Quiz Help: Guide to Government Contracting

TIP: Use the Find Function (ctrl+f) to easily locate quiz question answers.

LEARNING OBJECTIVES

Upon completion of this module, the student will be able to:

1. Identify the basic guidelines of federal government contracting

2. Understand small business qualifications and methods to verify your business

3. Describe the four steps required to register for government contracting

4. Learn how to find and research government contracting & subcontracting opportunities using the available tools and resources

5. Identify points of contact(POC)s in Florida which can provide assistance to small businesses for government contracting and subcontracting opportunities

6. Review the small business set-asides and sole-course programs

7. Identify the government contracting regulations and what a small business should do immediately


Introduction

U.S. federal government contracts represent a tremendous revenue opportunity for small construction businesses because:

• The U.S. Government is the world’s largest customer

• It buys all types of products and services in both large and small quantities

• It is required by law to provide opportunities for small businesses

As you might expect, the government is very particular about how it purchases products and services. The general aims of the rules and regulations governing federal contracts are to ensure that:

Competition is fair and open. The process of requesting proposals, evaluating bids, and making awards should take place on a level playing field with full visibility. Any business that is qualified to bid should be considered.

Products and services are competitively priced. The government seeks pricing that is commensurate with its formidable buying power.

The government gets what it pays for. The government protects itself by carefully defining requirements, terms and conditions for all purchases. Contractors must document that they have fulfilled all requirements and met all terms in order to be paid.

Both the government and contractors comply with the law—Different rules and regulations apply to different types of purchases. The Federal Acquisition Regulation (FAR) or Defense Acquisition Regulation Supplement (DFARS) apply to most federal agencies. Individual organizations often have their own rules as well.


TYPES OF GOVERNMENT CONTRACTORS

There are two broad categories of government contractors:

Prime contractors bid on and win contracts directly from government agencies. After award, the prime contractor company is the entity that is legally responsible for all aspects of fulfilling the contract, such as interacting with the government customer, recruiting staff, organizing and managing teams of subcontractors, and meeting all delivery requirements. Both large and small businesses can serve as prime contractors.

Subcontractors join prime contractors’ teams, usually to provide a specific capability or product. Subcontracting is an excellent way to enter the government contracting market and to participate in larger-scale opportunities. The advantage of being a “sub,” is that you’ll be responsible only for your area of expertise, not managing the entire contract. You can gain valuable experience (called “past performance”) that will qualify you for future contracts. But note that you’ll be serving two customers: Your prime contractor will determine what percentage of the work (called “workshare”) and which assignments (called “tasks”) you will receive. You may or may not work directly with the government, at the discretion of your prime.

Note: To serve as either a prime or a sub, you’ll need to qualify as a small business and register as government contractor. Then you can begin to seek both prime contractors and federal agencies as customers

GOVERNMENT CONTRACTING OPPORTUNITIES FOR SMALL BUSINESSES

The government is particularly concerned to include small businesses as it buys goods and services for several reasons:

  • To ensure that large businesses don’t “muscle out” small businesses
  • To gain access to the new ideas small businesses are great at providing
  • To support small businesses as engines of economic development and job creation
  • To offer opportunities to disadvantaged socio-ethnic groups

To these ends, most government agencies “set aside” a percentage of their acquisitions (what they buy) for small and disadvantaged businesses. In some cases, these set-asides might consist of certain types of tasks on larger contracts. In other cases, entire contracts may be designated for small businesses.


QUALIFYING AS A SMALL BUSINESS

You may take it for granted that your company is a “small business.” The distinction is important if you wish to register for government contracting as a small business. To be a small business, you must adhere to industry size standards established by the U.S. Small Business Administration. As you register as a government contractor in the System for Award Management (SAM), you will also self-certify your business as small.

The SBA, for most industries, defines a “small business” either in terms of the average number of employees over the past 12 months, or average annual receipts over the past three years. In addition, SBA defines a U.S. small business as a concern that:

• Is organized for profit

• Has a place of business in the US

• Operates primarily within the U.S. or makes a significant contribution to the U.S. economy through payment of taxes or use of American products, materials or labor

• Is independently owned and operated

• Is not dominant in its field on a national basis

The business may be a sole proprietorship, partnership, corporation, or any other legal form. In determining what constitutes a small business, the definition will vary to reflect industry differences, such as size standards.


