[Federal Register: April 13, 2009 (Volume 74, Number 69)]
[Proposed Rules]
[Page 16823-16829]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr13ap09-28]
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DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 2, 19 and 52
[FAR Case 2006-005; Docket 2009-0014; Sequence 1]
RIN 9000-AL18
Federal Acquisition Regulation; FAR Case 2006-005, HUBZone
Program Revisions
AGENCIES: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Proposed rule.
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SUMMARY: The Civilian Agency Acquisition Council and the Defense
Acquisition Regulations Council (Councils) are proposing to amend the
Federal Acquisition Regulation (FAR) to implement revisions to the
Small Business Administration's HUBZone Program as a result of
revisions to the Small Business Administration's regulations.
DATES: Interested parties should submit written comments to the FAR
Secretariat on or before June 12, 2009 to be considered in the
formulation of a final rule.
ADDRESSES: Submit comments identified by FAR case 2006-005 by any of
the following methods:
Regulations.gov: http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.regulations.gov. Submit
comments via the Federal eRulemaking portal by inputting ``FAR Case
2006-005'' under the heading ``Comment or Submission''. Select the link
``Send a Comment or Submission'' that corresponds with FAR Case 2006-
005. Follow the instructions provided to complete the ``Public Comment
and Submission Form''. Please include your name, company name (if any),
and ``FAR Case 2006-005'' on your attached document.
Fax: 202-501-4067.
Mail: General Services Administration, Regulatory
Secretariat (VIR), 1800 F Street, NW., Room 4041, ATTN: Hada Flowers,
Washington, DC 20405.
Instructions: Please submit comments only and cite FAR case 2006-
005 in all correspondence related to this case. All comments received
will be posted without change to http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://www.regulations.gov, including
any personal and/or business confidential information provided.
FOR FURTHER INFORMATION CONTACT: Rhonda Cundiff, Procurement Analyst,
at (202) 501-0044 for clarification of content. For information
pertaining to status or publication schedules, contact the FAR
Secretariat at (202) 501-4755. Please cite FAR case 2006-005.
SUPPLEMENTARY INFORMATION:
A. Background
On May 24, 2004, the Small Business Administration (SBA) published
a final rule in the Federal Register at 69 FR 29411, and on August 30,
2005, an interim rule at 70 FR 51243 amending its HUBZone regulations
at 13 CFR Part 126 to implement the Small Business Reauthorization Act
of 2000, the Consolidated Appropriations Act, 2005, and other various
policy changes. This rule proposes to amend the FAR, as follows, to
implement changes in the HUBZone regulations:
FAR 19.1303(d), Status as a qualified HUBZone small
business concern; 52.219-3, Notice of Total HUBZone Set-Aside; and
52.219-4, Notice of Price Evaluation Preference for HUBZone Small
Business Concerns, are revised to stipulate that to be eligible for a
HUBZone contract, a HUBZone small business concern must be a HUBZone
small business concern both at the time of its initial offer and at the
time of contract award. SBA revised the HUBZone regulations to require
HUBZone small business concerns to ``certify,'' at the time of their
initial offers and again at the time of contract award, their HUBZone
small business concern status. While the SBA regulations use the term
``certify,'' the certification is intended to be a ``representation''
as used in the FAR. Small business concern offerors are already
required to ``represent'' their HUBZone small business concern status
at the time of their initial offer.
FAR 52.219-3 and 52.219-4 are revised to add a requirement
that the HUBZone concern provide to the contracting officer a copy of
the notice required by 13 CFR 126.501 if material changes occur before
award that could affect its HUBZone eligibility.
The performance of work requirements of sections 52.219-3
and 52.219-4 are revised to be consistent with the SBA HUBZone
regulations. Alternate I would be used if there are not at least two
HUBZones that can meet the 50 percent requirement. FAR 19.1308,
Performance of work requirements (limitations on subcontracting), is
also revised to reflect the changes in the performance of work
requirements.
The definition of ``HUBZone contract,'' which is used in
the SBA
[[Page 16824]]
regulations, is added at section 2.101, Definitions.
This rule also proposes to revise the FAR as follows:
Adds ``qualified base closure areas'' and ``redesignated
areas'' to the list of HUBZone locations in the definition of
``HUBZone'' at section 2.101 as required by the Small Business
Reauthorization Act of 2000 and the Consolidated Appropriations Act,
2005.
Adds ``HUBZone joint ventures'' to the list of affiliates
that are controlled through contractual relationships at section
19.101, Explanation of terms, to recognize that HUBZone joint ventures,
comprised of members who are individually small under the appropriate
size standard, can qualify as HUBZone small business concerns when the
aggregate total of the joint venture is small under the size standard
for the NAICS code assigned to the contract, or alternative, when the
aggregate total of the joint venture is not small, and then either: (1)
for a procurement having a revenue-based size standard, the estimated
contract value exceeds half the size standard corresponding to the
NAICS code assigned to the contract; or (2) for a procurement having an
employee-based size standard, the estimated contract value exceeds $10
million.
