[Federal Register Volume 59, Number 10 (Friday, January 14, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-491]


[[Page Unknown]]

[Federal Register: January 14, 1994]


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GENERAL SERVICES ADMINISTRATION

48 CFR Parts 519 and 552

[GSAR Notice 5-384]

 

General Services Administration Acquisition Regulation; Small 
Business Subcontracting Program

AGENCY: Office of Acquisition Policy, GSA.

ACTION: Proposed rule.

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SUMMARY: This notice invites written comments on a proposed revision 
which expresses GSA's expectation that offerors under GSA procurements, 
in submitting required subcontracting plans, will do more than merely 
restate minimum plan requirements described at FAR 52.219-9. GSA also 
expects subcontracting plans to demonstrate aggressiveness, creativity, 
and innovation in involving small, small disadvantaged, and women-owned 
small business concerns in subcontracting opportunities and an 
understanding of the requirement that these concerns be afforded the 
maximum practicable opportunity to perform as subcontractors in the 
offeror's procurements. In negotiated solicitations, the subcontracting 
plan will be negotiated with price and any technical and management 
proposal required by the solicitation. In sealed bid solicitations, 
target goals may be stated by GSA in the solicitation. GSA understands, 
however, that offerors' subcontracting circumstances may vary greatly. 
The proposed revision also deletes various sections because they 
concern nonregulatory material.

DATES: Comments are due in writing on or before March 15, 1994.

ADDRESSES: Comments should be addressed to the GSA Desk Officer, room 
3235, NEOB, Washington, DC 20503 and Marjorie Ashby, Office of GSA 
Acquisition Policy, 18th and F Streets, NW., room 4006, Washington, DC 
20405.

FOR FURTHER INFORMATION CONTACT:
Paul Linfield, Office of GSA Acquisition Policy, (202) 501-1224.

SUPPLEMENTARY INFORMATION:

A. Executive Order 12866

    This rule was not submitted to the Office of Management and Budget 
(OMB) for review because the rule is not a significant regulatory 
action as defined in Executive Order 12866, Regulatory Planning and 
Review, and, therefore, was not required to be submitted.

B. Regulatory Flexibility Act

    Pursuant to the Regulatory Flexibility Act (5 U.S.C. 601 et seq.), 
the GSA certifies that the proposed rule will not have significant 
impact on a substantial number of small entities, since the revised 
subcontracting plan requirements in the proposed regulation will not 
apply to small business concerns. Accordingly, an initial regulatory 
flexibility analysis has not been prepared.

C. Paperwork Reduction Act

    The retitled provision at 552.219-73 contains an information 
collection requirement that is subject to the Paperwork Reduction Act 
(44 U.S.C. 3501 et seq.), and it has been submitted to OMB for approval 
under the Act. Comments on the information collection may be submitted 
to the Office of Information and Regulatory Affairs of OMB, Attention: 
Desk Officer for GSA, Washington, DC 20503. The title of the 
information collection is ``GSAR 552.219-73 Preparation, Submission, 
and Negotiation of Subcontracting Plans.'' The provision requires all 
offerors, other than small business concerns, responding to a 
negotiated solicitation to submit a subcontracting plan with their 
respective offers so that a plan can be negotiated concurrently with 
other parts of the proposal. The respondents are potential GSA 
contractors. The contracting officer will use the information to 
evaluate whether GSA's expectation that subcontracting opportunities 
exist for small, small disadvantaged and women-owned small business is 
reasonable under the circumstances; negotiate goals consistent with 
statutory requirements and acquisition objectives; and expedite the 
award process. The estimated annual burden for this additional 
collection is 14,690 hours. This is based on an estimated burden per 
response of 11.3 hours, a proposed frequency of one response per 
respondent, and an estimated number of likely respondents of 1,300.

List of Subjects in 48 CFR Parts 519 and 552

    Government procurement.
    Accordingly, it is proposed that 48 CFR parts 519 and 552 be 
amended to read as follows:
    1. The authority citation for 48 CFR parts 519 and 552 continues to 
read as follows:

    Authority: 40 U.S.C. 486(c).

PART 519--SMALL BUSINESS AND SMALL DISADVANTAGED BUSINESS CONCERNS


519.701, 519.702 and 519.704   [Removed]

    2. Sections 519.701, 519.702, and 519.704 are removed.
    3. Section 519.705-2 is revised to read as follows:


519.705-2   Determining the need for a subcontracting plan.

