Understand the benefits of SBA and FAR requirements and getting 8a sole source contracts with the government. It can take your business to the next level. 8a contracts are awarded when there is evidence that there is but a sole supplier that is capable of providing the products or purchases sought by the government. Under the SBA 8(a) Business Development Program, small businesses can also get single-source contracts by statute.
The government contracting agreement is not required to seek out a single supplier. This is but one exception to the full and open competition rules. However, there are many 8(a) companies that have yet to get their first sole 8a sole source contract. For companies in the SBA’s 8a Contracts Program that consider themselves for a single source for a specific product or service, they should promote these services or products to the government contracting agency.
Government Does Not Have to Directly Award Without Competition
Understand that the federal government does not have to directly contract to your company. However, the rules in place for the government justify sole sourcing to you if it chooses to. The better approach is to market your capabilities to the specific agency that may have forecasted projects. Your company should develop a concise strategic plan that incorporates the relevant FAR regulations for getting 8a sole source contracts. See FAR 19.803.
- Balance your initiatives between competed contracts and sole-source government contracts
- Be more specific about what makes your product or service so unique that the government might be able to justify why sole sourcing can be justified.
What is a Sole Source Contract?
In federal government contracting, agencies are required to seek competition for when spending taxpayer dollars. With that said, there are exceptions to the “other than full and open competition” requirement. If you are a small business, or 8a certified company, you can receive a sole source contract so long as the regulations allow for it. FAR regulations allow the contracting officer to utilize the statutes in order to serve the government’s interest. This is one way of getting government contracts that your should focus on.
What are the 8(a) ProgramThresholds?
Under the SBA regulations and FAR part 19.806, SBA 8a government contractors have certain thresholds/ limits to where they can get a single source contract. The exception to government caps typically applies to Native American Tribal entities, Alaskan Native Corporations (ANC) and NHOs. These groups are generally referred to as “Super 8(a)” companies.
- ANCs or Native American Tribal entities may receive a direct bid up to $22 million, and with proper justification, unlimited dollar amounts.
- Other 8(a) small businesses can only receive direct awards for manufacturing contracts up to $6.5 million and for service contracts up to $4 million.
- Under the 8(a) Program, the SBA accepts direct award contracts on behalf of the 8a company (not necessarily so for 8a set asides)
FAR 19.8 8a Sole Source Contracts With the Government & Set Aside Bid Mandates
Although there is a sole source threshold for awarding single source 8a FAR contracts to only one supplier, there are some caveats. Under FAR 19.8, the SBA cannot accept 8a contracts with the government that exceed $22 million unless the contracting agency completes a Justification and Approval under FAR 6.303.
There are agency negotiation timeliness that might come into play when it comes to getting government contracts. The SBA and the contracting agency are required to work out the negotiation kinks together. However, if the SBA cannot meet the agency timelines, the contracting offer, after notifying the SBA, can move ahead with the single source contract.
Common Perceptions By 8(a) Sole Supplier Small Businesses: Small businesses must understand that the SBA is not mandated to go out and find contracts for 8(a) certified companies. Instead, companies have to market their product or services to the government. Knowing how to reach the end result of getting direct award government contracts is a constant problem for many companies trying to be a sole supplier across the U.S. See also Commercial Off the Shelf Items in Government COTS Contracts.
On the other hand, the contracting officer is not required to contract directly with the SBA if she is making a sole source justification contract award for other small businesses not in the 8(a) Program.
Additional Government Contracting and 8a Government Contracts Information
CALL US FOR IMMEDIATE HELP
For help with structuring your company for government sole source purchase contracts with the government under the SBA 8a Contracts Program, or help with your existing contract call our government small business contract consultants and lawyers at 1-866-601-5518.