[Federal Register Volume 59, Number 27 (Wednesday, February 9, 1994)]
[Unknown Section]
[Page 0]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-2876]


[[Page Unknown]]

[Federal Register: February 9, 1994]


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NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

48 CFR Parts 1819 and 1852

 

Mentor-Protege Program

AGENCY: Office of Small and Disadvantaged Business Utilization (OSDBU), 
National Aeronautics and Space Administration (NASA).

ACTION: Proposed rule.

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SUMMARY: This proposed rule establishes NASA policy for the Mentor-
Protege Program which is designed to increase the overall participation 
of Small Disadvantaged Businesses (SDBs) in NASA contracts and 
subcontracts. The resultant increased participation of SDBs in NASA 
contracts and subcontracts will enhance NASA's efforts to meet and 
sustain the annual minimum eight (8) percent goal prescribed in Public 
Law 101-144 and its amended version Public Law 101-507.

DATES: Comments are due no later than April 11, 1994.

ADDRESSES: Comments should be addressed to Ms. Rae C. Martel, NASA 
Headquarters, NASA Office of Small and Disadvantaged Business 
Utilization, (Code K), Washington, DC 20546. Comments should also be 
addressed to the Office of Information and Regulatory Affairs of OMB, 
ATTN: Desk Officer for NASA, Washington, DC 20503.

FOR FURTHER INFORMATION CONTACT:
Ms. Rae C. Martel, Telephone: (202) 358-2088 or 1800-2NASA-95.

SUPPLEMENTARY INFORMATION:

Background

    The rule proposes NASA's policy on its Mentor-Protege Program. With 
respect to prime contractors, it defines eligibility for participation, 
allowable developmental assistance measures that will enhance the 
capabilities of SDBs to perform NASA contracts and subcontracts, and 
incentives for program participation. Further, it defines the 
transportability of subcontracting goal credit features from the 
Department of Defense (DOD) Mentor-Protege Program to NASA Contractors. 
However, the effectiveness of a mentor under the NASA Program will be 
evaluated by the measurable amount of developmental assistance provided 
under NASA contracts. Participation in the program is voluntary.
    With regard to SDBs, ``Socially And Economically Disadvantaged 
Businesses'' include the eligible participants set forth in NASA's 
Eight (8) percent legislation, Public Law 101-144 and the amended 
provision in Public Law 101-507.

Availability of NASA FAR Supplement

    The NASA FAR Supplement, of which this proposed coverage will 
become a part, is codified in 48 CFR, chapter 18, and is available in 
its entirety on a subscription basis from the Superintendent of 
Documents, Government Printing Office, Washington, DC 20402. Cite GPO 
Subscription Stock Number 933-003-00000-1. It is not distributed to the 
public, whether in whole or in part, directly by NASA.

Impact

    NASA certifies that this regulation will not have a significant 
economic effect on a substantial number of small entities under the 
Regulatory Flexibility Act (5 U.S.C. 601 et seq.). This proposed rule 
imposes reporting or recordkeeping requirements subject to OMB approval 
under the Paperwork Reduction Act, which will be requested separately.

List of Subjects in 48 CFR Parts 1819 and 1852

    Government procurement.
Deidre A. Lee,
Associate Administrator for Procurement.

    Accordingly, 48 CFR parts 1819 and 1852 are proposed to be amended 
as follows:
    1. The authority citation for 48 CFR parts 1819 and 1852 continues 
to read as follows:

    Authority: 42 U.S.C. 2473(c)(1).

PART 1819--SMALL BUSINESS AND SMALL DISADVANTAGED BUSINESS CONCERNS

    2. Subpart 1819.72 is added to read as follows:


Subpart 1819.72  [Added]

Subpart 1819.72--The NASA Mentor-Protege Program

1819.7201  Scope of subpart.
1819.7202  Definitions.
1819.7203  Non-affiliation.
1819.7204  Transportability of features from the Department of 
Defense (DOD) mentor-protege program to NASA contractors.
1819.7205  General policy.
1819.7206  Incentives for prime contractor participation.
1819.7207  Measurement of program success.
1819.7208  Mentor firms.
1819.7209  Protege firms.
1819.7210  Selection of protege firms.
1819.7211  Application process for mentor firms to participate in 
the program.
1819.7212  OSDBU review and approval process of agreement.
1819.7213  Agreement contents.
1819.7214  Developmental assistance.
1819.7215  Obligation.
1819.7216  Internal controls.
1819.7217  Reports.
1819.7218  Program review.
1819.7219  Contract and solicitation clauses.

