[Federal Register Volume 79, Number 22 (Monday, February 3, 2014)]
[Proposed Rules]
[Pages 6135-6143]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2014-01706]


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DEPARTMENT OF DEFENSE

GENERAL SERVICES ADMINISTRATION

NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 5, 6, 18, 19, and 52

[FAR Case 2012-022; Docket 2012-0022; Sequence 1]
RIN 9000-AM68


Federal Acquisition Regulation; Contracts Under the Small 
Business Administration 8(a) Program

AGENCY: Department of Defense (DoD), General Services Administration 
(GSA), and National Aeronautics and Space Administration (NASA).

ACTION: Proposed rule.

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SUMMARY: DoD, GSA, and NASA are proposing to amend the Federal 
Acquisition Regulation (FAR) to implement revisions made by the Small 
Business Administration (SBA) to its regulations implementing section 
8(a) of the Small Business Act, and to provide additional FAR coverage 
regarding protesting an 8(a) participant's eligibility or size status, 
procedures for releasing a requirement for non-8(a) procurements, and 
the ways a participant could exit the 8(a) Business Development 
program.

DATES: Interested parties should submit written comments to the 
Regulatory Secretariat at one of the addressees shown below on or 
before April 4, 2014 to be considered in the formation of the final 
rule.

ADDRESSES: Submit comments in response to FAR Case 2012-022 by any of 
the following methods:
     Regulations.gov: http://www.regulations.gov. Submit 
comments via the Federal eRulemaking portal by searching for ``FAR Case 
2012-022.'' Select the link ``Comment Now'' that corresponds with ``FAR 
Case 2012-022'' and follow the instructions provided at the screen. 
Please include your name, company name (if any), and ``FAR Case 2012-
022'' on your attached document.
     Fax: 202-501-4067.
     Mail: General Services Administration, Regulatory 
Secretariat (MVCB), ATTN: Hada Flowers, 1800 F Street NW., 2nd Floor, 
Washington, DC 20405.
    Instructions: Please submit comments only and cite FAR Case 2012-
022, in all correspondence related to this case. All comments received 
will be posted without change to http://www.regulations.gov, including 
any personal and/or business confidential information provided.

FOR FURTHER INFORMATION CONTACT: Mr. Karlos Morgan, Procurement 
Analyst, at 202-501-2364, for clarification of content. For information 
pertaining to status or publication schedules, contact the Regulatory 
Secretariat at 202-501-4755. Please cite FAR Case 2012-022.

SUPPLEMENTARY INFORMATION:

I. Background

    DoD, GSA, and NASA are proposing to amend the FAR to implement 
changes made in the SBA's final rule that was published in the Federal 
Register at 76 FR 8222 on February 11, 2011, and SBA's subsequent 
technical amendment that was published in the

[[Page 6136]]

Federal Register at 77 FR 28237 on May 14, 2012, which made changes to 
the regulations governing the section 8(a) Business Development program 
(commonly referred to as the ``8(a) Program'').

