Federal Acquisition Regulation: Rerepresentation of Size and Socioeconomic Status, 517-522 [2024-31404]
Download as PDF
Federal Register / Vol. 90, No. 2 / Friday, January 3, 2025 / Rules and Regulations
debarment’’ and adding ‘‘proposed for
debarment, or voluntarily excluded’’ in
its place; and
■ d. Removing from paragraph (d)(4)
‘‘suspension, or proposed debarment’’
and adding ‘‘suspension, proposed
debarment, or voluntary exclusion’’ in
its place.
The revisions read as follows:
52.209–6 Protecting the Government’s
Interest When Subcontracting With
Contractors Debarred, Suspended,
Proposed for Debarment, or Voluntarily
Excluded.
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Protecting the Government’s Interest
When Subcontracting With Contractors
Debarred, Suspended, Proposed for
Debarment, or Voluntarily Excluded
(JAN 2025)
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31. Amend section 52.212–5 by—
a. Revising paragraphs (b)(12), (32),
and (40) and (e)(1)(xix); and
■ b. In Alternate II, revising the date of
the alternate and paragraph (e)(1)(ii)(R).
The revisions read as follows:
■
■
52.212–5 Contract Terms and Conditions
Required To Implement Statutes or
Executive Orders—Commercial Products
and Commercial Services.
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(b) * * *
l (12) 52.209–6, Protecting the
Government’s Interest When
Subcontracting With Contractors
Debarred, Suspended, Proposed for
Debarment, or Voluntarily Excluded.
(JAN 2025) (31 U.S.C. 6101 note).
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l (32) 52.222–19, Child Labor—
Cooperation with Authorities and
Remedies (JAN 2025) (E.O. 13126).
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l (40) 52.222–54, Employment
Eligibility Verification (JAN 2025)
(Executive Order 12989). (Not
applicable to the acquisition of
commercially available off-the-shelf
items or certain other types of
commercial products or commercial
services as prescribed in FAR 22.1803.)
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(e)(1) * * *
(xix) 52.222–54, Employment
Eligibility Verification (JAN 2025) (E.O.
12989).
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Alternate II (JAN 2025) * * *
(e)(1) * * *
(ii) * * *
(R) 52.222–54, Employment Eligibility
Verification (JAN 2025) (Executive
Order 12989).
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517
52.213–4 Terms and Conditions—
Simplified Acquisitions (Other Than
Commercial Products and Commercial
Services).
(ii) During the period between termination
of the MOU and a decision by the suspending
and debarring official whether to suspend or
debar, the Contractor is excused from its
obligations under paragraph (b) of this
clause. If the Contractor is not suspended,
debarred, or subject to a voluntary exclusion,
then the Contractor must reenroll in E-Verify.
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32. Amend section 52.213–4 by
revising paragraphs (b)(1)(iii) and
(b)(2)(ii) to read as follows:
■
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(b) * * *
(1) * * *
(iii) 52.222–19, Child Labor—
Cooperation with Authorities and
Remedies (JAN 2025) (E.O. 13126)
(Applies to contracts for supplies
exceeding the micro-purchase
threshold, as defined in FAR 2.101 on
the date of award of this contract).
*
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(2) * * *
(ii) 52.209–6, Protecting the
Government’s Interest When
Subcontracting with Contractors
Debarred, Suspended, Proposed for
Debarment, or Voluntarily Excluded
(JAN 2025) (Applies to contracts over
the threshold specified in FAR 9.405–
2(b) on the date of award of this
contract).
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■ 33. Amend section 52.222–19 by—
■ a. Revising the date of the clause;
■ b. Removing from paragraph (d)(2)
‘‘suspending official’’ and ‘‘Subpart’’
and adding ‘‘suspending and debarring
official’’ and ‘‘subpart’’ in their places,
respectively; and
■ c. Removing from paragraph (d)(3)
‘‘The debarring’’ and ‘‘Subpart’’ and
adding ‘‘The suspending and debarring’’
and ‘‘subpart’’ in their places,
respectively.
The revision reads as follows:
52.222–19 Child Labor—Cooperation With
Authorities and Remedies.
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Child Labor—Cooperation With
Authorities and Remedies (JAN 2025)
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34. Amend section 52.222–54 by—
a. Revising the date of the clause;
b. Removing from paragraph (b)(5)(i)
‘‘suspension or debarment’’ and adding
‘‘suspending and debarring’’ in its place;
and
■ c. Revising paragraph (b)(5)(ii).
The revisions read as follows:
■
■
■
52.222–54 Employment Eligibility
Verification.
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Employment Eligibility Verification
(JAN 2025)
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(b) * * *
(5) * * *
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[FR Doc. 2024–31403 Filed 1–2–25; 8:45 am]
BILLING CODE 6820–EP–P
DEPARTMENT OF DEFENSE
GENERAL SERVICES
ADMINISTRATION
NATIONAL AERONAUTICS AND
SPACE ADMINISTRATION
48 CFR Parts 4, 8, 16, 19, and 52
[FAC 2025–03; FAR Case 2020–016, Item
II; Docket No. FAR–2020–0016; Sequence
No. 1]
RIN 9000–AO18
Federal Acquisition Regulation:
Rerepresentation of Size and
Socioeconomic Status
Department of Defense (DoD),
General Services Administration (GSA),
and National Aeronautics and Space
Administration (NASA).
ACTION: Final rule.
AGENCY:
DoD, GSA, and NASA are
issuing a final rule amending the
Federal Acquisition Regulation (FAR) to
implement regulatory changes made by
the Small Business Administration to
order-level size and socioeconomic
status rerepresentation requirements.
DATES: Effective January 17, 2025.
FOR FURTHER INFORMATION CONTACT: For
clarification of content, contact Ms.
Dana Bowman, Procurement Analyst, at
202–803–3188 or by email at
Dana.Bowman@gsa.gov. For information
pertaining to status, publication
schedules contact the Regulatory
Secretariat Division at 202–501–4755 or
GSARegSec@gsa.gov. Please cite FAC
2025–03, FAR Case 2020–016.
SUPPLEMENTARY INFORMATION:
SUMMARY:
I. Background
DoD, GSA, and NASA published a
proposed rule at 88 FR 67189 on
September 29, 2023, to implement
regulatory changes made by the Small
Business Administration (SBA) in its
final rule published on October 16,
2020, at 85 FR 66146. For further details
please see the proposed rule. Eight
respondents submitted comments on the
proposed rule.
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II. Discussion and Analysis
The Civilian Agency Acquisition
Council and the Defense Acquisition
Regulations Council (the Councils)
reviewed the public comments in the
development of the final rule. A
discussion of the comments and the
changes made to the rule as a result of
those comments are provided as
follows:
A. Summary of Significant Changes
There are no significant changes from
the proposed rule.
B. Analysis of Public Comments
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1. Exceptions to the Rule
Comment: A respondent expressed
concerns that the rule requires too much
work.
Response: FAR subpart 4.11, System
for Award Management (SAM),
establishes policies and procedures for
requiring registration in SAM. FAR
subpart 4.12, Representations and
Certifications, establishes policies and
procedures for requiring submission and
maintenance of representations and
certifications in SAM. Offerors and
contractors are required to be registered
in SAM in accordance with FAR
52.204–7, System for Award
Management, and to complete electronic
annual representations and
certifications in SAM, as part of
required registration in accordance with
FAR 52.204–13, System for Award
Management Maintenance. All
registrants are required to review and
update the representations and
certifications in SAM as necessary, but
at least annually, to ensure they are
current, accurate, and complete. This
rule modifies the clause at FAR 52.219–
28, Post-award Small Business Program
Rerepresentation, to require offerors to
rerepresent their status for orders issued
under multiple-award contracts under
certain circumstances. Although this
rule requires offerors to rerepresent,
contractors are already required to
ensure that their representations and
certifications in SAM are current,
accurate, and complete. Therefore, this
rule only imposes an additional burden
for orders requiring rerepresentation in
accordance with paragraphs (c)(1)
through (3) of the FAR clause at 52.219–
28.
Comment: A respondent
recommended that SBA create a
database for small business
certifications, which would allow for a
check and balance of a contractor’s selfcertification and protect contracting
officers in the event they are unable to
verify a concern’s status.
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Response: SBA already maintains a
database of certified small business
concerns. Specifically, the Dynamic
Small Business Search (DSBS) database
is SBA’s small business certification
repository. Certifications in DSBS also
appear in SAM, which is the
Government’s repository for prospective
and current Federal awardee
information, including representations
and certifications. The FAR requires
contracting officers to review SAM to
verify the contractor’s current size and
socioeconomic status. If a concern’s
certification status is not reflected in
SAM, contracting officers can verify a
concern’s status by checking DSBS at
https://dsbs.sba.gov.
