Society of American Military Engineers
Piscataqua Post
October 25, 2012
Presentation by:
Dave Pease, Program Manager
New Hampshire Procurement Technical Assistance Program (NH-PTAP)
172 Pembroke Road
Concord, NH 03302-1856
(603) 271-7581
[email protected]
www.nheconomy.com/sell-to-the-government
Implications of Small Size Standard
Changes for Architectural Services and
Engineering Services
The US Small Business Administration establishes definitions of “small business” on an industryspecific basis, as denoted by National Industrial Classification Codes (NAICS). These size
standards are typically measured by average annual gross revenues (service firms) or by
number of employees (manufacturers).
The standards are reviewed and adjusted as necessary, with public comment, on a regular
basis.
Federal contracting officers are required to assign a NAICS code to contracts that they solicit;
this assignment defines the term “small business” for the purpose of that specific contract.
On February 10, 2012, SBA published a Final Rule in the Federal Register, adjusting size
standards for Professional, Technical and Scientific Services. Significant changes were made to
the standards for Architectural (541310) and Engineering (541330) services. These changes
became effective March 12, 2012.
Architectural (541310)
Engineering (541330)
OLD STANDARD
$4.5 million
$4.5 million
NEW STANDARD
$7.0 million
$14 million
These are large increases. The effect of both changes is to significantly alter the composition of
the A/E “small business” community.
Who benefits? Companies in the window between the old & new standards, particularly those
near the high end of the new standard.
Who will lose?
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
Those who were small under the old standard, who could compete in a smaller pool.
Those who remain large, as contracts that formerly required a large firm’s capacity or
breadth of expertise can now be performed by the bigger “small” companies.
Implications for direct effects can be assumed to include:


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Sharp increase in the number of companies competing as small businesses
Increase in the average size of A/E companies in the “small” category
Increase in the breadth & depth of capability in small A/E firms
Indirect effects may also be large:

Expect fewer “open” competitions and more “set-asides”.
Strategies for the formerly small:
1. Find a safe niche
2. Grow aggressively
3. Teaming
Strategies for the marginally large businesses:
1. Teaming as a subcontractor
2. Mentor – Protégé?
3. Shrink?
What has happened in A/E contracting since March?
A&E FBO PUBLICATIONS* MARCH 1- OCTOBER 24
Total Small Business
2011 2012
% Change
New England
5
7
40%
US
81
94
16%
Open
New England
427
380
-11%
US
59
28
-53%
*Includes Presolicitations, Solicitations &
Awards
Self-Performance Requirements Under
Set-asides & 8(a) Contracts
Type of Set-aside
Service Contract
Construction
Contract
Trade Contract
Total Small
Business
8(a)
WOSB/EDWOSB
SDVOSB
HUBZone
50%
15%
25%
50%
50%
50%*
50%**
15%
15%
15%*
50%** /15%
25%
25%
15%*
50%** /25%
* For SDVOSB set-asides, the self-performance percentage may include performance by
subcontractors who are also SDVOSB
**For HUBZone set-asides, the rules are complex. The Contracting Officer may waive the 50%
self-performance requirement for construction and trade contracts if it can be shown that there
are 2 HUBZone companies that cannot meet the self-performance requirement, but can meet
the 15% or 25% requirement, as applicable. The FAR clause (52.219-3) still requires 50%
HUBZone participation through subcontractors.
References:
13 C.F.R. § 125.6 Prime Contractor Performance Requirements
Text of 13 C.F.R. § 125.6 and guidance on measuring self-performance:
https://dap.dau.mil/aap/pages/qdetails.aspx?cgiSubjectAreaID=28&cgiQuestionID=106789
FAR 52.219.14 Limitations on Subcontracting
SDVOSB:
52.219-27 Notice of Service-Disabled Veteran-Owned Small Business Set-Aside.
HUBZone:
FAR 19.1308 Performance of work requirements (limitations on subcontracting) for general
construction or construction by special trade contractors.
FAR 19.1309 Contract clauses.
FAR 52.219-3 Notice of HUBZone Set-Aside or Sole Source Award.
FAR 52.219-4 Notice of Price Evaluation Preference for HUBZone Small Business Concerns.
Prepared by NH-PTAP – October 25, 2012
Mentor – Protégé Programs
Small Business Administration – for 8(a) companies:
http://www.sba.gov/content/mentor-prot%C3%A9g%C3%A9-program
Department of Veterans Affairs – for VOSB or SDVOSB - PROGRAM ON HOLD
http://www.va.gov/osdbu/veteran/mpp.asp
Department of Defense – for SDB, WOSB, HUBZone, SDVOSB or AbilityOne:
http://www.acq.osd.mil/osbp/sb/programs/mpp/participate.shtml
General Services Administration – for all small businesses:
http://www.gsa.gov/portal/content/105301
Department of Homeland Security – for all small businesses – PROGRAM ON HOLD
http://www.dhs.gov/mentor-prot%C3%A9g%C3%A9-program
National Aeronautics and Space Administration – for SDB, WOSB, VOSB, SDVOSB, HUBZone,
NASA SBIR, HBCU or AbilityOne
http://osbp.nasa.gov/mentor.html
Requirements for mentors and protégés vary widely
by agency. Benefits to mentor companies are
primarily in the form of credit on subcontracting
plans and in source evaluations. In some cases, can
provide mentor with some access to set-aside
business as a subcontractor to the protégé.
Navigating Points of Contact within the
Federal Government
Working with the Federal government invariably introduces to a world of too many
titles and too many acronyms. For any given question or request, it can be extremely difficult to
understand which point of contact is right & appropriate.
While there are some basic rules, they are violated as often as they’re observed. Each
case seems to be somewhat different.
Some titles that you might be thinking about contacting;






Contracting Officer
Contracting Specialist
Small Business Specialist
OSDBU
Program Manager
Congressional delegation
Best strategies if you’re uncertain who to contact:
1. Call your PTAC. We can help with this. Often we know the agency; sometimes,
we can make a quick call to get a picture of the agency’s internal structure for
you.
2. If you’re unsure, express your uncertainty. No one will fault you for this – they
know they’re confusing. I usually lead off with something like:
“I’m trying to locate the right person in your organization to help me with x. I
understand that you may not be that person, but I’m hoping that you can direct
me to the right place.”
3. Be sure that you do know the role of the person you’re talking to. It’s often not
obvious.
4. Sometimes there are questions you want the answer to, but you would prefer
not to be identified. Let your PTAC ask for you.
To find your PTAC: www.aptac-us.org