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7:478

CONTRACT CLAUSES AND SOLICITATION PROVISIONS

(e) Identification of Areas of Performance. Each offeror desiring to be considered for award as a LSA concern on the set-aside portion of this procurement shall identify in Section B of his offer the geographical areas in which he proposes to perform, or cause to be performed, a substantial proportion of the contract. If the Department of Labor classification of any such area changes after the offeror has submitted his offer, the offeror may change the areas in which he proposes to perform, provided that he so notifies the Contracting Officer before award of the LSA set-aside portion. Such offerors are instructed to

insert in the clause entitled “Eligibility for Preference as a Labor Surplus Area Concern" in Section B of the solicitation, the address(es) where costs incurred on account of manufacturing or production (by offeror or first tier subcontractor) will amount to more than fifty percent (50%) of the contract price,

CAUTION: Failure to list the location of manufacture or production and the
percentage of cost to be incurred at each location in the space provided in the
clause entitled "Eligibility for Preference as a Labor Surplus Area Concern" set
forth in Section B of the solicitation will preclude consideration of the offeror as
a LSA concern.

(f) Requirements Contract. Only one award will be made for each item or sub-item of the nonset-aside portion and only one award will be made for each item or sub-item of the set-aside portion. For the purpose of equitably distributing orders in accordance with this "Notice of Partial Small Business Set-Aside," the Government will apportion the quantities to be ordered as equally as possible between the non-set-aside Contractor and the set-aside Contractor to whom the awards are made.

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7-2003.4 Notice of Combined Small Business-LSA Set-Asides. In accordance with 1-706.7(d)(1) or (2), insert the clause in (a) or (b) below.

(a)

NOTICE OF COMBINED SMALL BUSINESS-LABOR SURPLUS AREA SET-ASIDE (1978 JUN)

(a) General.

(1) Offers under this procurement are solicited from small business concerns only and the procurement is to be awarded only to one or more small business concerns. This action is based on a determination by the Contracting Officer, alone or in conjunction with a representative of the Small Business Administration, that it is in the interest of maintaining or mobilizing the Nation's full productive capacity, in the interest of war or national defense programs, or in the interest of assuring that a fair proportion of the Government procurement is placed with small business concerns. Offers received from firms which are not small business concerns shall be considered nonresponsive and shall be rejected.

7-2003.4

ARMED SERVICES PROCUREMENT REGULATION

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7:479

CONTRACT CLAUSES AND SOLICITATION PROVISIONS

(2) Part of this procurement, identified in the solicitation as the “labor surplus area (LSA) set-aside portion," has been further set aside for award only to one or more LSA concerns, which are also small business concerns, and, to a limited extent, to small business concerns which do not qualify as LSA concerns. Award of the LSA set- aside portion will be made after awards have been made on the non LSA set-aside portion.

(b) Definitions.

(1) A “small business concern” is a concern, including its affiliates, which is independently owned and operated, is not dominant in the field of operation in which it is making an offer on Government contracts, and can further qualify under the criteria set forth in the regulations of the Small Business Administration (CFR Title 13, Section 121.3-8). In addition to meeting these criteria, a manufacturer or a regular dealer submitting offers in his own name must agree to furnish in the performance of the contract, end items manufactured or produced by small business concerns; provided, that this additional requirement does not apply in connection with construction or service contracts.

(2)

(3)

Labor Surplus Area. The term "labor
surplus area" means a geographic area
which at the time of award is classified
as such by the Secretary of Labor in
the Department of Labor "Listing of
Eligible Labor Surplus Areas Under
Defense Manpower Policy 4A and
Executive Order 10582".

Labor Surplus Area Concerns. The term
"labor surplus area concern" means a
concern that agrees to perform or cause
to be performed a substantial proportion
of a contract in labor surplus areas.
A concern shall be deemed to perform a
substantial proportion of a contract in
labor surplus areas if the aggregate
costs that will be incurred by the
concern or its first tier subcontractors
on account of manufacturing or produc-
tion performed in labor surplus areas
amount to more than 50% of the contract
price.