Check if you are a Small Business

Reference the following table to view if you qualify as a small business.

Look up your industry and if your average annual receipts are less than the amount specified, YOU QUALIFY.

Note: Size standards are in millions of dollars. Also, construction businesses do not have size standards in numbers of employees.

NAICS CodesNAICS Industry Description: Subsector 236 – Construction of BuildingsSize Standards in millions of dollars
236115New Single-family Housing Construction (Except For-Sale Builders)$36.5
236116New Multifamily Housing Construction (except For-Sale Builders)$36.5
236117New Housing For-Sale Builders$36.5
236118Residential Remodelers$36.5
236210Industrial Building Construction$36.5
236220Commercial and Institutional Building Construction$36.5
NAICS CodesNAICS Industry Description: Subsector 237 – Heavy and Civil Engineering ConstructionSize Standards in millions of dollars
237110Water and Sewer Line and Related Structures Construction$36.5
237120Oil and Gas Pipeline and Related Structures Construction$36.5
237130Power and Communication Line and Related Structures Construction$36.5
237210Land Subdivision$27.5
237310Highway, Street, and Bridge Construction$36.5
237990Other Heavy and Civil Engineering Construction$36.5
237990_ExceptDredging and Surface Cleanup Activities$27.5
NAICS CodesNAICS Industry Description: Subsector 238 – Specialty Trade ContractorsSize Standards in millions of dollars
238110Poured Concrete Foundation and Structure Contractors$15.0
238120Structural Steel and Precast Concrete Contractors$15.0
238130Framing Contractors$15.0
238140Masonry Contractors$15.0
238150Glass and Glazing Contractors$15.0
238160Roofing Contractors$15.0
238170Siding Contractors$15.0
238190Other Foundation, Structure, and Building Exterior Contractors$15.0
238210Electrical Contractors and Other Wiring Installation Contractors$15.0

To view the complete list in its entirety of all NAICS industries, please refer to the following link: https://www.sba.gov/sites/default/files/files/Size_Standards_Table.pdf 


DETERMINE YOUR NAICS CODE

What is NAICS?

The North American Industry Classification System (NAICS) classifies business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the U.S. economy. The NAICS industry codes define establishments based on the activities in which they are primarily engaged. NAICS codes are also used for administrative, contracting, and tax purposes. NAICS is production oriented (not product oriented) and categorizes businesses with others that have similar methods of production.

Size standards using NAICS as their basis apply to all Federal government programs, including procurement. When the Federal government intends to acquire goods or services, it identifies the NAICS code that describes the principal purpose of that procurement. Your business may have myriad capabilities, and the NAICS code for a given procurement opportunity may not be the same as your primary NAICS code. That will not keep you from bidding or making an offer, so long as you meet the size standard for the procurement and have the capacity to provide the goods or services


Do I need an NAICS code for anything else?

You might find that many states, cities, and other political subdivisions (e.g., airport and bridge authorities) use or adapt SBA’s size standards based on NAICS for their own procurement programs. Federal and non-federal entities may also use NAICS codes for administrative and tax purposes. For example, the U.S. Department of Transportation provides reduced HAZMat registration fees for small businesses; but those businesses must identify their NAICS code when they apply for the reduced fee. The United States Census Bureau and other Federal statistical agencies use NAICS codes for collecting and reporting economic data.


Get your NAICS code or codes

Again, you may reference the previous table to obtain your NAICS code or codes. You may also use the following website to search the complete code database. http://www.census.gov/eos/www/naics/


GET A D-U-N-S NUMBER

Before you can bid on government proposals, you need to obtain a Dun & Bradstreet, or D-U-N-S, Number, a unique nine-digit identification number for each physical location of your business. D-U-N-S Number assignment is free for all businesses required to register with the federal government for contracts or grants.


What do I need to get my D-U-N-S Number?

When registering for your D-U-N-S Number, you will need the following on hand:

• Legal name

• Headquarters name and address for your business

• Doing Business As (DBA) or other name by which your business is commonly recognized

• Physical address, city, state and ZIP Code

• Mailing address (if separate from headquarters and/or physical address)

• Telephone number

• Contact name and title

• Number of employees at your physical location

• Whether you are a Home-Based Business


How do I get my D-U-N-S Number?

