Welcome to Session Title

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1 2017 SAME Small Business Conference Welcome to Session Title Moderator: Mercedes Enrique, CMS Corporation Speakers: Dr. Donna Peebles, Associate Director, USACE Kenneth Dodds, Director of Policy, Planning & Liaison, SBA Bianca Henderson, Associate Director SB Programs, NAVFAC Mary Urey, Director SB Programs, AFIMSC Hosted by the Society of American Military Engineers #SAMESBC

2 2017 SAME Small Business Conference SAFETY FIRST! Please take note of the exits in case of an emergency. Hosted by the Society of American Military Engineers #SAMESBC

3 2017 SAME Small Business Conference Thank You to Our Sponsors! SILENCE PLEASE! Please silence your mobile phones. Hosted by the Society of American Military Engineers #SAMESBC

4 2017 SAME Small Business Conference PRESENTATIONS Earn 1 PDH credit for attending this session. Where are the forms for the Education Sessions? Presentations? Hosted by the Society of American Military Engineers #SAMESBC

5 5 SMALL BUSINESS PARTICIPATION VERSUS SMALL BUSINESS SUB CONTRACTING SAME SBC Dr. Donna Peebles Associate Director 17 Nov 2017 The views, opinions and findings contained in this report are those of the authors(s) and should not be construed as an official Department of the Army position, policy or decision, unless so designated by other official documentation

6 PURPOSE To clarify that a request for a Small Business Participation Proposal is quite different than a request for a Subcontracting Plan; to explain how and why it s different. Contractors and Government personnel are struggling to understand the unique differences. Small Businesses don t understand how it benefits them as a prime offeror on an unrestricted solicitation. Large Businesses still want to submit Subcontracting Plans in response to an Evaluation Factor for Small Business Participation. Or they want to fight against it to push for their Comprehensive Subcontracting Plan. 6

7 SB PARTICIPATION VS. SUBCONTRACTING UNRESTRICTED ACQUISITIONS >$700K (OR $1.5M FOR CONSTRUCTIONS) Evaluation of SB Participation Subcontracting Plan How will SB participate? FAR DFARS PGI Applies to both LB and SB offerors % of total contract dollars Evaluation Factor Compliance check via QASP Market research based (10-15%) How will LB subcontract to SB? FAR DFARS Applies to LB offerors only % of subcontracted dollars Responsibility determination Compliance check via esrs USACE SubKtg goal (o/a 50%) Best-Value Trade-Off source selections Best-Value Trade-Off, Lowest Priced Technically acceptable (LPTA), and Sealed-Bid 3 7

8 DFARS EVALUATION FACTORS AND SIGNIFICANT SUBFACTORS. (c)(i) In acquisitions that require use of the clause at FAR , Small Business Subcontracting Plan, other than those based on the lowest price technically acceptable source selection process (see FAR ), the extent of participation of small businesses and historically black colleges or universities and minority institutions in performance of the contract shall be addressed in source selection. The contracting officer shall evaluate the extent to which offerors identify and commit to small business and historically black college or university and minority institution performance of the contract, whether as a joint venture, teaming arrangement, or subcontractor. (C) When an evaluation assesses the extent that small businesses and historically black colleges or universities and minority institutions are specifically identified in proposals, the small businesses and historically black colleges or universities and minority institutions considered in the evaluation shall be listed in any subcontracting plan submitted pursuant to FAR

9 SB PARTICIPATION FACTOR DIFFERENCES FOR LARGE & SMALL BUSINESS OFFERORS RFPs should be structured to allow small businesses to submit their own participation as a prime under the FAR Part 15 Evaluation Factor. A common mistake is asking (small and large businesses) to submit SUBCONTRACTING goals, because this requires a small businesses to SUBCONTRACT to attain the goal. Instead SBs should be allowed to submit their own PARTICIPATION as a PRIME. Therefore, under the SB Participation Factor, you should see SB Participation Goals meaning Large businesses achieve the goals through subcontracting; Small businesses can achieve goals through their own performance/participation as a prime without having to subcontract. 9