II. Discussion and Analysis

    This rule proposes to make a number of changes to regulations 
governing the 8(a) Program. While many of the changes are editorial and 
provide minor clarifications, other substantive changes are made, 
including situations in which an agency may or may not take credit 
towards its small business goals.
    This rule also proposes to include new FAR sections 19.813 to 
address protesting an 8(a) participant's eligibility or size status, 
FAR 19.814 to address procedures for requesting a formal size 
determination, FAR 19.815 to address procedures for releasing a 
requirement for non-8(a) procurement, and FAR 19.816 on ways a 
participant could exit the program.
    The following is a summary of the proposed FAR revisions associated 
with this rule:
    A. FAR 5.205, FAR 6.204, and FAR 18.114 proposed revisions include 
the removal of the term 8(a) concerns, 8(a) contractors, and 8(a) 
firms, as applicable, and replacing it with 8(a) participants to 
reflect the accurate terminology used in SBA regulations.
    B. FAR 19.000 proposes to remove the term ``business development.''
    C. FAR 19.800 proposed revisions include new language to clarify 
that the 8(a) Business Development Program, is commonly referred to as 
the ``8(a) program'', and that a small business that is accepted into 
the 8(a) program is known as a ``participant''. The section further 
proposes to clarify that an 8(a) contractor is an 8(a) participant that 
is currently performing on a Federal contract or order that was 
reserved for 8(a) participants.
    D. FAR 19.802 proposes to revise the title of the section from 
``Selecting concerns for the 8(a) Program,'' to ``Determining 
eligibility for the 8(a) program'', and adds the location in SBA 
regulations where the eligibility requirements for participation in the 
8(a) program can be found.
    E. FAR 19.803 proposed revisions are minor technical 
clarifications.
    F. FAR 19.804 propose the following revisions:
    1. Minor revisions to FAR 19.804-1 and 19.804-2
    2. Restructuring FAR 19.804-3 to add proposed new paragraph(s) 
19.804-3(a)(1), (a)(2), and 19.804-3(c).
    (i) FAR 19.804-3(a)(1) proposed revision advises contracting 
officers that, for acquisitions exceeding the simplified acquisition 
threshold, if SBA does not respond to an offering letter within 10 
working days, the contracting office may seek acceptance through SBA's 
Associate Administrator for Business Development. The contracting 
office may assume that SBA has accepted the requirement identified in 
its offering letter into the 8(a) Program, if a reply from the SBA 
Associate Administrator for Business Development is not received within 
five business days of receipt of the contracting agency's request.
    (ii) FAR 19.804-3(a)(2) proposed revision advises contracting 
officers that, for acquisitions not exceeding the simplified 
acquisition threshold, if SBA does not respond to an offering letter 
within 2 working days, the contracting officer may assume the offer is 
accepted and proceed with award of an 8(a) contract.
    (iii) FAR 19.804-3(c) proposes to add new language for 8(a) sole 
source awards. The proposed language advises contracting officers that 
SBA will either work with the contracting officer to select an 8(a) 
participant for a possible award, or determine whether an appropriate 
match exists by matching requirements consistent with the 8(a) 
participants' capability, where the contracting officer nominates the 
8(a) participant.
    3. FAR 19.804-4 and 19.804-5 proposed revisions are minor technical 
clarifications.
    4. FAR 19.804-6 proposes to make the following revisions--
    (i) Revise FAR paragraph 19.804-6(a) to advise contracting officers 
that separate offering and acceptance are not required for indefinite 
delivery contracts that have been set-aside for exclusive 8(a) 
competition, and also includes minor technical clarifications.
    (ii) Includes language concerning an 8(a) contractor's acceptance 
of new orders after the 8(a) contractor has left the program.
    (iii) Clarify that agencies may still continue to take small 
disadvantaged business (SDB) credit even after the contractor has left 
the 8(a) Program, unless the contractor has re-represented that it is 
other than small.
    G. FAR 19.805 proposed revisions include the following:
    1. FAR 19.805-1 proposed revisions are minor technical 
clarifications.
    2. FAR 19.805-2(b) proposed revisions include the requirement that 
an 8(a) participant must represent that it is a small business in 
accordance with the size standard corresponding to the North American 
Industry Classification System (NAICS) code assigned to the contract 
and discusses SBA's eligibility determination process.
    3. FAR 19.805-2(b)(1) proposed revisions include deleting the text 
in paragraph (b)(1) and adds a new paragraph (b)(1)(i) and (b)(1)(ii). 
FAR 19.805-2(b)(1)(i) proposes to clarify that if SBA determines that 
the apparent successful offeror is ineligible, the contracting office 
must send to SBA the identity of the next highest evaluated firm for an 
eligibility determination. The process is repeated until SBA determines 
that an identified offeror is eligible for award. FAR 19.805-
2(b)(1)(ii) includes language to advise that if the contracting office 
believes that the apparent successful offeror (or the offeror SBA has 
determined eligible for award) is not responsible to perform the 
contract, the contracting office must refer the matter to SBA for 
Certificate of Competency consideration.
    4. FAR 19.805-2(c) proposed revisions are minor clarifications.
    H. FAR 19.808-1 proposed revisions are minor clarifications and 
adds a new paragraph (d) and (e).
    1. FAR 19.808-1(d) proposes to clarify that an 8(a) participant 
must represent that it is a small business in accordance with the size 
standard corresponding to the NAICS code assigned to the contract.
    2. FAR 19.808-1(e) proposes to implement changes made to SBA's 
regulations at 13 CFR 124.109(a), 13 CFR 124.109(c)(3)(ii), 13 CFR 
124.110(e), and 13 CFR 124.111(d). The new language advises contracting 
officers that an 8(a) participant owned by an Alaska Native 
Corporation, Indian Tribe, Native Hawaiian Organization, or Community 
Development Corporation, may not receive a sole source, follow-on 8(a) 
contract, if the predecessor contract was performed by another 
participant owned by the same Alaska Native Corporation, Indian Tribe, 
Native Hawaiian Organization, or Community Development Corporation.
    I. FAR 19.808-2 and 19.809 proposed revisions are minor technical 
clarifications.
    J. FAR 19.810 proposes to revise the title from ``SBA appeals'', to 
``SBA appeals of a contracting officer's decision to the agency head'', 
and makes minor technical clarifications.
    K. FAR 19.811 and 19.812 proposed revisions are minor technical 
clarifications.
    L. Proposed new FAR section, FAR 19.813, Protesting an 8(a) 
Participant's eligibility or size status, adds language to clarify that 
the eligibility of an 8(a) participant for a sole source or competitive 
8(a) requirement may not be challenged. However, a successful

[[Page 6137]]

offeror's size status for a competitive 8(a) award may be protested by 
any offeror whom the contracting officer has not eliminated for reasons 
unrelated to size, the contracting officer or SBA.
    M. Proposed new FAR section, FAR 19.814, Requesting a formal size 
determination (8(a) sole source requirements), is added to clarify that 
if the size of an 8(a) participant nominated for award of an 8(a) sole 
source contract is called into question, a formal size determination 
may be requested.
    N. Proposed new FAR section, FAR 19.815, Release for non-8(a) 
procurement is added to provide the procedures for obtaining SBA's 
consent to release an 8(a) requirement for non-8(a) procurement, and a 
brief discussion of the matters that will be taken into consideration 
in order to reach a decision as to whether or not releasing a 
requirement for non-8(a) procurement is in the best interest of the 
agency, and the business development program.
    O. Proposed new FAR section, FAR 19.816, Exiting the 8(a) Program, 
adds language to advise contracting officers that--
    1. When a contractor exits the 8(a) program, it is no longer 
eligible to receive new 8(a) contracts. However, the contractor remains 
under contractual obligation to complete existing contracts, and any 
priced options that may be exercised.
    2. If an 8(a) contractor is suspended from the program it may not 
receive any new 8(a) contracts unless the head of the contracting 
agency (or designee) makes a determination that it is in the best 
interest of the Government to issue the award and SBA adopts that 
determination.
    3. A contractor that has completed its term of participation in the 
8(a) program may be awarded a competitive 8(a) contract if it was an 
8(a) participant eligible for award of the contract on the initial date 
specified for receipt of offers contained in the contract solicitation, 
and if the contractor continues to meet all other applicable 
eligibility criteria.