Adds a definition in Subpart 19.3, Determination of Small
Business Status for Small Business Programs, for ``interested party''
and a notice that SBA will dismiss protests from offerors SBA
determines are not ``interested parties.''
Changes the protest procedures in 19.306, Protesting a
firm's status as a HUBZone small business concern, to require protests
to be ``submitted'' instead of ``received'' by certain specified dates
consistent with SBA regulations.
At 19.800, General, removes an obsolete reference to
priority of HUBZone 8(a) concerns, deleted from SBA regulations.
Adds options for obtaining information on HUBZone small
business concerns at 19.1303, Status as a qualified HUBZone small
business concern.
Changes the nonmanufacturer rule at 19.102, Size
standards, paragraph (f)(8), 19.1303(e), 52.219-3(e), and 52.219-4(f)
to be consistent with SBA HUBZone regulations.
Changes the HUBZone set-aside procedures at 19.1305 to
business days, and changes 19.1305(e)(3), HUBZone set-aside procedures,
to require SBA to file its formal appeal with the head of the agency.
Changes procedures for HUBZone sole source awards at
19.1306, HUBZone sole source awards, to be consistent with the HUBZone
regulations.
Adds procedures at 19.1307, Price evaluation preference
for HUBZone small business concerns, and 52.219-4 for how to make award
when, after considering the price evaluation preference, an offer
submitted by a qualified HUBZone is equal to an offer submitted by a
large business.
Retitles clause 52.219-3, ``Notice of Total HUBZone Set-
Aside,'' to ``Notice of Total HUBZone Set-Aside or Sole Source Award,''
and clarifies the clause prescription for sole source awards to
implement the performance of the work requirements of the clause in
sole source HUBZone awards.
In 52.219-3 and 52-219-4, adds a reference to SBA
definitions on limitations on subcontracting.
Adds to 52.219-8(d), Utilization of Small Business
Concerns, the requirement that the contractor shall confirm that a
subcontractor is certified by SBA as a HUBZone small business by
accessing the Central Contractor Registration database or contacting
SBA. Additional language to 52.219-8(d) requires that for a competitive
subcontract, the contractor must inform each unsuccessful subcontract
offeror in writing of the name and location of the apparent successful
offeror prior to award of the contract to the successful subcontract
offer.
In addition to these HUBZone small business changes, this rule
proposes to amend the FAR as follows:
Changes the term ``8(a) program'' at 19.000, Scope of part
to ``8(a) business development program'' to reflect the complete title
of the program. To avoid confusion, however, other references to the
8(a) program are unchanged since nothing other than the title of the
program is changed.
Deletes the terminology ``acquisition and property sale
assistance'' from ``joint venture--acquisition and property sales
assistance'' at 19.101 because the term ``acquisition'' added no
meaning and ``property sales'' are beyond the scope of the FAR. The
proposed rule also deletes the other reference to a ``property sale''
in the same paragraph.
This is not a significant regulatory action and, therefore, was not
subject to review under Section 6(b) of Executive Order 12866,
Regulatory Planning and Review, dated September 30, 1993. This rule is
not a major rule under 5 U.S.C. 804.
B. Regulatory Flexibility Act
On May 24, 2004, the Small Business Administration (SBA) published
a final rule in the Federal Register at 69 FR 29411, and on August 30,
2005, an interim rule at 70 FR 51243 amending its HUBZone regulations
at 13 CFR Part 126 to implement the Small Business Reauthorization Act
of 2000, the Consolidated Appropriations Act, 2005, and other various
policy changes. This rule proposes to revise the Federal Acquisition
Regulation (FAR) in order to update the FAR to comply with the Small
Business Administration's regulations as they pertain to acquisition.
The changes may have a significant economic impact on a substantial
number of small entities within the meaning of the Regulatory
Flexibility Act, 5 U.S.C. 601, et seq.
An Initial Regulatory Flexibility Analysis (IRFA) has been prepared
and will be provided to the Chief Counsel for Advocacy for the Small
Business Administration. The reason these changes may have a
significant economic impact on a substantial number of small entities
is because the small entities must comply with additional HUBZone
requirements as discussed below. In addition, the proposed rule adds
``qualified base closure areas'' and ``redesignated areas'' to the list
of HUBZone locations in the definition of ``HUBZone''. This means that
there will be more qualified HUBZone contractors competing for HUBZone
contracts. The analysis is summarized as follows:
The proposed FAR rule requires a HUBZone small business concern to
be eligible for the HUBZone Program both at the time of its initial
offer and at the time of contract award in addition to requiring the
HUBZone concern to provide to the contracting officer a copy of the
notice required by 13 CFR 126.501 if material changes occur before
award that could affect its HUBZone eligibility. These requirements
will eliminate some small businesses that are not eligible in both
instances. The requirement for a HUBZone small business concern to
provide to the contracting officer a copy of the notice required by 13
CFR 126.501 if material changes occur before award that could affect
its HUBZone eligibility will eliminate those vendors that are no longer
a HUBZone concern. This will result in those HUBZone concerns that are
still eligible to compete having to compete only among other eligible
HUBZone concerns, thus increasing their chances for award.
