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CONTRACT CLAUSES AND SOLICITATION PROVISIONS

7:491

(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) when 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-set-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 Labor Surplus Area 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.

(End of clause)

7-2003.5(b)

(b)

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

(a) General. Part of this procurement, identified in the Schedule as the "set-aside portion", has been set aside for preferential award to one or more labor surplus area (LSA) concerns, and, to a limited extent, to other business concerns which do not qualify as LSA concerns. Award of the set-aside portion will be made after awards have been made on the non-set-aside portion. (b) Procedures.

(1) Determining Eligibility.

(A) To be eligible to participate in the set-aside portion of this procurement, a concern must submit a responsive offer on the non-set-aside portion.

(B) The Government reserves the right not to award to any concern submitting a token offer on the non-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 and other business concerns eligible under (1) above will participate in the set-aside in the following order of priority:

Group 1. LSA concerns which are also

small business concerns.

A concern in this group which has received an award on the non-setaside portion of an item shall first be requested to offer the same percentage of the set-aside portion. If a percentage of the set-aside portion of the item remains to be awarded, a drawing by lot shall determine the order of priority within this group for negotiations for the balance of the item.

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CONTRACT CLAUSES AND SOLICITATION PROVISIONS

Group 2. Other LSA concerns.

If a quantity of an item remains unawarded after negotiations have been completed with concerns in Group 1, the same procedure shall be followed for Group 2.

Group 3. Small business concerns which are not LSA concerns.

If a quantity of an item remains unawarded after negotiations with concerns in Group 2, the same procedure shall be followed for Group 3. Group 4. Other business concerns which are not LSA concerns.

If a quantity of the item remains unawarded after negotiations with concerns in Group 3, the same procedure shall be followed for Group

4.

(3) Determining the Set-Aside Award Price.

(A) General Rule.

Subject to the exceptions listed in (B) and (C) below, awards under the
set-aside shall be made at the highest unit price for each item awarded
on the non-set-aside, adjusted to reflect transportation, rent free use of
Government property and other cost factors considered in evaluating
bids on the non-set-aside portion. When any one of separate quantities
offered on an item cannot be accepted without awarding other quanti-
ties of that item at higher prices, the weighted average price shall be
used to determine the highest unit price for award if the highest award
of the non-set-aside portion of an item was made on such a conditioned
offer. When offers on the non-set-aside portion tie-in two or more items
so that an award cannot be made for a quantity on one item without a
concurrent award of a quantity on another item, such tie-in conditions
will be disregarded and the price offered for each quantity under each
item shall be considered separately. The set-aside award price shall be
subject to the same discount terms used in the evaluation of the highest
non-set-aside award price.

(B) Award Price Involving Foreign End Products, (see ASPR Section VI).
(i) When the highest award price on the non-set-aside is
established by an award for a foreign end product, the award
price for the set-aside portion shall be the award price on the
non-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 set-aside to concerns of-
fering foreign end products in which case the general rule ap-
plies.

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CONTRACT CLAUSES AND SOLICITATION PROVISIONS

(ii) Award under the set-aside to a concern offering a foreign end product when the highest award price on the non-set-aside portion is established by a domestic source end 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-set-aside portion, adjusted to reflect transportation and other factors considered in evaluating the offers.

(C) Obtaining Offers and Processing Set-Aside Awards.

(i) When an unaccepted low offer is not involved:

if there is no unaccepted low offer meeting the criteria in (ii) below, eligible concerns in the order of priority in (2) above will be requested to offer on the set-aside quantity at the highest unit price awarded on the non-set-aside portion. Concerns may offer less than the total set-aside portion, provided that if any part of the set-aside portion is not taken by eligible concerns in the first 3 groups, awards will be made in Group 4 at prices no higher than the lowest price awarded on the nonset-aside portion.

(ii) When an unaccepted low offer is involved:

if (1) a responsive offer is submitted on the non-set-aside portion at a unit price which, when adjusted, is lower than the adjusted highest unit price awarded on the non-set-aside portion, but cannot be accepted (e.g., because of “all-or-none", or other quantity limitations, or because the bidder is nonresponsible), and (II) at the time of negotiation for the set-aside portion, the offer could be accepted (e.g., because the set-aside quantity is large enough that the quantity limitations could be complied with, or because the bidder has now become responsible), then the following procedures shall be followed:

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Step One. Eligible concerns (in the order of priority in (2) above), excluding Group 4 firms, |

will be requested to offer at the adjusted unit price of the unaccepted bid, a quantity of the setaside portion equal to the quantity of the unaccepted offer.

Step Two. If no eligible concern will offer to take the entire quantity of the unaccepted offer, then all eligible concerns (in the order of priority in (2) above), excluding Group 4 firms, shall be requested to offer 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. Steps Four, Five and Six are applicable to the remaining 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 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-set-aside portion on any quantity of the set-aside portion remaining after Steps One, Two, Three and Four have been completed, provided that if any part of the set-aside portion is not taken by eligible concerns in the first 3 groups, awards will be made in Group 4 at prices no higher than the lowest price awarded on the non-set-aside portion. Step Six. If the entire set-aside portion is not taken by eligible concerns pursuant to Steps One through Five above, the partial 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.

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(4) Determining the Set-Aside Quantity.

(c) Definitions.

(1)

(2)

(A) The maximum quantity of an item which may be awarded to any eligible concern shall be determined by applying the percentage of the total non-set-aside portion of an item on which an offer was made to the total quantity of the set-aside portion of that item.

(B) If a concern offers on two or more items on the non-set-aside portion, but conditions its offer in such a manner that the total of all these quantities may not be awarded, or offers a quantity which, at the option of the Government, may be applied to one or more items, the overall maximum which can be offered on the set-aside portion of the items affected will be determined by applying the percent of the total quantities of these items on the non-set- aside portion that could have been awarded to the total of these items on the set-aside portion.

(C) Notwithstanding the foregoing, if the entire set-aside portion of an item is not awarded after completion of the above steps, then the unawarded balance shall be offered to those concerns who were previously awarded quantities on the set-aside portion but who were prevented from accepting additional quantities because of the quantity limitations stated above. The unawarded quantity will first be offered to that concern in the first priority which has received the largest quantity of the item. If two or more offerors in the first priority received an identical quantity, a drawing by lot shall determine their priority. If a balance still remains, this procedure shall be repeated with the offerors in each of the original priority groups in turn, to dispose of any balance of the item still remaining.

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.

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CONTRACT CLAUSES AND SOLICITATION PROVISIONS

7:495

(3) 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 offering on Government contracts, and can further qualify under the criteria set forth in 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.

(d) Agreement. The offeror agrees that if awarded a contract as a LSA concern under the set-aside portion of this procurement, he will perform or cause to be performed by a first tier subcontractor 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.

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ARMED SERVICES PROCUREMENT REGULATION

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