• 3.6.1 Small Business Programs
• 3.6.1.1 Applicability
• 3.6.1.2 Policy
• 3.6.1.3 Standards for Small Businesses Programs
• 3.6.1.4 Responsibilities
• 3.6.1.5 Acceptance of Purchase Requests
• 3.6.1.6 Principles For The Small Business Program
• 3.6.1.7 Prime Contracting with Small Businesses
• 3.6.1.8 Mentor–Protégé Program
• 3.6.1.9 Contract Bundling
• 3.6.1.10 Subcontracting with Small Businesses
• 3.6.1.11 Price Evaluation Preference for HUBZone Small Business Concerns

3.6.1 Small Business Programs

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3.6.1.1 Applicability

The policies contained herein are applicable to TSA procurements for goods and services and those procurements using purchase cards, and convenience checks, but excludes other agreements, including, but not limited to, utilities, real property, intergovernmental agreements, and other transaction agreements.

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3.6.1.2 Policy

TSA will follow the spirit and intent of the Small Business Administration in its procurement actions, even though it is not subject to the Small Business Act (15 USC 631 et seq). TSA recognizes that small businesses are of vital importance to job growth and the economic strength of the country and value that they bring to the market place. TSA shall implement and aggressively strive to provide attainable and reasonable opportunities to small business, veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, 8(a)/socially and economically disadvantaged business (8a/SEDB), small disadvantaged business, and woman–owned small business concerns to participate as prime contractors and subcontractors for the goods and services procured by TSA.

TSA policy is to ensure the following priority in all its procurement actions:

• First, consider small business for prime contracts;
• Second, if the first consideration has been ruled out based on market research, turn to competition where large businesses are expected to serve as prime contractors. In these cases, subcontracting with small businesses and the use of the DHS Mentor-Protégé Program will be critical.

TSA’s Small Business Program consists of an active approach to promoting diversity in all of its business relationships and encouraging economic development through the following:

• Competitive and single source set-asides;
• Measurable prime contracting and subcontracting goals;
• Vigorous outreach efforts;
• DHS Mentor-Protégé Program;
• Support of TSA’s Small Business Liaison Officers (SBLOs).

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3.6.1.3 Standards for Small Businesses Programs

TSA will utilize the Small Business Administration (SBA) standards for determining what constitutes a small business in terms of its size and in terms of the qualifying degree of ownership of the business (e.g., how much of the business must be owned by a service-disabled veteran-owned small business for it to be classified a service-disabled veteran- owned small business.) The TSA Office of Small and Disadvantaged Business Utilization (OSDBU) will assist in determining when standards are met in coordination with SBA.

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3.6.1.4 Responsibilities

Program Managers and Requiring Officials are responsible for ensuring that small business participation is considered and properly documented for every purchase request. All purchase requests estimated to be less than $200,000 will be set-aside for the exclusive participation of small business concerns. If a procurement less than $200,000 cannot be set-aside for small business, the Requiring Official must prepare a written statement providing the reasons for dissolving the automatic set-aside. This statement must have the concurrence of the Contracting Officer, the SBLO, and the OSDBU. Purchase requests expected to exceed $200,000 must be accompanied by a fully executed TSA Form 200.

3.6.1.4.1 Integrated Project Team’s Responsibilities

The Integrated Project Team (IPT), as led by the Program Manager or Requiring Official, has the following responsibilities regarding small business programs.

• Take all reasonable action to increase small business participation in the TSA’s procurements (including subcontracts);
• Consider the feasibility of breaking out requirements to increase opportunities for small businesses to successfully compete for prime contracts;
• Consider the extent of small business participation in contract performance during acquisition planning;
• Obtain guidance from the OSDBU as it relates to small business utilization issues, by including a small business specialist or SBLO on the IPT or by coordinating with the OSDBU;
• Participate and assist in the development of small business conferences and outreach efforts sponsored by the OSDBU and the DHS OSDBU.