In addition, the proposed rule impacts some small business concerns
by revising the FAR to state that except for construction or service
contracts, when the total value of the contract exceeds
[[Page 16825]]
$25,000, a HUBZone small business concern nonmanufacturer must agree to
furnish in performing the contract only end items manufactured or
produced by HUBZone small business manufacturer concerns. In SBA's
final rule dated August 30, 2005, SBA states that it is difficult to
obtain a precise quantitative estimate of the impact these changes
might have on small businesses. However, SBA estimates that 220
counties will be added as HUBZones a result of base closures.
The FAR Secretariat has submitted a copy of the IRFA to the Chief
Counsel for Advocacy of the Small Business Administration. A copy of
the IRFA may be obtained from the FAR Secretariat. The Councils will
consider comments from small entities concerning the affected FAR parts
2, 19 and 52 in accordance with 5 U.S.C. 610. Comments must be
submitted separately and should cite 5 U.S.C 601, et seq. (FAR case
2006-005), in correspondence.
C. Paperwork Reduction Act
The Paperwork Reduction Act does not apply because the proposed
changes to the FAR do not impose information collection requirements
that require the approval of the Office of Management and Budget under
44 U.S.C. Chapter 35, et seq.
List of Subjects in 48 CFR Parts 2, 19 and 52
Government procurement.
Dated: March 20, 2009.
Al Matera,
Director, Office of Acquisition Policy.
Therefore, DoD, GSA, and NASA propose amending 48 CFR parts 2, 19
and 52 as set forth below:
1. The authority citation for 48 CFR parts 2, 19 and 52 continues
to read as follows:
Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 42
U.S.C. 2473(c).
PART 2--DEFINITIONS OF WORDS AND TERMS
2. Amend section 2.101 in paragraph (b)(2) by revising the
definition ``HUBZone''; adding, in alphabetical order, the definition
``HUBZone contract''; and adding a second sentence to the definition
``HUBZone small business concern''. The revised and added text read as
follows:
2.101 Definitions.
* * * * *
(b) * * *
(2) * * *
HUBZone means a historically underutilized business zone that is an
area located within one or more qualified census tracts, qualified
nonmetropolitan counties, lands within the external boundaries of an
Indian reservation, qualified base closure areas, or redesignated
areas, as defined in 13 CFR 126.103.
HUBZone contract means a contract awarded to a ``HUBZone small
business'' concern through any of the following procurement methods:
(1) A sole source award to a HUBZone small business concern;
(2) Set-aside awards based on competition restricted to HUBZone
small business concerns; or
(3) Awards to HUBZone small business concerns through full and open
competition after a price evaluation preference in favor of HUBZone
small business concerns.
HUBZone small business concern * * * 13 CFR 126.103.
* * * * *
PART 19--SMALL BUSINESS PROGRAMS
3. Amend section 19.000 by revising paragraph (a)(6) to read as
follows:
19.000 Scope of part.
(a) * * *
(6) The ``8(a)'' business development program (hereafter referred
to as 8(a) program), under which agencies contract with the SBA for
goods or services to be furnished under a subcontract by a small
disadvantaged business concern;
* * * * *
4. Amend section 19.101, in the definition ``Affiliates'' by
redesignating paragraphs (7)(ii) through (7)(v) as (7)(iii) through
(7)(vi), respectively, and adding a new paragraph (7)(ii); and revising
the paragraph heading and first sentence of the newly redesignated
paragraph (7)(iii) to read as follows:
19.101 Explanation of terms.
* * * * *
Affiliates. * * *
(7) * * *
(ii) HUBZone joint venture. A HUBZone joint venture of two or more
HUBZone small business concerns may submit an offer for a HUBZone
contract as long as each concern is small under the size standard
corresponding to the NAICS code assigned to the requirement, provided
one of the following conditions apply:
(A) The aggregate total of the joint venture is small under the
size standard corresponding to the NAICS code assigned to the contract.
(B) The aggregate total of the joint venture is not small under the
size standard corresponding to the NAICS code assigned to the contract
and either--
(1) For a revenue-based size standard, the estimated contract value
exceeds half the size standard corresponding to the NAICS code assigned
to the contract; or
(2) For an employee-based size standard, the estimated contract
value exceeds $10 million.
(iii) Joint venture. Concerns submitting offers on a particular
acquisition as joint ventures are considered as affiliated and
controlling or having the power to control each other with regard to
performance of the contract. * * *
* * * * *
5. Amend section 19.102 by adding paragraph (f)(8) to read as
follows:
19.102 Size standards.
* * * * *
(f) * * *
(8) For non-manufacturer rules pertaining to HUBZone contracts, see
19.1303(e).
* * * * *
6. Revise section 19.306 to read as follows:
19.306 Protesting a firm's status as a HUBZone small business concern.
(a) Definition as used in this section--
Interested party has the meaning given in 13 CFR 126.103.
(b) HUBZone Small Business Status. (1) For sole source
acquisitions, the SBA or the contracting officer may protest the
apparently successful offeror's HUBZone small business concern status.
