cured on the same solicitation, an appropriate small business size standard shall be established for each product or service. Both the classification and the applicable size standard (number of employees, average annual receipts, etc.), pursuant to § 1-1.701, shall be set forth in each solicitation in excess of $10,000 and in each solicitation of $10,000 or less which is a small business set-aside. The contracting officer's determination shall be final unless appealed in the manner prescribed in paragraph (h) of this section.

(h) A written appeal from a product or service classification determination made by a contracting officer may be taken: (1) Not less than 10 working days before the bid opening date or closing date for submitting proposals or quotations when the bid opening date or closing date for the submission of proposals or quotations is more than 30 calendar days after the issuance of the invitation for bids or requests for proposals or quotations,

or

(2) Not less than 5 working days before the bid opening date or closing date for submitting proposals or quotations when the bid opening date or closing date for the submission of proposals or quotations is 30 calendar days or less after the issuance of the invitation for bids or request for proposals or quotations. The appeal shall be addressed to the Chairman, Size Appeals Board, Small Business Administration, Washington, DC 20416. No particular form is prescribed for the notice of appeal. However, the appellant shall submit to the SBA Size Appeals Board an original and four legible copies of such notice of appeal and, to avoid time-consuming correspondence, the notice of appeal should include the following information: (i) The character of the determination from which the appeal is taken and its date; (ii) the number and date of the invitation for bids or request for proposals or quotations, and the name and address of the contracting officer; (iii) a concise and direct statement of the reasons why the determination of the contracting officer is alleged to be erroneous; (iv) documentary evidence to support such allegations; and (v)

§ 1-1.705-3 Screening of procurements.

(a) Individual set-asides. SBA representatives (cleared for security where classified procurements are to be screened) shall, upon request, promptly be afforded an opportunity at the procuring activity to review all proposed procurements if it is anticipated that the resulting contract or contracts will exceed $2,500 unless in the case of procurements which are not expected to exceed $10,000, the head of the procuring activity determines that such review would unduly delay the procurement process. A copy of the determination and the justification therefor shall be furnished to the

13-131 0-83--6

SBA representative. Where it is anticipated that the resulting contract or contracts will exceed $2,500, such SBA representatives shall, upon request, promptly be afforded an opportunity to make recommendations concerning proposed procurements, including that they be exclusively or partially set aside for small business concerns.

The contracting officer shall afford the SBA representative an opportunity to recommend appropriate names of small business concerns for inclusion in lists of bidders for firms to be solicited in connection with current and future procurements.

(b) Class set-asides. SBA representatives shall be afforded an opportunity to make recommendations that current and future procurements, or portions thereof, of selected items or services, or groups of like items or services, shall be set aside as provided in § 11.706, for exclusive small business participation. Such set-asides, when approved by the contracting officer, shall be known as class set-asides. Concurrence in a class set-aside shall not be dependent upon the existence of a current procurement if future procurements can be clearly foreseen.

§ 1-1.705-4 Access to information.

Upon request, and subject to applicable security regulations, SBA representatives shall be given access to available or reasonably obtainable information, including technical data (including drawings and specifications), procurement history, bidders lists, and planned requirements immediately upon receipt by the procuring activity. The SBA representative will be furnished such other available or reasonably obtainable information as may be required for the SBA referral program.

§ 1-1.705-5 Joint small business set-asides.

The policies and procedures for joint small business set-asides, set forth in § 1-1.706, were developed cooperatively with the SBA and Government procurement agencies.

§ 1-1.705-6 Certificates of competency. Section 1-1.708 prescribes policies and procedures governing cooperative

action with SBA concerning certificates of competency.

§ 1-1.705-7 Performance of contract by SBA.

In accordance with the Small Business Act (15 U.S.C. 637(a)), in any case in which the Administrator of SBA certifies to the head of the procuring agency concerned that SBA is competent to perform any specific contract, the contracting officer is authorized, in his discretion, to award the contract to SBA upon such terms and conditions, consistent with applicable procurement regulations, as may be agreed upon between SBA and the contracting officer. The policies and procedures governing the award of such contracts are set forth in § 11.713.

[37 FR 1037, Jan. 22, 1972]

(a) Purpose. The purpose of small business set-asides is to increase small business participation in Government procurement. The order in which the various kinds of set-asides are to be made is provided by the priorities set forth in the Small Business Act (15 U.S.C. 644(e)):

(1) Concerns which are small business concerns and which are located in a labor surplus area, on the basis of a total set-aside.

(2) Concerns which are small business concerns on the basis of a total set-aside.

(3) Concerns which are small business concerns and which are located in a labor surplus area, on the basis of a partial set-aside.

(4) Concerns which are small business concerns, on the basis of a partial set-aside.

(5) Concerns which will perform as labor surplus area concerns, on the basis of a total set-aside. (See § 1-1.804-1.)

