Definition Partial & Total Small Business Set Aside Government Contracts

When considering total small business set-aside contracts and upcoming opportunities Congress, in an effort to increase its revenues, and to facilitate the mindset that government small businesses set aside program and opportunities contribute immensely to the economy, Congress has established small business goals for each agency to meet. 

• There is no secret that agencies still have a hard time meeting small business opportunity goals.
• Why is this? Depending on whom you ask, the answer may be different.

Hard data about a particular agency’s procurement planning and efforts for government small business set aside contracts should speak for themselves.

As the end-user submits a procurement, the agency, and its small business advocate should be looking first at the possibility of setting aside the project for small businesses.

• Do they always take this step? No, they don’t.

Understand the Agency’s Obligations for Small Business Set Aside Government Contracts Program 

Does a contracting agency have to take risks by saving extremely large projects under the small business set aside contract program? Not necessarily. However, there should be at least some effort to look at the possibility of a partial small business set-aside See FAR 19.5 below. See also, What is the Government Simplified Acquisition Threshold & micro purchase threshold?

Partial Small Business Set Aside Decisions

FAR regulations state that a partial set-aside shall not be made if there is a reasonable expectation that only two concerns (one large and one small) with capability will respond with offers unless authorized by the head of a contracting activity on a case-by-case basis. Similarly, a class of acquisitions, not including construction, maybe partially set aside. Under certain specified conditions, partial small business set-asides may be used in conjunction with multiyear contracting procedures.

When one reviews a challenge to a government small business set aside decision, you may quickly see that the legal analysis usually falls on whether the agency has to publicize the requirement as small business opportunities. Well, the obvious answer is no.

How to Does The Public Hold the Agency Accountable When it Comes to Government Contracts? Under government contracts law there is a degree of reasonableness in agency actions.

There is no secret that a vast of the Federal Acquisition Regulation’s language is “mandatory.”  In other words, there is a substantial amount of discretionary language where either the agency or the contracting officer “may” or “could” do something. This is in contrast to the small percentage of “shall” and “will” language.

The Agency’s reasonableness should be based on various things. For example, whether the agency has substantially met its annual goals before. If not, there should be more an effort to carve more small business set aside contracts opportunities.

Agency personnel may say that this proposition has no support in fact or law. However, as many federal contracting agencies forget. The law as set forth by Congress is intended for executive agencies to follow. The reason why goals for government small businesses are not set forth as a hard requirement is that there are a lot of variables involved in getting such an end result. See SBA OHA Affiliation Decision Defeats Contractor Argument that Subcontractor Was Similarly Situated.

The Agency certainly does not have the discretion to IGNORE congressional mandates. Therefore, the agency’s actions should be presumed to follow congressional mandates and the intent of those regulations.

A more analytical approach would be to assume that all contracting officers choose not a set-aside any projects under FAR 19.5 for federal small business contractors and used the position that there is no mandatory requirement to so except for projects that fall within the SAP thresholds, then what would be the impact on Congress and the current economy? See Government Contract Novation Vs Assignment of Contract & FAR 42.1204 Novation Clause.

• Agencies must realize that their discretion is subject to checks and balances.
• In federal contracting, as compared to state contracting, there is no specific language mandating minority set-aside contracts.
• The federal government looks more towards contracts for small disadvantaged businesses.

Public Issues With Total Small Business Set Aside Contracts Program 

When analyzing total small business set aside definition and whether small business set aside government contracts should be allocated to small companies, it would seem that the reasonable action would be to explain why it should not be set aside instead of the “ I don’t have to” rationale from the government.

The impact to Congress in the above example would mean that the CO’s decision to not set aside the project would have a direct impact on Congress’s ability to collect taxes from small businesses.  The intent of government small business set aside program “to the maximum extent possible.” Without revenues (from small businesses) Congress is at a disadvantage and therefore has to seek alternative revenues to fund the country.

According to NEW YORK (CNNMoney) — For the sixth year in a row, the government has missed its goal to award 23% of all federal contract dollars in small business opportunities.

The above information shows that there is a presumption of reasonableness to reserve small business set aside government contracts program.

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If you are interested in redeveloping your efforts to secure more small business opportunities, consider getting expert help from Watson’s government small business lawyers or consultants. Call 1-866-601-5518.

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