Comment: A respondent
recommended that recertification for
size or socioeconomic status for orders
should not be required.
Response: This rule implements
regulatory changes made by SBA in its
final rule published on October 16,
2020, which requires rerepresentation
for orders placed against multiple-award
contracts under certain circumstances.
The FAR currently requires contractors
to rerepresent their status under certain
circumstances. This rule expands the
requirement for rerepresentation to
verify orders that are set aside for small
businesses under certain multipleaward contracts are awarded to
qualified small businesses.
Comment: Some respondents
indicated that the proposed rule does
not consider the time it takes to award
a task order. The respondents stated that
the period of time from proposal
submission to order award often takes
12 to 36 months. Due to the time it takes
to award an order, some respondents
expressed concerns that this may impact
the Government’s ability to award the
order as the awardee’s small business
status could change during this period
of time. A respondent stated that small
businesses compete for and are awarded
contracts for which they qualify at that
time, and they should be afforded the
opportunity to be awarded task orders
under those contracts. The respondent
indicated that a company’s size can
change periodically and that a business
that was small at the time of proposal
submission may be large at order award.
The respondents also questioned if the
selected awardee would be eligible for
award if its size or socioeconomic status
changed between proposal submission
and order award.
Response: In accordance with SBA’s
final rule, size and socioeconomic status
are determined at the time of initial
offer (or other formal response to a
solicitation), which includes price, for
an order issued against a multiple-
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award contract if the contracting officer
requests rerepresentation for the order.
Therefore, the offeror will remain
qualified for the order if its status
changes between offer submittal and
award of the order.
Comment: A respondent asked how
an offeror’s eligibility would be affected
if rerepresentation is required for an
order that is set aside under a multipleaward contract and the offeror is no
longer small for the North American
Industry Classification System (NAICS)
code associated with the contract or no
longer qualifies under the
socioeconomic category for which it
initially qualified. The respondent also
asked if a woman-owned small business
would lose its small business status that
it had at initial award if it rerepresented
as large at a later date. Lastly, the
respondent asked if the goal of this
proposed rule is to require small
businesses to certify their size and
socioeconomic status for the life of the
contract.
Response: A small business concern
awarded a multiple-award contract that
was set aside for small businesses may
continue to perform under such a
contract as a small business concern
throughout for the life of those contracts
(e.g., for the base period and up to four
additional option years). However, if a
contracting officer requires
rerepresentation of size and/or
socioeconomic status for a particular
order, size and socioeconomic status is
determined at the time of offer
submission for the order. To clarify for
the respondent, a woman-owned small
business that represents as large for a
particular order, under a multiple-award
contract affected by this rule, would be
considered large for that order.
Comment: One respondent
recommended that implementation of
this policy be applicable to new
multiple-award contracts or,
alternatively, apply the policy to orders
issued under multiple-award contracts
after January 1, 2025.
Response: In accordance with FAR
1.108(d), this policy applies to
solicitations for contracts issued on or
after the effective date of the final rule.
The contracting officer also has the
discretion to include the changes made
in this final rule in solicitations for
contracts issued before the effective
date, provided award of the resulting
contract(s) occurs on or after the
effective date of the final rule. In
addition, contracting officers may, at
their discretion, include the changes
made in this final rule in any existing
contract with appropriate consideration.
The final rule does not require that
existing contracts be modified to add
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the updated version of FAR clause
52.219–28.
Comment: A respondent
recommended the rule be amended to
clearly define the criteria and timelines
for contracting officers requesting
rerepresentation of size under existing
multiple-award contracts.
Response: The final rule text at FAR
19.301–2(b)(2) specifies the new
requirements for a contractor to
rerepresent its status for orders placed
against multiple-award contracts under
certain circumstances in accordance
with FAR clause 52.219–28. Contracting
officers include FAR clause 52.219–28
in solicitations and contracts in
accordance with the prescription at FAR
19.309(c)(1). The clause at FAR 52.219–
28 provides instructions to offerors and
contractors regarding when
rerepresentation is required; therefore, it
is not necessary to provide additional
instructions to contracting officers.
2. Clarifications
Comment: A few respondents
recommended removing ‘‘and whose
socioeconomic status is not certified by
the SBA’’, from the proposed rule at
FAR 19.301–2(b), and in FAR clause
52.219–28. A respondent stated that the
proposed FAR text does not exist in the
SBA rule and that including the text
would make the FAR inconsistent with
SBA regulations. The respondent stated
that SBA regulations require
representation even if the SBA certifies
the concern’s socioeconomic status. The
respondent stated the rule, as written,
exempts small businesses whose
socioeconomic status is certified by the
SBA. A respondent stated that the
proposed FAR text makes the
requirement appear to only apply to
small businesses that are not small
disadvantaged businesses while
exempting small disadvantaged
businesses.
Response: The final rule FAR text at
19.301–2(b) and paragraph (c) of the
clause at FAR 52.219–28 has been
revised to adopt the recommendation.
Comment: A respondent
recommended clarifying when
recertification is required for orders
issued under a Federal Supply Schedule
(FSS) contract. The respondent
recommended adding the following new
paragraph (b)(2)(iv) at FAR 19.301–2: A
contractor generally does not need to
recertify its size eligibility for orders
issued under a FSS contract unless the
ordering contracting officer specifically
requests such recertification for that
order, under paragraph (b)(3) of this
section.
Response: The final rule FAR text at
19.301–2(b)(3) and paragraph (c)(4) of
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the clause at FAR 52.219–28 specifies
that for the NAICS code assigned to an
order under a multiple-award contract,
rerepresentation is required if the
contracting officer requires it for that
order. This also applies to orders issued
under an FSS contract. The final rule
FAR text at 19.301–2(b)(2) and
paragraph (c) of the clause at FAR
52.219–28 describes when a contractor
must rerepresent for an order and also
specifies ‘‘except for an order issued
under a Federal Supply Schedule
contract’’; therefore, it is not necessary
to add the recommended paragraph.
Comment: A respondent
recommended revising the proposed
rule FAR text at 19.301–2(b)(2)(i) to
replace: ‘‘unless the order is issued
under an unrestricted multiple-award
contract with reserves’’ with ‘‘except for
orders issued under a reserved portion
of a multiple-award contract with
reserves, in which case recertification is
not required . . .’’ to clarify that
recertification is not required for orders
issued under the reserved portion of a
multiple-award contract. The
respondent recommended text they
believed offered additional clarity that
would assist industry in understanding
recertification requirements.
Response: The final rule text at FAR
19.301–2(b)(2)(i) is revised to partially
adopt the respondent’s
recommendation.
Comment: A respondent stated that
the scenario illustrated at FAR 19.301–
2(b)(2)(ii) and (iii) incorrectly suggests
that it is permitted by SBA regulations.
The respondent recommends revising
the proposed FAR text at 19.301–
2(b)(2)(ii) and (iii) to make clear that
they apply to socioeconomic category
orders issued under multiple-award
contracts that are set aside for small
businesses. The respondent
recommended editing the proposed rule
FAR text at 19.301–2(b)(2)(ii) and (iii) to
clarify that each paragraph is referring
to a multiple-award contract that is set
aside for small businesses.
Response: The examples included in
the final rule FAR text at 19.301–
2(b)(2)(ii) and (iii) and in paragraphs
(c)(2) and (3) of the clause at FAR
52.219–28 are revised to adopt the
recommendation to edit the examples
for accuracy.
Comment: A respondent stated that,
while the proposed rule helps to explain
the different circumstances under which
size and socioeconomic recertification is
required, it does not address unique
recertification issues that arise under
sole-source orders placed under the 8(a)
Business Development Program. The
respondent recommended that the final
rule be amended to add a new
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519
paragraph at FAR 19.301–2(b) to explain
SBA’s responsibility to determine
eligibility for 8(a) sole-source orders.
The respondent indicated that, absent
additional clarity, some contracting
officers might incorrectly believe that
recertification is not required for 8(a)
sole-source orders.
Response: This rule does not exempt
contracting officers from complying
with FAR subpart 19.8, Contracting with
the Small Business Administration (The
8(a) Program). Contracting officers are
required to follow 8(a) offer and
acceptance procedures at FAR 19.804–2
and 19.804–3 for competitive and solesource 8(a) contracts and orders,
respectively. SBA will determine an 8(a)
participant’s eligibility during this
process; therefore, it is not necessary to
restate 8(a) Program requirements at
FAR 19.301–2(b).
Comment: A respondent
recommended correcting a
typographical error that references
paragraph ‘‘a’’ in the proposed revision
to paragraph (c) of the clause at FAR
52.219–28.
Response: The final rule FAR text in
paragraph (c) of the clause at FAR
52.219–28 has been revised to replace
‘‘a’’ with ‘‘c’’.
