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FAR clause 52.219-27, Notice of Service Disabled Veteran-Owned Small Business Set Aside, states that SDVOSB concerns providing products as manufacturers agree that at least 50 percent of the costs of manufacturing will be performed by the concern or other SDVOSB concerns. The record, as described above, shows that the Air Force conducted ample market research in connection with its decision to set aside the acquisition for SDVOSB, including: (1) issuing a sources sought notice and questionnaire; (2) identifying potential small business offerors using available government contractor databases; (3) surveying those businesses regarding their socioeconomic status; and (4) contacting contracting officials at other Air Force bases to discuss recently conducted procurements for similar aircraft services. VA255P657SC1615, and the exercise of an option under that task order, by the Department of Veterans Affairs (VA) to Live Process, Inc., of Madison, New Jersey, under that firms Federal Supply Schedule (FSS) contract. 8127-28 (2006), requires the VA to consider setting aside a procurement for SDVOSBs, or veteran-owned small businesses (VOSB), before procuring its requirements under the FSS.

25274 (May 5, 2004) (The law limits use of SDVOSB procurement authority to procurements that would not otherwise be made from Federal Prison Industries (section 4124 or 4125 of title 18, United States Code) or the [JWOD] Act (41 U. In addition, the FAR addresses the priorities for use of certain mandatory sources and the use of other sources, such as the GSAs FSS. In response, the FAR Council stated that [t]he use of FSS is not required and the use of FSS is not mandatory; however, agencies are encouraged to consider using certain existing non-mandatory sources before considering sources in the open market. Thus, there is nothing in statute or regulation stating that it is unlawful for an agency to issue an SDVOSB sole-source award when the requirement could be satisfied through an order under the FSS, as long as all conditions for a sole-source award are met. Market Research The Small Business Act states that an agency may issue a sole-source SDVOSB award if the contracting officer does not have a reasonable expectation that 2 or more small business concerns owned and controlled by service-disabled veterans will submit offers for the contracting opportunity. AR, Tab 4, Justification for Other than Full and Open Competition; Tab 5, Market Research. 7, 2015, 2015 CPD 28 at 4; Hydroid LLC, B-299072, Jan. Here, the protester argues that publicly available information, but not anything on the face of ARG Tacticals proposal, calls into question its SDVOSB status. The record shows that the agency reviewed ARG Tacticals quotation and SAM profile prior to award, and both showed that ARG Tactical represented that it was an SDVOSB. Nonetheless, the agency maintains that because it needs a minimum of 14 contracts, the number of SDVOSB concerns capable of performing the required work was insufficient to meet its needs. Nothing in the language of the VA Act supports the agencys position that in the context of multiple-award contracts, the VA Acts Rule of Two requires set asides only when there will be two or more SDVOSB or VOSB offers per contract. We recognize it is within the agencys discretion to determine the number of IDIQ contracts required to satisfy its needs. that the A/E shall visit proposed project site, as required . Under the Veterans Benefits, Health Care, and Information Technology Act of 2006, 38 U. We conclude that the agencys market research and resulting set-aside decision were reasonable. See DNO Inc., B-406256, B-406256.2, March 22, 2012, 2012 CPD 136 at 4. Further, this Office has stated that an agency may issue an SDVOSB sole-source award even where another SDVOSB exists that could conceivably perform the contract, but has expressed no interest in the work. 28, 2007, 2007 CPD 55 at 7; see also Chicago Dryer Co., B-401888, Dec. 8127, and the VAs implementing regulations, VA Acquisition Regulation, 48 C. Further, as indicated above, the contract specialist, in a database search specifically directed by the contracting officer, found more than 127 profiles of SDVOSB concerns nationwide matching the criteria. Thus, it appears that had the agency expanded its market research beyond the VISN 20 region it would have discovered numerous SDVOSB A/E concerns doing fire protection work. B-411552: Aug 20, 2015) (pdf) IOVC asserts that the VA failed to perform sufficient market research to ascertain the interest and capability of SDVOSBs [service-disabled veteran-owned small business] to perform the requirement. 30, 2012, 2012 CPD 333 at 3; Buy Rite Transp., B-403729, B-403768, Oct. The requirements of the 2006 VA Act do not dictate the use of any particular methodology in assessing the availability of SDVOSB firms to perform a requirement; measures such as prior procurement history, market surveys, advice from the agencys small business specialist, and information concerning prospective offerors business history and capability or capacity may all provide a reasonable basis for a decision to set aside, or not set aside, a requirement for SDVOSBs. but will not exceed ,000,000; and (3) in the estimation of the contracting officer, the contract award can be made at a fair and reasonable price that offers best value to the United States. The agency responds that only one SDVOSB expressed an interest in a long term contract for the combat knives. The determination as to whether an agency expects two or more SDVOSBs to submit an offer is a matter of business judgment within the contracting officer's discretion that we will not disturb absent a showing that it was unreasonable. 