOSB when four conditions exist.

VA may award a sole source contract up to $5M under any NAICS code without consideration of whether two or more SDVOSBs are likely to submit offers.

3. Sole Source Awards of Commercial Item Contracts

What Criteria Must Be Met

The simplified acquisition test authority allows agencies to use simplified acquisition procedures to acquire commercial items up to $6.5 million. Sole source authority can also be used for procurements above $650,000 provided that the advocate for competition for the procuring agency or an official described in FAR 6.304(a)(3) or (a)(4) approves the J&A.

FAR Guidance

While the sole source authority under FAR Part 13 is not tied to a recipient’s socioeconomic status, when a Contracting Officer uses the FAR Part 13 sole source authority to award to a SDVOSB, the procuring agency is entitled to take credit for that award against the agency’s SDVOSB goals!

HOW SAALEX CAN HELP:

Our Business Development team is ready to help you with any questions you may have about sole sourcing to SDVOSBs. Our team of experts are ready to assist your agency with successfully navigating through these requirements with the added bonus of helping to meet its socio-economic goals. For more information or to receive a white paper on Sole Sourcing, contact Mr. Devin Sappington at 321.704.9188 or via email: devin.sappington@saalex.com.

Saalex Solutions, Inc. is an Engineering and Information Technology Services company with a focus on, Test Range Operations and Maintenance, Integrated Logistics Support, Engineering Support and Information Technology Services. Founded in 1999 by Travis Mack, Saalex Solutions is a Small Disadvantaged, Service Disabled Veteran-Owned and Operated business headquartered in Camarillo, California