3.6.1.4.2 TSA’s Office of Small and Disadvantaged Business Utilization (OSDBU) Responsibilities

The OSDBU maintains a direct working relationship with the Acquisition Personnel, Program Offices, and IPT. When appropriate, the OSDBU interacts with all procurement teams in the following areas to provide support and ensure effective and consistent program implementation:

• Participates in procurement workshops to increase access to and award of TSA’s contracts to small businesses;
• Participates in acquisition planning meetings and other scheduled meetings with the procurement teams as an advisor;
• Identifies potential small businesses that qualify for a particular procurement;
• Provides the procurement team with source lists of small businesses;
• Reviews and concurs that the source selection criteria used to select firms for award is fair, consistent and does not limit opportunities for small businesses;
• Provides advertising recommendations to the integrated products teams to ensure all requirements are being advertised in media accessible to small businesses;
• Responds to written and telephone inquiries from small businesses and small disadvantaged businesses regarding procurement opportunities with TSA;
• Reviews and approves TSA Form 200s and source lists to ensure an adequate representation of small businesses;
• Reviews small business issues raised as part of individual acquisitions and as part of the overall acquisition program;
• Reviews subcontracting plans;
• Ensures that small businesses and small disadvantaged businesses are entered into the OSDBU database;
• Assists in the proposal evaluation process as a non-voting member of the evaluation team, as requested for small business issues;
• Verifies reported business ownership categories, by conducting reviews of databases, interviews, or on-site pre-award verifications;
• Participates in debriefing of small businesses as necessary.

3.6.1.4.3 Small Business Liaison Officers (SBLOs)

Small Business Liaison Officers (SBLO) will assist the OSDBU to promote opportunities for small businesses to participate as prime and subcontractors in contracts awarded by TSA, consistent with efficient contract performance. SBLOs promote stronger communications and build better partnerships between each Program Office and the OSDBU by:

• Ensuring that every effort is made to assist the agency in meeting its prime and subcontracting small business goals while working as a strong small business advocate within their office;
• Ensuring that every procurement request in excess of $200,000 is accompanied by a fully executed TSA Form 200;
• Ensuring that all requirements less than $200,000 are set-aside for small business concerns;
• Ensuring adequate documentation stating the reasons for not setting aside for small business are provided to the Contracting Officer in circumstances where small businesses will not be used; (These instances should be unusual and not the norm.)
• Ensuring timely and accurate input in TSA’s Procurement Forecast through the completion of the Advanced Acquisition Plan (AAP) Project; (The information will be input via the Federal Interagency Databases Online (FIDO) System upon receipt of the DHS Data Calls. The yearly DHS Data Call is received in July and is due in August with a semi-annual update received and due in March).
• Developing a short written narrative regarding the programs in which their office is responsible. This narrative will be used by the OSDBU for distribution to the small-business community.
• Participating in Small Business Fairs and Vendor Outreach Sessions when requested to do so by the OSDBU;
• Attending, informing, and encouraging staff participation in small business training (i.e. workshops, brown bag sessions, etc.).

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3.6.1.5 Acceptance of Purchase Requests

Program Managers and Requiring Officials are responsible for ensuring that small business participation is considered and properly documented for every purchase request. All purchase requests estimated to be less than $200,000 will be set-aside for the exclusive participation of small business concerns. If a procurement less than $200,000 cannot be set-aside for small business, the Requiring Official must prepare a written statement providing the reasons for dissolving the automatic set-aside. This statement must have the concurrence of the Contracting Officer, the SBLO, and the OSDBU. Purchase requests expected to exceed $200,000 must be accompanied by a fully executed TSA Form 200.

3.6.1.4.1 Integrated Project Team’s Responsibilities

The Integrated Project Team (IPT), as led by the Program Manager or Requiring Official, has the following responsibilities regarding small business programs.

• Take all reasonable action to increase small business participation in the TSA’s procurements (including subcontracts);
• Consider the feasibility of breaking out requirements to increase opportunities for small businesses to successfully compete for prime contracts;
• Consider the extent of small business participation in contract performance during acquisition planning;
• Obtain guidance from the OSDBU as it relates to small business utilization issues, by including a small business specialist or SBLO on the IPT or by coordinating with the OSDBU;
• Participate and assist in the development of small business conferences and outreach efforts sponsored by the OSDBU and the DHS OSDBU.