(2) For all other acquisitions, an offeror that is an interested
party, the contracting officer, or the SBA may protest the apparently
successful offeror's HUBZone small business concern status.
(c) Protests relating to whether a HUBZone small business concern
is a small business for purposes of any Federal program are subject to
the procedures of subpart 19.3. Protests relating to small business
size status for the acquisition and the HUBZone qualifying requirements
will be processed concurrently by SBA.
(d) All protests must be in writing and must state all specific
grounds for the protest. Assertions that a protested concern is not a
qualified HUBZone small business concern, without setting forth
specific facts or allegations, are insufficient. An offeror must submit
its protest to the contracting officer. The contracting officer and the
SBA must submit protests to SBA's Associate
[[Page 16826]]
Administrator for the HUBZone Program (AA/HUB).
(e) The protest of an offeror that is an interested party must be
submitted by close of business on the fifth business day after bid
opening (in sealed bid acquisitions) or by close of business on the
fifth business day after notification by the contracting officer of the
apparently successful offeror (in negotiated acquisitions). Any protest
submitted after these time limits is untimely, unless it is submitted
by the SBA or the contracting officer. Any protest received prior to
bid opening or notification of intended award, whichever applies, is
premature and shall be returned to the protester.
(f) Except for premature protests, the contracting officer shall
forward all protests received, notwithstanding whether the contracting
officer believes that the protest is not sufficiently specific, timely,
or submitted by an interested party. The contracting officer shall also
forward a referral letter with the information required by 13 CFR
126.801(e).
(g) Protests may be submitted in person or by facsimile, express
delivery service, or U.S. mail (postmarked within the applicable time
period) to: Associate Administrator/Historically Underutilized
Business, AA/HUB, U.S. Small Business Administration, 409 3rd Street,
SW., Washington, DC 20416; Fax (202) 205-7167. The AA/HUB will notify
the protester and the contracting officer that the protest was received
and indicate whether the protest will be processed or dismissed for
lack of timeliness or specificity. A protest will be dismissed if SBA
determines the protester is not an interested party.
(h) SBA will determine the HUBZone status of the protested HUBZone
small business concern within 15 business days after receipt of a
protest. If SBA does not contact the contracting officer within 15
business days, the contracting officer may award the contract to the
apparently successful offeror, unless the contracting officer has
granted SBA an extension. The contracting officer may award the
contract after receipt of a protest if the contracting officer
determines in writing that an award must be made to protect the public
interest.
(i) SBA will notify the contracting officer, the protester, and the
protested concern of its determination. The determination is effective
immediately and is final unless overturned on appeal by SBA's Associate
Deputy Administrator for Government Contracting and Business
Development (ADA/GC&BD).
(j) The protested HUBZone small business concern, the protester, or
the contracting officer may file appeals of protest determinations with
SBA's ADA/GC&BD. The ADA/GC&BD must receive the appeal no later than 5
business days after the date of receipt of the protest determination.
SBA will dismiss any appeal received after the 5-day period.
(k) The appeal must be in writing. The appeal must identify the
protest determination being appealed and must set forth a full and
specific statement as to why the decision is erroneous or what
significant fact the AA/HUB failed to consider.
(l) The party appealing the decision must provide notice of the
appeal to the contracting officer and either the protested HUBZone
small business concern or the original protester, as appropriate. SBA
will not consider additional information or changed circumstances that
were not disclosed at the time of the AA/HUB's decision or that are
based on disagreement with the findings and conclusions contained in
the determination.
(m) The ADA/GC&BD will make its decision within 5 business days of
the receipt of the appeal, if practicable, and will base its decision
only on the information and documentation in the protest record as
supplemented by the appeal. SBA will provide a copy of the decision to
the contracting officer, the protester, and the protested HUBZone small
business concern. The SBA decision, if received before award, will
apply to the pending acquisition. SBA rulings received after award will
not apply to that acquisition. The ADA/GC&BD's decision is the final
decision.
7. Amend section 19.703 by revising paragraph (d)(1)(i) to read as
follows:
19.703 Eligibility requirements for participating in the program.
* * * * *
(d) * * *
(1) * * *
(i) HUBZone web page at http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://dsbs.sba.gov/dsbs/dsp_searchhubzone.cfm or http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=https://eweb1.sba.gov/hubzone/internet/general/approved-firms.cfm;
* * * * *
19.800 [Amended]
8. Amend section 19.800 by removing the second sentence of
paragraph (e).
19.803 [Amended]
9. Amend section 19.803 by removing from the end of paragraph (c)
``(but see 19.800(e))''.
19.804-3 [Amended]
10. Amend section 19.804-3 by removing from the end of paragraph
(a) ``(AA)/8(a)BD'' and adding ``AA/BD'' in its place.
19.805-1 [Amended]
11. Amend section 19.805-1 by removing from paragraph (d) ``(AA/
8(a)BD)'' each time it appears and adding ``AA/BD'' in its place.
12. Amend section 19.1301 by revising paragraph (a) to read as
follows:
19.1301 General.
(a) The Historically Underutilized Business Zone (HUBZone) Act of
1997 (15 U.S.C. 631 note) created the HUBZone Program.
