PF 2020-04 Civilian Agency Acquisition Council (CAAC) Letter 2019-01 Supplement 1, Supplement to the Class Deviation from the Federal Acquisition Regulation Regarding Limitations on Subcontracting for Small Business Concerns

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DATE: October 7, 2020

SUBJECT: Civilian Agency Acquisition Council (CAAC) Letter 2019-01 Supplement 1, Supplement to the Class Deviation from the Federal Acquisition Regulation Regarding Limitations on Subcontracting for Small Business Concerns

TO: HCAs/Procurement Directors/Contracting Officers
FROM: Director, Contract and Financial Assistance Policy Division, Office of Policy, Office of Acquisition Management

SUMMARY: 

The subject CAAC letter supplement revises and supersedes CAAC letter 2019-01 issued on April 3, 2019. CAAC letter 2019-01 provided agencies a model class deviation to implement regulatory changes made by SBA to limitations on subcontracting in its final rule, pending publication of the formal amendment to the FAR via FAR case 2016-011. The class deviation updated the limitations on subcontracting and the nonmanufacturer rule for all small businesses in the clauses relating to set-asides and sole source awards under FAR part 19 for: (1) Small business concerns; (2) 8(a) Program participants; (3) Historically Underutilized Business Zone (HUBZone) small business concerns; (4) Service-disabled veteran-owned small business (SDVOSB) concerns; (5) Economically disadvantaged women-owned small business (EDWOSB) concerns; and (6) Women-owned small business (WOSB) concerns eligible under the WOSB Program. The Department of Energy issued its resulting class deviation on July 25, 2019.

CAAC letter 2019-01 supplement 1 was issued on July 2, 2020 to provide agencies a supplement to the model class deviation discussed above. The supplement was issued after FAR case 2014-002, Set-Asides under Multiple Award Contracts, was released as a final rule effective March 30, 2020. FAR case 2014-002 substantially changed FAR part 19 and the clauses related to FAR part 19 awards. The supplement updates the limitations on subcontracting and the nonmanufacturer rule for all small businesses in the clauses relating to awards under FAR part 19. Rulemaking to formally incorporate these changes is in progress. Pending publication of the amendment to the FAR via FAR case 2016-011, Revision of Limitations on Subcontracting, the Department of Energy authorizes a class deviation to implement the updates contained in the attached Findings and Determination document.

The DOE class deviation and CAAC letter 2019-01 supplement 1 with FAR Deviation clauses and instructions are attached.

Questions concerning this policy flash should be directed to Sharon Archer of the Contract and Financial Assistance Policy Division at sharon.archer@hq.doe.gov.

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