3. Negative Impacts of the Rule
Comment: A few respondents
indicated that the proposed rule will
creates an environment of reduced
competition, lower quality bidders, and
will force small businesses to compete
on an uneven playing field.
Response: SBA’s final rule requires
contractors to rerepresent their status for
orders set aside for small businesses
under an unrestricted multiple-award
contract for which size and
socioeconomic status were not relevant
to the award of the underlying multipleaward contract. This distinction is
important because the award of an order
under such a multiple-award contract is
the first time that size and
socioeconomic status is relevant.
Therefore, requiring a concern to
represent its size and socioeconomic
status encourages fair competition
among small businesses.
Comment: A respondent stated that
the proposed rule will impose an
onerous burden of new recordkeeping,
reporting, and other compliance
requirements on small businesses. The
respondent stated that this would
require a significant increase in staff
time and result in additional cost to
those businesses and the Government.
Response: This rule revises an
information collection currently
approved under OMB Control Number
9000–0163. Accordingly, the Regulatory
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Secretariat Division submitted to the
Office of Management and Budget
(OMB) a request for approval of a
revised information collection
requirement concerning 9000–0163,
Rerepresentation of Size and
Socioeconomic Status, that includes
burden estimates for order-level
rerepresentation requirements. In
addition, FAR subpart 4.12,
Representations and Certifications,
establishes policies and procedures for
requiring submission and maintenance
of representations and certification via
SAM. Offerors and quoters are required
to complete electronic annual
representations and certification in
SAM, as part of required registration in
accordance with FAR 4.1201. All
registrants are required to review and
update the representations and
certifications submitted in SAM as
necessary, but at least annually, to
ensure they are current, accurate, and
complete. Therefore, since contractors
and offerors are already required to
maintain and update their
representations and certifications in
SAM, this rule only imposes an
additional burden for the orders
requiring rerepresentation in accordance
with paragraphs (c)(1) through (3) of the
clause at FAR 52.219–28. The additional
estimated total burden hours for all
small businesses to rerepresent at the
order level is approximately 534 hours
annually.
Comment: A respondent asked if the
Government has a process in place for
managing inaccurate data and data
reporting and, if not, recommended the
issue be addressed prior to the
implementation of this rule to ensure
accurate data is available to all
taxpayers.
Response: Section IV, Expected
Impact of the Rule, in the preamble of
the proposed rule indicated that the
Federal Procurement Data System
(FPDS) does not currently capture size
and socioeconomic status at the order
level; therefore, contracting officers will
not be able to indicate the size or
socioeconomic status of a small
business concern at the order level. This
may result in inaccurate data and data
reporting. However, FPDS is anticipated
to be updated to capture this data.
4. Outside the Scope of the Rule
Comment: A few respondents
submitted comments that were
unrelated to the scope of the rule.
A respondent asked for guidance on
the certification for contractors under
teaming arrangements and joint
ventures. Another respondent
recommended that the small business
size standard be set at 500 employees
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for both product and service contracts to
prevent current small businesses with
250 to 300 personnel from graduating
from small business status and ensuring
their continued growth and
development into large businesses. A
respondent recommended creating a
middle-market set-aside category for
businesses exceeding 500 employees
with an annual revenue less than $250
million per year or five times the
current size standard. Another
respondent objected to bailouts.
Response: These comments are
outside the scope of this rule. The FAR
defers to SBA to establish small
business size standards.
C. Other Changes
Conforming changes are made at FAR
4.604, 8.405–5(b), 16.505(b), 19.202–
5(c), and 19.301–2. Paragraph headings
are added at 19.301–2(b), (c), (d), and (e)
to describe the contents of such
paragraphs and to conform with FAR
drafting convention. The text at FAR
19.301–2(d)(2)(i) and (ii) is amended for
clarity.
III. Applicability to Contracts at or
Below the Simplified Acquisition
Threshold (SAT) and for Commercial
Products, (Including Commercially
Available Off-the-Shelf (COTS) Items)
and for Commercial Services
This final rule amends the clauses at
FAR 52.219–28, Postaward Small
Business Program Rerepresentation, and
52.212–5, Contract Terms and
Conditions Required to Implement
Statutes or Executive OrdersCommercial Products and Commercial
Services. The clauses continue to apply
to acquisitions at or below the SAT,
acquisitions for commercial products
(including COTS items), and
acquisitions for commercial services.
IV. Expected Impact of the Rule
As a result of this final rule, a
contractor that represented its status
before contract award will be required
to rerepresent its size and/or
socioeconomic status for an order
placed under a multiple-award contract,
under certain circumstances and where
rerepresentation was not previously
required. The final rule validates that
orders set aside for small businesses
under certain multiple-award contracts
are awarded to small businesses that
qualify for the size and/or
socioeconomic status associated with
the orders. Therefore, an entity that no
longer qualifies as small under the
applicable NAICS code associated with
an order, or that no longer qualifies for
a particular socioeconomic category,
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will not be eligible for orders placed
under certain multiple-award contracts.
As a result of this final rule,
contracting officers will be required to
verify the size and/or socioeconomic
status of a small business concern prior
to issuing an order under multipleaward contracts subject to this rule.
Orders placed under an FSS contract
are exempt from the mandatory
rerepresentation requirement; however,
contracting officers continue to have the
discretion to require a rerepresentation
for an order under an FSS contract.
This final rule is also expected to
prevent agencies from receiving credit
toward their small business goals for
awards made to firms that no longer
qualify as small under the applicable
NAICS code or that no longer qualify as
a small business concern identified at
FAR 19.000(a)(3).
Existing e-business systems are
impacted by this final rule as FPDS does
not currently capture size and
socioeconomic status at the order level;
therefore, contracting officers will not
be able to indicate the size or
socioeconomic status of a small
business concern at the order level. This
may result in inaccurate data and data
reporting. However, the Government
anticipates that FPDS will be updated to
capture this data.
V. Executive Orders 12866 and 13563
Executive Orders (E.O.s) 12866 (as
amended by E.O. 14094) and 13563
direct agencies to assess the costs and
benefits of available regulatory
alternatives and, if regulation is
necessary, to select regulatory
approaches that maximize net benefits
(including potential economic,
environmental, public health and safety
effects, distributive impacts, and
equity). E.O. 13563 emphasizes the
importance of quantifying both costs
and benefits, of reducing costs, of
harmonizing rules, and of promoting
flexibility. This is not a significant
regulatory action and, therefore, was not
subject to review under section 6(b) of
E.O. 12866, Regulatory Planning and
Review, dated September 30, 1993.
VI. Congressional Review Act
Pursuant to the Congressional Review
Act, DoD, GSA, and NASA will send
this rule to each House of the Congress
and to the Comptroller General of the
United States. The Office of Information
and Regulatory Affairs (OIRA) in the
Office of Management and Budget has
determined that this rule does not meet
the definition in 5 U.S.C. 804(2).
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VII. Regulatory Flexibility Act
DoD, GSA, and NASA have prepared
a Final Regulatory Flexibility Analysis
(FRFA) consistent with the Regulatory
Flexibility Act, 5 U.S.C. 601–612.
1. Statement of the need for, and the
objectives of, the rule.
DoD, GSA, and NASA are issuing a final
rule to amend the FAR to update the
rerepresentation of size and socioeconomic
status requirements for set-aside orders
issued under unrestricted multiple-award
contracts to align with the regulatory changes
made by the Small Business Administration
(SBA) in its final rule dated October 16, 2020,
at 85 FR 66146. This final rule requires a
business concern to rerepresent its size and/
or socioeconomic status for all set-aside
orders under unrestricted multiple-award
contracts, unless the contract authorized
reserves of specific types of small business
concerns for which size and/or
socioeconomic status was required, and the
order is issued against the reserved portion.
Additionally, this rule requires a business
concern to rerepresent its socioeconomic
status for all set-aside orders for which the
required socioeconomic status for the order
differs from that of the underlying set-aside
multiple-award contract. The updated
requirements are made to clarify SBA’s
regulatory provisions and eliminate
confusion among small businesses and
contracting activities.
2. Statement of the significant issues raised
by the public comments in response to the
initial regulatory flexibility analysis, a
statement of the assessment of the agency of
such issues, and a statement of any changes
made to the rules as a result of such
comments.
There were no significant issues raised by
the public comments in response to the
initial regulatory flexibility analysis.
Currently, contractors are required to
rerepresent their size and socioeconomic
status for orders under multiple-award
contracts if the contracting officer requires
rerepresentation for that order or as required
by the clause at FAR 52.219–28. This rule
requires contractors to rerepresent their size
and/or socioeconomic status for all orders
issued under unrestricted multiple-award
contracts (except for orders issued under
Federal Supply Schedule (FSS) contracts),
and for set-aside orders for which the
required socioeconomic status for the order
differs from that of the underlying set-aside
multiple-award contract.