10 SB PARTICIPATION PROPOSALS HAVE A RELATIVE ORDER OF IMPORTANCE.SUBCONTRACTING PLANS DON T! Technical is the most important factor and is more important than all of the remaining factors combined. Technical is significantly more important than Past Performance. The Past Performance Factor is more important than the Cost Factor. The Cost Factor is more important than the Small Business Participation Factor. Army Source Selection Guide EXAMPLE 10

11 SUBCONTRACTING GOAL 20% VERSUS SB PARTICIPATION GOAL 20% Differences in Calculating on a $1,000,000 Award 20% Subcontracting Goal = 20% of the Subcontracted Dollars SBs get 20% of the dollars available for subcontracting. If a LB decides to subcontract $100,000, a small business will get 20% of the $100,000. SBs get 20% of subcontracted dollars = $20,000 20% SB Participation Goal = 20% of Total Contract Value SBs get 20% of total value = $200,000 11

12 Kenneth Dodds Director of Policy, Planning and Liaison U.S. Small Business Administration November, 2017

13 (g) Subcontracting consideration in source selection. (1) A contracting officer may include an evaluation factor in a solicitation which evaluates: (i) An offeror's proposed approach to small business subcontracting participation in the subject procurement; (ii) The extent to which the offeror has met its small business subcontracting plan goals on previous covered contracts; and/or (iii) The extent to which the offeror timely paid its small business subcontractors under covered contracts.

14 (2) A contracting officer may include an evaluation factor in a solicitation which evaluates an offeror's commitment to pay small business subcontractors within a specific number of days after receipt of payment from the Government for goods and services previously rendered by the small business subcontractor. (i) The contracting officer will comparatively evaluate the proposed timelines. (ii) Such a commitment shall become a material part of the contract. (iii) The contracting officer must consider the contractor's compliance with the commitment in evaluating performance, including for purposes of contract continuation (such as exercising options).

15 (3) A small business concern submitting an offer shall receive the maximum score, credit or rating under an evaluation factor described in paragraph (g) of this section without having to submit any information in connection with this factor. (4) A contracting officer shall include a significant evaluation factor for the criteria described in paragraphs (g)(1)(i) and (g)(1)(ii) of this section in a bundled contract or order as defined in (5) Paragraph (g) of this section may apply to solicitations for orders against multiple award contracts, (including a Federal Supply Schedule or Multiple Award Schedule contract, a Government-wide acquisition contract (GWAC), or a multi-agency contract (MAC)), blanket purchase agreements or basic ordering agreements.

16 JV Awardee would subcontract 100% to LBC members Solicitation required subcontracting plan Small business participation was evaluation factor No tier 1 SBC subcontracts, SBC participation at lower tiers Army OSDBU objected; PCR did not Aggressive lower tier small business participation deemed acceptable Denied, B , Feb. 17, 2009

17 Multiple award IDIQ SSA made award to all offerors except those rated unacceptable under technical approach or small business participation factor or those with CAS noncompliance issues Agency reasonably did not selected protester s proposal for award where proposal was rated unacceptable under small business participation factor due to protester s offering of a small business percentage substantially below agency s stated goal Denied, B , March 18, 2015

18 Agency gave lower rating to a small business prime under a Small Business Participation Plan Factor 13 CFR 125.3(g)(3) provide that an SBC shall receive the maximum score, credit or rating under an evaluation factor described in paragraph (g) (FAR (a)(5) ambiguous) Agency took corrective action, reevaluated, then after another protest, cancelled the RFP Protester raised a clearly meritorious challenge to the evaluation. Notwithstanding the Agency's position in the agency report and supplemental agency report, it was contrary to regulation for the agency to rate the protester, as a small business, merely acceptable under the small business participation plan factor where higher ratings were available Recommend reimbursement of costs, B , Apr. 26, 2016

19 Small business participation plan To receive higher rating than acceptable, had to meet or exceed at least one SBC subcategory participation goal Proposal committed to general SBC percentage, but did not commit to meeting any subcategory Rating of acceptable was reasonable Higher rating would not have helped; no prejudice Denied, B , May 1, 2017