* * * * *
13. Amend section 19.1303 by revising the section heading and
paragraphs (b), (c), and (d) and adding paragraph (e). The revised and
added text read as follows:
19.1303 Status as a HUBZone small business concern.
* * * * *
(b) If the SBA determines that a concern is a HUBZone small
business concern, it will issue a certification to that effect and will
add the concern to the List of Qualified HUBZone Small Business
Concerns http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=https://eweb1.sba.gov/hubzone/internet/general/approved-firms.cfm. Only firms on the list are HUBZone small business concerns,
eligible for HUBZone preferences. HUBZone preferences apply without
regard to the place of performance. Information on HUBZone small
business concerns can also be obtained at http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://dsbs.sba.gov/dsbs/dsp_dsbs.cfm or by writing to the Associate Administrator for the
HUBZone Program (AA/HUB) at U.S. Small Business Administration, 409 3rd
Street, SW., Washington, DC 20416 or at hubzone@sba.gov.
(c) A joint venture (see 19.101) may be considered a HUBZone small
business concern if it meets the criteria in the explanation of
affiliates in 19.101.
(d) To be eligible for a HUBZone contract under this section, a
HUBZone small business concern must be a HUBZone small business concern
both at the time of its initial offer and at the time of contract
award.
(e) A HUBZone small business concern may submit an offer for
supplies as a nonmanufacturer if it meets the requirements of the
nonmanufacturer rule set forth at 13 CFR 121.406(b)(1) and if the small
manufacturer providing the end item is also a HUBZone small business
concern.
[[Page 16827]]
(1) There are no waivers to the nonmanufacturer rule for HUBZone
contracts.
(2) For HUBZone contracts at or below $25,000 in total value, a
HUBZone small business concern may supply the end item of any
manufacturer, including a large business, so long as the product
acquired is manufactured or produced in the United States.
14. Amend section 19.1305 by removing from paragraph (a) ``A
participating agency'' and adding ``The'' in its place; and revising
paragraphs (c) and (e) to read as follows:
19.1305 HUBZone set-aside procedures.
* * * * *
(c) A contracting officer may set aside acquisitions exceeding the
micro-purchase threshold that do not exceed the simplified acquisition
threshold for competition restricted to HUBZone small business concerns
at the sole discretion of the contracting officer, provided the
requirements of paragraph (b) of this section can be satisfied.
* * * * *
(e) The procedures at 19.202-1 and, except for acquisitions not
exceeding the simplified acquisition threshold, at 19.402 apply to this
section.
(1) When the SBA intends to appeal a contracting officer's decision
to reject a recommendation of the SBA procurement center representative
(or, if a procurement center representative is not assigned, see
19.402(a)) to set aside an acquisition for competition restricted to
HUBZone small business concerns, the SBA procurement center
representative shall notify the contracting officer, in writing, of its
intent within 5 business days of receiving the contracting officer's
notice of rejection.
(2) Upon receipt of notice of SBA's intent to appeal, the
contracting officer shall suspend action on the acquisition unless the
head of the contracting activity makes a written determination that
urgent and compelling circumstances, which significantly affect the
interests of the Government, exist.
(3) Within 15 business days of SBA's notification to the
contracting officer, SBA must file its formal appeal with the head of
the agency, or the appeal will be deemed withdrawn. The head of the
agency shall reply to SBA within 15 business days of receiving the
appeal. The decision of the head of the agency shall be final.
15. Amend section 19.1306 by revising paragraph (a) to read as
follows:
19.1306 HUBZone sole source awards.
(a) An agency contracting officer may award contracts to HUBZone
small business concerns on a sole source basis without considering
small business set-asides (see Subpart 19.5), provided none of the
exclusions at 19.1304 apply and--
(1) The contracting officer does not have a reasonable expectation
that offers would be received from two or more HUBZone small business
concerns;
(2) The anticipated price of the contract, including options, will
not exceed--
(i) $5.5 million for a requirement within the NAICS codes for
manufacturing; or
(ii) $3.5 million for a requirement within all other NAICS codes;
(3) The acquisition is greater than the simplified acquisition
threshold (see part 13);
(4) The HUBZone small business concern has been determined to be a
responsible contractor with respect to performance; and
(5) Award can be made at a fair and reasonable price.
* * * * *
16. Amend section 19.307 by adding paragraph (e) to read as
follows:
19.1307 Price evaluation preference for HUBZone small business
concerns.
* * * * *
(e) When the two highest rated offerors are a HUBZone small
business concern and a large business, and the evaluated offer of the
HUBZone small business concern is equal to the evaluated offer of the
large business after considering the price evaluation preference, the
contracting officer shall award the contract to the HUBZone small
business concern.
19.1308 [Redesignated as 19.1309]
17. Redesignate section 19.1308 as 19.1309; and add a new section
19.1308 to read as follows:
19.1308 Performance of work requirements (limitations on
subcontracting).