Subpart 1819.72--The NASA Mentor-Protege Program


1819.7201   Scope of subpart.

    The NASA Mentor-Protege Program is designed to incentivize NASA 
prime contractors to assist High Tech small disadvantaged businesses 
(SDB)s in enhancing their capabilities to perform NASA contracts and 
subcontracts, foster the establishment of long term business 
relationships between SDBs and NASA prime contractors, and increase the 
overall number of SDBs that receive NASA contract and subcontract 
awards.


1819.7202   Definitions.

    Historically Black Colleges and Universities, as used in this 
subpart, means institutions determined by the Secretary of Education to 
meet the requirements of 34 CFR 608.2 and listed therein.
    Minority Educational Institutions, as used in this subpart, means 
institutions meeting the criteria established in 34 CFR 607.2 by the 
Secretary of Education.
    Small Disadvantaged Business concern, as used in this subpart, 
means a small business concern owned or controlled by individuals who 
are both socially and economically disadvantaged (within the meaning of 
section 8(a) (5) and (6) of the Small Business Act (15 U.S.C. 637(a) 
(5) and (6))).


1819.7203   Non-affiliation.

    For purposes of the Small Business Act, a protege firm may not be 
considered an affiliate of a mentor firm solely on the basis that the 
protege firm is receiving developmental assistance referred to in 
1819.7214 from such mentor firm under the program.


1819.7204   Transportability of features from the Department of Defense 
(DOD) mentor-protege program to NASA contractors.

    (a) In accordance with the benefits authorized by the DOD Mentor-
Protege Program (Pub. L. 101-510, section 831, as amended by Pub. L. 
102-190, section 814) a NASA contractor who is also an approved DOD 
Mentor can transfer credit features to their NASA contracts.
    (b) NASA prime contractors, who are approved DOD mentors, can award 
subcontracts non-competitively under their NASA contracts to the 
proteges which they are assisting under the DOD program (Pub. L. 101-
510, section 831(f)(2)).
    (c) NASA prime contractors may count the costs of developmental 
assistance provided to proteges being assisted under the DOD program 
toward meeting the goals in their subcontracting plans under their NASA 
prime contracts (Pub. L. 102-190, section 814). Limitations which may 
reduce the value of this benefit include:
    (1) Credit toward attaining subcontracting goals is available only 
to the extent that the developmental assistance costs have not been 
reimbursed to the contractor by DOD as direct or indirect costs; or
    (2) The credit is available to meet the goals of a NASA 
subcontracting plan only to the extent that it has not been applied to 
a DOD subcontracting plan. The same unreimbursed developmental 
assistance costs cannot be counted toward meeting the subcontracting 
goals of more than one prime contract. These costs would accrue from 
credit for the multiples attributed to assistance provided by Small 
Business Development Centers, Historically Black Colleges and 
Universities and minority educational institutions.
    (d) The features identified in paragraphs (a), (b), and (c) of this 
section point out the portability of features from the DOD Mentor-
Protege Program to NASA prime contractors. NASA mentors will be held to 
show ``good faith'' by providing actual developmental assistance beyond 
transferring credit from activity in the DOD activity to NASA 
subcontracting plans.


