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  1. Good Morning, Here is the scenario, a sources sought we sent out, a total of 7 responses were received: 2 SDVOSB's, 1 SMALL BIZ, and 4 Large Business. Under the VHA the "Rule of 2 Applies" therefore we did have two SDVOSB's respond with capabilities statements etc. However, the 2 SDVOSB's were then asked if they could comply with the "limitations on subcontracting as they apply to a set-aside" (i.e. SDVOSB must be able to perform 50% of the work and maintain 50% of the revenue". SDVOSB "A" states that they could meet the limitations on sub-contracting (i.e. they seemed the less capable of the 2 SDVOSB's however based on the info they provided to the sources sought, past contracts they have performed on etc.) SDVOSB "B" originally responded stating that they could comply, however they then replied afterword and stated after a more thorough review of the requirement they would be unable to comply with the limitations on sub-contracting due to the large IT component which is involved which would require them to further subcontract this portion out (i.e. SDVOSB "B" based on the past contracts they have been awarded and performed on appeared to be the more capable of the 2 SDVOSB's). We were originally going to solicit SDVOSB's as a set aside and meet the rule of 2, however due to one of the SDVOSB's stating they could not meet the limitations on subcontracting this just left us with one SDVOSB, and one Small. Currently, the program office SME is evaluating these two for strengths and weaknesses. However, regardless, all of these small businesses state they will have to partner with a large business in order to meet this requirement. Currently, the incumbent is a large biz. This is a fairly large contract greater than 15 million value, therefore FAR part 15 will be utilized, IPT etc. However, currently it appears based on our market research which is showing it is very unlikely SDVOSB "A" who states they can meet the limitation of sub-contracting actually can. This is based on the stronger SDVOSB who has performed multiple contracts of this type and magnitude stating they would not be able to. Also, the weaker of the SDVOSB's "A" has not performed on any contracts of this large scope, the largest they performed on was a $1.5 million contract. We are waiting for the strengths and weaknesses from the SME as well. Based on the current situation and info, I believe it is best we move forward with an unrestricted solicitation and solicit full and open, as I believe our market research will support the conclusion that although SDVOSB "A" states they can meet the limitations on sub contracting, in all actual reality they cannot based on all of the reasons I have stated above. Therefore, this would only leave us with a SMall, and we would not be able to meet the Rule of 2, thus solicit unrestricted "Full and open" Please provide your thoughts and strategies you would take regarding this situation. Kind Regards, J
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