Getting your D-U-N-S Number is easy. Visit D-U-N-S Request Service at http://fedgov.dnb.com/webform/displayHomePage.do;jsessionid=81407B1F03F2BDB123DD47D19158B75F

REGISTER YOUR BUSINESS WITH THE SYSTEM OF AWARD MANAGEMENT (SAM)

You need to register your business with the federal government’s SAM, the primary database of vendors doing business with the federal government. This registration is sometimes referred to as “self-certifying” your small business. Federal Acquisitions Regulations (FAR) require all prospective vendors to be registered in SAM prior to the award of a contract, basic agreement, basic ordering agreement, or blanket purchase agreement.

Using SAM you will be able to register your business size and socio-economic status while completing the required solicitation clauses and certification. By completing your required solicitation clauses and certifications you certify that the information provided about your company and its business activities are correct.

The certification information that you will be asked on SAM is explained in the Federal Acquisitions Regulations, Section 52.212-3 Offeror’s Representations and Certifications – Commercial Items, direct link: https://www.acquisition.gov/far/current/html/52_212_213.html

Visit SAM: https://www.sam.gov/portal/SAM/##11

FINDING & RESEARCHING OPPORTUNITIES

You have many options available to represent your company to potential buyers, to research the federal marketplace for available opportunities, and understand the competition. To prepare your business for federal contracting opportunities, it is important for you to understand these resources.


SYSTEM FOR AWARD MANAGEMENT (SAM)

SAM is a marketing tool for businesses.

SAM allows Government agencies and contractors to search for your company based on your ability, size, location, experience, ownership and more. SAM also informs searchers of firms certified by the SBA under the 8(a) Development and HUBZone Programs


DYNAMIC SMALL BUSINESS SEARCH

DSBS is also a marketing tool for your business.

The Small Business Administration maintains the Dynamic Small Business Search (DSBS) database. As a small business registers in the System for Award Management (SAM), there is an opportunity to fill out your small business profile. The information provided populates DSBS. DSBS is another tool contracting officers use to identify potential small business contractors for upcoming contracting opportunities. Small businesses can also use DSBS to identify other small businesses for teaming and joint venturing.

Visit DSBS: http://dsbs.sba.gov/dsbs/search/dsp_dsbs.cfm


FEDBIZOPPS: FEDERAL BUSINESS OPPORTUNITIES

Federal business opportunities for contractors are listed at FedBizOpps: Federal Business Opportunities. Federal agencies are required to use this site to communicate available procurement opportunities and their vendor requirements to the public and interested potential vendors for all contracts valued over $25,000.

Visit FEDBIZOPPS: https://www.fbo.gov/


GSA SCHEDULES

Many government agencies establish government-wide contracts, which simplify the procurement process for federal agencies by allowing them to acquire a vast array of products and services directly from commercial suppliers.

The largest government-wide contracts are established by the U.S. General Services Administration under its GSA Schedules Program. State and local governments also use the GSA schedules for purchasing goods and services, so becoming a GSA schedule contractor can be beneficial at all levels of government.


Additional Step Required to Compete for GSA Schedules

Obtain Past Performance Evaluations

Businesses interested in getting on the U.S. General Services Administration (GSA) Schedule for contracts should obtain an Open Ratings, Inc. Past Performance Evaluation. Open Ratings, a Dun & Bradstreet Company, conducts an independent audit of customer references and calculates a rating based upon a statistical analysis of various performance data and survey responses. While some GSA Schedule solicitations contain the form to request an Open Ratings Past Performance Evaluation, vendors may also submit an online request directly to Open Ratings.

Items Needed for Registration

• Your NAICS codes

• Your Data Universal Numbering System (DUNS)

• Your Federal Tax Identification Number (TIN or EIN)

• Your Standard Industrial Classification (SIC) codes

• Your Product Service codes (optional but useful)

• Your Federal Supply Classification codes (optional but useful)

Visit GSA: http://www.gsa.gov/portal/content/202573#3


FEDERAL PROCUREMENT DATA SYSTEM

Federal Procurement Data System – Next Generation is the repository of all federal contracting data for contracts in excess of $25,000. With this system, you can learn the following about federal contracting opportunities and increase your market capability:

• Which agencies have contracts and with whom

• What agencies buy

• Which contractors have contracts

In addition, there are over 50 standard reports you can run, as well as specialized reports that allow you to request information using over 160 customized fields.