3.6.1.4.2 TSA’s Office of Small and Disadvantaged Business Utilization (OSDBU) Responsibilities

The OSDBU maintains a direct working relationship with the Acquisition Personnel, Program Offices, and IPT. When appropriate, the OSDBU interacts with all procurement teams in the following areas to provide support and ensure effective and consistent program implementation:

• Participates in procurement workshops to increase access to and award of TSA’s contracts to small businesses;
• Participates in acquisition planning meetings and other scheduled meetings with the procurement teams as an advisor;
• Identifies potential small businesses that qualify for a particular procurement;
• Provides the procurement team with source lists of small businesses;
• Reviews and concurs that the source selection criteria used to select firms for award is fair, consistent and does not limit opportunities for small businesses;
• Provides advertising recommendations to the integrated products teams to ensure all requirements are being advertised in media accessible to small businesses;
• Responds to written and telephone inquiries from small businesses and small disadvantaged businesses regarding procurement opportunities with TSA;
• Reviews and approves TSA Form 200s and source lists to ensure an adequate representation of small businesses;
• Reviews small business issues raised as part of individual acquisitions and as part of the overall acquisition program;
• Reviews subcontracting plans;
• Ensures that small businesses and small disadvantaged businesses are entered into the OSDBU database;
• Assists in the proposal evaluation process as a non-voting member of the evaluation team, as requested for small business issues;
• Verifies reported business ownership categories, by conducting reviews of databases, interviews, or on-site pre-award verifications;
• Participates in debriefing of small businesses as necessary.

3.6.1.4.3 Small Business Liaison Officers (SBLOs)

Small Business Liaison Officers (SBLO) will assist the OSDBU to promote opportunities for small businesses to participate as prime and subcontractors in contracts awarded by TSA, consistent with efficient contract performance. SBLOs promote stronger communications and build better partnerships between each Program Office and the OSDBU by:

• Ensuring that every effort is made to assist the agency in meeting its prime and subcontracting small business goals while working as a strong small business advocate within their office;
• Ensuring that every procurement request in excess of $200,000 is accompanied by a fully executed TSA Form 200;
• Ensuring that all requirements less than $200,000 are set-aside for small business concerns;
• Ensuring adequate documentation stating the reasons for not setting aside for small business are provided to the Contracting Officer in circumstances where small businesses will not be used; (These instances should be unusual and not the norm.)
• Ensuring timely and accurate input in TSA’s Procurement Forecast through the completion of the Advanced Acquisition Plan (AAP) Project; (The information will be input via the Federal Interagency Databases Online (FIDO) System upon receipt of the DHS Data Calls. The yearly DHS Data Call is received in July and is due in August with a semi-annual update received and due in March).
• Developing a short written narrative regarding the programs in which their office is responsible. This narrative will be used by the OSDBU for distribution to the small-business community.
• Participating in Small Business Fairs and Vendor Outreach Sessions when requested to do so by the OSDBU;
• Attending, informing, and encouraging staff participation in small business training (i.e. workshops, brown bag sessions, etc.).

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3.6.1.6 Principles For The Small Business Program

3.6.1.6.1 Program Goals

Prior to the end of each fiscal year, Program Office goals (including subcontracting goals) shall be established and approved by the OSDBU to provide attainable and reasonable opportunities for small business, veteran-owned small business, service-disabled veteran- owned small business, HUBZone small business, 8(a) socially and economically disadvantaged business, small disadvantaged business, and woman–owned small business concerns to participate in contracts awarded by TSA for the next fiscal year. When feasible, TSA opportunities for small businesses will be identified in a publicized DHS Procurement Forecast. This Procurement Forecast will be prepared by utilizing the information that the SBLOs and Program Managers input into the Federal Interagency Databases Online (FIDO) System at www.fido.gov under the Advanced Acquisition Plan/Procurement Forecast (AAP/Procurement Forecast) Project. This Procurement Forecast is published on October 1st of each year at www.dhs.gov/openforbusiness and will be updated at least once during the fiscal year to keep the information current.