1819.7205   General policy.

    (a) Eligible large business prime contractors, not included on the 
``Parties Excluded from Procurement Programs'' list, who have at least 
one active subcontracting plan, and who are approved as mentor firms 
will enter into agreements with eligible (SDBs) as protege firms to 
provide appropriate developmental assistance to enhance the 
capabilities of SDBs to perform as subcontractors and suppliers. 
Eligible small business prime contractors, not included on the 
``Parties Excluded from Procurement Programs'' list and that are 
capable of providing developmental assistance to SDBs, may be approved 
as mentors.
    (b) The pilot program has a duration of three years commencing from 
[the date of the published final rule]. During this period, eligible 
mentor firms, which have received approval by NASA to participate in 
the program pursuant to subpart 1819.9212, may enter into agreements 
with protege firms.
    (c) The award fee evaluation plans contained in all NASA cost-plus-
award-fee contracts may include a factor for evaluation of a 
contractor's performance associated with Mentor-Protege Program 
participation.
    (d) Other contract types, including cost-plus-fixed-fee, with 
subcontracting opportunities may include the clause at 52.219-10, 
Incentive Subcontracting Program for Small and Small Disadvantaged 
Business Concerns, for use in evaluating a contractor's performance 
associated with Mentor-Protege Program participation when a 
subcontracting plan is required.
    (e) Costs incurred by a mentor to negotiate an agreement with a 
protege and to implement the agreement are incurred by both parties at 
their own risk. NASA will not reimburse these costs.


1819.7206  Incentives for prime contractor participation.

    (a) Under cost-plus-award fee contracts, mentor firms may be 
eligible to earn award fee associated with their performance as a 
mentor by performance evaluation period. This performance may be 
evaluated to determine the degree to which the participation went 
beyond (exceeded) the negotiated SDB goals commitment.
    (b) Under other contract types with subcontracting opportunities, 
including cost-plus-fixed-fee, mentor firms may be eligible to earn fee 
associated with their performance as a mentor. This performance may be 
evaluated to determine the degree to which the participation went 
beyond (exceeded) the negotiated SDB goals commitment.
    (c) The overall developmental assistance performance of NASA 
contractors, in promoting the use of SDBs as subcontractors, may be an 
evaluation factor in award fee plans of all cost-plus-award-fee 
contracts. Criteria under the factor could include:
    (1) Active participation in the NASA Mentor Protege Program;
    (2) Actions taken by the contractor to develop working 
relationships with SDBs and others;
    (3) The amount and quality of developmental assistance provided;
    (4) Subcontracts awarded to SDBs and others;
    (5) Success of the protege firms in increasing their business as a 
result of receiving developmental assistance; and
    (6) Accomplishment of any other activity as related to the Mentor-
Protege relationship.


1819.7207  Measurement of program success.

    The overall success of the program will be measured by the extent 
to which it results in:
    (a) An increase in the number, dollar value and percentage of 
subcontracts awarded to SDBs by mentor firms under NASA contracts since 
the date of entry into the program;
    (b) An increase in the number and dollar value of contract and 
subcontract awards to protege firms since the time of their entry into 
the program (under NASA contracts, contracts awarded by other Federal 
agencies and under commercial contracts);
    (c) An increase in the number and dollar value of subcontracts 
awarded to a protege firm by its mentor firm; and
    (d) An increase in subcontracting with SDB firms in industry 
categories where SDBs have not traditionally participated within the 
mentor firm's activity.


1819.7208  Mentor firms.

    (a) Eligibility:
    (1) Contractors eligible for receipt of government contracts;
    (2) Large prime contractors performing under contracts with at 
least one negotiated subcontracting plan as required by FAR 19.7; and
    (3) Small Business prime contractors that can provide developmental 
assistance to enhance the capabilities of SDBs to perform as 
subcontractors and suppliers. A small business prime contractor 
performing under a NASA contract that does not contain a negotiated 
subcontracting plan may apply.
    (b) Mentors will be encouraged to identify and select:
    (1) A broad base of firms including those defined as emerging SDB 
firms (e.g., an SDB whose size is no greater than 50% of the size 
standard applicable to the SIC code assigned to a contracting 
opportunity); and
    (2) SDBs in addition to firms with whom they have established 
business relationships.


Sec. 1819.7209  Protege firms.

    (a) For selection as a protege, a firm must be:
    (1) A small disadvantaged business concern as defined by FAR 
19.001;
    (2) Certified as small in the SIC code for the services or supplies 
to be provided by the protege to the mentor; and
    (3) Eligible for receipt of government contracts.
    (b) A protege firm may self-certify to a mentor firm that it meets 
each of the eligibility requirements in paragraphs (a) (1), (2) and (3) 
of this section. Mentor firms may rely in good faith on a written 
representation of a business concern that such business meets the 
requirements in paragraphs (a) (1) and (2).
    (c) Historically Black Colleges and Universities, minority 
educational institutions, and small women-owned businesses are eligible 
as proteges under this program.
    (d) Proteges may have multiple mentors. Proteges should maintain a 
system for developing reports of mentoring activity by federal agency.


