responsible for summarizing and reporting to the Director, OSDBU, on a quarterly basis, all prime contracts $500,000 and over ($1 million for construction) using the following reporting format:

(a) Name of the OPDIV and program office;

(b) Number and dollar amount of contracts requiring subcontracting plans;

(c) Number of contracts with subcontracting plans;

(d) Number of contracts without subcontracting plans;

(e) Small and small disadvantaged business subcontracting goals; and

(f) Statements citing reasons why small and small disadvantaged business subcontracting plans were not included in the contracts.

319.706 Responsibilities of the cognizant

administrative contracting officer.

(a) The contracting officer shall comply with the requirements of FAR 19.706(a), and shall use the Standard Form 294, Subcontracting Report for Individual Contracts, to monitor the contractor's progress in achieving both the small business and small disadvantaged business subcontracting goals. The contracting officer shall require the contractor to provide in the Remarks block of each Standard Form 294 submitted a narrative of the progress in fulfilling the small business and small disadvantaged business subcontracting goals. The contracting officer shall require the contractor to report any difficulties in achieving the goals and the actions being taken by the contractor to overcome the difficulties. The contracting officer shall document the contract file whenever the contractor is experiencing difficulties in achieving the planned subcontracting goals, and shall indicate the actions taken by the contractor to resolve the difficulties and the actions taken by the contracting officer to remedy the situation. A copy of this documentation shall be provided to the SADBUS.

(b) At the time of physical completion of the contract, the contracting officer shall prepare a memorandum for record for inclusion in the contract file indicating whether or not the con

tractor complied with the subcontracting plan and subcontracting provisions of the contract.

(1) If the contractor achieved its subcontracting dollar goals for both small business and small disadvantaged business, the memorandum shall state that the contractor complied with the subcontracting plan and provisions of the contract. No other documentation is needed.

(2) If the contractor failed to achieve its subcontracting dollar goals for either small business or small disadvantaged business, or both, the contracting officer shall indicate this failure in the memorandum and determine whether the contractor did or did not exercise its best efforts in attempting to achieve the goals.

(i) If determined that the contractor exercised its best efforts, the contractor shall be found to have complied with the subcontracting plan and provisions of the contract. The rationale for this determination shall be documented in the memorandum.

(ii) If determined that the contractor did not exercise its best efforts, the contractor shall be found to have not complied with the subcontracting plan and provisions of the contract. The reasons for this determination shall be documented in the memorandum, along with a description of specific actions taken by the contracting officer during the performance of the contracting to attempt to remedy the fail

ure.

(c) A copy of the memorandum pertaining to either situation described in paragraph (b)(2) (i) or (ii) of this section shall be sent to the Director, Office of Small and Disadvantaged Business Utilization.

[50 FR 46299, Nov. 7, 1985]

Subpart 319.8—Contracting with the Small Business Administration (The 8(a) Program)

SOURCE: 52 FR 27558, July 22, 1987, unless otherwise noted.

319.801 General.

The signing of the contract document may be accepted as SBA's certifi

cation that SBA is competent to perform a specific HHS requirement.

319.803 Selecting acquisitions for the 8(a)

program.

Brochures of 8(a) concerns which have been interviewed by the Office of Small and Disadvantaged Business Utilization (OSDBU) are forwarded to each small and disadvantaged business utilization specialist (SADBUS). These brochures are to be reviewed by the SADBUS to match HHS requirements with the capabilities of these concerns. The SADBUS will make the capabilities of these concerns known to program personnel and will obtain other information, as needed, by contacting OSDBU or the Small Business Administration (SBA).

319.870 Acquisition of technical requirements.

(a) Source selection. (1) SBA has ultimate responsibility for nomination of an 8(a) subcontractor for a proposed 8(a) requirement and may elect to deviate from usual source nomination procedures.

(2) Except for cases where SBA selects a concern for an 8(a) award, or as provided in paragraph (a)(3) below, limited technical competition shall be conducted for requirements for consulting services, computer science and related services, research, development, test, evaluation, demonstration, and technical and professional services, where technical aspects, methodology, or approach are of primary importance rather than price. Limited technical competition may be conducted on the basis of written technical proposals or oral technical discussions coupled with a review of the concerns' capability statements. (However, SBA encourages the submission of "open requirements" (requirements without source recommendations) so that assistance may be afforded to concerns having the greatest need. In particular, SBA has requested that requirements for CPA audit services be submitted as "open requirements" except where sole source offerings are appropriate (see paragraph (a)(3) below). SBA has also determined that the selection procedures outlined in the "Brooks Bill" must be utilized in the

award of A & E requirements under the 8(a) program. Therefore, whenever feasible, at least three 8(a) A & E concerns shall be evaluated for each A & E acquisition. Further, to the extent feasible and practical, A & E contracts awarded under the 8(a) program shall be made to concerns which have their home office located in the metropolitan area or state where the work is to be performed.)