(b) Applicability. This section is applicable to small business set-aside programs of executive agencies in connection with all procurement of property and services, maintenance, repair and construction, and research and development.

(c) Implementation. Any individual procurement or class of procurements shall be set aside entirely for small business-labor surplus area concerns,

for small (during fiscal year 1978) for public and private organizations for the handicapped and handicapped individuals eligible for assistance, as provided in the Small Business Act (15 U.S.C. 636(h)(1)). In the alternative, an appropriate part of the procurement shall be set aside for the exclusive participation of the referenced concerns, organizations, and individuals. Setasides shall be effected when it is determined to be in the interest of maintaining or mobilizing the Nation's full productive capacity, or to be in the interest of war or national defense programs, or to be in the interest of assuring that a fair proportion of Government procurement is placed with small business concerns. Determinations shall be made: (1) Unilaterally by a contracting officer, or (2) jointly by an SBA representative and a contracting officer, upon initiation by party.

business concerns, and

either

(d) Initiation of set-asides. Insofar as practicable, unilateral determinations initiated by a contracting officer of a procuring agency shall be used as the basis for small business set-asides rather than joint determinations by an SBA representative and a contracting officer. This, however, does not preclude SBA from initiating with an agency a proposal for a joint determination set-aside.

(e) Set-aside priorities. (1) The setaside priorities in paragraph (a) of this section shall be followed in determining the type of set-aside to be employed. Individual procurements shall be reviewed by the contracting officer to determine if they can be set aside:

(i) Totally for small business-labor surplus area concerns (see § 1-1.7065(a)).

(ii) Totally for small business concerns where a total set-aside for small business-labor surplus area concerns cannot be made (see § 1-1.706-5(a)).

(iii) Partially for small businesslabor surplus area concerns where a total set-aside for small business concerns cannot be made. (See § 1-1.7066.)

(iv) Partially for small business concerns where a partial set-aside for small business-labor surplus area con

cerns cannot be made. (See § 1-1.7066.)

(v) Totally for labor surplus area concerns where a partial set-aside for small business concerns cannot be made. (See § 1–1.804.)

(2) If it is determined that the procurement cannot be set aside in accordance with any of the set-aside priorities in paragraph (e)(1) of this section, the procurement may be made without regard to those priorities.

(f) Record of contract actions. The record of contract actions (see § 11.313) shall set forth the factual basis for the contracting officer's decision regarding the type of set-aside selected or the decision not to make a set-aside.

(g) Small purchases. Small purchases; i.e., purchases under $10,000 subject to small purchase procedures, shall be identified as small businesssmall purchase set-asides for small business concerns as provided in §§ 13.602 and 1-3.603-3.

[29 FR 10104, July 24, 1964, as amended at 33 FR 10393, July 20, 1968; 43 FR 26006, June 16, 1978; 45 FR 55722, Aug. 21, 1980; 47 FR 33694, Aug. 4, 1982]

§ 1-1.706-2 Review of SBA set-aside proposals.

(a)(1) When an SBA representative has recommended that all, or a portion, of an individual procurement or class of procurements be set aside for small business-labor surplus area concerns or for small business concerns, the contracting officer (or other designated representative of the procurement agency) shall promptly either: (i) Concur in the recommendation or (ii) disapprove the recommendation, stating in writing his reasons for disapproval. The SBA representative shall be allowed 2 workdays to appeal any such disapproval to the head of the procuring activity or his designee. During consideration of such appeal, there shall be a full and free interchange of all pertinent facts between the SBA representative and the procuring activity concerned. Within 1 workday after receipt of a decision from the head of the procuring activity or his designee disapproving a recommended set-aside, the SBA representative may request the contracting

officer to suspend action on the procurement pending a further appeal by the SBA Administrator to the head of the agency concerned. SBA shall be allowed 15 workdays after making any such request within which (A) the Administrator of SBA may appeal the decision of the head of the procuring activity (or his designee) to the head of the agency concerned, and (B) to notify the contracting officer of the appeal. If such a notification is not received by the contracting officer within the 15-day period, SBA shall be deemed to have withdrawn its request to suspend action on the procurement and to have refrained from taking an appeal to the head of the agency. Where SBA has appealed to the head of the agency concerned and the contracting officer has been notified of that fact within the 15-day period, the head of the procuring activity shall, in accordance with agency procedures, forward a full justification of his decision through appropriate channels to the head of the agency. The head of the agency shall respond to the appeal by the Administrator of SBA within 30 workdays.

