19.502-5 Insufficient reasons for not setting aside an acquisition
Source: FAR 19.502-5 on acquisition.gov
Contracting officers cannot use the listed reasons alone to avoid setting aside acquisitions for small businesses, ensuring fair access to federal contracting opportunities.
Overview
FAR 19.502-5 outlines specific reasons that, by themselves, are not sufficient to justify not setting aside an acquisition for small businesses. The regulation lists several common rationales that contracting officers may encounter but clarifies that these alone do not override the requirement to consider a small business set-aside. The intent is to prevent agencies from bypassing small business participation based on factors such as prior contract awards, planning lists, product qualifications, short solicitation periods, classification, perceived fairness in contract distribution, prior class set-asides, or the use of brand name or equal descriptions.
Key Rules
- Prior Small Business Awards
- A history of awarding contracts to small businesses does not justify excluding a new acquisition from set-aside consideration.
- Industrial Readiness Planning Program
- Being on a planning list is not a sufficient reason unless a large business on the list wants to supply the item.
- Qualified Products List (QPL)
- Presence on a QPL does not preclude a set-aside unless large businesses on the list want to participate.
- Short Solicitation Periods
- Less than 30 days for receipt of offers is not a valid reason to avoid a set-aside.
- Classified Acquisitions
- Classification status alone does not exempt an acquisition from set-aside consideration.
- Fair Proportion Argument
- The belief that small businesses already have a fair share of contracts is not sufficient to avoid a set-aside.
- Class Set-Aside by Another Activity
- Prior class set-asides by other contracting activities do not justify exclusion.
- Brand Name or Equal Descriptions
- Use of brand name or equal specifications does not preclude a set-aside.
Responsibilities
- Contracting Officers: Must not use the listed reasons alone to avoid setting aside acquisitions for small businesses and must document any valid justification if not setting aside.
- Contractors: Should be aware that these reasons cannot be used to exclude them from set-aside opportunities.
- Agencies: Should ensure oversight to prevent improper exclusion of small businesses from set-aside opportunities.
Practical Implications
- This section exists to reinforce the integrity of the small business set-aside program and prevent circumvention through commonly cited but insufficient justifications.
- It impacts daily contracting by requiring careful documentation and adherence to set-aside requirements, regardless of the listed circumstances.
- Common pitfalls include misinterpreting these reasons as valid grounds for exclusion, leading to potential protests or compliance issues.
None of the following is, in itself, sufficient cause for not setting aside an acquisition:
(a) A large percentage of previous contracts for the required item(s) has been placed with small business concerns.
(b) The item is on an established planning list under the Industrial Readiness Planning Program. However, a total small business set-aside shall not be made when the list contains a large business Planned Emergency Producer of the item(s) who has conveyed a desire to supply some or all of the required items.
(c) The item is on a Qualified Products List. However, a total small business set-aside shall not be made if the list contains the products of large businesses unless none of the large businesses desire to participate in the acquisition.
(d) A period of less than 30 days is available for receipt of offers.
(e) The acquisition is classified.
(f) Small business concerns are already receiving a fair proportion of the agency’s contracts for supplies and services.
(g) A class small business set-aside of the item or service has been made by another contracting activity.
(h) A "brand name or equal" product description will be used in the solicitation.