Visit FPDS-NG: https://www.fpds.gov/fpdsng_cms/index.php/en/


USASPENDING.GOV

USASpending.gov is your source for information about government spending through contracts awarded by the federal government. The website is a searchable database that contains information for each federal award, including:

• Name of the entity receiving the award

• Amount of the award

• Transaction type and funding agency

• Location of the entity receiving the award

• Unique identifier of the entity receiving the award

This information can be used to help you identify procurement trends within the federal government and potential opportunities.

Visit USASPENDING.gov: https://www.usaspending.gov/Pages/Default.aspx


OSDBU.GOV

Many federal agencies have what is known as an Office of Small and Disadvantaged Business Utilization (OSDBU) or an Office of Small Business Programs (OSBP). These offices work within their agencies to identify opportunities to incorporate small businesses as vendors to their agencies. Each agency releases a forecast of anticipated procurement activities that includes potential small business opportunities. Once you have reviewed an agency forecast and used systems like FPDS and USASpending.gov to discern if there may be opportunities at a specific agency, it can be beneficial to reach out to the OSDBU to build a relationship with the agency. Additionally, each OSDBU holds trainings and events to help small businesses identify if there are opportunities with the agency.

Visit OSDBU.org: http:/osdbu.gov/


ADDITIONAL HELP

Procurement Center Representatives

Procurement Center Representatives (PCRs) assist small businesses in obtaining federal contracts through six Area Offices across the US and its territories.

PCRs view many acquisition and procurement strategies before they are announced. This enables them to influence opportunities that should be set-aside for small business concerns including all socio-economic categories of 8(a) (Small Disadvantaged Businesses), Women-Owned Small Businesses (WOSB), Economically Disadvantaged WOSB (EDWOSB), Service-connected Disabled Veteran-Owned Small Businesses (SDV), and Historically Underutilized Business Zone (HUBZone) small businesses. As a result of this privilege they fall under the Procurement Integrity Act (PIA) and cannot divulge pre-solicitation information.

Among other activities, PCRs increase the small business share of federal procurement awards by:

• Initiating small business concern category set-asides;

• Conducting market research for small business sources to assist Federal buying activities;

• Assisting small business concerns with contracting issues or payment issues;

• Counseling small firms on understanding the Federal contracting process;

• Advocating for the breakout of items previously acquired under full and open competition to be set-aside for small business concerns.

Visit Southeast PCR Directory: https://www.sba.gov/content/pcr-directory-area-3


The contacts for Florida PCRs are listed below including activities covered.

MR. SCOTT NIRK

Procurement Center Representative
U.S. Small Business Administration
Office of Government Contracting, Area III
South Florida District Office
100 S. Biscayne Blvd. 7th Floor
Miami, FL 33131
Tel: (305) 536-5521, x158
Fax: (305) 536-5058
Email: scott.nirk@sba.gov

ACTIVITIES COVERED

  • ACC 410th CSB – Miami, FL
  • Dept. of the Air Force, 482nd Fighter Wing/Contracting Flight – Homestead ARB, FL
  • Dept. of Homeland Security, U.S. Coast Guard, Civil Engineering Unit Miami, – Miami, FL
  • Joint Interagency Task Force South (JIATFS) – Key West, FL
  • U.S. Dept. of State, Regional Procurement Support Office, Florida Regional Ctr. – Fort Lauderdale, FL
  • U.S. Dept. of Veterans Affairs – Bay Pines, FL
  • U.S. Dept. of Veterans Affairs, Acquisition Service Area Office East 8 – Miami, FL

MS. ARLEEN L. BOYD-ALSTON

Procurement Center Representative
U.S. Small Business Administration
Office of Government Contracting, Area III
NAVFAC Bldg. 902, 2nd Floor
Box 30 Naval Air Station
Jacksonville, FL 32212
Tel: (904) 542-6220
Fax: (202) 481-2755
Email: arleen.boyd-alston@sba.gov

