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contractor100

cascading procurement - does VA have authority?

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VA establishing a MAC.  Award of the contract will be made using a "tiered evaluation," in which Tier 1 is evaluated first, if not enough awards can be made in Tier 1, evaluation will move to Tier 2 and so on.  The task orders under the contract will be awarded using the same scheme.  

Tier 1 - SDVOSBs that team/subcontract exclusively with SDVOSBs and VOSBs

Tier 2 - SDVOSBs that team/subcontract with Small Businesses (Other than SDVOSBs

and VOSBs), Joint Ventures that include Small Businesses

Tier 3 - SDVOSBs that team/subcontract with Large Businesses, Joint Ventures that

include Large Businesses

Does VA have to have statutory authority to do this?  Do they?

 

Maybe here?

 

38 U.S. Code § 8127

(i)Priority for Contracting Preferences.—Preferences for awarding contracts to small business concerns shall be applied in the following order of priority:

(1)
Contracts awarded pursuant to subsection (b), (c), or (d) to small business concerns owned and controlled by veterans with service-connected disabilities.
(2)
Contracts awarded pursuant to subsection (b), (c), or (d) to small business concerns owned and controlled by veterans that are not covered by paragraph (1).
(3)Contracts awarded pursuant to—
(A)
section 8(a) of the Small Business Act (15 U.S.C. 637(a)); or
(B)
section 31 of such Act (15 U.S.C. 657a).
(4)
Contracts awarded pursuant to any other small business contracting preference.

thanks for any thoughts.
 

 

 

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1 hour ago, contractor100 said:

Does VA have to have statutory authority to do this?  Do they?

What makes you think that they need specific statutory authority to conduct a procurement in a certain way? Why ask a question like this?

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It appears that agencies must have specific statutory authority to use tiers or cascades:

Quote

13 CFR 125.2 - What are SBA's and the procuring agency's responsibilities when providing contracting assistance to small businesses?

(e) Multiple Award Contract 

(7) Tiered evaluation of offers, or cascading. An agency cannot create a tiered evaluation of offers or “cascade” unless it has specific statutory authority to do so. This is a procedure used in negotiated acquisitions when the contracting officer establishes a tiered or cascading order of precedence for evaluating offers that is specified in the solicitation, which states that if no award can be made at the first tier, it will evaluate offers at the next lower tier, until award can be made. For example, unless the agency has specific statutory authority to do so, an agency is not permitted to state an intention to award one contract to an 8(a) BD Participant and one to a HUBZone SBC, but only if no awards are made to 8(a) BD Participants.

Unquote

https://www.law.cornell.edu/cfr/text/13/125.2

 

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napolik:

Have you checked to see if VA has such statutory authority? Note that the scheme described involves mainly VOSBs.

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I have been searching, and this is the best I could do, so far .

PUBLIC LAW 109–461—DEC. 22, 2006 appears to give the VA authority to do cascades. Specifically,

Quote

§ 8127. Small business concerns owned and controlled by veterans: contracting goals and preferences

‘‘(i) PRIORITY FOR CONTRACTING PREFERENCES.—Preferences for awarding contracts to small business concerns shall be applied in the following order of priority:

‘‘(1) Contracts awarded pursuant to subsection (b), (c), or (d) to small business concerns owned and controlled by veterans with service-connected disabilities.

‘‘(2) Contracts awarded pursuant to subsection (b), (c), or (d) to small business concerns owned and controlled by veterans that are not covered by paragraph (1).

‘‘(3) Contracts awarded pursuant to— ‘‘(A) section 8(a) of the Small Business Act (15 U.S.C. 637(a)); or ‘‘(B) section 31 of such Act (15 U.S.C. 657a).

‘‘(4) Contracts awarded pursuant to any other small business contracting preference.

Unquote

https://www.va.gov/ogc/docs/pl109-461.pdf

These priorities appear in a 2016 VA solicitation:

Quote

The proposed acquisition will be an unrestricted acquisition. Please note that this Pre-Solicitation notification informs the Small Business Community of the VA's proposed acquisition and its intent to use a cascading method for selection. Construction & Facilities Management will advertise an announcement./Request for SF330s nationwide for locations listed but not limited to Lake Worth, FL, Elwood, IL, Phoenix, AZ, Bushnell, FL, Holly, MI, Bourne, MA, San Antonio, TX, Montevallo, AL, Houston, TX. Cascading Method for Small Business Awards In accordance with FAR Subpart 19 and PL 109-461, award under this solicitation will be made on a competitive basis from a cascading method as defined below who submits a technically acceptable (as evaluated by Technical Evaluation Board), responsive offer (qualified, responsible, and meets minimum technical requirements), with a fair and reasonable price (determined by Contracting Officer), provided that there is adequate competition among such offerors. a) If there is inadequate competition and/or if the offeror does not meet our requirement based on our best value criteria for award to a SDVOSB concern, award will be made competitively to an eligible Veteran Owned Small Business (VOSB) concern. b ) If there is inadequate competition and/or if the offeror does not meet our requirement based on our best value criteria for award to a VOSB concern, award will be made competitively to an eligible 8a, HubZone, or a Woman Owned business concern. c) If there is inadequate competition and/or if the offeror does not meet our requirement based on our best value criteria for award to a 8a, HubZone, or a Woman Owned business concern, award will be made competitively to an eligible small business concern IAW FAR 19.5.

Unquote

https://oppex.com/notice/FBO_4ca6b4ec54319c9cf4a9eabb591a269d

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The cascading order matches exactly what's in 38 U.S. Code § 8127 (the statute at issue in Kingdomware) by putting SDVOSBs first, but I don't see where that statute says they explicitly do a cascading procurement but I am prob. wrong

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Sorry, our emails crossed.  Still don't see how that's an authorization.  

I don't see an explicit authorization in the VA supplement, not like the one in the DFARS.

 

215.203-70  Requests for proposals – tiered evaluation of offers.

 

      (a)  The tiered or cascading order of precedence used for tiered evaluation of offers shall be consistent with FAR Part 19.

 

      (b)  Consideration shall be given to the tiers of small businesses (e.g., 8(a), HUBZone small business, service-disabled veteran-owned small business, small business) before evaluating offers from other than small business concerns.

 

      (c)  The contracting officer is prohibited from issuing a solicitation with a tiered evaluation of offers unless—

 

              (1)  The contracting officer conducts market research, in accordance with FAR Part 10 and Part 210, to determine—

 

                    (i)  Whether the criteria in FAR Part 19 are met for setting aside the acquisition for small business; or

 

                    (ii)  For a task or delivery order, whether there are a sufficient number of qualified small business concerns available to justify limiting competition under the terms of the contract; and

 

              (2)  If the contracting officer cannot determine whether the criteria in paragraph (c)(1) of this section are met, the contracting officer includes a written explanation in the contract file as to why such a determination could not be made (Section 816 of Pub. L. 109-163).

 

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Quote

An agency cannot create a tiered evaluation of offers or “cascade” unless it has specific statutory authority to do so.

PUBLIC LAW 109–461—DEC. 22, 2006 appears to give the VA authority to do cascades.

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The VAAR does address priorities that can be translated into tiers or cascades.

This citation appears to be the device for implementing the legislation:

Quote

819.7004 Contracting Order of Priority.

In determining the acquisition strategy applicable to an acquisition, the contracting officer shall consider, in the following order of priority, contracting preferences that ensure contracts will be awarded:

(a) To SDVOSBs;

(b) To VOSB, including but not limited to SDVOSBs;

(c) Pursuant to—

(1) Section 8(a) of the Small Business Act (15 U.S.C. 637(a)); or

(2) The Historically-Underutilized Business Zone (HUBZone) Program (15 U.S.C. 657a); and

(d) Pursuant to any other small business contracting preference.

Unquote

Also see this:

Quote

815.304-70  Evaluation factor commitments.

(a) VA contracting officers shall:

(1) Include provisions in negotiated solicitations giving preference to offers received from VOSBs and additional preference to offers received from SDVOSBs;

(2) Use past performance in meeting SDVOSB subcontracting goals as a nonprice evaluation factor in selecting offers for award;

(3) Use the proposed inclusion of SDVOSBs or VOSBs as subcontractors as an evaluation factor when competitively negotiating the award of contracts or task or delivery orders; and

(4) Use participation in VA’s Mentor-Protégé Program as an evaluation factor when competitively negotiating the award of contracts or task or delivery orders.

(b) If an offeror proposes to use an SDVOSB or VOSB subcontractor in accordance with 852.215–70, Service-Disabled Veteran-Owned and Veteran-Owned Small Business Evaluation Factors, the contracting officer shall ensure that the offeror, if awarded the contract, actually does use the proposed subcontractor or another SDVOSB or VOSB subcontractor for that subcontract or for work of similar value.

