Congress Votes No Set-Asides on GSA Schedules A provision allowing set-asides on GSA schedules and other multiple-award contracts was dropped from the final version of the 2006 Defense Authorization Act that was signed by President Bush Jan. 6. The Senate had adopted the amendment sponsored by Small Business Committee Chair Olympia Snowe (R-ME), but a joint conference committee with the House eliminated it. While set-asides are not permitted, GSA has told buyers they can use socioeconomic status as a primary evaluation factor when awarding task or delivery orders. (SAA, 7/22/05) The act also limits the use of cascading, or tiered, set-asides. Section 816 says a contracting officer can use such set-asides only if he is unable to determine whether at least two qualified small firms are available to bid on the contract. In a cascading procurement, all offerors submit their proposals at the same time and the customer agency first considers, for example, proposals from 8(a) firms, then service-disabled veterans, then other small businesses, then large businesses. Industry groups have complained that the use of cascades was spreading because they are a shortcut for contracting officers, but they require contractors to spend bid and proposal dollars preparing a proposal that may never be considered. The Senate had voted to ban cascading set-asides, but the conference committee watered down the provision. Other provisions of the Defense Authorization Act: *The Offices of Small and Disadvantaged Business Utilization in DOD and all military services are renamed Offices of Small Business Programs. The Senate Armed Services Committee report said, “The name would not reflect a change in emphasis or support for disadvantaged businesses, but rather would clarify that the Office of Small Business Programs has the full range of authority over many other small business programs that presently are not reflected in the office’s title.” *The act extends through 2007 the authority to hire private security guards at defense installations, as long as they are performing new requirements that were instituted after the 9/11 terrorist attacks. *It calls for a study of DOD’s efforts to increase contracts going to service-disabled veteran-owned businesses. *It continues restrictions on job competitions under OMB Circular A-76. To win a job competition, a private-sector offeror must produce savings of at least 10% (or $10 million, whichever is less) from the government’s cost. In addition, defense components must conduct a full-fledged competition, with formal offers from federal workers and contractors, for any work involving 10 or more government employees. Civilian agencies are allowed to conduct streamlined competitions, using market research rather than formal bids, in work units with fewer than 65 employees. *It directs the defense secretary to develop procedures for considering in-sourcing of work now performed by contractors. *The final bill eliminated a Senate-passed provision to create Services Contract Support Centers in the Defense Department and military services. Contractor groups called the proposal an unnecessary complication in the acquisition process. Instead, the act requires DOD to develop policies, procedures, and best practices guidelines for services contracts. The final bill also scrapped a Senate provision that would have ended the competitiveness demonstration program. The Defense Department wanted to kill the program, which prohibits set-aside contracts in certain industries.