(a) Before issuing a solicitation for general construction or
construction by special trade contractors, the contracting officer must
determine if at least two HUBZone small business concerns can
individually perform at least 50 percent of the cost of contract
performance incurred for personnel, using its own employees or
subcontract employees of other HUBZone small business concerns. If not,
the clause at 52.219-3 Notice of Total HUBZone Set-Aside or Sole Source
Award, or 52.219-4, Notice of Price Evaluation Preference for HUBZone
Small Business Concerns, shall be used, as applicable, with its
Alternate I (see 19.1309).
(b) See 13 CFR 125.6 for definitions of terms used in paragraph (a)
of this section.
18. Revise the newly designated section 19.1309 to read as follows:
19.1309 Contract clauses.
(a) The contracting officer shall insert the clause 52.219-3,
Notice of Total HUBZone Set-Aside or Sole Source Award, in
solicitations and contracts for acquisitions that are set aside for, or
awarded on a sole source basis to, HUBZone small business concerns
under 19.1305 or 19.1306. The contracting officer shall insert the
clause with its Alternate I if market research indicates that there are
not at least two HUBZone small business concerns that can meet the
requirements of 19.1308.
(b) The contracting officer shall insert the clause at FAR 52.219-
4, Notice of Price Evaluation Preference for HUBZone Small Business
Concerns, in solicitations and contracts for acquisitions conducted
using full and open competition. The clause shall not be used in
acquisitions that do not exceed the simplified acquisition threshold.
The contracting officer shall insert the clause with its Alternate I if
market research indicates that there are not at least two HUBZone small
business concerns that can meet the requirements of 19.1308.
PART 33--PROTESTS, DISPUTES, AND APPEALS
19. Amend section 33.102 by revising the second sentence of
paragraph (a) to read as follows:
33.102 General.
(a) * * * (See 19.302 for protests of small business status, 19.305
for protests of disadvantaged business status, 19.306 for protests of
HUBZone small business status, and 19.307 for protests of service-
disabled veteran-owned small business status.
* * * * *
PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
20. Amend section 52.212-3 by revising the date of the provision;
removing from paragraph (c)(10)(i) the word ``change'' and adding
``changes'' in its place and removing the word ``has'' and adding
``have'' in its place; and revising paragraph (c)(10)(ii). The revised
text reads as follows:
52.212-3 Offeror Representations and Certifications--Commercial Items.
* * * * *
[[Page 16828]]
Offeror Representations and Certifications--Commercial Items (Date)
* * * * *
(c) * * *
(10) * * *
(ii) It [ballot] is, [ballot] is not a HUBZone joint venture
that complies with the requirements of 13 CFR Part 126, and the
representation in paragraph (c)(10)(i) of this provision is accurate
for each HUBZone small business concern participating in the HUBZone
joint venture. [The offeror shall enter the names of each of the
HUBZone small business concerns participating in the HUBZone joint
venture: --------------------.] Each HUBZone small business concern
participating in the HUBZone joint venture shall submit a separate
signed copy of the HUBZone representation.
* * * * *
(End of provision)
21. Amend section 52.212-5 by revising the date of the clause,
paragraphs (b)(3), (b)(4), and (b)(8); and removing from paragraph
(e)(1)(ii) ``Feb 2009'' and adding ``(Date)'' in its place. The revised
text reads as follows:
52.212-5 Contract Terms and Conditions required to implement Statutes
or Executive Orders--Commercial items.
* * * * *
CONTRACT TERMS AND CONDITIONS REQUIRED TO IMPLEMENT STATUTES OR
EXECUTIVE ORDERS--COMMERCIAL ITEMS (DATE)
* * * * *
(b) * * *
----(3) 52.219-3, Notice of Total HUBZone Set-Aside or Sole
Source Award (Date) (15 U.S.C. 657a).
----(4) 52.219-4, Notice of Price Evaluation Preference for
HUBZone Small Business Concerns (Date) (if the offeror elects to
waive the preference, it shall so indicate in its offer) (15 U.S.C.
657a).
* * * * *
------(8) 52.219-8, Utilization of Small Business Concerns
(Date) (15 U.S.C. 637(d)(2) and (3)).
* * * * *
(End of clause)
22. Amend section 52.213-4 by revising the date of the clause and
paragraph (a)(2)(vi) to read as follows:
52.213-4 Terms and Conditions--Simplified Acquisitions (Other Than
Commercial Items).
* * * * *
TERMS AND CONDITIONS--SIMPLIFIED ACQUISITIONS (OTHER THAN COMMERCIAL
ITEMS) (DATE)
* * * * *
(a) * * *
(2) * * *
(vi) 52.244-6, Subcontracts for Commercial Items (Date).
* * * * *
(End of clause)
23. Amend section 52.219-1 by revising the date of the clause and
paragraphs (b)(6)(i) and (b)(6)(ii) to read as follows:
52.219-1 Small Business Program Representations.