Sec. 1819.7210  Selection of protege firms.

    (a) Mentor firms will be solely responsible for selecting protege 
firms. The mentor is encouraged to identify and select protege firms 
that represent a balance in company size, e.g., start-up, emerging, 
etc.
    (b) Mentor firms may have more than one protege.
    (c) The selection of protege firms by mentor firms may not be 
protested, except as in paragraph (d) of this section.
    (d) In the event of a protest regarding the size or disadvantaged 
status of a business concern eligible to be a protege firm, the mentor 
firm shall refer the protest to the Associate Administrator, NASA 
Office of Small and Disadvantaged Business Utilization (OSDBU) for 
resolution. When appropriate, NASA will seek an advisory option from 
the SBA.


Sec. 1819.7211  Application process for mentor firms to participate in 
the program.

    (a) Prime contractors interested in becoming a mentor firm must 
submit a request to the NASA OSDBU to be approved under the program. 
The application will be evaluated on the extent to which the company 
plans to provide developmental assistance and that a balance is 
represented among the size and SDB status of such potential proteges. 
The information required in paragraph (b) of this section must be 
submitted to be considered for approval as a mentor firm.
    (b) A proposed mentor must submit the following information to the 
NASA OSDBU:
    (1) Certification that the mentor firm is currently performing 
under at least one active approved subcontracting plan (small business 
exempted) and that they are currently eligible for the award of federal 
contracts;
    (2) The cognizant NASA contract number(s), type of contract, 
performance (including options), title of technical program effort, 
name of NASA Program Manager (including contact information) and name 
of NASA field center where support is provided;
    (3) The number of proposed Mentor-Protege arrangements;
    (4) Data on all current NASA contracts and subcontracts to include 
the contract/subcontract number(s), period of performance, awarding 
NASA installation or contractor and contract/subcontract value(s) 
including options;
    (5) Data on total (NASA) subcontracts awarded and SDB awards.
    (6) Information on the proposed types of developmental assistance. 
For each proposed Mentor-Protege relationship include information on 
the company's ability to provide developmental assistance to the 
identified protege firm and how that assistance will potentially 
increase subcontracting opportunities for the protege firm, including 
subcontracting opportunities in industry categories where SDBs are not 
dominant in the company's current subcontractor base; and
    (7) A Letter of Intent signed by both the mentor and protege(s).


Sec. 1819.7212  OSDBU review and approval process of agreement.

    (a) Information and Letter of Intent is reviewed by NASA OSDBU. 
NASA OSDBU will provide a copy of the submitted information to the 
cognizant NASA technical program manager and contracting officer for a 
parallel review and concurrence.
    (b) If OSDBU approves the application, then the mentor
    (1) Negotiates agreement with the protege; and
    (2) Submits an original and two (2) copies of the agreement to NASA 
OSDBU for approval by the NASA Mentor-Protege program manager, the NASA 
technical program manager and the contracting officer.
    (c) Upon agreement approval, the mentor may implement development 
assistance program.
    (d) An approved agreement will become a part of the official 
subcontracting plan, where applicable. Other agreements will be 
incorporated into the contract.
    (e) If OSDBU disapproves the application, then the mentor may 
provide additional information for reconsideration.


Sec. 1819.7213  Agreement contents.

    The contents of the agreement must contain:
    (a) Names and addresses of mentor and protege firms and a point of 
contact within both firms who will oversee the agreement;
    (b) Procedures for the mentor firm to notify the protege firm, 
OSDBU, and the contracting officer, in writing, at least 30 days in 
advance of the mentor firm's intent to voluntarily withdraw from the 
program;
    (c) Procedures for a protege firm to notify the mentor firm in 
writing at least 30 days in advance of the protege firm's intent to 
voluntarily terminate the mentor-protege agreement. The mentor shall 
notify the OSDBU and the contracting officer immediately upon receipt 
of such notice from the protege;
    (d) A description of the developmental program for the protege, 
including the type of developmental assistance that will be provided by 
the mentor firm to the protege firm, and a schedule for providing 
assistance and criteria for evaluation of the protege's developmental 
success;
    (e) A listing of the number and types of subcontracts to be awarded 
to the protege firm;
    (f) Program participation term;
    (g) Termination procedures;
    (h) Plan for accomplishing work should the agreement be terminated; 
and
    (i) Other terms and conditions, as appropriate.