    The requirement at FAR 19.702(a)(1) for submission of a 
subcontracting plan by only the apparently successful offeror does not 
apply to GSA negotiated solicitations when the contract is expected to 
exceed $500,000 ($1,000,000 for construction). Except for acquisitions 
of leasehold interests in real property using expedited procedures and 
those offering minimal subcontracting opportunities, negotiated 
solicitations shall require submission with the initial offer of a 
subcontracting plan in the format described in FAR 52.219-9 by all 
offerors that are not small business concerns. Where price is the basis 
for award, such as multiple award schedule contracts, the plan will be 
evaluated and negotiated along with price. In solicitations requiring 
technical and management proposals, the subcontracting plan will be 
included as an evaluation factor or subfactor and negotiated 
concurrently with the technical, management, and price proposals.


519.705-4, 519.705-6, 519.706, and 519.706-70  [Removed]

    4. Section 519.705-4, 519.705-6, 519.706, and 519.706-70 are 
removed.
    5. Section 519.708 is revised to read as follows:


519.708  Solicitation provisions and contract clauses.

    (a) The contracting officer shall insert the provision at 552.219-
72, Notice to Offerors of Subcontracting Plan Requirements, on the 
cover page of the solicitation if the contract amount is expected to 
exceed $500,000 ($1,000,000 for construction) except for:
    (1) Acquisitions set aside for small business;
    (2) Solicitations for personal services;
    (3) Solicitations for work to be performed outside any state, 
territory, or possession of the United States, the District of 
Columbia, and the Commonwealth of Puerto Rico; and
    (4) Acquisitions of leasehold interests in real property using 
expedited procedures.
    (b) The contracting officer shall insert the provision at 552.219-
73, Preparation, Submission, and Negotiation of Subcontracting Plans, 
in negotiated solicitations if the contract amount is expected to 
exceed $500,000 ($1,000,000 for construction) except for:
    (1) Acquisitions set aside for small business;
    (2) Solicitations for personal services;
    (3) Solicitations for work to be performed outside any state, 
territory, or possession of the United States, the District of 
Columbia, and the Commonwealth of Puerto Rico;
    (4) Acquisitions of leasehold interests in real property using 
expedited procedures; and
    (5) Solicitations where, in the judgment of the contracting 
officer, subcontracting opportunities are minimal.
    (c) The contracting officer shall insert the provision at 552.219-
74, Goals for Subcontracting Plan, in sealed bid solicitations if the 
contract amount is expected to exceed $500,000 ($1,000,000 for 
construction) except for:
    (1) Acquisitions set aside for small business;
    (2) Solicitations for personal services;
    (3) Solicitations for work to be performed outside any state, 
territory, or possession of the United States, the District of 
Columbia, and the Commonwealth of Puerto Rico.
The basic provision should be used when the contracting officer is able 
to realistically establish target goals. Alternate I should be used 
when the contracting officer cannot establish realistic target goals.


519.770, 519.770-1, and 519.770-3  [Removed]

    6. Sections 519.770, 519.770-1, and 519.770-3 are removed.
    7. Section 552.219-72 is revised to read as follows:


552.219-72  Notice to offerors of subcontracting plan requirements.

    As prescribed in 519.708(a), insert the following provision:

Notice to Offerors of Subcontracting Plan Requirements (XXX 1993)

    The General Services Administration (GSA) is committed to 
assuring that maximum practicable opportunity is provided to small, 
small disadvantaged, and women-owned small business concerns to 
participate in the performance of this contract consistent with its 
efficient performance. GSA expects any subcontracting plan submitted 
pursuant to FAR 52.219-9 to reflect this commitment. Consequently, 
an offeror, other than a small business concern, before being 
awarded a contract exceeding $500,000 ($1,000,000 for construction) 
will be required to demonstrate that its subcontracting plan 
represents an aggressive program for involving small, small 
disadvantaged, and women-owned small business concerns as 
subcontractors in the performance of this contract.
(End of Provision)

    8. Section 552.219-73 is revised to read as follows:


552.219-73  Preparation, submission, and negotiation of subcontracting 
plans.

    As prescribed in 519.708(b), insert the following provision:

Preparation, Submission, and Negotiation of Subcontracting Plans (XXX 
1993)

