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I recently saw a briefing that advocated using socio-economic status (e.g., business size) as a primary factor for selecting an FSS vendor for a services task order. In effect, an SDVOSB firm would receive an 'outstanding' rating, other SBs an 'excellent' rating, and LB concerns a ?fair? rating. Moreover, business size was the highest evaluation factor. FAR 8.405-5 advises that ordering activities may consider socio-economic status, but, given that FAR 19 doesn't apply to GSA orders and the exception at 19.202-1(e) is not implied, this seems a somewhat disingenuous representation of an agency?s need. I?m sure the underlying strategy is intended to comply with the FAR while clearly establishing a preference for small businesses. While it may be legal, I have difficulty accepting the premise that business size could, or should be a more important factor than technical capability, or a similar factor that actually has some measure of price parity. Has anyone else encountered this within their agency, or seen any guidance on the inclusion of such a factor for FSS buys? Thanks.

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I recently saw a briefing that advocated using socio-economic status (e.g., business size) as a primary factor for selecting an FSS vendor for a services task order. In effect, an SDVOSB firm would receive an 'outstanding' rating, other SBs an 'excellent' rating, and LB concerns a ?fair? rating. Moreover, business size was the highest evaluation factor. FAR 8.405-5 advises that ordering activities may consider socio-economic status, but, given that FAR 19 doesn't apply to GSA orders and the exception at 19.202-1(e) is not implied, this seems a somewhat disingenuous representation of an agency?s need. I?m sure the underlying strategy is intended to comply with the FAR while clearly establishing a preference for small businesses. While it may be legal, I have difficulty accepting the premise that business size could, or should be a more important factor than technical capability, or a similar factor that actually has some measure of price parity. Has anyone else encountered this within their agency, or seen any guidance on the inclusion of such a factor for FSS buys? Thanks.

Yes, I've seen it, recommended KOs use it, and seen GSA recommend it.

http://blogs.gsa.gov/blogs/servicesorderin...ile/not-tie.pdf

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Yes, I've seen it, recommended KOs use it, and seen GSA recommend it.

http://blogs.gsa.gov/blogs/servicesorderin...ile/not-tie.pdf

GSA recommends it because GSA authored it. The paper addresses the content of the briefing but doesn't establish the basis for actually determining 'best value' when using socio-economic status as a primary factor. Is it prudent to award at a 20-30% price premium simply to (presumably) attain a specific small business goal? Doubtful. It appears the logic advanced in the paper is actually incongruent (in spirit, anyway) with GSA's FAR 19 exemption status.

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Not the author but I've seen what you are talking about. GSA recommends it because we have a PIN (Procurement Implementation Notice) that says we cannot do set-asides under FAR Part 8, but instead have to apply a preference for the appropriate small business class, if that's what is desired. In order to give the preference, you have to evaluate it so it becomes a factor that no one can be found unacceptable under. Personally I disagree with it being the primary evaluation factor and I haven't seen it used that way in my office. Usually we have language that says something like "between proposals that are found to be technically equal, and reasonably the same in cost, preference will be given to the vendor with the higher rating in the Socio-Economic Factor". Reasonably the same in cost gets defined (often as within a certain percentage of each other based on anticipated value of procurement) in the RFQ.

The rating system in teh socio-ecomonic factor is usually Excellent if you are in the targeted group (SDVOSB, WOSB, 8(a), etc); good if you are a small business but not in the Excellent Group and Acceptable if you are anyone else. To date, no one's complained about it to either the Agency or GAO if that's a measure of validity.

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