What authority do I have to force the Randolph Sheppard act to only choose subcontractors (Blind vendors) who operate as a small business when the rulings conclude that RSA preference takes precedence over less-specific statutes such as HUBZone and the Randolph Sheppard Act does not require that the Blind Vendor operate as a small business? (52.219-8 - Utilization of Small Business Concerns, 52.219-9-Small Business Subcontracting Plan, 52.219-16 Liquidated Damages-Subcontracting Plan?
Q1: "Therefore, can I conclude that the blind licensee is not required to be a small business under the law?"
A1: Yes, you can conclude that they are NOT required to be a small business. It is not a requirement of the Randolph-Sheppard Act that a vendor be a small business.
Q2: "What authority do I have to force the Randolph Sheppard act to only choose subcontractors (Blind vendors) who operate as a small business when the rulings conclude that RSA preference takes precedence over less-specific statutes such as HUBZone and the Randolph Sheppard Act does not require that the Blind Vendor operate as a small business?"
A2: Your authority to "force" the State Licensing Agency (SLA) to provide only small business vendors to satisfy the requirement, or conversely, to force the selected vendor to provide a small business subcontract plan, is limited. There is nothing written in the Randolph-Sheppard Act (RSA) specifically concerning subcontracting or subcontracting plans. First, to clarify a point, the RSA does not choose subcontractors, the State Licensing Agency (SLA) issues the blind vendor a “license”. The Prime contract is between the SLA and the Federal agency. If there are more than one eligible blind vendor, they may compete for the agency requirement. Additionally, the SLA must apply for a permit to operate on a DoD installation. Once issued, the blind vendor has priority unless the interests of the U.S. are adversely affected. [DODI 1125.03, encl 2]. As a result, the contracting officer does not appear to have any authority or influence regarding the size of the vendor(s) selected by the SLA to perform the contract.
15 U.S.C. §§ 631-657 (Chapter 14A)-Aid to Small Business (a.k.a. The Small Business Act) and 20 U.S.C. §§ (107-107f) (Chapter 6A)-Vending Facilities for Blind in Federal Buildings (a.k.a The Randolph Sheppard Act) have separate and distinct requirements. There does not appear to be an exclusion in the Small Business Act for the state licensing agency vendors under the RSA to provide a small business subcontracting plan. The prescriptions for each clause do need to be carefully considered though because there may be a likelihood that the Randolph-Sheppard Act contracts won’t offer subcontracting possibilities. Otherwise, the vendor is a "business entity" and we select clauses consistent with the FAR.
If a vendor believed they were being adversely limited by the provisions and clauses they could seek relief in arbitration (see e.g. HAWAII v. ARMY ARBITRATION DECISION https://www2.ed.gov/programs/rsarsp/arbitration-decisions/r-s-16-07.pdf). The arbitration decision could be appealed to the United States District Court and subsequently to the United States Court of Appeals.
I could find no precedent (administrative or judicial) that precludes the agency from including 52.219-8, 52.219-9, and 52.219-16 in solicitations and contracts. There do appear to be options to press upon the SLA the importance of including small businesses.
Possible approaches the contracting officer could take:
1. Include within the solicitation a statement along the lines of: "This acquisition will be competed as a small business set-aside and is held under the authority of the Randolph-Sheppard Act (RSA). Offerors should understand that the RSA agency (SLA) is given preference if within the competitive range." [see similar approach by GAO in Intermark, B-290925, 2002). This approach recognizes the different controlling authorities (RSA & FAR) but does not resolve the subcontracting plan issue.
2. Look to solicitation examples in the System for Award Management (SAM): https://sam.gov/opp/87be0ae9c7e730756571ce6b15eea535/view (see section M of the solicitation)and https://sam.gov/opp/d1a62db2402044f1997720c28504695d/view] (see proposal instructions on page 23). This approach resolves the subcontracting plan if the vendor signs the contract. The contracting officer may then hold the vendor to the terms. Left undetermined is what occurs if the vendor refuses the inclusion of the clauses. Arbitration would be the likely outcome.
3. Contact the Head of the DoD Component for specific guidance and assistance. Particularly since this area has been subject to dispute and litigation. Consequently, authoritative decisions rendered by the US Department of Education and the GAO must be reconciled with DoD and Component policy. An authoritative response, tailored to the particular State where the work is to be performed and the specific details of prior administrative and judicial decisions can best be rendered by the Component's counsel.