* * * * *
SMALL BUSINESS PROGRAM REPRESENTATIONS (DATE)
* * * * *
(b) * * *
(6) * * *
(i) It [ballot] is, [ballot] is not a HUBZone small business
concern listed, on the date of this representation, on the List of
Qualified HUBZone Small Business Concerns maintained by the Small
Business Administration; and no material changes in ownership and
control, principal office, or HUBZone employee percentage have
occurred since it was certified in accordance with 13 CFR Part 126;
and
(ii) It [ballot] is, [ballot] is not a HUBZone joint venture
that complies with the requirements of 13 CFR Part 126, and the
representation in paragraph (b)(6)(i) of this provision is accurate
for each HUBZone small business concern participating in the HUBZone
joint venture. [The offeror shall enter the names of each of the
HUBZone small business concerns participating in the HUBZone joint
venture: --------------------.] Each HUBZone small business concern
participating in the HUBZone joint venture shall submit a separate
signed copy of the HUBZone representation.
* * * * *
24. Revise section 52.219-3 to read as follows:
52.219-3 Notice of Total HUBZone Set-Aside or Sole Source Award.
As prescribed in 19.1309(a), insert the following clause:
NOTICE OF TOTAL HUBZONE SET-ASIDE OR SOLE SOURCE AWARD (DATE)
(a) Definitions. See 13 CFR 125.6(e) for definitions of terms
used in paragraph (c).
(b) General. (1) Offers are solicited only from HUBZone small
business concerns. Offers received from concerns that are not
HUBZone small business concerns will not be considered.
(2) Any award resulting from this solicitation will be made to a
HUBZone small business concern.
(c) Agreement. A HUBZone small business concern agrees that, in
the performance of the contract, in the case of a contract for--
(1) Services (except construction), at least 50 percent of the
cost of personnel for contract performance will be spent for
employees of the concern or employees of other HUBZone small
business concerns;
(2) Supplies (other than acquisition from a nonmanufacturer of
the supplies), at least 50 percent of the cost of manufacturing,
excluding the cost of materials, will be performed by the concern or
other HUBZone small business concerns;
(3) General construction, at least 50 percent of the cost of the
contract performance incurred for personnel will be spent on the
concern's employees or on a combination of the concern's employees
and employees of HUBZone small business concern subcontractors. At
least 15 percent of the cost of contract performance incurred for
personnel will be spent on the concern's employees. No more than 50
percent of the cost of contract performance incurred for personnel
will be subcontracted to concerns that are not HUBZone small
business concerns; or
(4) Construction by special trade contractors, at least 50
percent of the cost of the contract performance incurred for
personnel will be spent on the concern's employees or on a
combination of the concern's employees and employees of HUBZone
small business concern subcontractors. At least 25 percent of the
cost of contract performance incurred for personnel will be spent on
the concern's employees. No more than 50 percent of the cost of
contract performance incurred for personnel will be subcontracted to
concerns that are not HUBZone small business concerns.
(d) A HUBZone joint venture agrees that, in the performance of
the contract, the applicable percentage specified in paragraph (c)
of this clause will be performed by the aggregate of the HUBZone
small business participants.
(e)(1) When the total value of the contract exceeds $25,000, a
HUBZone small business concern nonmanufacturer agrees to furnish in
performing this contract only end items manufactured or produced by
HUBZone small business concern manufacturers.
(2) When the total value of the contract is equal to or less
than $25,000, a HUBZone small business concern nonmanufacturer may
provide end items manufactured by other than a HUBZone small
business concern manufacturer provided the end items are produced or
manufactured in the United States.
(3) Paragraphs 1 and 2 do not apply in connection with
construction or service contracts.
(f) Notice. If this solicitation has been set-aside for HUBZone
small business concerns or the price evaluation preference for
HUBZone small business concerns applies, the HUBZone small business
offeror acknowledges the requirement that a prospective HUBZone
awardee must be a HUBZone small business concern at the time of
award of this contract. The HUBZone offeror shall provide the
Contracting Officer a copy of the notice required by 13 CFR 126.501
if material changes occur before contract award that could affect
its HUBZone eligibility. If the apparently successful HUBZone
offeror is not a HUBZone small business concern at the time of award
of this contract, the Contracting Officer will proceed to award to
the next otherwise successful HUBZone small business concern or
other offeror.
[[Page 16829]]
(End of Clause)
Alternate I (Date). As prescribed in 19.1309(a), substitute the
following paragraphs (c)(3) and (c)(4) for paragraphs (c)(3) and (c)(4)
of the basic clause:
(3) General construction, at least 15 percent of the cost of the
contract performance incurred for personnel will be spent on the
concern's employees; or
(4) Construction by special trade contractors, at least 25
percent of the cost of the contract performance incurred for
personnel will be spent on the concern's employees.
25. Amend section 52.219-4 by--
a. Revising the prescription, date of the clause, and paragraph
(a);
b. Adding paragraph (b)(4);
c. Removing from paragraph (c) ``paragraph (d) of'' and adding
``paragraphs (d) and (e) of'' in its place;
d. Revising paragraphs (d)(3), (d)(4), (e) and (f);
e. Adding paragraph (g) and Alternate I.
The revised and added text reads as follows:
52.219-4 Notice of Price Evaluation Preference for HUBZone Small
Business Concerns.
