Sole-source justifications for small-business contracts made permanent
Agencies have been under an interim rule requiring them to justify many small-business sole-source awards. Now the rule has become final.
Agencies should get used to justifying many sole-source contracts that they award to small business.
Regulatory officials announced the revision to the Federal Acquisition Regulation on April 18. It requires an agency to make public the justification for an 8(a) small business sole-source contract prior to awarding it. The justification is required for awards worth more than $20 million, according to a Federal Register notice published on April 18.
The fiscal 2010 National Defense Authorization Act required the regulatory change. The justifications have been required under an interim rule since March 2011.
The justifications must include what the contract provides the agency and that it’s paying a fair price, the agency’s reason for avoiding competition, and proof that it is in the agency’s best interest.
The law doesn’t specify at which stage the agency needs to justify the decision, but officials wanted it come out before the contract negotiations begin.