FAR Council considers justifying sole-source awards

Congress demands a good reason for awarding a contract worth $20 million or more without hosting a competition for the work

The Federal Acquisition Regulatory Council will host meetings in October to discuss rule changes on justifying large sole-source contracts to small businesses, including Alaska Native Corporations.

Because lawmakers ultimately want sole-source contracts to be beneficial for the government, the fiscal 2010 National Defense Authorization Act passed by Congress last year said an agency must have good reasons for awarding a contract worth $20 million or more without hosting a competition for the work.

The law mandates that an agency describe the contract and why it’s circumventing the competitive process. Members of Congress said they want to know that a company is offering a reasonable price and stressed the need for justification that the sole-source award is worthwhile for the government.

In addition, the law states that an agency must make the justification public within two weeks.

Agencies can award the large contracts through the Small Business Administration’s 8(a) business development program. Regulations enable contract awards to be made to socially and economically disadvantaged small businesses, even businesses owned by Indian tribes and ANCs.

In the notice, FAR Council members said they believe talking with Indian and native Alaskan tribal leaders will be valuable as they debate how to institute the new law.

Acquisition rules that allow set-aside contracts for ANCs and similar unique set-asides are a point of contention in the contractor community, and even Congress has questioned their unique status.

Many contractors say ANCs get more than their share of contracts while the ANCs say the government is obligated to help them, especially economically.

The FAR council has not set specific dates for the meetings, which will be held in Washington, D.C.; Albuquerque, N.M.; and Fairbanks, Alaska.

About the Author

Matthew Weigelt is a freelance journalist who writes about acquisition and procurement.

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