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  • Question

    The contract period is nearing an end. the current contractor installed contractor owned security cameras and monitoring equipment. Is it lawful to continue service with this contractor rather than solicit for a new contract and possibly getting a different contractor? A different contractor would mean new equipment installation costs, etc.


    Answer

    Traditionally when we have a contract that is coming to the end of its period of performance we have to start the acquisition process to determine how the Government will proceed with putting a new contract in place. This is done by competitively soliciting the requirement.

    Based upon the type of service you are requiring I will make an assumption that market research will show there multitude of small businesses that could provide this type of security/monitoring service to the government, so you would have a robust small business pool if you compete the requirement.

    If the current contractor is a small business registered in the 8(a) program then you could do a sole source contract to them based upon FAR 19.805-1(a)(2)

    19.805 -- Competitive 8(a).

    19.805-1 -- General.

    (a) Except as provided in paragraph (b) of this section, an acquisition offered to the SBA under the 8(a) program shall be awarded on the basis of competition limited to eligible 8(a) participants when--

    (1) There is a reasonable expectation that at least two eligible and responsible 8(a) participants will submit offers and that award can be made at a fair market price; and

    (2) The anticipated total value of the contract, including options, will exceed $7 million for acquisitions assigned manufacturing North American Industry Classification System (NAICS) codes and $4 million for all other acquisitions.

    Now FAR 19.805-1(a)(2) tells us that that if your contract, including options, is greater than $7 million for acquisitions assigned manufacturing NAICS and $4 million for all other acquisitions you would use competitive procedures.

    Now knowing that, we can also safely infer the opposite of what FAR 19.805-1(a)(2) states; we can sole source contracts less than $7 million for acquisitions assigned manufacturing NAICS and $4 million respectively under the 8(a) program.

    Your acquisition would fall under the $4 million (all other acquisitions) if your requirement is less than $4 million and the current contractor is in the 8(a) program.

    I personally have used this many times to quickly sole source requirements (services) on contract that were less than $4 million under the 8(a) program. The only drawback is that once the requirement is in the 8(a) program it stays there.

    Otherwise if your contract value exceeds $4 million then you would have to compete the requirement most likely among small businesses.

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