Proposed Rule Clarifies 8(a) Sole-Source Justification Requirement

On November 15, 2016, the U.S. Department of Defense, General Services Administration, and National Aeronautics and Space Administration issued a proposed rule, which can be found here, to clarify the justification requirement for 8(a) sole-source awards. Currently, an agency may not award a sole-source 8(a) contract over $22 million unless the contracting officer justifies the use of a sole-source contract in writing; the justification is approved by the appropriate official designated to approve contract awards for dollar amounts that are comparable to the amount of the sole-source contract; and the justification and related documentation are made available to the public.

The proposed rule clarifies that a justification under any other authority cannot be substituted for a sole-source 8(a) justification.

In addition, the proposed rule clarifies appropriate actions that contracting officers should take in the event a contract value rises above or below $22 million prior to award. Under the proposed rule, if the estimated contract value at the time of the submission of the offering letter exceeds $22 million, the contracting officer should include the approved justification with the offering letter. If the contract value at submission of the offering letter is less than or equal to $22 million, but the contract value at the time of award exceeds $22 million, the contracting officer should send the approved justification prior to contract award.

Lastly, the preamble to the proposed rule clarifies that if a contract modification is out of scope, it would be considered a new contract and would need to complete the appropriate process for a new contract and that contracting officers will use their discretion to determine if a modification is within the scope of an original contract.

Comments to the proposed rule are due on or before January 17, 2017.