7-2003.4

ARMED SERVICES PROCUREMENT REGULATION

7:480

CONTRACT CLAUSES AND SOLICITATION PROVISIONS

(c) Procedures.

(1) Determining Eligibility:

(i) To be eligible to participate in the LSA set-aside portion of this procurement, a labor surplus area concern which is also a small business concern (or a small business concern to the extent indicated below) must submit a responsive offer on the non LSA set-aside portion.

(ii) The Government reserves the right not to award to any concern submitting a token offer on the non LSA set-aside portion or attempting by any other device to secure an unfair advantage over other offerors.

(2) Determining Priority for Award: Labor surplus concerns which are also small business concerns and other small business concerns eligible under (1) above will participate in the setaside in the following order of priority:

Group 1. Small business concerns which are also labor surplus area (LSA)

concerns.

Group 2. Small business concerns which are not labor surplus area (LSA)

concerns.

Within each of the above groups, offers on the LSA set-aside portion will be requested from concerns in the order of their offers on the non LSA set-aside portion, beginning with the lowest responsive offer. Concerns may offer less than the total LSA set-aside portion.

(3) Determining the LSA set-aside award price:

(1) General Rule. Subject to the exceptions listed in (ii) and (iii) below, awards under the LSA set-aside shall be made at the highest unit price for each item awarded on the non LSA set-aside, adjusted to reflect transportation, rent free use of Government property and other cost factors considered in evaluating offers on the non LSA set-aside portion. The LSA set-aside award price shall be subject to the same discount terms used in the evaluation of the highest non LSA set-aside award price.

(ii) Award Price Involving Foreign End Products (see ASPR Section VI).

(A) When the highest award price on the non LSA set-aside is established by an award for a foreign end product, the award price for the LSA setaside portion shall be the award price on the non LSA set-aside as adjusted in evaluating the offer submitting the foreign end product for award under applicable Buy American procedures, except for awards on the LSA set-aside to concerns offering foreign end products, in which case the general rule applies.

(B) Award under the LSA set-aside to a concern offering a foreign end product, when the highest award price on the non LSA set-aside portion is established by an award to a firm offering a domestic source end

7-2003.4

ARMED SERVICES PROCUREMENT REGULATION

CONTRACT CLAUSES AND SOLICITATION PROVISIONS

product, shall be at a price which, after application of the evaluation
factors used under Buy American procedures for determining eligibility
of a foreign end product for award, is equal to the highest award price
on the non LSA set-aside portion, adjusted to reflect transportation and
other factors considered in evaluating the offers.

(iii) Obtaining Offers and Processing LSA Set-aside Awards.
(A) When an unaccepted low offer is not involved:

if there is no unaccepted low offer meeting the criteria in (B) below,
eligible concerns in the order of priority in (2) above will be requested
to offer on the LSA set-aside quantity at the highest unit price awarded
on the non LSA set-aside portion. Concerns may offer less than the
total LSA set-aside portion. If any part of the LSA set-aside portion is
not taken by eligible concerns, the partial LSA set-aside is automati-
cally dissolved as to the unawarded portion. Such unawarded portion
may be procured by advertising or negotiation, as appropriate, in ac-
cordance with existing regulations.

(B) When an unaccepted low offer is involved:

if(I) a responsive offer is submitted on the non LSA set-aside portion at a unit price which, when adjusted, is lower than the adjusted highest unit price awarded on the non LSA set-aside portion, but cannot be accepted (e.g., because of “all-or-none” or other quantity limitations, or because the offeror is nonresponsible), and (II) at the time of negotiation for the LSA set-aside portion, the offer could be accepted (e.g., because the LSA set-aside quantity is large enough that the quantity limitations could be complied with, or because the offeror has now become responsible), then the following procedures shall be followed. Step One. Eligible concerns (in the order of priority in (2) above) will be requested to offer at the adjusted unit price of the unaccepted offer, a quantity of the LSA set-aside portion equal to the quantity of the unaccepted offer.

Step Two. If no eligible concern is willing to take the entire quantity of the unaccepted offer, then all eligible concerns (in the order of priority in (2) above) shall be requested to make offers on any lesser portion at the same price, until either the entire quantity is awarded or all eligible concerns refuse any further portions of such quantity.