3. Description of and an estimate of the
number of small entities to which the rule
will apply.
According to data from the Federal
Procurement Data System (FPDS) for fiscal
year (FY) 2021, FY 2022, and FY 2023, small
businesses were required to rerepresent their
socioeconomic status for modifications as
follows: 2,006, 3,379, in and 2,842,
respectively. This averages out to
approximately 2,742 rerepresentation
modifications per year. Additional data from
FPDS indicates that agencies set aside orders
under unrestricted multiple-award contracts,
excluding reserve orders and orders under
FSS contracts, as follows: 7,341 in FY 2021,
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7,463 in FY 2022, and 8,336 in FY 2023,
which averages out to 7,713 per year. Data
from FPDS also indicates that agencies set
aside orders under set-aside multiple-award
contracts (other than FSS contracts) in the
categories covered by this rule as follows:
2,060 in FY 2021, 1,977 in FY 2022, and
2,213 in FY 2023, which averages out to
2,083 per year. Therefore, the estimated
number of small entities to which the rule
will apply is 4,179.
4. Description of projected reporting,
recordkeeping, and other compliance
requirements of the rule.
This rule includes new reporting,
recordkeeping, or other compliance
requirements for small entities. The
Regulatory Secretariat Division has submitted
to OMB a request to review and approve
revisions to previously approved information
collection requirements in the clause at FAR
52.219–28, Post-Award Small Business
Program Rerepresentation.
5. Description of the steps the agency has
taken to minimize the significant economic
impact on small entities consistent with the
stated objectives of applicable statutes.
There are no known significant alternative
approaches that would accomplish the stated
objectives.
Interested parties may obtain a copy
of the FRFA from the Regulatory
Secretariat Division. The Regulatory
Secretariat Division has submitted a
copy of the FRFA to the Chief Counsel
for Advocacy of the Small Business
Administration.
VIII. Paperwork Reduction Act
The Paperwork Reduction Act (44
U.S.C. 3501–3521) applies. The rule
contains information collection
requirements. The Regulatory
Secretariat Division has submitted to
OMB a request to review and approve
revisions to previously approved
information collection requirements in
the FAR clause at 52.219–28.
A. OMB Control Number, Title, and Any
Associated Form(s)
OMB control number and title: 9000–
0163, Rerepresentation of Size and
Socioeconomic Status.
B. Need and Uses
This rule amends FAR clause 52.219–
28 to require concerns to also
rerepresent their size and/or
socioeconomic status for orders placed
under multiple-award contracts under
certain circumstances as described in
paragraph (c) of the clause and this
preamble.
The collected information is used by
SBA, Congress, Federal agencies, and
the public for various reasons such as
market research, set-aside
determinations, and determining if
agencies are meeting statutory goals.
PO 00000
Frm 00017
Fmt 4701
Sfmt 4700
521
C. Annual Burden
Public reporting burden for this
collection of information is estimated to
average 0.5 hours per response,
including the time for reviewing
instructions, searching existing data
sources, gathering the data needed, and
completing and reviewing the collection
of information.
The increase in the annual reporting
burden, because of the final rule, is
estimated as follows:
Respondents: 835.
Total annual responses: 1,069.
Total response burden hours: 534.
D. Public Comment to OMB on
Information Collection
A 60-day notice was published in the
Federal Register at 88 FR 67189, on
September 29, 2023. A comment was
received and addressed in section II. of
this preamble; however, it did not
change the estimate of the burden.
Written comments and
recommendations for this information
collection revision should be sent
within 30 days of publication of this
rule to www.reginfo.gov/public/do/
PRAMain. Find this information
collection by selecting ‘‘Currently under
Review—Open for Public Comments’’ or
by using the search function.
E. Obtaining Copies
Requesters may obtain a copy of the
information collection documents from
the GSA Regulatory Secretariat Division,
by calling 202–501–4755 or emailing
GSARegSec@gsa.gov. Please cite OMB
Control Number 9000–0163, Small
Business Rerepresentation.
List of Subjects in 48 CFR Parts 4, 8, 16,
19, and 52
Government procurement.
William F. Clark,
Director, Office of Government-wide
Acquisition Policy, Office of Acquisition
Policy, Office of Government-wide Policy.
Therefore, DoD, GSA, and NASA are
amending 48 CFR parts 4, 8, 16, 19, and
52 as set forth below:
■ 1. The authority citation for 48 CFR
parts 4, 8, 16, 19, and 52 continues to
read as follows:
Authority: 40 U.S.C. 121(c); 10 U.S.C.
chapter 4 and 10 U.S.C. chapter 137 legacy
provisions (see 10 U.S.C. 3016); and 51
U.S.C. 20113.
PART 4—ADMINISTRATIVE AND
INFORMATION MATTERS
4.604
[Amended]
2. Amend section 4.604 in paragraph
(b)(4) by removing the text ‘‘contracting
office’’ and ‘‘Post-Award’’ and adding
■
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Federal Register / Vol. 90, No. 2 / Friday, January 3, 2025 / Rules and Regulations
‘‘contracting officer’’ and ‘‘Postaward’’
in their places, respectively.
PART 8—REQUIRED SOURCES OF
SUPPLIES AND SERVICES
8.405–5
[Amended]
3. Amend section 8.405–5 in
paragraph (b) by removing the text
‘‘section 19.301–2(b)(2)’’ and adding
‘‘19.301–2(b)(3)’’ in its place.
■
PART 16—TYPES OF CONTRACTS
16.505
[Amended]
4. Amend section 16.505 in paragraph
(b)(9) by removing the text ‘‘section
19.301–2(b)(2)’’ and adding ‘‘19.301–
2(b)(3)’’ in its place.
■
PART 19—SMALL BUSINESS
PROGRAMS
19.202–5
[Amended]
5. Amend section 19.202–5 in
paragraph (c) introductory text by
removing ‘‘Post Award’’ and adding
‘‘Postaward’’ in its place.
■ 6. Amend section 19.301–2 by—
■ a. Revising the section heading and
paragraph (b) introductory text;
■ b. Removing from paragraphs (b)(1)(i)
and (ii) ‘‘Post-Award’’ and adding
‘‘Postaward’’ in its place;
■ c. Redesignating paragraph (b)(2) as
paragraph (b)(3);
■ d. Adding a new paragraph (b)(2);
■ e. Adding headings to paragraphs (c)
and (d);
■ f. Revising paragraphs (d)(2)(i) and
(ii); and
■ g. Adding a heading to paragraph (e).
The revisions and additions read as
follows:
■
19.301–2 Rerepresentation by a contractor
that represented its status as a small
business concern.
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*
*
*
*
*
(b) Requirements. A contractor that
represented its status as any of the small
business concerns identified at
19.000(a)(3) before contract award is
required to rerepresent its size and
socioeconomic status in accordance
with the clause at 52.219–28, Postaward
Small Business Program
Rerepresentation—
*
*
*
*
*
(2) For the NAICS code assigned to an
order (except for an order issued under
a Federal Supply Schedule contract)—
(i) Set aside exclusively for a small
business concern identified at
19.000(a)(3) that is issued under an
unrestricted multiple-award contract,
unless the order is issued under the
reserved portion of an unrestricted
multiple-award contract (e.g., an order
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set aside for a woman-owned small
business concern under a multipleaward contract that was not set-aside,
unless the order is issued under the
reserved portion of the multiple-award
contract);
(ii) Issued under a multiple-award
contract set aside for small businesses
that is further set aside for a specific
socioeconomic category that differs from
the underlying multiple-award contract
(e.g., an order set aside for a HUBZone
small business concern under a
multiple-award contract that is set-aside
for small businesses); or
(iii) Issued under the part of the
multiple-award contract that is set aside
for small businesses that is further set
aside for a specific socioeconomic
category that differs from the underlying
set-aside part of the multiple-award
contract (e.g., an order set aside for a
part of the multiple-award contract that
is partially set-aside for small
businesses); or
*
*
*
*
*
(c) NAICS code size standard. * * *
(d) Procedures— * * *
(2) * * *
(i) When an order is issued under an
unrestricted multiple-award contract
and the contractor’s rerepresentations
no longer qualifies it as a small business
concern identified at 19.000(a)(3), the
agency can no longer include the value
of the order in its small business prime
contracting goal achievements. When a
contractor’s rerepresentation for an
order qualifies it as a different small
business concern identified at
19.000(a)(3) than what it represented for
contract award, the agency can include
the value of the order in its small
business prime contracting goal
achievement, consistent with the
rerepresentation.
(ii) A rerepresentation for an order
issued under an unrestricted multipleaward contract does not change the size
or socioeconomic status representation
for the contract.