    (a) An offeror, other than a small business concern, submitting 
an offer that exceeds $500,000 ($1,000,000 for construction) shall 
submit a subcontracting plan with its initial offer. The 
subcontracting plan will be negotiated concurrently with price and 
any required technical and management proposals, unless the offeror 
submits a previously-approved commercial products plan. Maximum 
practicable utilization of small, small disadvantaged, and women-
owned small business concerns as subcontractors is a matter of 
national interest with both social and economic benefits. It is the 
General Services Administration's (GSA's) expectation that an 
offeror's subcontracting plan will reflect a commitment to assuring 
that small, small disadvantaged, and women-owned small business 
concerns are provided the maximum practicable opportunity, 
consistent with efficient contract performance, to participate as 
subcontractors in the performance of the resulting contract.
    (b) GSA believes that this potential contract provides 
significant opportunities for the use of small, small disadvantaged, 
and women-owned small business concerns as subcontractors. 
Consequently, in addressing the eleven elements described at FAR 
52.219-9(d), the offeror shall demonstrate that its subcontracting 
plan represents an aggressive program for involving small, small 
disadvantaged, and women-owned small business concerns in performing 
the contract. The subcontracting plan shall include a description of 
the offeror's subcontracting strategies used in any previous 
contracts, significant achievements, and how this plan will build 
upon those earlier achievements. Additionally, the offeror shall 
demonstrate through its plan that it understands the small business 
subcontracting program's objectives, GSA's expectations, and actions 
necessary to meet these goals and expectations.
    (c) In determining the acceptability of any subcontracting plan, 
the Contracting Officer will--
    (1) Review the plan to verify that the offeror has demonstrated 
an understanding of the small business subcontracting program's 
objectives and GSA's expectations with the respect to the program 
and has included all the information, goals, and assurances required 
by FAR 52.219-9;
    (2) Consider previous goals and achievements of contractors in 
the same industry;
    (3) Consider information and potential sources obtained from 
agencies administering national and local preference programs and 
other advocacy groups in evaluating whether the goals stated in the 
plan adequately reflect the anticipated potential for subcontracting 
to small, small disadvantaged, and women-owned small business 
concerns; and
    (4) Review, when applicable, the offeror's description of its 
strategies, historical performance and significant achievements in 
placing subcontracts for the same or similar products or services 
with small, small disadvantaged, and women-owned small business 
concerns.
    (d) Failure to submit to subcontracting plan and/or correct 
deficiencies in the plan within the time specified by the 
Contracting Officer shall make the offeror ineligible for award.
(End of Provision)

    9. Section 552.219-74 is added to read as follows:


552.219-74  Goals for subcontracting plan.

    As prescribed in 519.708(c), insert the following provision:

Goals for Subcontracting Plan (XXX 1993)

    (a) Maximum practicable utilization of small, small 
disadvantaged, and women-owned small business concerns as 
subcontractors is a matter of national interest with both social and 
economic benefits. The General Services Administration's (GSA's) 
commitment to ensuring that maximum practicable opportunity is 
provided to small, small disadvantaged, and women-owned small 
business concerns to participate as subcontractors in the 
performance of this contract, consistent with its efficient 
performance, must be reflected in the offeror's subcontracting plan 
submitted pursuant to FAR 52.219-9. In addressing the eleven 
elements described at FAR 52.219-9(d), the offeror shall demonstrate 
that its subcontracting plan represents an aggressive program for 
involving small, small disadvantaged, and women-owned small business 
concerns in performing this contract. The subcontracting plan shall 
include a description of the offeror's subcontracting strategies 
used in previous contracts, significant achievements, and how this 
plan will build upon those earlier achievements. Additionally, the 
offeror shall demonstrate through its's plan that it understands the 
small business subcontracting program's objectives, GSA's 
expectations, and actions necessary to meet these goals and 
expectations.
    (b) GSA believes that this contract provides significant 
opportunities for the use of small, small disadvantaged, and women-
owned small business concerns as subcontractors. Accordingly, it is 
anticipated that an acceptable subcontracting plan will contain at 
least the following goals:

Small Business: ____ percent
Small Disadvantaged Business: ____ percent
Women-Owned Small Business: ____ percent
    Note: Target goals are expressed as a percentage of planned 
subcontracting dollars.
    (c) In determining the acceptability of a subcontracting plan, 
the Contracting Officer will--
    (1) Review the plan to verify that the offeror has demonstrated 
an understanding of the small business subcontracting program's 
objectives and GSA's expectations with respect to the program and 
has included all the information, goals, and assurances required by 
FAR 52.219-9;
    (2) Consider previous goals and achievements of contractors in 
the same industry;
    (3) Consider information and potential sources obtained from 
agencies administering national and local preference programs and 
other advocacy groups in evaluating whether the goals stated in the 
plan adequately reflect the anticipated potential for subcontracting 
to small, small disadvantaged, and women-owned small business 
concerns; and
    (4) Review, when applicable, the offeror's description of 
strategies, historical performance and significant achievements in 
placing subcontracts for the same or similar products or services 
with small, small disadvantaged, and women-owned small business 
concerns.
    (d) Failure to submit an acceptable subcontracting plan and/or 
correct deficiencies in the plan within the time specified by the 
Contracting Officer shall make the offeror ineligible for award.
(End of Provision)

Alternate I (XXX 1993)

    The Contracting Officer, as prescribed in 519.708(c) shall 
delete paragraph (b) of the basic provision and redesignate 
paragraphs (c) and (d) as paragraphs (b) and (c).

    Dated: December 21, 1993.
Richard H. Hopf, III,
Associate Administrator for Acquisition Policy.
[FR Doc. 94-491 Filed 1-13-94; 8:45 am]
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