Step Three.

Case 1. If the unaccepted offer was submitted by a concern not eligible to participate in the LSA set-aside, and if any of the quantity under Step Two is not awarded, then it and all other remaining quantities of the LSA set-aside portion must be withdrawn and resolicited. If the entire quantity under Step Two is awarded among eligible concerns, Steps Four, Five and Six are applicable to the remaining LSA set-aside portion.

Case 2. If the unaccepted offer was submitted by a concern eligible to participate in the LSA set-aside, Steps Four, Five and Six are applicable to the remaining LSA set-aside portion regardless of whether any quantity under Step Two is not awarded after all eligible concerns have been afforded an opportunity to offer on the unaccepted quantity. However, the concern which submitted the unaccepted offer shall be eliminated from consideration under Step Four and Step Five, for award at higher prices, unless that concern first accepts a quantity of the LSA set-aside portion equal to the entire quantity of its unaccepted offer at the adjusted price of its offer.

Step Four. In case there is more than one unaccepted offer which meets the conditions of (I) and (II) above, Steps One, Two and Three above shall be applied with respect to the quantities of each such offer in turn, from lowest price to highest.

Step Five. Eligible concerns in the order of priority in (2) above will be requested to offer, at the highest unit price awarded on the non LSA set-aside portion on any quantity of the LSA setaside portion, remaining after Steps One, Two, Three and Four have been completed.

Step Six. If the entire LSA set-aside portion is not taken by eligible concerns pursuant to Steps One through Five above, the partial LSA set-aside is automatically dissolved as to the unawarded portion and such unawarded portion may be procured by advertising or negotiation as appropriate, in accordance with existing regulations.

7-2003.4

ARMED SERVICES PROCUREMENT REGULATION

7:482

CONTRACT CLAUSES AND SOLICITATION PROVISIONS

(d) Agreement. The offeror agrees that if awarded a contract as a small business LSA concern under the set-aside portion of this procurement, he will perform or cause to be performed a substantial proportion of the contract in areas classified at the time of award or at the time of performance of the contract as LSA.

(e) Identification of Areas of Performance. Each offeror desiring to be considered for award as a LSA concern on the LSA set-aside portion of this procurement shall identify in Section B of his offer the geographical areas in which he proposes to perform, or cause to be performed, a substantial proportion of the contract. If the Department of Labor classification of any such area changes after the offeror has submitted his offer, the offeror may change the areas in which he proposes to perform, provided, that he so notifies the Contracting Officer before award of the LSA set-aside portion. Such offerors are in

structed to insert in the clause entitled "Eligibility for Preference as a Labor Surplus Area Concern" in Section B of the solicitation, the address(es) where costs incurred on account of manufacturing or production (by offeror or first tier subcontractor) will amount to more than fifty percent (50%) of the contract price.

CAUTION: Failure to list the location of manufacture or production and the percentage of cost to be incurred at each location in the space provided in the clause entitled "Eligibility for Preference as a Labor Surplus Area Concern" set forth in Section B of the solicitation will preclude consideration of the offeror as a LSA concern.

(f) Requirements Contract. Only one award will be made for each item or sub-item of the non LSA set-aside portion and only one award will be made for each item or sub-item of the LSA setaside portion. For the purpose of equitably distributing orders in accordance with this "Notice of Combined Small Business - Labor Surplus Area Set-Aside," the Government will apportion the quantities to be ordered as equally as possible between the non LSA set-aside Contractor and the LSA set-aside Contractor to whom the awards are made.

(End of clause)

7-2003.4(b)

(b)

NOTICE OF COMBINED SMALL BUSINESS-LABOR SURPLUS AREA SET-ASIDE ALTERNATE (1978 JUN)

(a) General.

(1) Offers under this procurement are solicited from small business concerns only and the procurement is to be awarded only to one or more small business concerns. This action is based on a determination by the Contracting Officer, alone or in conjunction with a representative of

7-2003.4

ARMED SERVICES PROCUREMENT REGULATION

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