(e) Size status change. * * *
19.302
[Amended]
7. Amend section 19.302 in paragraph
(j) by removing ‘‘Post-Award’’ and
adding ‘‘Postaward’’ in its place.
■
19.309
[Amended]
8. Amend section 19.309 in paragraph
(c)(1) by removing ‘‘Post-Award’’ and
adding ‘‘Postaward’’ in its place.
■
PART 52—SOLICITATION PROVISIONS
AND CONTRACT CLAUSES
52.212–5
[Amended]
Frm 00018
Fmt 4701
10. Amend section 52.219–28 by—
a. Revising the section heading, clause
heading and date, and paragraph (c);
and
■ b. Removing from paragraph (f)
‘‘paragraph (b) and (c)’’ and ‘‘office in’’
and adding ‘‘paragraphs (b) and (c)’’ and
‘‘officer in’’ in their places, respectively.
The revisions read as follows:
■
■
52.219–28 Postaward Small Business
Program Rerepresentation.
*
Sfmt 9990
*
*
*
*
Postaward Small Business Program
Rerepresentation (JAN 2025)
*
*
*
*
*
(c) If the Contractor represented its status
as any of the small business concerns
identified at 19.000(a)(3) prior to award of
this contract, the Contractor shall rerepresent
its size and socioeconomic status according
to paragraph (f) of this clause or, if
applicable, paragraph (h) of this clause, for
the NAICS code assigned to an order (except
that paragraphs (c)(1) through (3) of this
clause do not apply to an order issued under
a Federal Supply Schedule contract at
subpart 8.4)—
(1) Set aside exclusively for a small
business concern identified at 19.000(a)(3)
that is issued under an unrestricted multipleaward contract, unless the order is issued
under the reserved portion of an unrestricted
multiple-award contract (e.g., an order set
aside for a woman-owned small business
under a multiple-award contract that is not
set-aside, unless the order is issued under the
reserved portion of the multiple-award
contract);
(2) Issued under a multiple-award contract
set aside for small businesses that is further
set aside for a specific socioeconomic
category that differs from the underlying
multiple-award contract (e.g., an order set
aside for a HUBZone small business concern
under a multiple-award contract that is set
aside for small businesses);
(3) Issued under the part of the multipleaward contract that is set aside for small
businesses that is further set aside for a
specific socioeconomic category that differs
from the underlying set-aside part of the
multiple-award contract (e.g., an order set
aside for a WOSB concern under the part of
the multiple-award contract that is partially
set aside for small businesses); and
(4) When the Contracting Officer explicitly
requires it for an order issued under a
multiple-award contract, including for an
order issued under a Federal Supply
Schedule contract (see 8.405–5(b) and
19.301–2(b)(2)).
*
9. Amend section 52.212–5 in
paragraph (b)(26)(i) by removing ‘‘Post-
■
PO 00000
Award’’ and ‘‘(FEB 2024)’’ and adding
‘‘Postaward’’ and ‘‘(JAN 2025)’’ in their
places, respectively.
*
*
*
*
[FR Doc. 2024–31404 Filed 1–2–25; 8:45 am]
BILLING CODE 6820–EP–P
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Agencies
[Federal Register Volume 90, Number 2 (Friday, January 3, 2025)]
[Rules and Regulations]
[Pages 517-522]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-31404]
-----------------------------------------------------------------------
DEPARTMENT OF DEFENSE
GENERAL SERVICES ADMINISTRATION
NATIONAL AERONAUTICS AND SPACE ADMINISTRATION
48 CFR Parts 4, 8, 16, 19, and 52
[FAC 2025-03; FAR Case 2020-016, Item II; Docket No. FAR-2020-0016;
Sequence No. 1]
RIN 9000-AO18
Federal Acquisition Regulation: Rerepresentation of Size and
Socioeconomic Status
AGENCY: Department of Defense (DoD), General Services Administration
(GSA), and National Aeronautics and Space Administration (NASA).
ACTION: Final rule.
-----------------------------------------------------------------------
SUMMARY: DoD, GSA, and NASA are issuing a final rule amending the
Federal Acquisition Regulation (FAR) to implement regulatory changes
made by the Small Business Administration to order-level size and
socioeconomic status rerepresentation requirements.
DATES: Effective January 17, 2025.
FOR FURTHER INFORMATION CONTACT: For clarification of content, contact
Ms. Dana Bowman, Procurement Analyst, at 202-803-3188 or by email at
[email protected]. For information pertaining to status, publication
schedules contact the Regulatory Secretariat Division at 202-501-4755
or [email protected]. Please cite FAC 2025-03, FAR Case 2020-016.
SUPPLEMENTARY INFORMATION:
I. Background
DoD, GSA, and NASA published a proposed rule at 88 FR 67189 on
September 29, 2023, to implement regulatory changes made by the Small
Business Administration (SBA) in its final rule published on October
16, 2020, at 85 FR 66146. For further details please see the proposed
rule. Eight respondents submitted comments on the proposed rule.
[[Page 518]]
II. Discussion and Analysis
The Civilian Agency Acquisition Council and the Defense Acquisition
Regulations Council (the Councils) reviewed the public comments in the
development of the final rule. A discussion of the comments and the
changes made to the rule as a result of those comments are provided as
follows:
A. Summary of Significant Changes
There are no significant changes from the proposed rule.
B. Analysis of Public Comments
1. Exceptions to the Rule
Comment: A respondent expressed concerns that the rule requires too
much work.
Response: FAR subpart 4.11, System for Award Management (SAM),
establishes policies and procedures for requiring registration in SAM.
FAR subpart 4.12, Representations and Certifications, establishes
policies and procedures for requiring submission and maintenance of
representations and certifications in SAM. Offerors and contractors are
required to be registered in SAM in accordance with FAR 52.204-7,
System for Award Management, and to complete electronic annual
representations and certifications in SAM, as part of required
registration in accordance with FAR 52.204-13, System for Award
Management Maintenance. All registrants are required to review and
update the representations and certifications in SAM as necessary, but
at least annually, to ensure they are current, accurate, and complete.
This rule modifies the clause at FAR 52.219-28, Post-award Small
Business Program Rerepresentation, to require offerors to rerepresent
their status for orders issued under multiple-award contracts under
certain circumstances. Although this rule requires offerors to
rerepresent, contractors are already required to ensure that their
representations and certifications in SAM are current, accurate, and
complete. Therefore, this rule only imposes an additional burden for
orders requiring rerepresentation in accordance with paragraphs (c)(1)
through (3) of the FAR clause at 52.219-28.
Comment: A respondent recommended that SBA create a database for
small business certifications, which would allow for a check and
balance of a contractor's self-certification and protect contracting
officers in the event they are unable to verify a concern's status.
Response: SBA already maintains a database of certified small
business concerns. Specifically, the Dynamic Small Business Search
(DSBS) database is SBA's small business certification repository.
Certifications in DSBS also appear in SAM, which is the Government's
repository for prospective and current Federal awardee information,
including representations and certifications. The FAR requires
contracting officers to review SAM to verify the contractor's current
size and socioeconomic status. If a concern's certification status is
not reflected in SAM, contracting officers can verify a concern's
status by checking DSBS at https://dsbs.sba.gov.
Comment: A respondent recommended that recertification for size or
socioeconomic status for orders should not be required.
Response: This rule implements regulatory changes made by SBA in
its final rule published on October 16, 2020, which requires
rerepresentation for orders placed against multiple-award contracts
under certain circumstances. The FAR currently requires contractors to
rerepresent their status under certain circumstances. This rule expands
the requirement for rerepresentation to verify orders that are set
aside for small businesses under certain multiple-award contracts are
awarded to qualified small businesses.
Comment: Some respondents indicated that the proposed rule does not
consider the time it takes to award a task order. The respondents
stated that the period of time from proposal submission to order award
often takes 12 to 36 months. Due to the time it takes to award an
order, some respondents expressed concerns that this may impact the
Government's ability to award the order as the awardee's small business
status could change during this period of time. A respondent stated
that small businesses compete for and are awarded contracts for which
they qualify at that time, and they should be afforded the opportunity
to be awarded task orders under those contracts. The respondent
indicated that a company's size can change periodically and that a
business that was small at the time of proposal submission may be large
at order award. The respondents also questioned if the selected awardee
would be eligible for award if its size or socioeconomic status changed
between proposal submission and order award.
Response: In accordance with SBA's final rule, size and
socioeconomic status are determined at the time of initial offer (or
other formal response to a solicitation), which includes price, for an
order issued against a multiple-award contract if the contracting
officer requests rerepresentation for the order. Therefore, the offeror
will remain qualified for the order if its status changes between offer
submittal and award of the order.