Unquote

 

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The last little bit:

Quote

PUBLIC LAW 109-461

On December 22, 2006, President Bush signed Public Law (P.L.) 109-461, The Veterans Health Care, Benefits and Information Technology Act of 2006. This law directs the Secretary of Veterans Affairs to “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.S.C. § 8128(a). To implement the Veterans Benefits Act, VA established the “Veterans First Contracting Program” on June 20, 2007. See AR 38-540 to 541 (New Guidelines for Placing Items and Services on the AbilityOne Procurement List (Apr. 28, 2010) (“New Guidelines”)). The program directed VA to consider service-disabled veteran-owned small businesses (“SDVOSB”) and veteran-owned small businesses (“VOSB”) as a first and second priority when satisfying its acquisition requirements. Id. at 38-541. A final implementing rule establishing changes to the Department’s acquisition regulations was made effective January 7, 2010. See 74 Fed. Reg. 64619-01 (Dec. 8, 2009) (codified in scattered sections of 48 C.F.R. Subparts 802, 804, 808, 809, 810, 813, 815, 817, 819, 828, and 852).

VA’S IMPLEMENTATION OF PUBLIC LAW 109-461

In 2006, Congress created the Veteran First contracting program to help provide preference to small businesses owned by veterans and service-disabled veterans over other companies. VA was charged with putting procedures in place to verify the ownership and status of the companies that wanted to participate in Veterans First. The VA has failed time and time again to follow the “Veterans First” law, which establishes set aside guidelines for service-disabled veteran-owned small businesses. While the GAO has investigated and agreed with the protest’s claims, an internal memo from the VA dated October 17th makes the assertion that since the GAO is part of the legislative branch, the VA is not bound by their findings and that the courts would decide the issue.. The memo goes on further to state that “GAO recommendation does not change how VA will acquire goods and services in support of its mission.”

On October 26, 2010, the United States Court of Federal Claims (USCFC) set precedence on behalf of all SDVOSB / VOSB, when it ruled in favor of Angelica Textile Services, Inc., in the case of Angelica Textile Services, Inc., v. United States (10-496C) . The Federal Court decision confirmed that veterans have a contract preference and priority. Here are some excerpts from the court ruling :

• “The Veterans Benefits Act is a specific mandate to the Department, and only to the Department, to grant first priority to SDVOSBs and VOSBs in the awarding of contracts.”
• Above “any other provision of law” such as FAR Part 8 Required Sources of Supply
• Above “any other provision of law” such as FAR Part 19.14;
• Above general federal statues and initiatives
• In all market types such federal supply schedules and open market;
• Exclusively within the VA under 8127 (b), (c), or (d) and 8128

Unquote

https://www.legion.org/legislative/testimony/160365/va’s-service-disabled-veteran-owned-small-business-certification

 

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Wasn't questioning whether VA is required to give first priority to the named groups in the order listed in the statute. Of course they do.  Was questioning whether this statute is specific authorization to use a cascading procurement, per the SBA reg. Perhaps 8127 only means that the preferences must be applied in order to select which category to set aside a procurement for.

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The VA seems to be split in it's interpretation of it's interpretation of "Cascading Authority"

1 interpretation is that it doesn't explicitly give authority in 38 U.S.C. so 13 CFRs prohibition applies to the VA. 

The other interpretation is that 38 U.S.C. does give authority. 

13 CFR was written because tiered evaluation of offers inhibits competition and the SBA promotes competition.  38 U.S.C. Requires the VA to restrict competition to SDVOSB/VOSBS when the rule of two can be applied.  I'm not sure 13CFR would apply, but I don't know who the authority would be.  I was told OMB was the driver behind removing tiered evaluations from regulations but it would be nice if there was a list stating which agencies do have authority to conduct tiered evaluations.  I think they could be very useful in the case of the VA. 

If the contracting officer has a reasonable expectation that two or more SDVOSBs will make an awardable offer they would set-aside the procurement.  If no offers were received or an award couldn't be made at a fair and reasonable price the set-aside would have to be dissolved and then potentially re-set-aside to VOSBs and so on and so forth until an award could be made to a SB concern or otherwise.  If the tiered evaluation was structured properly it would save a lot of administrative burden to the contracting officers.

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Bare Walls,

Cascades cause industry to make proposals that they may have no chance of ever being considered for.  That convience and procurement time saved for the CO means risking proposal costs for the contractors and many would not bid in a cascade scheme for just that reason.  A lot depends on the complexity of the proposal needed and thus the cost of submitting it.

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