III. Executive Orders 12866 and 13563

    Executive Orders (E.O.s) 12866 and 13563 direct agencies to assess 
all costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). E.O. 
13563 emphasizes the importance of quantifying both costs and benefits, 
of reducing costs, of harmonizing rules, and of promoting flexibility. 
This is not a significant regulatory action and, therefore, was not 
subject to review under section 6(b) of E.O. 12866, Regulatory Planning 
and Review, dated September 30, 1993. This rule is not a major rule 
under 5 U.S.C. 804.

IV. Regulatory Flexibility Act

    The Department of Defense (DoD), the General Services 
Administration (GSA), and the National Aeronautics and Space 
Administration (NASA) do not expect this proposed rule to 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., because these changes do not place any new requirements on small 
business. The purpose of this rule is to implement changes made in 
SBA's final rule, published in the Federal Register at 76 FR 8222 on 
February 11, 2011 pertaining to the 8(a) Business Development Program 
and to clarify existing guidance in the FAR.
    The Initial Regulatory Flexibility Analysis (IRFA) is summarized as 
follows:

    The issues addressed in this proposed rule include: (1) 
clarification of the evaluation, offering, and acceptance process; 
(2) procedures for acquiring SBA's consent to release an 8(a) 
requirement outside the 8(a) program; and (3) clarification that it 
is the contracting officer's responsibility to determine that the 
potential 8(a) contractor meets the applicable performance of work 
requirements at time of award, and the impact of exiting the 8(a) 
program in terms of the firm's ability to receive future 8(a) 
requirements and its current contractual commitments. These 
revisions do not place any new requirements, financial or otherwise, 
on small entities, and serve mainly to provide more explicit 
guidance to Federal contracting officials. Currently, the 8(a) 
Program has approximately 8,567 participants. These participants may 
or may not be economically impacted by the changes discussed in this 
proposed rule.
    This proposed rule will not impose any new information 
collections requirements on small businesses.
    The rule does not duplicate, overlap, or conflict with any other 
Federal rules.
    There are no alternative approaches that will accomplish the 
stated objectives of the rule.

    The Regulatory 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 Regulatory Secretariat. DoD, GSA, 
and NASA invite comments from small business concerns and other 
interested parties on the expected impact of this rule on small 
entities.
    DoD, GSA, and NASA will also consider comments from small entities 
concerning the existing regulations in subparts affected by this rule 
in accordance with 5 U.S.C. 610. Interested parties must submit such 
comments separately and should cite 5 U.S.C. 610 (FAR Case 2012-022) in 
correspondence.

V. Paperwork Reduction Act

    The proposed rule does not contain any information collection 
requirements that require the approval of the Office of Management and 
Budget under the Paperwork Reduction Act (44 U.S.C. chapter 35).

List of Subjects in 48 CFR Parts 5, 6, 18, 19, and 52

    Government procurement.

    Dated: January 23, 2014.
William Clark,
Acting Director, Office of Government-wide Acquisition Policy, Office 
of Acquisition Policy, Office of Government-wide Policy.

    Therefore, DoD, GSA, and NASA propose amending 48 CFR parts 5, 6, 
18, 19 and 52 as set forth below:

0
1. The authority citation for 48 CFR part 5 continues to read as 
follows:

    Authority:  40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 
U.S.C. 20113.

PART 5--PUBLICIZING CONTRACT ACTIONS

0
2. Amend section 5.205 by revising paragraph (f) to read as follows:


5.205  Special situations.

* * * * *
    (f) Section 8(a) competitive acquisition. When a national buy 
requirement is being considered for competitive acquisition limited to 
eligible 8(a) participants under subpart 19.8, the contracting officer 
must transmit a synopsis of the proposed contract action to the GPE. 
The synopsis may be transmitted to the GPE concurrent with submission 
of the agency offering (see 19.804-2) to the Small Business 
Administration (SBA). The synopsis should also include information--
    (1) Advising that the acquisition is being offered for competition 
limited to eligible 8(a) participants;
    (2) Specifying the North American Industry Classification System 
(NAICS) code;
    (3) Advising that eligibility to participate may be restricted to 
8(a) participants in either the developmental stage or the 
developmental and transitional stages; and
    (4) Encouraging interested 8(a) participants to request a copy of 
the solicitation as expeditiously as possible since the solicitation 
will be issued

[[Page 6138]]

without further notice upon SBA acceptance of the requirement for the 
section 8(a) program.

PART 6--COMPETITION REQUIREMENTS

0
3. The authority citation for 48 CFR part 6 is revised to read as 
follows:

    Authority:  40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 
U.S.C. 20113.

0
4. Revise section 6.204 to read as follows:


6.204  Section 8(a) competition.

    (a) To fulfill statutory requirements relating to section 8(a) of 
the Small Business Act, as amended by Public Law 100-656, contracting 
officers may limit competition to eligible 8(a) participants (see 
Subpart 19.8).
    (b) No separate justification or determination and findings is 
required under this part to limit competition to eligible 8(a) 
participants. (But see 6.302-5 and 6.303-1 for sole-source 8(a) awards 
over $20 million.)

PART 18--EMERGENCY ACQUISITIONS

0
5. The authority citation for 48 CFR part 18 continues to read as 
follows:

    Authority:  40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 
U.S.C. 20113.


18.114  [Amended]

0
6. Amend section 18.114 by removing ``firms'' and adding 
``participants'' in its place.

PART 19--SMALL BUSINESS PROGRAMS

0
7. The authority citation for 48 CFR part 19 continues to read as 
follows:

    Authority:  40 U.S.C. 121(c); 10 U.S.C. chapter 137; and 51 
U.S.C. 20113.