3.6.1.6.2 Reports to the Administrator

To ensure attainment of the program goals, Assistant Administrators and Office Heads shall be held accountable and goal achievement shall be monitored at all levels of the agency. The OSDBU will submit quarterly small business participation reports to the Assistant Administrator for Acquisition to maximize visibility and program support. A courtesy copy of the report will be provided to the SBLO’s to allow for continual program improvement and course corrections as necessary for the upcoming year.

3.6.1.6.3 Procurement Forecast

The OSDBU will work with the Procurement Management & Information Systems
Support (PMISS) Division of the Office of Acquisition to prepare the Procurement Forecast to identify expected contract opportunities available to small business concerns. The PMISS Division serves as the TSA AAP Coordinator of the AAP/Procurement Forecast Project. The Procurement Forecast will be prepared from TSA’s data call to the SBLOs, who will in turn develop the information from their respective program offices and input the information into the Federal Interagency Databases Online (FIDO) System. The Procurement Forecast will summarize the annual acquisition plans prepared by each program office. Program Managers shall maintain Procurement Forecasts. Updates shall be prepared for contracting opportunities valued over $100,000 and submitted via the SBLOs within the FIDO System. DHS OSDBU will publicize TSA’s Procurement Forecast on its website at www.dhs.gov/openforbusiness. The publication of this document will assist the small business community by providing advanced notice of TSA’s procurement plans for the Fiscal Year.

3.6.1.6.4 TSA Form 200

Office of Small and Disadvantaged Business Utilization (OSDBU) Set-Aside Review Form

The TSA Form 200 has been designed to record TSA actions with regard to soliciting and awarding acquisitions over $200,000. A TSA Form 200 must be completed for every purchase request anticipated to exceed $200,000.

In the event that the Requiring Office, the Contracting Officer, and the OSDBU cannot reach agreement on the method of procurement, the purchase request must be forwarded to the TSA Competition Advocate for final resolution.

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3.6.1.7 Prime Contracting with Small Businesses

Each procurement of goods or services having an anticipated dollar value up to $200,000 is automatically reserved exclusively for small businesses. If a procurement less than $200,000 cannot be set-aside for small business, the Requiring Official must prepare a statement providing reasons for dissolving the automatic set-aside. This statement must have the written concurrence of the Contracting Officer, the SBLO, and the OSDBU. A fully executed TSA Form 200 must accompany purchase requests expected to exceed $200,000. The Program Office responsible for the procurement is responsible for obtaining their respective SBLO’s signature on the TSA Form 200 that accompanies the purchase request. Each contract for goods or services having an anticipated dollar value above $200,000 should also be set-aside for small businesses whenever there are two or more small businesses that are competitive in terms of market prices, quality, and delivery.

3.6.1.7.1 Categories of Small Businesses Set-Asides

Contracting Officers may partially or fully set-aside contracts for small businesses. Set-asides include competitive set-asides, and single source awards under socio-economic programs. Competitive contracts may be set-aside for the following:

• Small business community at large;
• 8(a)/socially and economically disadvantaged business concerns (SEDB);
• Small businesses located in Historically Underutilized Business Zones (HUBZone Businesses);
• Serviced disabled veteran-owned small businesses (SDVOSB); or

• Businesses owned by a Federally recognized Native American Tribe or an Alaska Native Corporation

Contracting Officers may open competition further when no responsive, responsible offers are received from small business concerns. Set-asides may not be made for woman-owned small businesses.

IPTs may find small businesses by searching the Central Contractor Registration site at www.ccr.gov.