Comment: A respondent asked how an offeror's eligibility would be
affected if rerepresentation is required for an order that is set aside
under a multiple-award contract and the offeror is no longer small for
the North American Industry Classification System (NAICS) code
associated with the contract or no longer qualifies under the
socioeconomic category for which it initially qualified. The respondent
also asked if a woman-owned small business would lose its small
business status that it had at initial award if it rerepresented as
large at a later date. Lastly, the respondent asked if the goal of this
proposed rule is to require small businesses to certify their size and
socioeconomic status for the life of the contract.
Response: A small business concern awarded a multiple-award
contract that was set aside for small businesses may continue to
perform under such a contract as a small business concern throughout
for the life of those contracts (e.g., for the base period and up to
four additional option years). However, if a contracting officer
requires rerepresentation of size and/or socioeconomic status for a
particular order, size and socioeconomic status is determined at the
time of offer submission for the order. To clarify for the respondent,
a woman-owned small business that represents as large for a particular
order, under a multiple-award contract affected by this rule, would be
considered large for that order.
Comment: One respondent recommended that implementation of this
policy be applicable to new multiple-award contracts or, alternatively,
apply the policy to orders issued under multiple-award contracts after
January 1, 2025.
Response: In accordance with FAR 1.108(d), this policy applies to
solicitations for contracts issued on or after the effective date of
the final rule. The contracting officer also has the discretion to
include the changes made in this final rule in solicitations for
contracts issued before the effective date, provided award of the
resulting contract(s) occurs on or after the effective date of the
final rule. In addition, contracting officers may, at their discretion,
include the changes made in this final rule in any existing contract
with appropriate consideration. The final rule does not require that
existing contracts be modified to add
[[Page 519]]
the updated version of FAR clause 52.219-28.
Comment: A respondent recommended the rule be amended to clearly
define the criteria and timelines for contracting officers requesting
rerepresentation of size under existing multiple-award contracts.
Response: The final rule text at FAR 19.301-2(b)(2) specifies the
new requirements for a contractor to rerepresent its status for orders
placed against multiple-award contracts under certain circumstances in
accordance with FAR clause 52.219-28. Contracting officers include FAR
clause 52.219-28 in solicitations and contracts in accordance with the
prescription at FAR 19.309(c)(1). The clause at FAR 52.219-28 provides
instructions to offerors and contractors regarding when
rerepresentation is required; therefore, it is not necessary to provide
additional instructions to contracting officers.
2. Clarifications
Comment: A few respondents recommended removing ``and whose
socioeconomic status is not certified by the SBA'', from the proposed
rule at FAR 19.301-2(b), and in FAR clause 52.219-28. A respondent
stated that the proposed FAR text does not exist in the SBA rule and
that including the text would make the FAR inconsistent with SBA
regulations. The respondent stated that SBA regulations require
representation even if the SBA certifies the concern's socioeconomic
status. The respondent stated the rule, as written, exempts small
businesses whose socioeconomic status is certified by the SBA. A
respondent stated that the proposed FAR text makes the requirement
appear to only apply to small businesses that are not small
disadvantaged businesses while exempting small disadvantaged
businesses.
Response: The final rule FAR text at 19.301-2(b) and paragraph (c)
of the clause at FAR 52.219-28 has been revised to adopt the
recommendation.
Comment: A respondent recommended clarifying when recertification
is required for orders issued under a Federal Supply Schedule (FSS)
contract. The respondent recommended adding the following new paragraph
(b)(2)(iv) at FAR 19.301-2: A contractor generally does not need to
recertify its size eligibility for orders issued under a FSS contract
unless the ordering contracting officer specifically requests such
recertification for that order, under paragraph (b)(3) of this section.
Response: The final rule FAR text at 19.301-2(b)(3) and paragraph
(c)(4) of the clause at FAR 52.219-28 specifies that for the NAICS code
assigned to an order under a multiple-award contract, rerepresentation
is required if the contracting officer requires it for that order. This
also applies to orders issued under an FSS contract. The final rule FAR
text at 19.301-2(b)(2) and paragraph (c) of the clause at FAR 52.219-28
describes when a contractor must rerepresent for an order and also
specifies ``except for an order issued under a Federal Supply Schedule
contract''; therefore, it is not necessary to add the recommended
paragraph.
Comment: A respondent recommended revising the proposed rule FAR
text at 19.301-2(b)(2)(i) to replace: ``unless the order is issued
under an unrestricted multiple-award contract with reserves'' with
``except for orders issued under a reserved portion of a multiple-award
contract with reserves, in which case recertification is not required .
. .'' to clarify that recertification is not required for orders issued
under the reserved portion of a multiple-award contract. The respondent
recommended text they believed offered additional clarity that would
assist industry in understanding recertification requirements.
Response: The final rule text at FAR 19.301-2(b)(2)(i) is revised
to partially adopt the respondent's recommendation.
Comment: A respondent stated that the scenario illustrated at FAR
19.301-2(b)(2)(ii) and (iii) incorrectly suggests that it is permitted
by SBA regulations. The respondent recommends revising the proposed FAR
text at 19.301-2(b)(2)(ii) and (iii) to make clear that they apply to
socioeconomic category orders issued under multiple-award contracts
that are set aside for small businesses. The respondent recommended
editing the proposed rule FAR text at 19.301-2(b)(2)(ii) and (iii) to
clarify that each paragraph is referring to a multiple-award contract
that is set aside for small businesses.
Response: The examples included in the final rule FAR text at
19.301-2(b)(2)(ii) and (iii) and in paragraphs (c)(2) and (3) of the
clause at FAR 52.219-28 are revised to adopt the recommendation to edit
the examples for accuracy.
Comment: A respondent stated that, while the proposed rule helps to
explain the different circumstances under which size and socioeconomic
recertification is required, it does not address unique recertification
issues that arise under sole-source orders placed under the 8(a)
Business Development Program. The respondent recommended that the final
rule be amended to add a new paragraph at FAR 19.301-2(b) to explain
SBA's responsibility to determine eligibility for 8(a) sole-source
orders. The respondent indicated that, absent additional clarity, some
contracting officers might incorrectly believe that recertification is
not required for 8(a) sole-source orders.
Response: This rule does not exempt contracting officers from
complying with FAR subpart 19.8, Contracting with the Small Business
Administration (The 8(a) Program). Contracting officers are required to
follow 8(a) offer and acceptance procedures at FAR 19.804-2 and 19.804-
3 for competitive and sole-source 8(a) contracts and orders,
respectively. SBA will determine an 8(a) participant's eligibility
during this process; therefore, it is not necessary to restate 8(a)
Program requirements at FAR 19.301-2(b).
Comment: A respondent recommended correcting a typographical error
that references paragraph ``a'' in the proposed revision to paragraph
(c) of the clause at FAR 52.219-28.
Response: The final rule FAR text in paragraph (c) of the clause at
FAR 52.219-28 has been revised to replace ``a'' with ``c''.
3. Negative Impacts of the Rule
Comment: A few respondents indicated that the proposed rule will
creates an environment of reduced competition, lower quality bidders,
and will force small businesses to compete on an uneven playing field.
Response: SBA's final rule requires contractors to rerepresent
their status for orders set aside for small businesses under an
unrestricted multiple-award contract for which size and socioeconomic
status were not relevant to the award of the underlying multiple-award
contract. This distinction is important because the award of an order
under such a multiple-award contract is the first time that size and
socioeconomic status is relevant. Therefore, requiring a concern to
represent its size and socioeconomic status encourages fair competition
among small businesses.
Comment: A respondent stated that the proposed rule will impose an
onerous burden of new recordkeeping, reporting, and other compliance
requirements on small businesses. The respondent stated that this would
require a significant increase in staff time and result in additional
cost to those businesses and the Government.
Response: This rule revises an information collection currently
approved under OMB Control Number 9000-0163. Accordingly, the
Regulatory
[[Page 520]]
Secretariat Division submitted to the Office of Management and Budget
(OMB) a request for approval of a revised information collection
requirement concerning 9000-0163, Rerepresentation of Size and
Socioeconomic Status, that includes burden estimates for order-level
rerepresentation requirements. In addition, FAR subpart 4.12,
Representations and Certifications, establishes policies and procedures
for requiring submission and maintenance of representations and
certification via SAM. Offerors and quoters are required to complete
electronic annual representations and certification in SAM, as part of
required registration in accordance with FAR 4.1201. All registrants
are required to review and update the representations and
certifications submitted in SAM as necessary, but at least annually, to
ensure they are current, accurate, and complete. Therefore, since
contractors and offerors are already required to maintain and update
their representations and certifications in SAM, this rule only imposes
an additional burden for the orders requiring rerepresentation in
accordance with paragraphs (c)(1) through (3) of the clause at FAR
52.219-28. The additional estimated total burden hours for all small
businesses to rerepresent at the order level is approximately 534 hours
annually.