1819.7214  Developmental assistance.

    The forms of developmental assistance a mentor can provide to a 
protege include:
    (a) Management guidance relating to
    (1) Financial management,
    (2) Organizational management,
    (3) Overall business management/planning, and
    (4) Business development;
    (b) Engineering and other technical assistance;
    (c) Noncompetitive award of subcontracts under NASA contractors;
    (d) Progress payments based on costs. The customary progress 
payment rate for all NASA contracts with small disadvantaged businesses 
is 95 percent. This customary progress payment rate for SDBs may be 
used by prime contractors;
    (e) Advance payments. While a mentor can make advance payments to 
its proteges who are performing as subcontractors, the mentor will only 
be reimbursed by NASA for these costs if advance payments have been 
authorized in accordance with statute and regulation; and
    (f) Loans.


1819.7215  Obligation.

    (a) Mentor or protege may voluntarily withdraw from the program as 
mutually agreed by both mentor and protege.
    (b) Mentor and protege firms will submit a ``lessons learned'' 
evaluation to the NASA OSDBU at the conclusion of the pilot program 
period or the conclusion of their effort whichever comes first.


1819.7216  Internal controls.

    The NASA OSDBU will manage the program. Internal controls will be 
established by NASA OSDBU to achieve the stated program objectives (by 
serving as checks and balances against undesired actions or 
consequences) such as:
    (a) Reviewing and evaluating mentor applications for realism, 
validity and accuracy of provided information; and
    (b) Reviewing quarterly progress reports submitted by mentors and 
proteges on protege development to measure protege progress against the 
master plan contained in the approved agreement.


1819.7217  Reports.

    (a) Quarterly reports shall be submitted by the mentor to the NASA 
mentor-protege program manager, NASA Headquarters OSDBU to include 
information as outlined in 1819.7206(b).
    (b) Proteges are encouraged to submit quarterly reports, to the 
NASA mentor-protege program manager, on program progress as pertains to 
their mentor-protege agreement.
    (c) The NASA technical program manager shall submit quarterly 
reports, for the purposes of award fee determination, assessing the 
prime contractor's performance in the mentor-protege program as 
pertains to the technical effort and protege development.
    (d) The NASA mentor-protege program manager will submit quarterly 
reports to the cognizant contracting officer regarding participating 
prime contractor's performance in the program for use in the award fee 
determination process.


1819.7218  Program review.

    At the conclusion of each year in the mentor-protege program, the 
prime contractor and protege will formally brief the NASA mentor-
protege program manager, the technical program manager, and the 
contracting officer during a formal program review regarding program 
accomplishments as pertains to the approved agreement.


1819.7219  Solication provisions and contract clause.

    (a) The contracting officer shall insert the provision at 1852.219-
77, NASA Mentor-Protege Program, in all solicitations and contracts 
with subcontracting plans or that offer subcontracting opportunities, 
regardless of the dollar value of the prime contract.
    (b) The contracting officer shall insert the provision at 1852.219-
78, Evaluation of Prime Contractor Participation in the Mentor-Protege 
Program, in all solicitations containing the provisions at 1852.219-77, 
NASA Mentor-Protege Program or FAR 52.219-9, Small Business and Small 
Disadvantaged Business Subcontracting Plan.
    (c) The contracting officer shall insert the clause at 1852.219-79, 
Mentor Responsibility and Evaluation, in contracts where the prime 
contractor is a participant in the NASA Mentor-Protege Program.

PART 1852--SOLICITATION PROVISIONS AND CONTRACT CLAUSES

    a. Sections 1852.219-77, 1852.219-78, and 1852.219-79 are added to 
read as follows:


1852.219-77  NASA Mentor-Protege Program.