19.000  [Amended]

0
8. Amend section 19.000 by removing from paragraph (a)(3) ``business 
development''.
0
9. Revise the subpart heading of 19.8 to read as follows:

Subpart 19.8--Contracting With the Small Business Administration 
(The 8(a) Program)

* * * * *
0
10. Revise section 19.800 to read as follows:


19.800  General.

    (a) Section 8(a) of the Small Business Act (15 U.S.C. 637(a)) 
established a program that authorizes the Small Business Administration 
(SBA) to enter into all types of contracts with other agencies and let 
subcontracts for performing those contracts to firms eligible for 
program participation. This program is the ``8(a) Business Development 
Program'', commonly referred to as the ``8(a) program''. A small 
business that is accepted into the 8(a) program is known as a 
``participant''. SBA's subcontractors are referred to as ``8(a) 
contractors''. As used in this subpart, an 8(a) contractor is an 8(a) 
participant that is currently performing on a Federal contract or order 
that was reserved for 8(a) participants.
    (b) Contracts may be awarded to the SBA for performance by eligible 
8(a) participants on either a sole source or competitive basis.
    (c) Acting under the authority of the program, the SBA certifies to 
an agency that the SBA is competent and responsible to perform a 
specific contract. The contracting officer has the discretion, to award 
the contract to the SBA based upon mutually agreeable terms and 
conditions.
    (d) The contracting officer shall comply with 19.203 before 
deciding to offer an acquisition to a small business concern under the 
8(a) program. For acquisitions above the simplified acquisition 
threshold, the contracting officer shall consider 8(a) set-asides or 
sole source awards before considering small business set-asides.
    (e) When SBA has delegated its 8(a) program contract execution 
authority to an agency, the contracting officer must refer to its 
agency supplement or other policy directives for appropriate guidance.
0
11. Revise section 19.802 to read as follows:


19.802  Determining eligibility for the 8(a) program.

    Determining the eligibility of a small a business to be a 
participant in the 8(a) program is the responsibility of the SBA. SBA's 
regulations on eligibility requirements for participation in the 8(a) 
program are found at 13 CFR 124.101 through 124.112.
0
12. Revise section 19.803 to read as follows:


19.803  Selecting acquisitions for the 8(a) program.

    Through their cooperative efforts, the SBA and an agency match the 
agency's requirements with the capabilities of 8(a) participants to 
establish a basis for the agency to contract with the SBA under the 
program. Selection is initiated in one of three ways--
    (a) The SBA advises the contracting activity of an 8(a) 
participant's capabilities through a search letter and requests the 
contracting activity to identify acquisitions to support the 
participant's business plans. In these instances, the SBA will provide 
at minimum the following information in order to enable the contracting 
activity to match an acquisition to the participant's capabilities:
    (1) Identification of the concern and its owners.
    (2) Background information on the concern, including any and all 
information pertaining to the concern's technical ability and capacity 
to perform.
    (3) The participant's present production capacity and related 
facilities.
    (4) The extent to which contracting assistance is needed in the 
present and the future, described in terms that will enable the agency 
to relate the concern's plans to present and future agency 
requirements.
    (5) If construction is involved, the request shall also include the 
following:
    (i) A participant's capabilities in and qualifications for 
accomplishing various categories of construction work typically found 
in North American Industrial Category System subsector 236 
(construction of buildings), subsector 237 (heavy and civil engineering 
construction), or subsector 238 (specialty trade contractors.
    (ii) The participant's capacity in each construction category in 
terms of estimated dollar value (e.g., electrical, up to $100,000).
    (b) The SBA identifies a specific requirement for one or more 8(a) 
participant(s) and sends a requirements letter to the agency's small 
business office, requesting the contracting office offer the 
acquisition to the 8(a) program. In these instances, in addition to the 
information in paragraph (a) of this section, the SBA will provide--
    (1) A clear identification of the acquisition sought; e.g., project 
name or number;
    (2) A statement as to how the required equipment and real property 
will be provided in order to ensure that the participant will be fully 
capable of satisfying the agency's requirements;
    (3) If construction, information as to the bonding capability of 
the participant(s); and
    (4) Either--
    (i) If a sole source request--
    (A) The reasons why the participant is considered suitable for this 
particular acquisition; e.g., previous contracts for the same or 
similar supply or service; and
    (B) A statement that the participant is eligible in terms of its 
small business size status relative to the assigned

[[Page 6139]]

NAICS code, business support levels, and business activity targets; or
    (ii) If competitive, a statement that at least two 8(a) 
participants are considered capable of satisfying the agency's 
requirements and a statement that the participants are also eligible in 
terms of their small business size status relative to the assigned 
NAICS code, business support levels, and business activity targets. If 
requested by the contracting office, SBA will identify at least two 
such participants and provide information concerning the participants' 
capabilities.
    (c) Agencies may also review other proposed acquisitions for the 
purpose of identifying requirements which may be offered to the SBA. 
Where agencies independently, or through the self marketing efforts of 
an 8(a) participant, identify a requirement for the 8(a) program, they 
may offer on behalf of a specific 8(a) participant, for the 8(a) 
program in general, or for 8(a) competition.
0
13. Revise section 19.804-1 to read as follows:


19.804-1  Agency evaluation.

    In determining the extent to which a requirement should be offered 
in support of the 8(a) program, the agency should evaluate--
    (a) Current and future plans to acquire the specific items or work 
that 8(a) participants are seeking to provide, identified in terms of--
    (1) Estimated quantities of the supplies or services required or 
the estimated number of construction projects planned; and
    (2) Performance or delivery requirements, including--
    (i) Required monthly production rates, when applicable; and
    (ii) For construction, geographical location;
    (b) The impact of any delay in delivery;
    (c) Whether the items or work have previously been acquired using 
small business set-asides, and the date the items or work were 
acquired;
    (d) Problems encountered in previous acquisitions of the items or 
work from the 8(a) participants or other contractors; and
    (e) Any other pertinent information about known 8(a) participants, 
the items, or the work. This includes any information concerning the 
participants' products or capabilities. When necessary, the contracting 
agency shall make an independent review of the factors in 19.803(a) and 
other aspects of the participants' capabilities which would ensure the 
satisfactory performance of the requirement being considered for 
commitment to the 8(a) program.
0
14. Amend section 19.804-2 by--
0
a. Revising the introductory text of paragraph (a) and paragraph 
(a)(10);
0
b. Redesignating paragraphs (a)(12) through (a)(15) as paragraphs 
(a)(13) through (a)(16), respectively;
0
c. Adding a new paragraph (a)(12);
0
d. Removing from the newly designated paragraph (a)(13) ``Program'' and 
adding ``program'' in its place;
0
e. Removing from the newly designated paragraph (a)(15) ``sole source'' 
and adding ``sole-source'' in its place; and
0
f. Removing from paragraph (b)(3) ``firm'' and adding ``8(a) 
participant'' in its place (twice).
    The revised and added text reads as follows:


19.804-2  Agency offering.

    (a) After completing its evaluation, the contracting office shall 
notify the SBA of the extent of its plans to place 8(a) contracts with 
the SBA for specific quantities of items or work. The notification, 
referred to as an offering letter, shall identify the time frames 
within which prime contract and subcontract actions must be completed 
in order for the agency to meet its responsibilities. The offering 
letter shall also contain the following information applicable to each 
prospective contract:
* * * * *
    (10) Identification of any particular 8(a) participant designated 
for consideration, including a brief justification, such as--
    (i) The 8(a) participant, through its own efforts, marketed the 
requirement and caused it to be reserved for the 8(a) program; or
    (ii) The acquisition is a follow-on or renewal contract and the 
nominated 8(a) participant concern is the incumbent.
* * * * *
    (12) Identification of all 8(a) participants which have expressed 
an interest in being considered for the acquisition.
* * * * *
0
15. Revise section 19.804-3 to read as follows:


19.804-3  SBA acceptance.

    (a) Upon receipt of the contracting office's offering letter, SBA 
will determine whether to accept the requirement for the 8(a) program. 
SBA's decision whether to accept the requirement will be transmitted to 
the contracting office in writing within 10 working days of receipt of 
the offer if the contract is likely to exceed the simplified 
acquisition threshold and within 2 working days of receipt if the 
contract is at or below the simplified acquisition threshold. The 
contracting office may grant an extension of these time periods, if 
requested by SBA.
    (1) For acquisitions exceeding the simplified acquisition 
threshold, if SBA does not respond to an offering letter within 10 
working days, the contracting office may seek SBA's acceptance through 
the Associate Administrator for Business Development. The contracting 
office may assume that SBA has accepted the requirement into the 8(a) 
program if it does not receive a reply from the Associate Administrator 
for Business Development within five calendar days of receipt of the 
contracting office's request.
    (2) For acquisitions not exceeding the simplified acquisition 
threshold, when the contracting office makes an offer to the 8(a) 
program on behalf of a specific 8(a) participant and does not receive a 
reply to its offering letter within 2 working days, the contracting 
office may assume the offer is accepted and proceed with award of an 
8(a) contract.
    (b) As part of the acceptance process, SBA will review the 
appropriateness of the NAICS code designation assigned to the 
requirement by the contracting officer.
    (1) SBA will not challenge the NAICS code assigned to the 
requirement by the contracting officer if it is reasonable, even though 
other NAICS codes may also be reasonable.
    (2) If SBA and the contracting officer are unable to agree on a 
NAICS code designation for the requirement, SBA may refuse to accept 
the requirement for the 8(a) program, appeal the contracting officer's 
determination to the head of the agency pursuant to 19.810, or appeal 
the NAICS code designation to the SBA Office of Hearings and Appeals 
under Subpart C of 13 CFR Part 134.
    (c) Sole-source 8(a) awards. If an appropriate match exists, SBA 
will advise the contracting officer whether it will participate in 
contract negotiations or whether SBA will authorize the contracting 
officer to negotiate directly with the identified 8(a) participant. 
Where SBA has delegated its contract execution functions to a 
contracting agency, SBA will also identify that delegation in its 
acceptance letter.
    (1) Sole-source award where the contracting officer nominates a 
specific 8(a) participant. SBA will determine whether an appropriate 
match exists where the contracting officer identifies a particular 
participant for a sole-source award.
    (i) Once SBA determines that a procurement is suitable to be 
accepted as an 8(a) sole-source contract, SBA will

[[Page 6140]]

normally accept it on behalf of the 8(a) participant recommended by the 
contracting officer, provided that 8(a) participant complies with the 
requirements of 13 CFR 124.503(c)(1).
    (ii) If an appropriate match does not exist, SBA will notify the 
8(a) participant and the contracting officer, and may then nominate an 
alternate 8(a) participant.
    (2) Sole-source award where the contracting officer does not 
nominate a specific 8(a) participant. When a contracting officer does 
not nominate as 8(a) participant for performance of a sole-source 8(a) 
contract, SBA will select an 8(a) participant for possible award from 
among two or more eligible and qualified 8(a) participants. The 
selection will be based upon relevant factors, including business 
development needs, compliance with competitive business mix 
requirements (if applicable), financial condition, management ability, 
technical capability, and whether award will promote the equitable 
distribution of 8(a) contracts. (For construction requirements see 13 
CFR 124.503(d)(1)).
0
16. Amend section 19.804-4 by--
0
a. Removing from the introductory text ``Program'' and adding 
``program'' in its place;
0
b. Revising paragraph (b); and
0
c. Removing from paragraph (d) ``Program'' and adding ``program'' in 
its place.
    The revised text reads as follows:


19.804-4  Repetitive acquisitions.

* * * * *
    (b) A nominated 8(a) participant's eligibility, and whether or not 
it is the same 8(a) participant that performed the previous contract;
* * * * *
0
17. Amend section 19.804-5 by revising paragraphs (a) and (c) to read 
as follows:


19.804-5  Basic ordering agreements.