3.6.1.7.2 Socio-Economic Program Single-Source Awards

When the anticipated total value of a contract (including all options) is $5 million or below for procurements assigned manufacturing North American Industry Classification System (NAICS) codes and $3 million or below for all other procurements, then that contract may be noncompetitively awarded to the following businesses:

• Socially and economically small disadvantaged business concerns (8(a)/SEDB) that are certified by the SBA;
• Small businesses located in Historically Underutilized Business Zones (HUBZone Businesses);
• Service disabled veteran-owned small businesses (SDVOSB); or
• Businesses owned by Federally recognized Native American Tribes or an Alaska Native Corporation for any dollar value.

(Single source awards to HUBZone Businesses and businesses owned by Federally recognized Native American Tribes or an Alaska Native Corporation may be awarded for any dollar value.)

Where a contract is anticipated to exceed the noncompetitive threshold, it may be awarded on a noncompetitive basis if there is not a reasonable expectation that at least two or more sources from the set-aside category will submit offers that are in the Government's best interest in terms of quality, price and/or delivery.

3.6.1.7.3 Approval of Socially and Economically Disadvantaged Program Single Source Award

Socially and economically disadvantaged (8(a)/SEDB) single source awards will be approved through the OSDBU. Program Managers and Requiring Officials will identify a contract as an 8(a)/SEDB single source award on the TSA Form 200 and submit to the OSDBU for approval. The OSDBU will research the request, verify the reported business ownership category of the suggested source, and forward the approval or rejection back to the Program Manager. Once approved by the OSDBU, the Contracting Officer may commence the single source 8(a)/SEDB procurement.

Contracting Officers may commence with 8(a)/SEDB single source awards when the OSDBU has not responded to the request within 5 business days. Program Offices shall provide copies of requests pending in the OSDBU to the Contracting Officer to let them know when the 5 day period began. In these instances, the Contracting Officer shall review the contractor’s representations and certifications regarding business ownership category to verify appropriate business ownership category and shall check the SBA database at www.ccr.gov.

3.6.1.7.4 Single Source Awards to HUBZone Small Business Concerns

Single source awards may be made to HUBZone small business concerns only if all the following have been met:

• Only one HUBZone small business concern can satisfy the requirement;
• The anticipated award price of the contract (including options) will not exceed $5 million for a requirement within the NAICS codes for manufacturing, or, $3 million for a requirement within any other NAICS code;
• The requirement is not currently being performed by a non-HUBZone small business concern;
• The HUBZone small business concern has been determined to be responsible with respect to performance; and
• Award will be made at a fair and reasonable market price.

3.6.1.7.5 Single Source Awards to Service Disabled Veteran-Owned Small Business Concerns

Single source awards may be made to service disabled veteran owned small business concerns only if all the following have been met:

• Only one service disabled veteran-owned small business concern can satisfy the requirements;
• The anticipated award price of the contract (including options) will not exceed $5 million for a requirement within the NAICS codes for manufacturing, or, $3 million for a requirement within any other NAICS code;
• The service disabled veteran-owned small business concern has been determined to be responsible with respect to performance; and
• Award will be made at a fair and reasonable market price.

3.6.1.7.6 Declaration of Business Ownership Category

Vendors that are being considered for contract award must certify their belonging to a business ownership category or categories by completing required certifications and representations. Contracting Officers may accept business ownership representations and certifications through Online Representations and Certifications Application (ORCA) found at orca.bpn.gov. Unless challenged, the Contracting Officer will accept the certification as proof that a vendor belongs to the reported business category(ies). If a business ownership category is challenged, then the Contracting Officer will forward the challenged status to the OSDBU for final resolution. Responses to a set-aside solicitation from a vendor not belonging to the set-aside business ownership category will be deemed non-responsive by the Contracting Officer, and will not be considered for contract award. When the use of subcontracts will be utilized in performance of a contract, the vendor will collect and submit to the Contracting Officer certifications and representations for each of the potential subcontractors.

3.6.1.7.7 Verification of Reported Business Ownership Category

TSA reserves the right to review and verify each firm’s small business program eligibility. If the firm is not a small business as defined by SBA’s North American Industry Classification System (NAICS) code size standards, it will not qualify as a small business.

TSA will follow SBA standards for determining and reporting small business size and ownership.