ACTIVITES COVERED

  • U.S. Army Corps of Engineers – Jacksonville, FL
  • NAVSUP Fleet Logistics Center Jacksonville – Jacksonville, FL
  • Navy Facilities Engineering Command Southeast – Jacksonville, FL
  • Navy Field Engineering & Acquisition Division (NAVFAC ROICC) – Pensacola, FL
  • Navy Field Engineering & Acquisition Division (NAVFAC-SE PWD) – Pensacola, FL
  • Naval Hospital – Jacksonville, FL
  • U.S. Property and Fiscal Office for Florida (USPFO-FL) – St. Augustine, FL
  • Dept of Veteran Affairs Hospital- Gainesville, FL
  • NAVSEA SERMC- Mayport, FL

MR. THOMAS VAN HORN

Procurement Center Representative
U.S. Small Business Administration
Office of Government Contracting, Area III
Naval Air Warfare Center – Training Systems Division
12350 Research Blvd.
Orlando, FL 32826-3224
Tel: (407) 380-8210
Fax: (407) 380-8232
Email: thomas.vanhorn@sba.gov

ACTIVITIES COVERED

  • 6th Contracting Squadron – MacDill AFB, FL
  • 45 CONS – Patrick AFB, FL
  • AFISRA/A7KR Contracting Activity – Patrick AFB, FL
  • NASA Kennedy Space Center- Titusville, FL
  • Naval Air Warfare Center, Training Systems Division Orlando (NAWCTSD) – Orlando, FL
  • USSOCOM HQ – MacDill AFB, FL
  • U.S. Army PEO STRI – Orlando, FL
  • U.S. Dept. of Veterans Affairs – Tampa, FL
  • U.S. Dept. of Veterans Affairs – Orlando, FL

SUBCONTRACTING

For some small businesses, subcontracting to a Prime Vendor is a great way to “get a foot in the door” of government contracting.


SUB-NET

The SUB-Net database is a listing of subcontracting solicitations and opportunities posted by large prime contractors and other non-federal agencies. SUB-Net has been used by state and local governments, non-profit organizations, colleges and universities, and even foreign governments to post solicitations and identify small businesses.

Subcontracting to a prime government contractor can be a good way to participate in the contracting process. Large businesses with prime contracts exceeding $650,000 (except for construction, which is $1.5 million) must provide a plan with subcontracting opportunities for all categories of small business.

To find subcontracting opportunities, go to SUB-Net, SBA’s database, where you will be able to review the site to identify subcontracting opportunities that are in your area of expertise. It’s easy to search by all solicitations or simply by entering in the NAICS Code of the industry you are interested in searching for a subcontract.

Visit Sub-net: http://web.sba.gov/subnet/search/index.cfm


SUBCONTRACTING OPPORTUNITIES DIRECTORY

The SBA obtains the names and addresses for this listing from subcontracting plans that are submitted to the Government when a large business receives a Federal contract over $650,000.

Visit FL Directory: https://www.sba.gov/content/subcontracting-opportunities-dc-ga#fl

Additional Help

The Commercial Market Representative (CMR)’s will counsel small businesses on how to market their products and services to the prime contractors in this directory. The contact for Florida CMR is below.

SBA, South Florida District Office
100 S. Biscayne Blvd. 7th Floor
Miami, FL 33131
Tel: (305) 536-5521, x158
Fax: (305) 536-5058
Email: Scott.Nirk@sba.gov


SMALL BUSINESS SET ASIDE

Small business set-asides are a powerful tool for helping small businesses compete for and win federal contracts. Every year, the federal government purchases approximately $400 billion in goods and services from the private sector. When market research concludes that small businesses are available and able to perform the work or provide the products being procured by the government, those opportunities are “set-aside” exclusively for small business concerns.

There are many different types of set-asides. Some are open to all small businesses; others are open only to small businesses with certain designations.


CONTRACT VALUE

A set-aside is based, in part, on the value of the goods or services that the government is looking to purchase.

