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    In the past this requirement has been solicited and awarded to Pest Control Companies under NAICS 325320 Pesticide and other agricultural chemical manufacturing Bus Size 1000Empl. However I believe this requirement should be solicited under NAICS Code 326199 all Other Plastics Products Manufacturing Business Size 500Empl, in accordance with FAR 19.102 (d ) Size standards which states when acquiring a product or service that could be classified in two or more industries with different size standards, contracting officers shall apply the size standard for the industry accounting for the greatest percentage of the contract price. If I solicit using the NAICS code for plastics what would happen if the vendor with the best quote turns out to actually be a pesticide company and they are not listed in SAM under the NAICS code for plastics? Would the vendor have to add this NAICS code to their SAM record or are they eligible for award on a small business set aside so long as they meet the size standards under the NAICS code for award ? Would the vendor need to add the new NAICS code in SAM to be eligible for award on an unrestricted procurement?


    Answer

    Based on the FAR reference submitted with Background, FAR 9.102(d), you must apply the size standard for the industry accounting for the greatest percentage of the price. However, prior to paragraph (d), FAR 9.102(a) states: "The SBA establishes small business size standards on an industry-by-industry basis. Paragraph (b) further states: "Small business size standards are applied by (1) classifying the product or service being acquired in the industry whose definition, as found in the NAICS manual, best describes the principal nature of the product or service being acquired." Based on the Background information, the principal nature or purpose of these traps is to detect and monitor pest infestations. The rationale given to change the NAICS is because the traps are made of plastic corrugated sheets which makes the plastic the major component of the traps. Although this is true, the plastic traps without the insecticide glue could not be used for detecting and monitoring pest infestations which indicates that the NAICS assigned for Pesticide and other Agricultural Chemical manufacturing is most indicative of the "principal nature of the product or service being acquired". The use of the word "quote" in the question implies that this requirement is being solicited under FAR Part 13 Simplified Acquisition Procedures. If this is the case and the $ value is not anticipated to exceed $25K, then FAR 19.102 (f) (7) allows a non-manufacturer to supply the product or service of any size manufacturer as longs as the end product is produced/manufactured in the U.S.
     

    FAR19.303(a) makes it mandatory for the Contracting Officer (CO) to determine the appropriate NAICS code and related small business size standard and include in solicitations exceeding $3000. Paragraph (c) further states that the CO's determination is final unless appealed. DFARS 219.303 makes it mandatory for DoD COs to follow the procedures for "Correctly Identifying Size Status of Contractors" in the DPAP memo dated July 21, 2010. To specifically address the questions:
     
    *  FAR/DFARS does not specifically address what would happen if NAICS code was changed and vendor under different NAICS code submitted the best quote.
    *  FAR/DFARS does not specifically address whether vendor would have to add new/changed NAICS to their SAM record. However the DPAP memo requires contracting officers to review a vendor's completed provisions in ORCA (now SAM) to determine the small business size standard relating to the appropriate NAICS code of a vendor when FAR provision 52.204-8 or 52.212-3 is included in the contract. If these provisions are not included, then COs must review the offeror's responses to 52.219-1 in their proposal to determine the size status on associated awards. Each of those provisions relates the size standard to the NAICS code when the contractor is registered in ORCA (now SAM).
     
    Although the DPAP memo does not apply to the submitter, the FAR provisions do apply to all federal agencies. Therefore if the provisions are applicable to the solicitation, then the small business size status must relate to the appropriate NAICS code. It is suggested that the submitter consult their agency level and local level regulations for any additional guidance specifically applicable to the USDA.


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