819.7004, 819.7005, the VA is required to set aside acquisitions for [service-disabled veteran-owned small business] SDVOSBs whenever it determines that there is a reasonable expectation that offers will be received from at least two SDVOSB firms and that award can be made at a fair and reasonable price. Thus, the record here does not support the agencys determination to limit its market research to firms within the VISN 20 region. Crosstown Courier Serv., Inc., B-410936, March 12, 2015, 2015 CPD 107 at 4; Crosstown Courier Serv., Inc., B-407404, Nov. Triad Isotopes, Inc., B-411360, July 16, 2015, 2015 CPD 220 at 7. First, there must be a reasonable expectation that at least two SDVOSBs will submit an offer (or, in the case here, a quotation). The record supports the contracting officers finding regarding the common ownership of Aero Sage and Sage Care. (Aero Sage LLC B-414314, B-414314.2: May 5, 2017) The protester argues that the sole-source award to ARG Tactical, an SDVOSB, is unlawful[because] the requirement could be satisfied through an order under the [FSS]. The agency states that the Veterans Benefit Act of 2003 and implementing regulations provide a contracting officer with the discretion to issue an SDVOSB sole-source award. In addition, the agency reasonably considered the fact that two SDVOSBs had previously been unable to perform the incumbent contract. Under the Veterans Benefits, Health Care, and Information Technology Act of 2006, 38 U. The CO also considered the procurement history for the incumbent, small business set-aside contract. The agency explains that it did not set aside the solicitation for the incumbent contract, or a similar procurement for courier services in Iowa, for SDVOSB concerns because the pricing received from SDVOSB concerns in response to those solicitations exceeded the independent government estimate by an average of 212% and 163%, respectively. Additionally, the VA was concerned that awarding the contract to a SDVOSB concern not located in Minnesota could result in excessive subcontracting in violation of the limitation on subcontracting provisions at FAR clause 52.219‑27(d) and VAAR clause 852.219-10(c). Under these circumstances, we find the VAs market research and set-aside determination to be reasonable. In addition, the exceptions set out in subsections (b) and (c) of section 8127 use the discretionary term may, in contrast to subsection (d)s use of the mandatory term shall. See Aldevra, supra, at 5 (explaining that FAR subpart 19.14--the only subpart within FAR Part 19 that addresses set-asides for SDVOSBs--implements the requirements of the Veterans Benefit Act of 2003, which applies government-wide, and not the 2006 VA Act, which applies only to VA procurements). 8128(a)--a separate subsection of the VA Act, which provides, in its entirely, as follows:(a) Contracting priority.--In procuring goods and services pursuant to a contracting preference under this title or any other provision of law, the Secretary [of the VA] shall give priority to a small business concern owned and controlled by veterans, if such business concern also meets the requirements of that contracting preference.38 U. Where, as here, the protester is challenging the terms of the solicitation, and the remedy sought is the opportunity to compete under a revised solicitation, the protester is an interested party, even if it did not submit a quotation or offer. (Kingdomware Technologies, B-405727, December 19, 2011) (pdf) MICCI argues that because it offered a lower price than Seawolf, the [Department of Veterans Affairs] VA was required under the class deviation to VAAR sect. sections 3551-3556 (2006), only an "interested party" may protest a federal procurement. Where the nonmanufacturing rule applies to a procurement and the agencys market research fails to consider whether the firms identified in the market research can comply with the rule, the market research is unreasonable. As shown above, the VA Acts Rule of Two has two prongs. Under these circumstances, we will not question her judgment that the dual requirements of the VA Acts Rule of Two were not met. The agency did further market research by reviewing the websites of SDVOSB firms with the relevant NAICS code to investigate whether these firms perform valet parking services. 8127, and the VAs implementing regulations, VA Acquisition Regulation Supplement (VAAR), 48 C. See AR, Tab 4, Market Research Report, at 1-2; Tab 5, Minnesota Market Research. The phrase explains the purpose for the mandate, which is to meet the goals established under subsection (a); however, the phrase does not create an exception to the mandate. Despite this lack of rulemaking, the VA now claims blanket discretion to define the scope of procurements to which the statutory mandate applies. With respect to the VAs previously-raised argument that our Office should defer to its 2009 rulemaking that stated that the FAR language in Part 19 applies to the SDVOSB set-aside program created by the VA Act, the VAs conclusions in that rulemaking were refuted by the express language of the FAR section upon which the VA relies. (Aldevra, B-406205, Mar 14, 2012) (pdf) The VA contends that Kingdomware has not been prejudiced by the agency's corrective action because the protester had the opportunity to submit a quotation in response to the revised FSS solicitation and chose not to do so. The VA also argues that, because the protester did not submit a quotation, it is not an interested party to further challenge the procurement. Under the Competition in Contracting Act of 1984, 31 U. Kingdomware also timely objected to the VA's proposed corrective action, arguing that in accordance with the 2006 VA Act the VA was required to perform market research to determine whether an SDVOSB set-aside was appropriate. In sum, consistent with our decision in Aldvera, we conclude that the 2006 VA Act requires that the agency make a determination whether an acquisition should be set aside for SDVOSB concerns prior to conducting a procurement using FSS procedures.

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