20 81 FR (12/23/16), Implements Section 1614 of NDAA of 2014, 15 USC 637(d)(16) Where the prime contractor has an individual subcontracting plan, the prime contractor shall establish two sets of small business subcontracting goals, one goal for the first tier and one goal for lower tier subcontracts awarded by other than small subcontractors with individual subcontracting plans. Under individual subcontracting plans the prime contractor shall receive credit for small business concerns performing as first tier subcontractors (first tier goal) and subcontractors at any tier pursuant to the subcontracting plans required under paragraph (c) of this section in an amount equal to the dollar value of work awarded to such small business concerns (lower tier goal). Other-than-small, lower tier subcontractors must have their own individual subcontracting plans if the subcontract is at or above the subcontracting plan threshold, and are required to make a good faith effort to meet their subcontracting plan goals. The prime contractor and any subcontractor with a subcontracting plan are responsible for reporting on subcontracting performance under their contracts or subcontracts at their first tier.

21 Thank you for Inviting Me! Kenneth Dodds U.S. Small Business Administration Director, Office of Policy, Planning and Liaison

22 SAME Small Business Conference NAVFAC SMALL BUSINESS UTILIZATION EVALUATION FACTOR Bianca Henderson Associate Director Office of Small Business Programs 22 22

23 New Source Selection Factor NAVFAC rolled out a new Small Business Utilization Factor in FY This new factor applies to both LB and SBs that respond to Unrestricted RFPs. The new factor is similar to the old one, but moves away from evaluating the Small Business Subcontracting Plan and will now evaluate Small Business Participation and Commitment. It is important to note that offerors representing as other than small businesses will still be required to submit a Small Business Subcontracting Plan (in compliance with ) at the time of proposal submission. The new factor focuses on two key areas: Achievements Small Business Participation and Commitment 23 23

24 SB Participation Plan vs Subcontracting Plan In acquisitions that require use of the clause at FAR , Small Business Subcontracting Plan, other than those based on the lowest price technically acceptable source selection process (see FAR ), the extent of participation of small businesses to include SDVOSBs, HUBZoneSBs, SDBs, and WOSB concerns in performance of the contract shall be addressed in source selection. The contracting officer shall evaluate the extent to which offerors identify and commit to small business performance of the contract, whether as a joint venture, teaming arrangement, or subcontractor. Proposals addressing the extent of small business performance shall be separate from subcontracting plans submitted pursuant to the clause at FAR and shall be structured to allow for consideration of offers from small businesses. (DFAR ) When an evaluation assesses the extent that small businesses are specifically identified in proposals, the small businesses considered in the evaluation shall be listed in any subcontracting plan submitted pursuant to FAR to facilitate compliance with (e). * Large Businesses, Subcontracting plans, required by FAR Part , need to be consistent with the SB Participation Plan

25 Small Business Utilization Factor Small Business Participation and Commitment Evaluation Factor Basics: Achievements (Summarize) Describe achievements in supporting the Gov ts policy to provide maximum practicable opportunities for SB s, VOSB s, SDVOSB s HUBZone, SDB, WOSB. SB Subcontracting history; Large Businesses submit Reports (esrs); SB proposers submit subcontracting history. The history should be associated with each project cited under the Corporate Experience Factor. All offerors provide a subcontracting history in a format (Attachment) provided in the RFP. Note: All offerors utilizing the achievement of team members or key subcontractors shall clearly demonstrate how these companies will have meaningful involvement in the this project. JVs, partnerships, or other entities should provide achievements information for each individual business entity(ies)

26 Small Business Utilization Factor Small Business Participation and Commitment (Strategy) Identify in terms of dollar value & percentage of the total value of the extent of work to be to self-performed as the prime. If proposing as a joint venture identify the percentage of work each member will be responsible for and indicate size status. Address specific strategies for post award execution roles and initiatives to enhance small business opportunities. The anticipated prime and first tier overall small business participation rate for the acquisition (work to be performed by small businesses as the prime and/ or subcontractors) is 20% of the contract value. Offerors shall explain in their participation and commitment strategies how the participation rates were established

