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NAICS Codes - Large Business


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I had an interesting situation come up that I can't say I have dealt with before in my 10 years as a CS.  A sole source requirement is being done to a large business who is registered in SAM but not have any NAICS codes listed.  Must a vendor have a NAICS code listed in SAM in order to receive a federal contract?  Funny how the little things seem to never come up for us!

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37 minutes ago, thecontractingguy said:

Must a vendor have a NAICS code listed in SAM in order to receive a federal contract?

Apologies in advance for answering your question with questions, but have you thought about the purpose and function of NAICS codes (specifically in relation to federal contracting)?  Also, where would you find information that explains why a prospective contractor may not be able to receive a federal contract and is there a NAICS requirement there?

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At my federal agency, we will not award a contract to a vendor not registered and current in SAM, and their SAM record must show the NAICS/size for the pending procurement.  This is regardless of set aside or no set aside, and regardless of appropriated or non appropriated funding.

Now, under most circumstances, I notify vendor and allow time for them to input a specific missing NAICS.

EB

 

 

 

 

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1 hour ago, baierle said:

At my federal agency, we will not award a contract to a vendor not registered and current in SAM, and their SAM record must show the NAICS/size for the pending procurement.  This is regardless of set aside or no set aside, and regardless of appropriated or non appropriated funding.

Now, under most circumstances, I notify vendor and allow time for them to input a specific missing NAICS.

EB

 

I understand the requirement for current registration in SAM, but where does your agency's requirement for a particular NAICS code listing come from?

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I've seen similar practices, to baierle's, based on reads of 52.219-1 and 52.204-8.

For example -- If FAR 52.204-8 is in the solicitation and a firm does not have the NAICS code in SAM, arguably, the firm must submit a separate reps & certs or update SAM with the NAICS and associated certifications.

Why? Because 52.204-8 states that the offeror verifies that their [reps & certs] are current, accurate, complete, and applicable to this solicitation (including the business size standard applicable to the NAICS code referenced for this solicitation).

I've seen practitioners use this in responsibility determinations or to suggest that a firm that does not have the applicable NAICS is not awardable under the solicitation.

Not sure if any related protest decisions exist.

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Guest Vern Edwards
18 hours ago, baierle said:

At my federal agency, we will not award a contract to a vendor not registered and current in SAM, and their SAM record must show the NAICS/size for the pending procurement.  This is regardless of set aside or no set aside, and regardless of appropriated or non appropriated funding.

On what grounds? See Trade Links General Trading and Contracting, WLL, GAO B-412364.3, July 1, 2016, footnote 11:

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Trade Links also disputes Al–Tahouna's eligibility for award because it did not certify that it was a small business under the applicable North American Industry Classification System (NAICS) code for this procurement in the System for Award Management (SAM). See Protest at 7; Comments at 2, 11. The Small Business Administration (SBA) establishes small business size standards-expressed as either a maximum number of employees or annual receipts in millions of dollars-on an industry-by-industry basis. FAR §19.102(a)(1). SBA identifies the size standards using North American Industry Classification System (NAICS) codes. 13 C.F.R. §121.201. The FAR provides that size standards are “applied” by classifying the product or service being acquired under the NAICS code that best describes it; identifying the size standard SBA established for that industry; and specifying the size standard in the solicitation so that offerors can appropriately represent themselves as large or small. FAR §19.102(b). The solicitation here, however, was issued on an unrestricted basis. RFP at 1.

The protest was denied.  See also SRD Architects, GAO B-412498, 2016 CPD ¶ 63, Feb. 25, 2016. From the digest:

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SRD Architects, a small business located in Anaheim, California, challenges the selection for negotiations of AGS, Inc., a small business located in San Francisco, California, pursuant to solicitation/synopsis No. N62473–15–R–2417, issued by the Naval Facilities Engineering Command Southwest, Capital Improvements Contract Core, for architectural design and engineering services. The protester argues that the agency should have found AGS ineligible for award because at the time AGS submitted its qualifications statement, AGS had a different primary North American Industry Classification System (NAICS) code than the code required by the solicitation.

That protest was denied, too. See also Gaver Industries, Inc., dba Barker & Barker Paving, GAO B-412428, 2016 CPD ¶ 57, Feb. 9, 2016.

Those decisions tell me that a NAICS  code in the SAM registration is not essential for an offeror to be eligible for award. SRD Architects says its not essential even even under a set-aside and even when the solicitation expressly calls for it.

If anyone thinks I'm wrong, tell me why, and please cite a statute, regulation, or protest decision.

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Thanks, Bob and Vern.

From SRD Architects:

"The FAR provides that size standards are “applied” by classifying the product or service being acquired under the NAICS code that best describes it … so that offerors can appropriately represent themselves as large or small … So long as a company meets the applicable size standard, we are aware of no statutory or regulatory requirement that it have the particular NAICS code identified in the solicitation as its primary code.  High Plains Computing, Inc. d/b/a HPC Solutions, B-409736.2, Dec. 22, 2014, 2014 CPD ¶ 379 at 6-7. "

"Here, the record shows that the contract specialist had a reasonable basis upon which to conclude that [the awardee] AGS was eligible for award under the size standard associated with the solicitation … Additionally, even to the extent that the solicitation itself went beyond the requirements of statute and regulation in imposing a requirement that the prime firm have 541310 as its primary NAICS code, there was nothing in the solicitation to indicate that this requirement could not be satisfied up to the date of award."

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To add to Vern's references and going back to the OP's question.    Let's not confuse doing a reps and certs as required by all offerors  versus doing a reps and certs to say the firm is a small business or not.

Consider reading FAR 52.204-8 Annual Representations and Certifications.   The provision requires the offeror to do one of two things, indicate that it's annual reps and certs ( the business has in SAM)  apply or that the certs and reps for the individual procurement apply and so certify.  Noting the discussion thread the firm certifies one way or the other to the NAICS code in the solicitation.   If they do not check either block in the provision then that is another issue that must be addressed. 

In my view GAO did not get to the point which in my view is a firm certifies to the NAICS in the solicitation, whether full and open, set-aside, and/or sole/single source.   So to the contractingguy's OP they can certify to the NAICS even if they do not have it in their SAM profile.   The real question becomes is the firm responsible to perform work in that code?

I believe baierle's agency is off base.  Would be interesting on what basis they have taken the position they have.

 

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