    (a) The contracting office shall submit an offering letter for, and 
SBA must accept, each order under a basic ordering agreement (BOA) in 
addition to offering and accepting the BOA itself.
* * * * *
    (c) Once an 8(a) contractor's program term expires, the contractor 
otherwise exits the 8(a) program, or becomes other than small for the 
NAICS code assigned under the BOA, SBA will not accept new orders for 
the contractor.
0
18. Revise section 19.804-6 to read as follows:


19.804-6  Indefinite delivery contracts.

    (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 Government-wide 
acquisition contracts, or indefinite-delivery, indefinite-quantity 
(IDIQ) contracts) that have been set aside for exclusive competition 
among 8(a) contractors. SBA's acceptance of the original contract is 
valid for the term of the contract.
    (b) 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 assigned to the contract.
    (c) Agencies may continue to take credit toward their prime 
contracting small disadvantaged business or small business goals for 
orders awarded to 8(a) participants, 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 assigned 
under the 8(a) contract. However, if an 8(a) contractor rerepresents 
that it is other than small for the NAICS code 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.
0
19. Amend section 19.805-1 by--
0
a. Revising the introductory text of paragraph (a);
0
b. Removing from paragraph (a)(1) ``firms'' and adding ``participants'' 
in its place; and
0
c. Revising the introductory text of paragraph (b);
0
d. Removing from paragraph (b)(1) ``firms'' and adding ``participants'' 
in its place
0
e. Revising paragraph (d).
    The revisions read as follows:


19.805-1  General.

    (a) Except as provided in paragraph (b) of this subsection, an 
acquisition offered to the SBA under the 8(a) program shall be awarded 
on the basis of competition limited to eligible 8(a) participants 
when--
* * * * *
    (b) Where an acquisition exceeds the competitive threshold as 
defined in paragraph (a)(2) of this section, the SBA may accept the 
requirement for a sole-source 8(a) award if--
* * * * *
    (d) The SBA Associate Administrator for Business Development may 
approve a contracting office's request for a competitive 8(a) award 
below the competitive thresholds. Such requests will be approved only 
on a limited basis and will be primarily granted where technical 
competitions are appropriate or where a large number of responsible 
8(a) participants are available for competition. In determining whether 
a request to compete below the threshold will be approved, the SBA 
Associate Administrator for Business Development will, in part, 
consider the extent to which the contracting activity is supporting the 
8(a) program on a noncompetitive basis. The agency may include 
recommendations for competition below the threshold in the offering 
letter or by separate correspondence to the SBA Associate Administrator 
for Business Development.
0
20. Revise section 19.805-2 to read as follows:


19.805-2  Procedures.

    (a) Offers shall be solicited from those sources identified in 
accordance with 19.804-3.
    (b) The SBA will determine the eligibility of the participants for 
award of the contract. Eligibility will be determined by the SBA as of 
the time of submission of initial offers which include price. 
Eligibility is based on Section 8(a) program criteria. An 8(a) 
participant must represent that it is a small business in accordance 
with the size standard corresponding to the NAICS code assigned to the 
contract.
    (1) In either negotiated or sealed bid competitive 8(a) 
acquisitions SBA will determine the eligibility of the apparent 
successful offeror and advise the contracting office within 5 working 
days after receipt of the contracting office's request for an 
eligibility determination.
    (i) If SBA determines that the apparent successful offeror is 
ineligible, the contracting office will then send to SBA the identity 
of the next highest evaluated firm for an eligibility determination. 
The process is repeated until SBA determines that an identified offeror 
is eligible for award. SBA determines whether a participant is eligible 
for a specific 8(a) competitive requirement as of the date that the 
8(a) participant submitted its initial offer which includes price.
    (ii) If the contracting office believes that the apparent 
successful offeror (or the offeror SBA has determined eligible for 
award) is not responsible to perform the contract, the contracting 
office must refer the matter to SBA for Certificate of Competency 
consideration under 19.6.
    (2) In any case in which a 8(a) participant is determined to be

[[Page 6141]]

ineligible, SBA will notify the 8(a) participant of that determination.
    (c) Any party with information concerning questioning the 
eligibility of an 8(a) participant to continue participation in the 
8(a) program or for the purposes of a specific 8(a) award may submit 
such information to the SBA in accordance with 13 CFR 124.112(c).
0
21. Amend section 19.808-1 by removing from paragraph (c) ``activity'' 
and adding ``officer'' in its place; and adding paragraphs (d) and (e) 
to read as follows.


19.808-1  Sole source.

* * * * *
    (d) An 8(a) participant must represent that it is a small business 
in accordance with the size standard corresponding to the NAICS code 
assigned to the contract.
    (e) An 8(a) participant owned by an ANC, Indian Tribe, Native 
Hawaiian Organization, or Community Development Corporation may not 
receive an 8(a) sole-source award that is a follow-on contract to an 
8(a) contract, if the predecessor contract was performed by another 
8(a) participant (or former 8(a) participant) owned by the same ANC, 
Indian Tribe, Native Hawaiian Organization, or Community Development 
Corporation (See 13 CFR 124.109-124.111).
0
22. Revise section 19.808-2 to read as follows.


19.808-2  Competitive.

    In competitive 8(a) acquisitions subject to Part 15, the 
contracting officer conducts negotiations directly with the competing 
8(a) participants. Conducting competitive negotiations among 8(a) 
participants prior to SBA's formal acceptance of the acquisition for 
the 8(a) program may be grounds for SBA's not accepting the acquisition 
for the 8(a) program.
0
23. Revise section 19.809 to read as follows.


