Regulatory Developments
On June 24, 2019, the U.S. Small Business Administration (“SBA”) finally issued a proposed rule in response to the 2018 Small Business Runway Extension Act, which increased the time period over which receipts are averaged for purposes of calculating a concern’s size from three years to five. The proposed rule specifies that it will go into effect only after the effective date of a final rule, confirming SBA’s intention to continue to apply the three-year averaging period to any certification submitted prior to the effective date of the final rule.
On May 20, 2019, the U.S. Department of Veterans Affairs (“VA”) issued a class deviation from Department of Veterans Affairs Acquisition Regulation (“VAAR”) 808.002, Priorities for Use of Government Supply Sources, and VAAR Subpart 808.6, Acquisition from Federal Prison Industries, Inc., the two provisions implementing the FAR Part 8 mandatory source priority of AbilityOne Procurement List and Federal Prison Industries contractors. The class deviation effectively gives Veterans First providers priority over AbilityOne providers in all VA contract opportunities should two or more veteran-owned small businesses (“VOSBs”) or service-disabled veteran-owned small businesses (“SDVOSBs”) be capable of performing the contract at a reasonable price. The newly implemented class deviation preempts the AbilityOne priority in all VA procurements in favor of a Veterans First priority. However, “if an award is not made to an eligible . . . VOSB under VAAR Subpart 819.70, the priority use of AbilityOne applies, and supplies and services on the Procurement List are mandatory sources.” The class deviation was immediately effective and to be implemented in all VA contracts.
On June 11, 2019, the House Armed Services Committee published the draft 2020 National Defense Authorization Act (“NDAA”). Notable potential changes include a reduction in the monetary threshold for enhanced DoD post-award debriefing rights and a grant of permanent authority for DoD’s Mentor-Protégé Program. The 2018 NDAA implemented “Enhanced Post-Award Debriefing Rights” for certain DoD procurements. This change required defense agencies to provide the agency’s written source selection award determination for all small business contracts valued between $10 and $100 million, and all defense contracts valued over $100 million. Section 828 of the draft 2020 NDAA would reduce the monetary threshold for these enhanced debriefings to only $50 million, significantly increasing the number of procurements for which they must be provided. Section 881 of the draft NDAA permanently authorizes the DoD Mentor-Protégé Program and requires that the DoD’s Office of Small Business Programs establish mentor-protégé performance goals and periodic reviews.
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