Comment: A respondent asked if the Government has a process in
place for managing inaccurate data and data reporting and, if not,
recommended the issue be addressed prior to the implementation of this
rule to ensure accurate data is available to all taxpayers.
Response: Section IV, Expected Impact of the Rule, in the preamble
of the proposed rule indicated that the Federal Procurement Data System
(FPDS) does not currently capture size and socioeconomic status at the
order level; therefore, contracting officers will not be able to
indicate the size or socioeconomic status of a small business concern
at the order level. This may result in inaccurate data and data
reporting. However, FPDS is anticipated to be updated to capture this
data.
4. Outside the Scope of the Rule
Comment: A few respondents submitted comments that were unrelated
to the scope of the rule.
A respondent asked for guidance on the certification for
contractors under teaming arrangements and joint ventures. Another
respondent recommended that the small business size standard be set at
500 employees for both product and service contracts to prevent current
small businesses with 250 to 300 personnel from graduating from small
business status and ensuring their continued growth and development
into large businesses. A respondent recommended creating a middle-
market set-aside category for businesses exceeding 500 employees with
an annual revenue less than $250 million per year or five times the
current size standard. Another respondent objected to bailouts.
Response: These comments are outside the scope of this rule. The
FAR defers to SBA to establish small business size standards.
C. Other Changes
Conforming changes are made at FAR 4.604, 8.405-5(b), 16.505(b),
19.202-5(c), and 19.301-2. Paragraph headings are added at 19.301-2(b),
(c), (d), and (e) to describe the contents of such paragraphs and to
conform with FAR drafting convention. The text at FAR 19.301-2(d)(2)(i)
and (ii) is amended for clarity.
III. Applicability to Contracts at or Below the Simplified Acquisition
Threshold (SAT) and for Commercial Products, (Including Commercially
Available Off-the-Shelf (COTS) Items) and for Commercial Services
This final rule amends the clauses at FAR 52.219-28, Postaward
Small Business Program Rerepresentation, and 52.212-5, Contract Terms
and Conditions Required to Implement Statutes or Executive Orders-
Commercial Products and Commercial Services. The clauses continue to
apply to acquisitions at or below the SAT, acquisitions for commercial
products (including COTS items), and acquisitions for commercial
services.
IV. Expected Impact of the Rule
As a result of this final rule, a contractor that represented its
status before contract award will be required to rerepresent its size
and/or socioeconomic status for an order placed under a multiple-award
contract, under certain circumstances and where rerepresentation was
not previously required. The final rule validates that orders set aside
for small businesses under certain multiple-award contracts are awarded
to small businesses that qualify for the size and/or socioeconomic
status associated with the orders. Therefore, an entity that no longer
qualifies as small under the applicable NAICS code associated with an
order, or that no longer qualifies for a particular socioeconomic
category, will not be eligible for orders placed under certain
multiple-award contracts.
As a result of this final rule, contracting officers will be
required to verify the size and/or socioeconomic status of a small
business concern prior to issuing an order under multiple-award
contracts subject to this rule.
Orders placed under an FSS contract are exempt from the mandatory
rerepresentation requirement; however, contracting officers continue to
have the discretion to require a rerepresentation for an order under an
FSS contract.
This final rule is also expected to prevent agencies from receiving
credit toward their small business goals for awards made to firms that
no longer qualify as small under the applicable NAICS code or that no
longer qualify as a small business concern identified at FAR
19.000(a)(3).
Existing e-business systems are impacted by this final rule as FPDS
does not currently capture size and socioeconomic status at the order
level; therefore, contracting officers will not be able to indicate the
size or socioeconomic status of a small business concern at the order
level. This may result in inaccurate data and data reporting. However,
the Government anticipates that FPDS will be updated to capture this
data.
V. Executive Orders 12866 and 13563
Executive Orders (E.O.s) 12866 (as amended by E.O. 14094) and 13563
direct agencies to assess the costs and benefits of available
regulatory alternatives and, if regulation is necessary, to select
regulatory approaches that maximize net benefits (including potential
economic, environmental, public health and safety effects, distributive
impacts, and equity). E.O. 13563 emphasizes the importance of
quantifying both costs and benefits, of reducing costs, of harmonizing
rules, and of promoting flexibility. This is not a significant
regulatory action and, therefore, was not subject to review under
section 6(b) of E.O. 12866, Regulatory Planning and Review, dated
September 30, 1993.
VI. Congressional Review Act
Pursuant to the Congressional Review Act, DoD, GSA, and NASA will
send this rule to each House of the Congress and to the Comptroller
General of the United States. The Office of Information and Regulatory
Affairs (OIRA) in the Office of Management and Budget has determined
that this rule does not meet the definition in 5 U.S.C. 804(2).
[[Page 521]]
VII. Regulatory Flexibility Act
DoD, GSA, and NASA have prepared a Final Regulatory Flexibility
Analysis (FRFA) consistent with the Regulatory Flexibility Act, 5
U.S.C. 601-612.
1. Statement of the need for, and the objectives of, the rule.
DoD, GSA, and NASA are issuing a final rule to amend the FAR to
update the rerepresentation of size and socioeconomic status
requirements for set-aside orders issued under unrestricted
multiple-award contracts to align with the regulatory changes made
by the Small Business Administration (SBA) in its final rule dated
October 16, 2020, at 85 FR 66146. This final rule requires a
business concern to rerepresent its size and/or socioeconomic status
for all set-aside orders under unrestricted multiple-award
contracts, unless the contract authorized reserves of specific types
of small business concerns for which size and/or socioeconomic
status was required, and the order is issued against the reserved
portion. Additionally, this rule requires a business concern to
rerepresent its socioeconomic status for all set-aside orders for
which the required socioeconomic status for the order differs from
that of the underlying set-aside multiple-award contract. The
updated requirements are made to clarify SBA's regulatory provisions
and eliminate confusion among small businesses and contracting
activities.
2. Statement of the significant issues raised by the public
comments in response to the initial regulatory flexibility analysis,
a statement of the assessment of the agency of such issues, and a
statement of any changes made to the rules as a result of such
comments.
There were no significant issues raised by the public comments
in response to the initial regulatory flexibility analysis.
Currently, contractors are required to rerepresent their size
and socioeconomic status for orders under multiple-award contracts
if the contracting officer requires rerepresentation for that order
or as required by the clause at FAR 52.219-28. This rule requires
contractors to rerepresent their size and/or socioeconomic status
for all orders issued under unrestricted multiple-award contracts
(except for orders issued under Federal Supply Schedule (FSS)
contracts), and for set-aside orders for which the required
socioeconomic status for the order differs from that of the
underlying set-aside multiple-award contract.
3. Description of and an estimate of the number of small
entities to which the rule will apply.
According to data from the Federal Procurement Data System
(FPDS) for fiscal year (FY) 2021, FY 2022, and FY 2023, small
businesses were required to rerepresent their socioeconomic status
for modifications as follows: 2,006, 3,379, in and 2,842,
respectively. This averages out to approximately 2,742
rerepresentation modifications per year. Additional data from FPDS
indicates that agencies set aside orders under unrestricted
multiple-award contracts, excluding reserve orders and orders under
FSS contracts, as follows: 7,341 in FY 2021, 7,463 in FY 2022, and
8,336 in FY 2023, which averages out to 7,713 per year. Data from
FPDS also indicates that agencies set aside orders under set-aside
multiple-award contracts (other than FSS contracts) in the
categories covered by this rule as follows: 2,060 in FY 2021, 1,977
in FY 2022, and 2,213 in FY 2023, which averages out to 2,083 per
year. Therefore, the estimated number of small entities to which the
rule will apply is 4,179.
4. Description of projected reporting, recordkeeping, and other
compliance requirements of the rule.
This rule includes new reporting, recordkeeping, or other
compliance requirements for small entities. The Regulatory
Secretariat Division has submitted to OMB a request to review and
approve revisions to previously approved information collection
requirements in the clause at FAR 52.219-28, Post-Award Small
Business Program Rerepresentation.
5. Description of the steps the agency has taken to minimize the
significant economic impact on small entities consistent with the
stated objectives of applicable statutes.
There are no known significant alternative approaches that would
accomplish the stated objectives.
Interested parties may obtain a copy of the FRFA from the
Regulatory Secretariat Division. The Regulatory Secretariat Division
has submitted a copy of the FRFA to the Chief Counsel for Advocacy of
the Small Business Administration.
VIII. Paperwork Reduction Act
The Paperwork Reduction Act (44 U.S.C. 3501-3521) applies. The rule
contains information collection requirements. The Regulatory
Secretariat Division has submitted to OMB a request to review and
approve revisions to previously approved information collection
requirements in the FAR clause at 52.219-28.