$3,500 – $150,000

Every federal government purchase with an anticipated value above the micro-purchase threshold of $3,500, and up to the Simplified Acquisition Threshold (SAT) of $150,000, is required to be automatically and exclusively set-aside for small businesses. There must be at least two or more (Rule of Two) responsible small business concerns that are competitive in terms of market prices, quality, and delivery for an automatic set-aside to occur.

$150,000+

Contract opportunities above the SAT of $150,000 shall also be set aside if the Rule of Two is met.

$1.5M

Construction Contracts opportunities over $1.5M, awarded to Other-than-Small-Businesses (OTSBs), must have small business subcontracting plans to the extent there are subcontracting opportunities. A small business subcontracting plan establishes subcontracting goals for small businesses, small disadvantaged businesses, HUBZone, veteran-owned, service-disabled veteran-owned and women-owned small businesses.


PRIME CONTRACT GOALS

The Federal government has specified annual prime contracting goals for designated small businesses. The current, government-wide procurement goal stipulates that at least 23% of all federal government contracting dollars should be awarded to small businesses. In addition, targeted sub-goals are established for the following small business categories:

• Women Owned Small Business – 5%

• Small Disadvantaged Business – 5%

• Service Disabled Veteran Owned Small Business – 3%

• HUBZone – 3%


SET ASIDE AND SOLE SOURCE PROGRAMS

Government contracts can be set-aside for small businesses in the following certification programs and socio-economic categories:

• 8(a) Business Development

• HUBZone Program

• Women Owned Small Business (WOSB) Program (includes Economically Disadvantaged Women Owned Small Business (EDWOSB) concerns)

• Service Disabled Veteran Owned Program (SDVO)

In addition, there are sole source development opportunities under the 8(a) program and sole source conditional opportunities under the HUBZone, SDVOSB, and WOSB programs.


8(a) Business Development Program

The 8(a) Business Development Program is a business assistance program for small disadvantaged businesses. The 8(a) Program offers a broad scope of assistance to firms that are owned and controlled at least 51% by socially and economically disadvantaged individuals.

The 8(a) Program is an essential instrument for helping socially and economically disadvantaged entrepreneurs gain access to the economic mainstream of American society. The program helps thousands of aspiring entrepreneurs to gain a foothold in government contracting.

Eligibility

To qualify a small business shall qualify for both of the following:

1. Socially Disadvantaged– those who have been subjected to racial or ethnic prejudice or cultural bias within American society because of their identification as members of groups without regard to their individual qualities. Following are socially disadvantaged presumed groups.

• Black Americans

• Hispanic Americans

• Native Americans

• Asian Pacific Americans

• Subcontinent Asian American

2. Economically Disadvantaged- those who are socially disadvantaged individuals

whose ability to compete in the free enterprise system has been impaired due to diminished capital and credit opportunities. The following are required to determine eligibility.

• Narrative statement of economic disadvantage

• Personal financial information (including tax returns and certain SBA forms)


HUBZone Program

The Historically Underutilized Business Zones (HUBZone) program was enacted into law as part of the Small Business Reauthorization Act of 1997. The program encourages economic development in historically underutilized business zones – “HUBZones” – through the establishment of preferences.

SBA’s HUBZone program is in line with the efforts of both the Administration and Congress to promote economic development and employment growth in distressed areas by providing access to more federal contracting opportunities.

Eligibility

Your business must be located in an area designated as a Historically Underutilized Business (HUB) Zone. You may determine if an address or a particular area is designated as a HUBZone by using the HUBZone Maps.

Visit HUBZone Map: http://map.sba.gov/hubzone/maps/

Current HUBzone qualified FL counties.

Calhoun

Hendry

Dixie

Putnam


Women-Owned Small Businesses (WOSB) Program

The WOSB Federal Contract Program was implemented in February 2011 with the goal of expanding the number of industries where WOSB were able to compete for business with the federal government. This program enables Economically Disadvantaged WOSBs (EDWOSBs) to compete for federal contracts that are set-aside for EDWOSBs in industries where women-owned small businesses are underrepresented. It also allows set-asides for WOSBs in industries where women-owned small businesses are substantially underrepresented. Regarding construction this includes the following industries.

