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The GovCon Bulletin™

Sep, 2015

SBA Issues Final Rule Authorizing Sole Source Awards For WOSBs

On September 14, 2015, the U.S. Small Business Administration (“SBA”) published a final rule (the “Final Rule”) that implements congressional authority given to federal agencies under the National Defense Authorization Act for Fiscal Year 2015 (the “NDAA”) to make sole source awards to women-owned small businesses (WOSBs). The Final Rule also implements the NDAA’s mandate shortening the time period for the SBA to conduct a study to determine the industries in which WOSBs are underrepresented in federal contracting.

Under existing SBA regulations, contracting officers already may restrict competition (i.e., they may set aside contracts) to Economically Disadvantaged Women-Owned Small Businesses (EDWOSBs) in industries where WOSBs are underrepresented or substantially underrepresented, while they may set aside contracts for remaining WOSB’s in industries where the WOSB’s are substantially underrepresented. The Final Rule, which becomes effective October 14, 2015, now authorizes contracting officers to make sole source awards to EDWOSB’s and remaining WOSB’s in the respective industries in which set-asides are authorized.

The Final Rule also specifies the conditions under which contracting officers can make the sole source awards to WOSBs or EDWOSBs.  Specifically, if, after conducting market research in an industry where a WOSB or EDWOSB set-aside is authorized, a contracting officer cannot identify two or more WOSBs or EDWOSBs that can perform at a fair and reasonable price but identifies one WOSB or EDWOSB that can perform at a fair and reasonable price, a contract may be awarded on a sole source basis, as long as the value of the contract, including options, does not exceed $6.5 million for manufacturing contracts and $4 million for all other contracts.

Lastly, the Final Rule amends the SBA protest regulation in 13 CFR 127.600 to permit the SBA or the contracting officer to protest the EDWOSB or WOSB status of a proposed awardee of a sole source procurement.  The amended regulation leaves in place the right of interested parties to protest the EDWOSB or WOSB status of a successful offeror for all other EDWOSB or WOSB requirements.

Mark A. Amadeo