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3.6.1.8 Mentor–Protégé Program

TSA will participate in the DHS Mentor-Protégé Program in accordance with the policies of the DHS OSDBU. The Mentor-Protégé Program encourages TSA’s large business prime contractors to provide mutually beneficial development assistance to small business, veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, 8(a) socially and economically disadvantaged business, small disadvantaged business, and woman–owned small business concerns. The program is designed to improve the performance of TSA contracts and subcontracts, foster the establishment of long-term business relationships between prime contractors and small business subcontractors, and strengthen subcontracting opportunities and accomplishments through incentives.

3.6.1.8.1 Incentives for Mentor Participation

Mentors may receive a higher evaluation for Mentor-Protégé participation toward the award of contracts during the evaluation of competitive offers.

Mentors may receive credit toward attaining subcontracting goals contained in their TSA subcontracting plan(s) for Mentor-Protégé participation on a dollar for dollar basis by counting protégé development assistance costs in their various small business subcontracting categories. A ceiling on allowable developmental costs shall be established at time of contract award.

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3.6.1.9 Contract Bundling

Contract bundling may provide substantial benefits to the Government. However, because of the potential impact on small business participation, market research must be conducted by the IPT, Program Office, or Requiring Office to determine whether bundling is necessary and justified. Market research may indicate that bundling is necessary and justified if TSA would derive measurably substantial benefits.

Measurably substantial benefits may include, individually or in any combination or aggregate, cost savings or price reduction, quality improvements that will save time or improve or enhance performance or efficiency, reduction in acquisition cycle times, better terms and conditions, and any other benefits. The IPT, Program Office, or Requiring Office must quantify the identified benefits and explain how their impact would be measurably substantial. Contract bundling may be determined to be necessary and justified if, as compared to the benefits that would be derived from contracting to meet those requirements if not bundled, measurably substantial benefits would be derived equivalent to

• Ten percent of the estimated contract or order value (including options) if the value is $75 million or less; or
• Five percent of the estimated contract or order value (including options) or $7.5 million, whichever is greater, if the value exceeds $75 million.

Reduction of administrative or personnel costs alone is not sufficient justification for contract bundling unless the cost savings are expected to be at least ten percent of the estimated contract or order value (including options) of the bundled requirements.

Substantial bundling is any bundling that results in a contract or order that exceeds $2 million.

When the proposed acquisition strategy involves substantial bundling, the acquisition strategy must additionally

• Identify the specific benefits anticipated to be derived from bundling;
• Include an assessment of the specific impediments to participation by small business concerns as prime contractors that result from bundling;
• Specify actions designed to maximize small business participation as subcontractors (including suppliers) at any tier under the contract, or order, that may be awarded to meet the requirements;
• Include a specific determination that the anticipated benefits of the proposed bundled contract or order justify its use; and
• Identify alternative strategies that would reduce or minimize the scope of the bundling, and the rationale for not choosing those alternatives.

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3.6.1.10 Subcontracting with Small Businesses

The TSA Small Business Subcontracting Program includes:

• Collection and negotiation of reasonable subcontracting plans.
• Preference for incentives to contractors for meeting subcontracting goals.
• Collection of subcontracting reports.
• Verification of subcontracting plan implementation through audits and report reviews.

To ensure that the maximum use of small businesses as subcontractors is promoted, IPTs or the responsible program office shall, to the maximum extent practicable, include a source selection evaluation factor related to small business participation in TSA solicitations. Proposals shall be evaluated in terms of the total value of the proposed subcontracting effort as it relates to the total value of the prospective contract and the meaningfulness and substantiveness of the work to be performed. Competitive solicitations should use an evaluation factor or sub factor that will be used to evaluate small business participation in subcontracts. Small business concerns will receive maximum evaluation credit for this factor.

3.6.1.10.1 Subcontracting Plans

Other than small business offerors shall submit subcontracting plans for acquisitions exceeding $2,000,000 before award of the contract unless formally waived by the Contracting Officer for urgent and compelling business reasons. The Contracting Officer must approve plans before contract award. The subcontracting plan shall specify the identification of the small businesses to be utilized and the extent of the contractual commitment between the prime and the subcontractor to be evaluated.