(3) There may be circumstances where one 8(a) concern has exclusive or predominant capability among 8(a) concerns by reason of experience, specialized facilities, or technical competence to perform the work within the time required. In these circumstances, after coordinating with the SADBUS, the initiating program office may recommend, for approval by the contracting officer, that only that 8(a) concern be considered for nomination to SBA. This recommendation shall be in writing, setting forth full and complete justification for the nomination. The justification shall be submitted to the appropriate contracting officer, through the SADBUS, for concurrence, and shall be maintained as a permanent record in the contract file. In addition, a copy of the justification shall be included in the offering letter to SBA.

(4) Where limited technical competition is required or is determined to be appropriate, the sources (i.e., concerns) which are to be included will be decided by the contracting activity in consultation with SBA. Consultation will be initiated by nomination of sources recommended by program officials and the SADBUS, and, if SBA elects, by SBA.

(5) Each 8(a) concern or group of concerns nominated for a specific 8(a) requirement shall have been approved by SBA for that particular requirement prior to any discussion with the concern(s) about the requirement.

(6) It is conceivable that limited technical competition will assist in the development of 8(a) concerns. However, contracting activities should recognize that to involve a large number of 8(a) concerns in a limited technical competition may have an adverse impact on the limited financial resources of these concerns. Usually,

three to five concerns should be nominated, depending on the nature of the intended contract and subject to

SBA's approval.

(b) Offering letter. (1) When a decision has been made by the SADBUS, program director, and contracting officer to process an acquisition through the Small Business Administration, under provisions of section 8(a) of the Small Business Act, the contracting activity shall promptly furnish the applicable SBA office a letter offering the acquisition to the SBA, with information copies to the SADBUS and OSDBU. The offering letter to SBA should transmit the following:

(i) A description of work to be performed or items to be delivered;

(ii) The names of the concerns nominated for technical competition or the name of the concern nominated for award. (For limited technical competition, indicate whether or not written technical proposals are desired. If only one concern is nominated, a written justification must be included to substantiate limiting the nomination to as indicated in

one

source,

319.870(a)(3));

(iii) Contracting activity dollar estimate of the requirement;

(iv) Acquisition history (e.g., first time offered, items or services not presently being provided by a small business concern, etc.);

(v) Period of performance;

(vi) Any special requirements, restrictions, or geographical limitations (e.g., turn-around time demands a concern within two hours travel time, etc.);

(vii) A statement to the effect that public soliciation for the acquisition has not been issued for small business set-aside;

(viii) A statement to the effect that the acquisition cannot reasonably be expected to be won by an eligible 8(a) concern under normal competitive means;

(ix) Type of proposed contract (i.e., fixed-price, cost plus fixed-fee, requirements, etc.);

(x) A list of contractors who have performed on the specific requirement during the previous 12 months;

(xi) The applicable SIC code; and

(xii) The applicable DCIS product/ service code.

(2) Within ten (10) business days after receipt of the offering letter, SBA is to acknowledge the offering letter and accept or reject the requirement. If SBA has not acknowledged the offering letter within this period, the contracting activity, after giving due regard to the urgency of the acquisition, may withdraw the offer by giving written notice to SBA.

(c) Technical evaluation. (1) When the concerns to be included in the limited technical competition have been determined by the contracting activity, in consultation with SBA, the contracting officer shall hold a technical competition among those concerns. Cost factors shall not be included in the technical proposals nor brought out in any manner during technical discussions of the proposals.

(2) When the limited technical competition is completed, a technical evaluation report shall be prepared and signed by the technical evaluators. The report shall indicate the ranking of the concerns, include a narrative evaluation specifying the strengths and weaknesses of each concern, and state any reservations or qualifications that might bear upon the selection of a source for negotiation and award. The technical evaluation report is required whether the limited technical competition was conducted on the basis of written technical proposals or oral technical discussions. The technical evaluation report shall be furnished the contracting officer and maintained as a permanent record in the contract file.

(3) The contracting officer shall send a letter to the SBA naming the highest rated concern and indicating the concern appears to have the capability to perform the requirement. The letter shall request authority to negotiate with the concern nominated for award, and include the title of the acquisition and the national buy number assigned by SBA. No other data need be furnished to SBA. Within ten (10) business days after receipt of the letter, the local SBA office will contact the contracting officer to arrange for contract negotiation. If a shorter response time is required, the contract

ing officer should notify SBA in the letter.