• Residential Building Construction

• Nonresidential Building Construction

• Utility System Construction

• Highway, Street, and Bridge Construction

• Other Heavy and Civil Engineering Construction

• Foundation, Structure, and Building Exterior Contractors

• Building Equipment Contractors

• Building Finishing Contractors

• Other Specialty Trade Contractors


Service-Disabled Veteran-Owned Program (SDVO)

The purpose of this program is to provide procuring agencies with the authority to set acquisitions aside for exclusive competition among service-disabled veteran-owned small business concerns, as well as the authority to make sole source awards to service-disabled veteran-owned small business concerns if certain conditions are met.

Eligibility

• The Service Disabled Veteran (SDV) must have a service-connected disability that has been determined by the Department of Veterans Affairs or Department of Defense

• The SDVOSBC must be small under the North American Industry Classification System (NAICS) code assigned to the procurement

• The SDV must unconditionally own 51% of the SDVOSBC

• The SDVO must control the management and daily operations of the SDVOSBC

• The SDV must hold the highest officer position in the SDVOSBC


IMPORTANT CONTRACTING RULES & LIMITATIONS

Subcontracting Limitations

Under set-aside award conditions, small businesses are required to perform minimum levels of work when they receive a federal contract. These subcontracting limitations apply to contract set-asides for small businesses when the contract amount exceeds $150,000, and all other set aside or sole source contracts under the 8(a), HUBZone, SDVOSB or WOSB programs.

Service Contracts: The small business prime contractor must provide at least 50% of the contract cost for personnel.

General Construction Contracts: The small business prime contractor must perform at least 15% of the cost of the contract with its own employees, not including the cost of materials.

Specialty Construction Contracts: The small business prime contractor must perform at least 25% of the cost of the contract with its own employees, not including the cost of materials.

Under the HUBZone, SDVOSB or WOSB Programs the small business prime contractor can utilize similarly situated subcontractors to meet these performance requirements.

Under the HUBZone program, there are higher performance requirements for construction contracts.


CONTRACTING REGULATIONS FOR SMALL BUSINESSES

Winning a federal contract also means complying with laws and regulations unique to those doing business with the government. Many new contractors, especially small businesses, are unprepared for the rules and regulations they must follow, which can lead to costly errors and potential legal problems.

PROCUREMENT REGULATIONS

Government contracts are different from commercial contracts in many important ways. Federal contracts contain or reference many provisions unique to the government. These references point to the FAR.

The Federal Acquisition Regulation (FAR) is a substantial and complex set of rules governing the federal government’s purchasing process. Its purpose is to ensure purchasing procedures are standard and consistent, and conducted in a fair and impartial manner.

The FAR is issued and maintained jointly under the statutory authorities granted to the Secretary of Defense, Administrator of General Services and the Administrator, National Aeronautics and Space Administration. Statutory authorities to issue and revise the FAR have been delegated to the Procurement Executives in DoD, GSA and NASA.

It is important to understand FAR.

There are many costly pitfalls if you don’t take the time to understand the provisions in your contract, which often reference areas of the FAR.

Visit FAR: https://www.acquisition.gov/?q=browsefar


CONCLUSION

The material presented gives a general overview of government contracting as well as the steps required to register and prepare your business for contracting for the government.

Preparing for Government work may seem a confusing process filled with many hours of reviewing regulations and preparing documentation. And its true many business shy away from government contracting work for this reason. However, it’s essential to note that different government agencies are always offering work, regardless of economic times. They will always be there which maybe especially vital during times of recession when other typical commercial work declines.

At the very least, ensure you visit Fedbizopps.com and research any potential opportunities you may be interested in. Also, if you think you may qualify for small business set-aside, you should really consider government contracting as your potential to win and be awarded contracts is greatly increased.

There is a wealth of information out there to prepare any small business including small business representatives who will assist you in getting government contracts.

For more information, please visit the following sites:

https://www.acquisition.gov/

https://www.regulations.gov

https://www.acq.osd.mil/dpap

https://www.business.gov

https://www.sba.gov/services/training


REFERENCES

SBA.gov, Contracting 

SBA.gov, Getting Started as a Government Contractor

SBA.gov, Finding Government Customers

SBA.gov, Resources for Small Business 

SBA.gov, Government Contracting Programs