A. OMB Control Number, Title, and Any Associated Form(s)
OMB control number and title: 9000-0163, Rerepresentation of Size
and Socioeconomic Status.
B. Need and Uses
This rule amends FAR clause 52.219-28 to require concerns to also
rerepresent their size and/or socioeconomic status for orders placed
under multiple-award contracts under certain circumstances as described
in paragraph (c) of the clause and this preamble.
The collected information is used by SBA, Congress, Federal
agencies, and the public for various reasons such as market research,
set-aside determinations, and determining if agencies are meeting
statutory goals.
C. Annual Burden
Public reporting burden for this collection of information is
estimated to average 0.5 hours per response, including the time for
reviewing instructions, searching existing data sources, gathering the
data needed, and completing and reviewing the collection of
information.
The increase in the annual reporting burden, because of the final
rule, is estimated as follows:
Respondents: 835.
Total annual responses: 1,069.
Total response burden hours: 534.
D. Public Comment to OMB on Information Collection
A 60-day notice was published in the Federal Register at 88 FR
67189, on September 29, 2023. A comment was received and addressed in
section II. of this preamble; however, it did not change the estimate
of the burden. Written comments and recommendations for this
information collection revision should be sent within 30 days of
publication of this rule to www.reginfo.gov/public/do/PRAMain. Find
this information collection by selecting ``Currently under Review--Open
for Public Comments'' or by using the search function.
E. Obtaining Copies
Requesters may obtain a copy of the information collection
documents from the GSA Regulatory Secretariat Division, by calling 202-
501-4755 or emailing [email protected]. Please cite OMB Control Number
9000-0163, Small Business Rerepresentation.
List of Subjects in 48 CFR Parts 4, 8, 16, 19, and 52
Government procurement.
William F. Clark,
Director, Office of Government-wide Acquisition Policy, Office of
Acquisition Policy, Office of Government-wide Policy.
Therefore, DoD, GSA, and NASA are amending 48 CFR parts 4, 8, 16,
19, and 52 as set forth below:
0
1. The authority citation for 48 CFR parts 4, 8, 16, 19, and 52
continues to read as follows:
Authority: 40 U.S.C. 121(c); 10 U.S.C. chapter 4 and 10 U.S.C.
chapter 137 legacy provisions (see 10 U.S.C. 3016); and 51 U.S.C.
20113.
PART 4--ADMINISTRATIVE AND INFORMATION MATTERS
4.604 [Amended]
0
2. Amend section 4.604 in paragraph (b)(4) by removing the text
``contracting office'' and ``Post-Award'' and adding
[[Page 522]]
``contracting officer'' and ``Postaward'' in their places,
respectively.
PART 8--REQUIRED SOURCES OF SUPPLIES AND SERVICES
8.405-5 [Amended]
0
3. Amend section 8.405-5 in paragraph (b) by removing the text
``section 19.301-2(b)(2)'' and adding ``19.301-2(b)(3)'' in its place.
PART 16--TYPES OF CONTRACTS
16.505 [Amended]
0
4. Amend section 16.505 in paragraph (b)(9) by removing the text
``section 19.301-2(b)(2)'' and adding ``19.301-2(b)(3)'' in its place.
PART 19--SMALL BUSINESS PROGRAMS
19.202-5 [Amended]
0
5. Amend section 19.202-5 in paragraph (c) introductory text by
removing ``Post Award'' and adding ``Postaward'' in its place.
0
6. Amend section 19.301-2 by--
0
a. Revising the section heading and paragraph (b) introductory text;
0
b. Removing from paragraphs (b)(1)(i) and (ii) ``Post-Award'' and
adding ``Postaward'' in its place;
0
c. Redesignating paragraph (b)(2) as paragraph (b)(3);
0
d. Adding a new paragraph (b)(2);
0
e. Adding headings to paragraphs (c) and (d);
0
f. Revising paragraphs (d)(2)(i) and (ii); and
0
g. Adding a heading to paragraph (e).
The revisions and additions read as follows:
19.301-2 Rerepresentation by a contractor that represented its status
as a small business concern.
* * * * *
(b) Requirements. A contractor that represented its status as any
of the small business concerns identified at 19.000(a)(3) before
contract award is required to rerepresent its size and socioeconomic
status in accordance with the clause at 52.219-28, Postaward Small
Business Program Rerepresentation--
* * * * *
(2) For the NAICS code assigned to an order (except for an order
issued under a Federal Supply Schedule contract)--
(i) Set aside exclusively for a small business concern identified
at 19.000(a)(3) that is issued under an unrestricted multiple-award
contract, unless the order is issued under the reserved portion of an
unrestricted multiple-award contract (e.g., an order set aside for a
woman-owned small business concern under a multiple-award contract that
was not set-aside, unless the order is issued under the reserved
portion of the multiple-award contract);
(ii) Issued under a multiple-award contract set aside for small
businesses that is further set aside for a specific socioeconomic
category that differs from the underlying multiple-award contract
(e.g., an order set aside for a HUBZone small business concern under a
multiple-award contract that is set-aside for small businesses); or
(iii) Issued under the part of the multiple-award contract that is
set aside for small businesses that is further set aside for a specific
socioeconomic category that differs from the underlying set-aside part
of the multiple-award contract (e.g., an order set aside for a part of
the multiple-award contract that is partially set-aside for small
businesses); or
* * * * *
(c) NAICS code size standard. * * *
(d) Procedures-- * * *
(2) * * *
(i) When an order is issued under an unrestricted multiple-award
contract and the contractor's rerepresentations no longer qualifies it
as a small business concern identified at 19.000(a)(3), the agency can
no longer include the value of the order in its small business prime
contracting goal achievements. When a contractor's rerepresentation for
an order qualifies it as a different small business concern identified
at 19.000(a)(3) than what it represented for contract award, the agency
can include the value of the order in its small business prime
contracting goal achievement, consistent with the rerepresentation.
(ii) A rerepresentation for an order issued under an unrestricted
multiple-award contract does not change the size or socioeconomic
status representation for the contract.
(e) Size status change. * * *
19.302 [Amended]
0
7. Amend section 19.302 in paragraph (j) by removing ``Post-Award'' and
adding ``Postaward'' in its place.
19.309 [Amended]
0
8. Amend section 19.309 in paragraph (c)(1) by removing ``Post-Award''
and adding ``Postaward'' in its place.
PART 52--SOLICITATION PROVISIONS AND CONTRACT CLAUSES
52.212-5 [Amended]
0
9. Amend section 52.212-5 in paragraph (b)(26)(i) by removing ``Post-
Award'' and ``(FEB 2024)'' and adding ``Postaward'' and ``(JAN 2025)''
in their places, respectively.
0
10. Amend section 52.219-28 by--
0
a. Revising the section heading, clause heading and date, and paragraph
(c); and
0
b. Removing from paragraph (f) ``paragraph (b) and (c)'' and ``office
in'' and adding ``paragraphs (b) and (c)'' and ``officer in'' in their
places, respectively.
The revisions read as follows:
52.219-28 Postaward Small Business Program Rerepresentation.
* * * * *
Postaward Small Business Program Rerepresentation (JAN 2025)
* * * * *
(c) If the Contractor represented its status as any of the small
business concerns identified at 19.000(a)(3) prior to award of this
contract, the Contractor shall rerepresent its size and
socioeconomic status according to paragraph (f) of this clause or,
if applicable, paragraph (h) of this clause, for the NAICS code
assigned to an order (except that paragraphs (c)(1) through (3) of
this clause do not apply to an order issued under a Federal Supply
Schedule contract at subpart 8.4)--
(1) Set aside exclusively for a small business concern
identified at 19.000(a)(3) that is issued under an unrestricted
multiple-award contract, unless the order is issued under the
reserved portion of an unrestricted multiple-award contract (e.g.,
an order set aside for a woman-owned small business under a
multiple-award contract that is not set-aside, unless the order is
issued under the reserved portion of the multiple-award contract);
(2) Issued under a multiple-award contract set aside for small
businesses that is further set aside for a specific socioeconomic
category that differs from the underlying multiple-award contract
(e.g., an order set aside for a HUBZone small business concern under
a multiple-award contract that is set aside for small businesses);
(3) Issued under the part of the multiple-award contract that is
set aside for small businesses that is further set aside for a
specific socioeconomic category that differs from the underlying
set-aside part of the multiple-award contract (e.g., an order set
aside for a WOSB concern under the part of the multiple-award
contract that is partially set aside for small businesses); and
(4) When the Contracting Officer explicitly requires it for an
order issued under a multiple-award contract, including for an order
issued under a Federal Supply Schedule contract (see 8.405-5(b) and
19.301-2(b)(2)).
* * * * *
[FR Doc. 2024-31404 Filed 1-2-25; 8:45 am]
BILLING CODE 6820-EP-P