(d) Negotiation. (1) When requested by SBA, the contracting activity shall render all possible assistance to SBA with respect to SBA's negotiation of 8(a) subcontracts. However, SBA will usually delegate negotiation authority to the HHS contracting activity.

(2) The contracting officer has a greater latitude in holding a discussion with a concern solicited under an 8(a) acquisition than under a non-8(a) acquisition. Negotiation will normally proceed similarly to the process described in FAR 36.606. If agreement cannot be reached with the highest rated concern, or it is determined that the highest rated concern cannot furnish the required goods or services, or a concern would be unable to earn a profit if awarded the contract, both SBA and OSDBU will be notified, and, upon approval by SBA, negotiations will commence with the next highest rated concern. When extensive discussions with all sources fail to result in any acceptable proposals, the contracting officer will notify SBA. If within ten (10) business days, SBA has not notified the contracting officer of any additional sources or any methods of improving the existing source(s), the contracting activity will proceed with the acquisition without further regard for the 8(a) procedures, unless additional time is requested by SBA and the additional time is granted by the contracting activity after giving due regard to the urgency of the acquisition.

(3) After the conclusion of negotiations with the selected source, the contracting activity will prepare the contract between the contracting activity and SBA and the subcontract between SBA and the selected source. These documents will be prepared in accordance with FAR 19.809, and forwarded to SBA for signature. Contracting activities shall completely negotiate the 8(a) subcontract and prepare the definitive subcontract documents before submitting the prime contract to SBA for signature.

(e) Delays. The contracting officer is responsible for promptly notifying all offerors if an award is to be delayed beyond 30 days from the date of re

ceipt of technical proposals. The contracting officer is also responsible for keeping the offerors informed of the situation if the delay persists or other problems arise which impede the award.

(f) Debriefing. Unsuccessful offerors shall be promptly notified of the contract award. A debriefing, when requested in writing, shall be provided by the cognizant contracting officer to an 8(a) concern that has been unsuccessful in an 8(a) limited technical competition.

(g) Liaison with the Small Business Administration. (1) Contracting activities will maintain a continuous liaison with the SBA to ensure that the overall goals of each activity are achieved. In the event there is a dispute between the contracting activity and an SBA representative regarding any aspect of 8(a) contracting, the contracting activity must promptly notify the OSDBU.

(2) The business development responsibility of SBA requires them to assist in and monitor the growth and development of all 8(a) concerns. Therefore, it is incumbent upon HHS to assist SBA in this effort by utilizing the source selection process in a manner that would make use of the largest possible number of 8(a) con

cerns.

(h) Arriving at contract amount. Contracts will be awarded at prices which are fair and reasonable (see FAR 19.805 and 19.806).

(i) Advance payments. 8(a) concerns requesting advance payments should be advised to submit the request to the SBA, in writing, in accordance with SBA operating procedures. SBA is responsible for reviewing and approving requests, and for making funds available, for advance payments under 8(a) contracts.

(j) Contract modifications, inspections, etc. The responsibility for subcontract administration and field inspection will, in most cases, be delegated by SBA to the contracting activity. The contracting activity may develop a tripartite agreement for execution by SBA, the 8(a) subcontractor, and the contracting activity instead of developing separate modifications for the SBA contract and the 8(a) subcontract.

(k) Subcontract administration. Some concerns may need additional management expertise for optimal performance and completion of a particular contract. Therefore, when subcontract administration is delegated to HHS by SBA, the contracting activity shall promptly apprise the SBA, the SADBUS, and OSDBU whenever the contractor is experiencing problems. SBA should provide necessary technical assistance so the contractor can successfully complete the contract.

(1) Contract termination. The OSDBU, SADBUS, and SBA are to be notified prior to initiating final action to terminate an 8(a) contract.

PART 320-LABOR SURPLUS AREA

CONCERNS

AUTHORITY: 5 U.S.C. 301; 40 U.S.C. 486(c).

Subpart 320.1-General

320.102 General policy.

Contracting activities should obtain appropriate publications and other information identifying labor surplus areas from:

U.S. Department of Labor, Employment and Training Administration, Office of Policy Evaluation and Research, Division of Labor Market Information, Washington, D.C. 20530.

Contracting officers shall use the "Directory of Labor Surplus Area Contractors," provided by the Office of Small and Disadvantaged Business Utilization, as a source to identify labor surplus area concerns and to augment other labor surplus area source lists. Contracting officers should also seek to identify concerns from labor surplus areas by placing sources sought synopses in the Commerce Business Daily. Small and disadvantaged business utilization specialists shall assist contracting officers in developing and maintaining source lists of small business and other concerns in labor surplus areas. Department of Commerce and SBA regional and field offices should be contacted for assistance in identifying labor surplus area concerns.

[49 FR 14012, Apr. 9, 1984]