    As prescribed in 1819.7219(a), insert the following provision:

NASA Mentor-Protege Program (Jan 1994)

    (a) Prime contractors, including certain small businesses, are 
encouraged to participate in the NASA pilot mentor-protege program 
for the purpose of providing developmental assistance to eligible 
small disadvantaged businesses to enhance their capabilities and 
increase their participation in NASA contracts.
    (b) The pilot program consists of:
    (1) Mentor firms, which are prime contractors with at least one 
active subcontracting plan;
    (2) Protege firms, which are small disadvantaged business (SDB) 
concerns, include the eligible participants as set forth in Public 
Law 101-144, as amended by Public Law 101-507, as follows:
    ``Small Business concerns or other organizations owned or 
controlled by socially and economically disadvantaged individuals 
(within the meaning of section 8(a) (5) and (6) of the Small 
Business Act (15 U.S.C. 637(a) (5) and (6)), including Historically 
Black Colleges and Universities and Minority Educational 
Institutions''. For the purpose of this section economically and 
socially disadvantaged individuals shall be deemed to include 
women;''
    (3) Mentor-Protege agreements, approved by the NASA Office of 
Small and Disadvantaged Business Utilization;
    (4) Potential of payment of additional award fee for voluntary 
participation and successful performance in the mentor-protege 
program.
    (c) Mentor participation in the program, described in 48 CFR 
1819.72, means providing technical, managerial and financial 
assistance to aid SDBs in developing requisite high-tech expertise 
and business systems to compete successfully for NASA contracts and 
subcontracts.
    (d) Contractors interested in participating in the pilot program 
are encouraged to contact the NASA OSDBU, Washington, DC 20546, 
(202) 358-2088, for further information.

(End of clause)


1852.219-78  Evaluation of Prime Contractor Participation in the NASA 
Mentor-Protege Program.

    As prescribed in 1819.7219(b), insert the following provision:

Evaluation of Prime Contractor Participation in the NASA Mentor-Protege 
Program (Jan 1994)

    This subfactor will consider the proposed participation and 
extent of developmental assistance to be provided by a prime 
contractor to small disadvantaged businesses.


1852-219-79  Mentor Requirements and Evaluation.

    As prescribed in 1819-7219(c), insert the following provision:

Mentor Requirements and Evaluation (Jan 1994)

    (a) The purpose of the NASA Mentor-Protege Program (Program) is 
for a NASA prime contractor to provide developmental assistance to a 
small disadvantaged business (SDB). The Mentor's active 
participation in the Program, in compliance with the terms of the 
negotiated Mentor-Protege Agreement, demonstrates both a commitment 
to achieve the goal of its contractual subcontracting plan and a 
commitment to increase the participation of SDBs in NASA contracts 
and subcontracts. This commitment will be recognized in determining 
the Mentor's performance fee.
    (b) The OSDBU will evaluate the contractor's performance through 
the Performance Evaluation process. The evaluation will consider the 
following:
    (1) Specific actions taken by the contractor, during the 
evaluation period, to increase the participation of SDBs as 
subcontractors and suppliers;
    (2) Specific actions taken by the contractor during this 
evaluation period to develop the technical and corporate 
administrative expertise of the SDBs as defined in the agreement;
    (3) To what extent the Protege has met the developmental 
objectives in the agreement; and
    (4) To what extent the firm's participation in the Mentor-
Protege Program resulted in the Protege receiving competitive 
contract(s) and subcontract(s) from private firms and agencies other 
than the Mentor.
    (c) Quarterly reports shall be submitted by the mentor to the 
NASA mentor-protege program manager, NASA Headquarters OSDBU to 
include information as outlined in 1819.7206(b).
    (d) The Mentor will notify the OSDBU and the contracting 
officer, in writing, at least 30 days in advance of the mentor 
firm's intent to voluntarily withdraw from the program or upon 
receipt of a Protege's notice to withdraw from the Program;
    (e) Mentor and protege firms will submit a ``lessons learned'' 
evaluation to the NASA OSDBU at the conclusion of the pilot program 
period or the conclusion of their effort whichever comes first. At 
the conclusion of each year in the mentor-protege program, the prime 
contractor and protege will formally brief the NASA mentor-protege 
program manager, the technical program manager, and the contracting 
officer during a formal program review regarding program 
accomplishments as pertains to the approved agreement.

(End of clause)

[FR Doc. 94-2876 Filed 2-8-94; 8:45 am]
BILLING CODE 7510-01-M