19.809  Preaward considerations.

    The contracting officer should request a preaward survey of the 
8(a) participant whenever considered useful. If the results of the 
preaward survey or other information available to the contracting 
officer raise substantial doubt as to the participant's ability to 
perform, the contracting officer must refer the matter to SBA for 
Certificate of Competency consideration under Subpart 19.6.
0
24. Amend section 19.810 by--
0
a. Revising the section heading;
0
b. Removing from paragraph (a)(2) ``firm'' and ``Program'' and adding 
``participant'' and ``program'' in its place, respectively;
0
c. Removing from paragraph (a)(3) ``activity's'' and adding 
``officer's'' in its place;
0
d. Revising paragraph (b); and
0
e. Removing from paragraph (c) ``firm'' and adding ``participant'' in 
its place.
    The revisions read as follows:


19.810  SBA appeals of a contracting officer's decision to the agency 
head.

* * * * *
    (b) Notification of an intent to appeal to the agency head by SBA 
must be received by the contracting officer within 5 working days after 
SBA is formally notified of the contracting officer's decision. SBA's 
Administrator will provide a copy of this notification of the intent to 
appeal to the contracting agency Director for Small and Disadvantaged 
Business Utilization or, for the Department of Defense, the Director of 
Small Business Programs, SBA must send the written appeal to the agency 
head within 15 working days of SBA's notification of intent to appeal 
or the appeal may be considered withdrawn. Pending issuance of a 
decision by the agency head, the contracting officer shall suspend 
action on the acquisition. The contracting officer need not suspend 
action on the acquisition if the contracting officer makes a written 
determination that urgent and compelling circumstances that 
significantly affect the interests of the United States will not permit 
waiting for a decision.
* * * * *
0
25. Amend section 19.811-1 by revising the introductory text of 
paragraph (b) to read as follows:


19.811-1  Sole source.

* * * * *
    (b) The contracting officer shall prepare the contract that the SBA 
will award to the 8(a) contractor in accordance with agency procedures, 
as if awarding the contract directly to the 8(a) contractor, except for 
the following:
* * * * *


19.811-3  [Amended]

0
26. Amend section 19.811-3 by--
0
a. Removing from the introductory text of paragraph (d) ``Concerns'' 
and adding ``Participants'' in its place; and
0
b. Removing from paragraphs (d)(1) and (e) ``concerns'' and adding 
``participants'' in its place, respectively.
0
27. Amend section 19.812 by removing from paragraph (b) ``firm'' and 
adding ``8(a) contractor'' in its place; and revising paragraph (d) to 
read as follows:


19.812  Contract administration.

* * * * *
    (d) An 8(a) contract, whether in the base or an option year, must 
be terminated for convenience if the 8(a) contractor to which it was 
awarded transfers ownership or control of the firm or if the contract 
is transferred or novated for any reason to another firm, unless the 
Administrator of the SBA waives the requirement for contract 
termination (13 CFR 124.515). The Administrator may waive the 
termination requirement only if certain conditions exist. Moreover, a 
waiver of the requirement for termination is permitted only if the 8(a) 
contractor's request for waiver is made to the SBA prior to the actual 
relinquishment of ownership or control, except in the case of death or 
incapacity where the waiver must be submitted within 60 calendar days 
after such an occurrence. The clauses in the contract entitled 
``Special 8(a) Contract Conditions'' and ``Special 8(a) Subcontract 
Conditions'' require the SBA and the 8(a) subcontractor to notify the 
contracting officer when ownership of the firm is being transferred. 
When the contracting officer receives information that an 8(a) 
contractor is planning to transfer ownership or control to another 
firm, the contracting officer shall take action immediately to preserve 
the option of waiving the termination requirement. The contracting 
officer shall determine the timing of the proposed transfer and its 
effect on contract performance and mission support. If the contracting 
officer determines that the SBA does not intend to waive the 
termination requirement, and termination of the contract would severely 
impair attainment of the agency's program objectives or mission, the 
contracting officer shall immediately notify the SBA in writing that 
the agency is requesting a waiver. Within 15 business days thereafter, 
or such longer period as agreed to by the agency and the SBA, the 
agency head must either confirm or withdraw the request for waiver. 
Unless a waiver is approved by the SBA, the contracting officer must 
terminate the contract for convenience upon receipt of a written 
request by the SBA. This requirement for a convenience termination does 
not affect the Government's right to terminate for default if the cause 
for termination of an 8(a) contract is other than the transfer of 
ownership or control.
0
28. Add sections 19.813 through 19.816 to read as follows:


19.813  Protesting an 8(a) Participant's eligibility or size status.

    (a) The eligibility of an 8(a) participant for a sole-source or 
competitive 8(a) requirement may not be

[[Page 6142]]

challenged by another 8(a) participant or any other party, either to 
SBA or any administrative forum as part of a bid or other contract 
protest (see 13 CFR 124.517).
    (b) The size status of an 8(a) participant nominated for an 8(a) 
sole-source contract may not be protested by another 8(a) participant 
or any other party.
    (c) The size status of the apparent successful offeror for 
competitive 8(a) awards may be protested. The filing of a size status 
protest is limited to--
    (1) Any offeror whom the contracting officer has not eliminated for 
reasons unrelated to size;
    (2) The contracting officer; or
    (3) The SBA District Director, or designee, in either the district 
office serving the geographical area in which the contracting activity 
is located or the district office that services the apparent successful 
offeror, or the Associate Administrator for Business Development.
    (d) Protests of competitive 8(a) awards shall follow the procedures 
at 19.302. For additional information, refer to 13 CFR 121.1001.


