Determining the need for a subcontracting plan
Contracting officers must thoroughly assess and document the need for a subcontracting plan, ensuring compliance with thresholds and maximizing small business participation opportunities.
Overview
FAR 19.705-2 outlines the process contracting officers must follow to determine whether a subcontracting plan is required for a proposed contract or contract modification. The regulation requires officers to assess if the contract value exceeds the threshold specified in FAR 19.702(a) and to evaluate whether subcontracting opportunities exist based on industry practices, prequalification requirements, and the feasibility of subcontracting portions of the work. If no subcontracting possibilities are found, a detailed, higher-level-approved rationale must be documented. The section also addresses the timing for requiring subcontracting plans in solicitations, the prohibition on multiple plans per contract (with exceptions for IDIQ orders), and the need to update goals when modifications or options introduce new subcontracting opportunities. When a plan is added due to a modification or size re-representation, reporting requirements begin from the date of incorporation.
Key Rules
- Threshold Determination
- Contracting officers must determine if the contract or modification exceeds the subcontracting plan threshold in FAR 19.702(a).
- Assessment of Subcontracting Possibilities
- Officers must consider industry practices, prequalification requirements, and feasibility of subcontracting work.
- Documentation of No Subcontracting Possibilities
- If no opportunities exist, a detailed rationale must be approved above the contracting officer and filed.
- Solicitation Requirements
- Officers may require plans with initial offers or later, considering competition integrity and small business opportunities.
- Single Plan Rule and Goal Amendments
- Only one plan per contract, but separate goals for IDIQ orders are allowed; goals must be updated for new opportunities.
- Reporting for Added Plans
- When a plan is added, reporting starts from the incorporation date and must be cumulative.
Responsibilities
- Contracting Officers: Assess thresholds, evaluate subcontracting possibilities, document decisions, determine timing for plan submission, ensure only one plan per contract, and update/amend goals as needed.
- Contractors: Comply with plan requirements, update goals when modifications occur, and report achievements as required.
- Agencies: Approve no-subcontracting determinations at a higher level and maintain contract file documentation.
Practical Implications
- Ensures small business subcontracting opportunities are considered for eligible contracts.
- Requires careful documentation and justification when subcontracting is deemed not feasible.
- Impacts solicitation and contract administration processes, especially for modifications and IDIQ contracts.
- Common pitfalls include failing to document rationale for no plan, missing updates after modifications, or improper timing of plan submission.