As prescribed in 19.1309(b), insert the following clause:
NOTICE OF PRICE EVALUATION PREFERENCE FOR HUBZONE SMALL BUSINESS
CONCERNS (DATE)
(a) Definitions. See 13 CFR 125.6(e) for definitions of terms
used in paragraph (d).
(b) * * *
(4) When the two highest rated offerors are a HUBZone small
business concern and a large business, and the evaluated offer of
the HUBZone small business concern is equal to the evaluated offer
of the large business after considering the price evaluation
preference, award will be made to the HUBZone small business
concern.
(d) * * *
(3) General construction, at least 50 percent of the cost of the
contract performance incurred for personnel will be spent on the
concern's employees or on a combination of the concern's employees
and employees of HUBZone small business concern subcontractors. At
least 15 percent of the cost of contract performance incurred for
personnel will be spent on the concern's employees. No more than 50
percent of the cost of contract performance incurred for personnel
will be subcontracted to concerns that are not HUBZone small
business concerns; or
(4) Construction by special trade contractors, at least 50
percent of the cost of the contract performance incurred for
personnel will be spent on the concern's employees or on a
combination of the concern's employees and employees of HUBZone
small business concern subcontractors. At least 25 percent of the
cost of contract performance incurred for personnel will be spent on
the concern's employees. No more than 50 percent of the cost of
contract performance incurred for personnel will be subcontracted to
concerns that are not HUBZone small business concerns.
(e) A HUBZone joint venture agrees that the aggregate of the
HUBZone small business concerns to the joint venture, not each
concern separately, will perform the applicable percentage of work
requirements.
(f)(1) When the total value of the contract exceeds $25,000, a
HUBZone small business concern nonmanufacturer agrees to furnish in
performing this contract only end items manufactured or produced by
HUBZone small business concern manufacturers.
(2) When the total value of the contract is equal to or less
than $25,000, a HUBZone small business concern nonmanufacturer may
provide end items manufactured by other than a HUBZone small
business concern manufacturer provided the end items are produced or
manufactured in the United States.
(3) Paragraphs 1 and 2 do not apply in connection with
construction or service contracts.
(g) Notice. If this solicitation has been set aside for HUBZone
small business concerns or the price evaluation preference for
HUBZone small business concerns applies, the HUBZone small business
offeror acknowledges the requirement that a prospective HUBZone
awardee must be a HUBZone small business concern at the time of
award of this contract. The HUBZone offeror shall provide the
Contracting Officer a copy of the notice required by 13 CFR 126.501
if material changes occur before contract award that could affect
its HUBZone eligibility. If the apparently successful HUBZone
offeror is not a HUBZone small business concern at the time of award
of this contract, the Contracting Officer will proceed to award to
the next otherwise successful HUBZone small business concern or
other offeror.
(End of Clause)
Alternate I (Date). As prescribed in 19.1309(b), substitute the
following paragraphs (d)(3) and (d)(4) for paragraphs (d)(3) and (d)(4)
of the basic clause:
(3) General construction, at least 15 percent of the cost of the
contract performance incurred for personnel will be spent on the
concern's employees; or
(4) Construction by special trade contractors, at least 25
percent of the cost of the contract performance incurred for
personnel will be spent on the concern's employees.
26. Amend section 52.219-8 by revising the date of the clause and
paragraph (d) to read as follows:
52.219-8 Utilization of Small Business Concerns.
* * * * *
UTILIZATION OF SMALL BUSINESS CONCERNS (DATE)
* * * * *
(d)(1) Contractors acting in good faith may rely on written
representations by their subcontractors regarding their status as a
small business concern, a veteran-owned small business concern, a
service-disabled veteran-owned small business concern, a small
disadvantaged business concern, or a women-owned small business
concern.
(2) The Contractor shall confirm that a subcontractor
representing itself as a HUBZone small business concern is certified
by SBA as a HUBZone small business concern by accessing the Central
Contractor Registration (CCR) database or by contacting the SBA.
Options for contacting the SBA include--
(i) HUBZone web page at http://frwebgate.access.gpo.gov/cgi-bin/leaving.cgi?from=leavingFR.html&log=linklog&to=http://dsbs.sba.gov/dsbs/dsp_searchhubzone.cfm;
(ii) In writing to the--AA/HUB, U.S. Small Business
Administration, 409 3rd Street, SW., Washington DC 20416; or
(iii) E-mail at hubzone@sba.gov.
(3) Upon determination of the successful subcontract offeror for
a competitive subcontract, the Contractor must inform each
unsuccessful subcontract offeror in writing of the name and location
of the apparent successful offeror prior to award of the contract.
(End of clause)
52.244-6 [Amended]
27. Amend section 52.244-6 by removing from the clause heading
``(Dec 2008)'' and adding ``(Date)'' in its place; and by removing from
paragraph (c)(1)(ii) ``(May 2004)'' and adding ``(Date)'' in its place.
[FR Doc. E9-8318 Filed 4-10-09; 8:45 am]
BILLING CODE 6820-EP-P