Federal Acquisition Regulation: Small Business Participation on Certain Multiple-Award Contracts
Published Date: 1/15/2025
Proposed Rule
Summary
The Department of Defense, GSA, and NASA want to make sure small businesses get a fair shot at winning spots on certain big government contracts. They’re proposing new rules to boost small business participation and want your feedback by March 17, 2025. This could open up more opportunities and money for small businesses in the near future!
Analyzed Economic Effects
5 provisions identified: 5 benefits, 0 costs, 0 mixed.
Mandatory Order Set-Asides for Small Business
If you are a small business on a multiple-award contract, contracting officers must set aside an order for small business when they reasonably expect offers from two or more responsible small business contract awardees that are competitive on price, quality, schedule, and past performance. This set-aside requirement does not apply to orders under the Federal Supply Schedule (FSS) or when specified exceptions apply.
Set-Asides Built Into New Contract Ordering Rules
New multiple-award contracts must include ordering procedures that allow orders to be set aside for small business awardees when the set-aside conditions are met, and the rule clarifies that the set-aside requirement can apply to existing contracts if the contract's ordering procedures allow it and there is adequate time left for a small business to perform. Agencies may create agency-specific exceptions but must coordinate those procedures with their small business office and the SBA and publish them.
Potential Increase in Small Business Contracting Opportunities
The agencies say this rule is intended to increase the number of multiple-award contracts and orders that are set aside for small businesses and to reverse declining small business participation. The rule could affect any of the roughly 384,100 small entities currently registered in SAM that seek to do business with the Federal Government.
On‑Ramps Required to Be Considered for Long-Term Contracts
When planning long-term multiple-award contracts (defined as more than five years in duration, including options), agencies must discuss the use of on-ramps that allow additional small and large businesses to become contract holders during the contract period. If on-ramps are not included but small businesses are expected to enter the market after award and meaningful opportunities exist, the agency must explain why on-ramps were not included.
No New Requirements for SAT or Commercial Items
The proposed rule does not add new requirements for contracts at or below the Simplified Acquisition Threshold (SAT) or for commercial products (including commercially available off-the-shelf items) or commercial services. Clauses continue to apply to such acquisitions as before.
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Key Dates
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