19.804-6 Indefinite delivery contracts
Source: FAR 19.804-6 on acquisition.gov
FAR 19.804-6 clarifies when SBA offers and acceptances are required for 8(a) orders under indefinite delivery contracts and how agencies can continue to take small business credit after a contractor exits the 8(a) program.
Overview
FAR 19.804-6 addresses the procedures and requirements for issuing orders under indefinite delivery contracts (such as IDIQs, GWACs, and Federal Supply Schedules) that involve 8(a) program participants. It clarifies when separate SBA offers and acceptances are required for individual orders, the conditions for sole source orders, and how agencies can continue to take credit for awards to 8(a) contractors even after they exit the 8(a) program or become other than small. The section also outlines the value thresholds and procedural requirements for issuing orders directly to 8(a) contractors.
Key Rules
- Offers and Acceptances
- No separate SBA offer and acceptance is needed for individual orders under multiple-award contracts set aside for exclusive 8(a) competition, as long as all 8(a) contract holders can compete. Offers and acceptances are required for orders under contracts not exclusively set aside for 8(a).
- Sole Source Orders
- Contracting officers may issue sole source orders under certain value thresholds if the contract was set aside for 8(a) competition and proper offering/acceptance procedures are followed.
- Direct Orders to 8(a) Contractors
- Direct orders may be issued to a single 8(a) contractor under specific value thresholds and procedural requirements.
- Continued Eligibility
- 8(a) contractors may continue to receive orders even after leaving the 8(a) program or becoming other than small.
- Credit Toward Goals
- Agencies may continue to count orders toward small business goals unless the contractor rerepresents as other than small or certain ownership changes occur.
Responsibilities
- Contracting Officers: Must determine when offers and acceptances are required, follow value thresholds, and ensure proper procedures for sole source and direct orders. Must track contractor status for credit toward small business goals.
- Contractors: Must comply with size and eligibility representations and notify of changes in status or ownership.
- Agencies: Must monitor and report on small business credit, and adjust reporting if contractor status changes.
Practical Implications
- Ensures clarity on when SBA involvement is needed for orders under 8(a) contracts.
- Helps agencies and contractors understand how continued eligibility and credit work after program exit or status change.
- Common pitfalls include failing to follow offer/acceptance procedures or misreporting small business credit after status changes.
(a) Separate offers and acceptances are not required for individual orders under multiple-award contracts (including the Federal Supply Schedules managed by GSA, multi-agency contracts or Governmentwide acquisition contracts, or indefinite-delivery, indefinite-quantity (IDIQ) contracts) that have been set aside for exclusive competition among 8(a) contractors, and the individual order is to be competed among all 8(a) contract holders. SBA's acceptance of the original contract is valid for the term of the contract. Offers and acceptances are required for individual orders under multiple-award contracts that have not been set aside for exclusive competition among 8(a) contractors.
(b) The contracting officer may issue an order on a sole source basis when—
(1) The multiple-award contract was set aside for exclusive competition among 8(a) participants;
(2) The order has an estimated value less than or equal to the dollar thresholds set forth at 19.805-1(a)(2); and
(3) The offering and acceptance procedures at 19.804-2 and 19.804-3 are followed.
(c) The contracting officer may issue an order directly to one 8(a) contractor in accordance with 19.504(c)(1)(ii) when—
(1) The multiple-award contract was reserved for 8(a) participants;
(2) The order has an estimated value less than or equal to $8.5 million for acquisitions assigned manufacturing NAICS codes and $5.5 million for all other acquisitions; and
(3) The offering and acceptance procedures at 19.804-2 and 19.804-3 are followed.
(d) An 8(a) contractor may continue to accept new orders under the contract, even if it exits the 8(a) program, or becomes other than small for the NAICS code(s) assigned to the contract.
(e) Agencies may continue to take credit toward their prime contracting small disadvantaged business or small business goals for orders awarded to 8(a) contractors, even after the contractor's 8(a) program term expires, the contractor otherwise exits the 8(a) program, or the contractor becomes other than small for the NAICS code(s) assigned under the 8(a) contract. However, if an 8(a) contractor rerepresents that it is other than small for the NAICS code(s) assigned under the contract in accordance with 19.301-2 or, where ownership or control of the 8(a) contractor has changed and SBA has granted a waiver to allow the contractor to continue performance (see 13 CFR 124.515), the agency may not credit any subsequent orders awarded to the contractor towards its small disadvantaged business or small business goals.