The OSDBU will assist Contracting Officers in evaluating and negotiating acceptable plans, obtain necessary advice and assistance from the DHS OSDBU, and monitor contractor’s performance through an analysis of required reports. The review will include recommendations regarding acceptance or rejection of the plans. If the plan is incomplete or otherwise unsatisfactory, the OSDBU, Contracting Officer, and the prime contractor shall work together to negotiate an acceptable plan. As requested by the Contracting Officer, the OSDBU will monitor prime contractors’ Individual Subcontracting Reports (ISRs) and conduct compliance reviews of prime contractors’ subcontracting programs.

Also as requested by the Contracting Officer, the OSDBU will assist the Contracting Officers in reviewing the contractors ISRs when they are submitted during the period of performance of the contract in accordance with the terms and conditions of the contract. These reports should be submitted via the electronic Subcontracting Reporting System (eSRS) at www.esrs.gov.

3.6.1.10.2 Types of Subcontracting Plans

Individual Contract Plan: a subcontracting plan that covers the entire contract period (including option periods), applies to a specific contract, and has goals that are based on the offeror’s planned subcontracting in support of the specific contract, except that indirect costs incurred for common or joint purposes may be allocated on a prorated basis to the contract.

Master Plan: a subcontracting plan that contains all of the required elements of an individual contract plan, except goals, and may be incorporated into individual contract plans, provided the master plan has been approved.

Commercial Plan: a subcontracting plan (including goals) that covers the offeror’s fiscal year and that applies to the entire production of commercial items (supplies or services) sold by either the entire company or a portion (e.g., division, plant, or product line).

3.6.1.10.3 Subcontracting Incentive Program

TSA may utilize positive incentives to the maximum extent practicable, and devise monetary penalties for prime contractors who fail to meet stated goals. The Contractor shall give preference to small business, veteran-owned small business, service-disabled veteran-owned small business, HUBZone small business, 8(a)/socially and economically disadvantaged business, small disadvantaged business, and woman–owned small business concerns to the maximum extent practicable and consistent with the efficient performance of the contract for all subcontract awards.

The Contracting Officer should encourage increased subcontracting opportunities for small disadvantaged business concerns in negotiated acquisitions by providing monetary incentives. Monetary incentives shall be based on actual achievement as compared to proposed monetary targets for small disadvantaged business subcontracting. A total of up to 5% of the subcontract’s award amount may be paid for meeting subcontracting goals. If the Contractor exceeds its target for subcontracting goals to small disadvantaged business concerns, it can receive up to 5% of the dollars in excess of the subcontract value, unless the Contracting Officer determines otherwise.

Contracting Officers will negotiate revised goals and incentives/disincentives, and modify the contract accordingly as necessitated by contract changes or other circumstances. Prior to award, the Contracting Officer must ensure sufficient funding is obligated for payment of subcontracting award incentives. The Program Office must have appropriate funding available to participate in the program.

When soliciting large businesses, source selection organizations should use an evaluation factor or sub factor that will be used to evaluate small business participation in subcontracts.

An optional incentive program may be established that may be equal to 5% of the amount paid, or to be paid, to a qualifying subcontractor or supplier that is an Alaska Native Corporation or Native American-owned economic enterprise. The Program Office must have appropriate funding available to participate in the program.

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3.6.1.11 Price Evaluation Preference for HUBZone Small Business Concerns

Contracting Officers shall consider price evaluation preference for HUBZone small business concerns in acquisitions using full and open competition that are anticipated to be greater than the simplified acquisition parameter. Contracting Officers may give offers from HUBZone small business concerns a price evaluation preference by adding a factor up to 10 percent to all offers. The preference shall not be used—

• Where price is not a selection factor so that a price evaluation preference would not be considered;
• Where all fair and reasonable offers are accepted (e.g., the award of multiple award schedule contracts).

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