19.814  Requesting a formal size determination (8(a) sole source 
requirements).

    (a) If the size status of an 8(a) participant nominated for award 
of an 8(a) sole-source contract is called into question, a request for 
a formal size determination may be submitted to SBA pursuant to 13 CFR 
121.1001(b)(2)(ii) by--
    (1) The 8(a) participant nominated for award of the particular 
sole-source contract;
    (2) The contracting officer who has been delegated SBA's 8(a) 
contract execution functions, where applicable, or the SBA program 
official with authority to execute the 8(a) contract; or
    (3) The SBA District Director in the district office that services 
the 8(a) participant or the Associate Administrator for Business 
Development.
    (b) SBA's Government Contracting Area Director or designee will 
issue a formal size determination within 15 business days, if possible, 
after SBA receives the request for a formal size determination.
    (c) An appeal from an SBA size determination shall follow the 
procedures at 19.302.


19.815  Release for non-8(a) procurement.

    (a) Once a requirement has been accepted by SBA into the 8(a) 
program, any follow-on requirements shall remain in the 8(a) program 
unless SBA agrees to release the requirement from the 8(a) program in 
accordance with 13 CFR 124.504(d).
    (b) To obtain release of a requirement for a non-8(a) procurement, 
the contracting officer shall make a written request to, and receive 
concurrence from, the SBA Associate Administrator for Business 
Development.
    (c)(1) The SBA Associate Administrator for Business Development 
will consider the following information when determining whether to 
release a requirement from the 8(a) program--
    (i) Whether the agency has achieved its SDB goal;
    (ii) Whether the agency has not achieved its HUBZone, SDVOSB, WOSB, 
or small business goal(s);
    (iii) Whether the requirement is critical to the business 
development of the 8(a) contractor that is currently performing the 
requirement.
    (2) Generally, a requirement that was previously accepted into the 
8(a) program will only be released for procurements outside the 8(a) 
program when the contracting activity agency agrees to set-aside the 
requirement under the small business, HUBZone, SDVOSB, or WOSB 
programs.
    (3) The requirement that a follow-on procurement must be released 
from the 8(a) program in order for it to be fulfilled outside the 8(a) 
program does not apply to task or delivery orders offered to and 
accepted into the 8(a) program, where the basic contract was not 
accepted into the 8(a) program.


19.816  Exiting the 8(a) program.

    (a) When a contractor exits the 8(a) program, it is no longer 
eligible to receive new 8(a) contracts. However, the contractor remains 
under contractual obligation to complete existing contracts, and any 
priced options that may be exercised.
    (b) If an 8(a) contractor is suspended from the program (see 13 CFR 
124.305), it may not receive any new 8(a) contracts unless the head of 
the contracting agency (or designee) makes a determination that it is 
in the best interest of the Government to issue the award and SBA 
adopts that determination.
    (c) A contractor that has completed its term of participation in 
the 8(a) program may be awarded a competitive 8(a) contract if it was 
an 8(a) participant eligible for award of the contract on the initial 
date specified for receipt of offers contained in the contract 
solicitation, and if the contractor continues to meet all other 
applicable eligibility criteria.
    (d) SBA's regulations on exiting the 8(a) program are found at 13 
CFR 124.301 through 124.305, and 13 CFR 124.507(d).
0
29. Amend section 19.1504 by revising paragraph (a) to read as follows:


19.1504  Exclusions.

* * * * *
    (a) Requirements that an 8(a) contractor is currently performing 
under the 8(a) program or that SBA has accepted for performance under 
the authority of the 8(a) program, unless SBA has consented to release 
the requirements from the 8(a) program;
* * * * *

PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

0
30. Amend section 52.212-5 by revising the date of the clause and 
paragraph (b)(17) to read 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) * * *
    (17) 52.219-14, Limitations on Subcontracting (Date) (15 U.S.C. 
637(a)(14)).
* * * * *
0
31. Amend section 52.219-11 by revising the date of the clause and 
paragraph (c) to read as follows:


52.219-11  Special 8(a) Contract Conditions.

* * * * *

Special 8(a) Contract Conditions (Date)

* * * * *
    (c) Except for novation agreements, delegate to the ------------ 
[insert name of contracting agency] the responsibility for 
administering the subcontract to be awarded hereunder with complete 
authority to take any action on behalf of the Government under the 
terms and conditions of the subcontract; provided, however, that the 
------------ [insert name of contracting agency] shall give advance 
notice to the SBA before it issues a final notice terminating the 
right of a subcontractor to proceed with further performance, either 
in whole or in part, under the subcontract for default or for the 
convenience of the Government.
* * * * *
0
32. Amend section 52.219-12 by revising the date of the clause and 
removing from paragraph (b)(2) ``and advance payments''.
    The revision reads as follows:


52.219-12  Special 8(a) Subcontract Conditions.

* * * * *

[[Page 6143]]

Special 8(a) Subcontract Conditions (Date)

* * * * *
0
33. Amend section 52.219-14 by revising the date of the clause and 
removing from paragraphs (b)(1), (b)(2), and (b)(3) ``8(a) concerns'' 
and adding ``8(a) participants'' in its place.
    The revision reads as follows:


52.219-14  Limitations on Subcontracting.

* * * * *

Limitations on Subcontracting (Date)

* * * * *
0
34. Amend section 52.219-17 by revising the date of the clause; and 
removing from paragraph (a)(2) ``and advance payments''.
    The revision reads as follows:


52.219-17  Section 8(a) Award.

* * * * *

Section 8(a) Award (Date)

* * * * *
0
35. Amend section 52.219-18 by:
0
a. Revising the section and clause heading;
0
b. Revising the date of the clause; and
0
c. Removing from Alternate I ``concerns'' and adding ``participants'' 
in its place.
    The revisions read as follows.


52.219-18  Notification of Competition Limited to Eligible 8(a) 
Participants.

Notification of Competition Limited to Eligible 8(a) Participants 
(Date)

* * * * *
[FR Doc. 2014-01706 Filed 1-31-14; 8:45 am]
BILLING CODE 6820-EP-P