27 Basis of Evaluations The extent to which SB firms are specifically identified in proposals; The extent of commitment to SB firms; The complexity and variety of the work small firms are to perform; The realism of the proposal; Past performance of the offerors in complying with requirements of the clauses at FAR , Utilization of Small Business Concerns, and , Small Business Subcontracting Plan The extent of participation of SB firms in terms of the value of the total acquisition and the extent of which the proposal meets or exceeds small business participation goals for this acquisition

28 Factor Evaluation Other considerations: SB Factor is weighted equal to the highest weighted technical factor. In the simplest terms.it is very important. DO NOT underestimate the SB Factor or it could cost your firm the contract award. Small Business Professional evaluates and rates the factor

29 Workload Link NAVFAC Public Portal ervices/sb.html/ NAVFAC HQ / Office of Small Business Programs Associate Director, Bianca Henderson, bianca.d.henderson@navy.mil Visit NAVFAC Booth #

30 Air Force Installation & Mission Support SBPCD the USAF Way Mary Urey HQ AFIMSC/SB November 2017 Warfighters Supporting Warfighters! 30

31 When Is Evaluation of Small Business Participation Required? When the acquisition involves bundling (FAR (c)(4)) In Other Than LPTA source selections, whenever a subcontracting plan is required (DFARS (c)) DFARS (c)(i)(b) specifically says Proposals addressing the extent of small business performance shall be separate from subcontracting plans submitted pursuant to the clause at FAR DEVIATION 2016-O0009 and shall be structured to allow for consideration of offers from small businesses. Note: Permissible for LPTAs 31

32 Small Business Subcontracting Plan vs. SBPCD Slide layout Presentation basics Pictures, animation, graphics 15 Recommendation 32

33 What gets evaluated? DFARS PGI (c)(i)(A) provides the following examples (these are not the only criteria that can be used) as small business participation evaluation factors and significant subfactors (criteria): The extent to which such firms are specifically identified in proposals; The extent of commitment to use such firms (for example, enforceable commitments are to be weighted more heavily than non-enforceable ones) The complexity and variety of the work small firms are to perform Past performance of the offerors in complying with requirements of the clauses at FAR , Utilization of Small Business Concerns, and Small Business Subcontracting Plan [DEVIATION O0009] (evaluation may be under the small business participation factor/subfactor or under the past performance factor) The extent of participation of such firms in terms of the value of the total acquisition and The realism of the proposal 33

34 Best Practices Though it is permissible to evaluate small business participation at a subfactor or lower level, the greater the opportunity for small business participation, the more small business should be evaluated at the factor level to maximize small business participation. Using five adjectival ratings from Outstanding to Unacceptable gives more information than a judgment of acceptable/unacceptable. As a point of reference, it is good to know the level of small business participation relative to the TCV rather than just as a percentage of planned subcontracting dollars. 34

35 Best Practices Evaluating small business participation provides more information than the small business subcontracting plan, such as commitment letters to individual small businesses and information on past performance. Small businesses are not required to submit subcontracting plans, but they will be required to address the extent of small business performance (participation) in their proposals when the solicitation requires evaluation of small business participation. 35

36 Make the Small Business Participation Commitments Contractual Create a Section H Special Contract Requirements clause to capture all proposed commitments/requirements. Describe what will be evaluated and how in Sections L & M of the solicitation or clauses & for commercial items. Incorporate the SBPCD as an attachment in the contract. Include the small business participation in the PWS/SOW and the QASP. 36

37 Benefits of an SBPCD Clearly distinguishable from the small business subcontracting plan Takes small business utilization beyond intent (plan) to actual, more enforceable commitment Small businesses count themselves toward the participation rate. Evaluating small business participation provides more information than the small business subcontracting plan, such as commitment letters to individual small businesses and information on past performance. Small businesses will be required to address the extent of small business performance (participation) in their proposals when the solicitation requires evaluation of small business participation. 37

38 DAU SBPCD Template Committment-Document-(SBPCD)-Sample-Template 38

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40 2017 SAME Small Business Conference Q&A & FEEDBACK Please walk up to the mic for questions. Questions will be addressed during the allotted time. Rate our session in the SBC App. Hosted by the Society of American Military Engineers #SAMESBC