(2) Any procurement action affected by a set-aside recommendation which has been disapproved by the contracting officer and appealed by the SBA representative shall be suspended pending the decision of the head of the procuring activity or his designee. If the decision sustains the disapproval and if the SBA representative requests further suspension in accordance with (1) of this § 1-1.706-2(a), the suspension shall continue until: (i) The SBA appeal is deemed to have been withdrawn (as provided in (1) of this § 1-1.706-2(a)), or (ii) the matter is determined by the head of the agency concerned. Such suspension shall not apply, however, to any particular procurement action which, as determined by the contracting officer, must, in order to protect the public interest, be initiated without delay and as to which he inserts in the contract file a statement signed by him setting forth the facts and circumstances justifying the determination. The contracting officer shall promptly notify the SBA representative of any procurement action initiated pursuant to

the preceding sentence by supplying him with a copy of the justification.

(b) None of the following is, in itself, sufficient cause for not making a setaside:

(1) A large percentage of previous procurements of the item in question has been placed with small business concerns.

(2) The item to be purchased is on an established planning list under the Industrial Readiness Planning Program, except that a total set-aside shall not be authorized when one or more large business Planned Emergency Producers of the item desire to participate in the procurement.

(3) The item to be purchased is on a Qualified Products List, except that a total set-aside shall not be authorized when the products of one or more large businesses are on the Qualified Products List unless it has been confirmed that none of such large businesses desires to participate in the procurement.

(4) A period of less than 30 days from date of issuance of invitations for bids or requests for proposals is prescribed for the submission of the bids or proposals.

(5) The procurement is classified.

(6) Small business concerns are receiving a fair proportion of the total contracts for property or services.

(7) A class set-aside of the item or service concerned has been made at some other procuring activity.

(8) The item will be described by "brand name or equal."

(c) In approving a proposed class setaside, the contracting officer shall make sure that the set-aside determination: (1) Specifically identifies the items or services subject thereto; (2) provides that it will, at least once each year, be reviewed jointly by an SBA representative and the procuring activity to determine whether it should be withdrawn (see § 1-1.706-3 for withdrawal procedures); (3) provides that it does not apply to any individual procurement for which small purchase procedures are to be used; and (4) provides that such class set-aside applies only to the procuring activity making or participating in the set-aside determination. Any class of procurements proposed to be totally set aside shall

(a) Each individual procurement governed by a class set-aside shall be carefully reviewed to insure that any changes in the magnitude of anticipated requirements, specifications for the items or services, delivery requirements, or competitive market conditions, since the initial approval of the class set-aside, are not of such material nature as to result in the probable payment of an unreasonable price by the Government or in a change in small business capability.

(b) If, prior to the award of a contract involving an individual or class set-aside for small business, the contracting officer considers the procurement of the set-aside portion from a small business concern would be detrimental to the public interest (e.g., because of unreasonable price), the contracting officer may withdraw either a joint or a unilateral set-aside determination. In the case of: (1) A joint setaside determination, or (2) a unilateral set-aside

determination where SBA has designated either a resident or a liaison representative for the agency, the contracting officer shall initiate the withdrawal thereof by giving notice, containing the reason therefor, to the SBA representative (by telephone where liaison representatives are involved). Similarly, a class setaside may be modified so as to withdraw one or more individual procurements therefrom. If the SBA representative does not agree to a withdrawal or modification, the action may be appealed in accordance with the procedures set forth in § 1-1.706-2(a). This procedure is not applicable to automatic dissolutions of set-asides as provided in § 1-1.706-7. In all cases where SBA has not designated either

resident or liaison representatives for the agency, the contracting officer shall withdraw a unilateral set-aside determination where he considers that procurement of the set-aside from a small business concern would be detrimental to the public interest (e.g., because of unreasonable price).

(c) A statement supporting any withdrawal or modification of a set-aside shall be made by the procuring activity and retained in the contract file. [29 FR 10104, July 24, 1964, as amended at 37 FR 1363, Jan. 28, 1972]

§ 1-1.706-4 Reporting for Department of Commerce Procurement Synopsis.

Section 1-1.1003-7 contains special instructions concerning reporting of procurements involving small business set-asides to the Department of Commerce for publication in the "Commerce Business Daily."

§ 1-1.706-5 Total set-asides.

(a) General. The entire amount of an individual procurement or class of procurements shall be set aside either: (1) For small business-labor surplus area concerns and eligible organizations for the handicapped and handicapped individuals that agree to perform as labor surplus area concerns, or (2) for small business concerns and eligible organizations for the handicapped and handicapped individuals. However, there must be a reasonable expectation that bids or proposals will be obtained from a sufficient number of responsible concerns, organizations, and individuals so that awards will be made at reasonable prices. Total setasides shall not be made unless such a reasonable expectation exists. In the absence of such an expectation, a partial set-aside shall be considered pursuant to § 1-1.706-6. Although the past procurement history of the item or similar items is important, it is not the only controlling factor which should be considered in determining whether a reasonable expectation exists.

(b) Authority. Contracts involving total small business set-asides (with or without reference to labor surplus areas) shall be entered into by negotiation either through conventional nego