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Set-Asides Authorized for Multiple Award Contracts

Set-asides are now permitted under GSA schedules and other multiple award contracts.

The Federal Acquisition Regulation councils adopted an interim rule implementing provisions of the 2010 Jobs Act. It became effective Nov. 2.

Under the rule, contracting officers may set aside task and delivery orders on multiple award contracts for small businesses in any socioeconomic category. The law does not go as far as some small business advocates wanted; it gives contracting officers discretion over whether to set aside orders, rather than requiring set-asides under the rule of two.

In addition, agencies may set aside part of a multiple award contract. They may reserve one or more contract awards for small businesses on a multiple award contract that is awarded through full and open competition.

The rule could open significant new opportunities for small firms. Multiple award contracts, whether governmentwide or restricted to a single agency, account for a fast-growing share of federal procurement dollars.

“[T]he set-aside authority for multiple-award contracts conveyed by this interim rule may serve as the linchpin to closing the remaining shortfall agencies are experiencing in meeting their small business contracting goals,” the FAR councils said.

GSA policy previously permitted limiting competition on GSA schedule orders to small businesses without formal set-asides. But the president’s Interagency Task Force on Small Business Contracting noted that there was no “comprehensive policy” for governmentwide or agency multiple award contracts. Some agencies set aside places on their contracts for small firms, while others did not.

SBA is working on a change in its rules that will provide more specific guidance on using the new set-aside authority.


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