48 C.F.R. § 19.1405

19.1405 Set-aside procedures.

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(a) The contracting officer—

(1) Shall comply with 19.203 before deciding to set aside an acquisition under the SDVOSB Program;

(2) May set-aside acquisitions exceeding the micro-purchase threshold for competition restricted to SDVOSB concerns when the requirements of paragraph (b) of this section can be satisfied; and

(3) Shall consider SDVOSB set-asides before considering SDVOSB sole source awards (see 19.1406) or small business set-asides (see subpart 19.5).

(b) A contracting officer may restrict competition to SDVOSB concerns eligible under the SDVOSB Program if there is a reasonable expectation based on market research that—

(1) Two or more SDVOSB concerns eligible under the SDVOSB Program will submit offers; and

(2) Award will be made at a fair market price.

(1) Verify that offers received are eligible for consideration for award by checking if the offeror—

(i) Is designated in SAM as an SDVOSB concern certified by SBA; or

(ii) Has represented that it is an SDVOSB concern in SAM and submitted an application for certification to SBA on or before December 31, 2023. Pending applications for certification are in the SBA Veteran Small Business Certification database at https://veterans.certify.sba.gov;

(2) Proceed with the offer evaluation, if the offeror meets the criteria in paragraph (c)(1)(i) or (ii) of this section; or

(3) Remove the offeror from consideration, if the offeror does not meet the criteria in paragraph (c)(1)(i) or (ii) of this section, as the offeror is not eligible for award.

(d) If the contracting officer receives only one acceptable offer from an SDVOSB concern eligible under the SDVOSB Program in response to a set-aside, the contracting officer should make an award to that concern. If the contracting officer receives no acceptable offers from SDVOSB concerns eligible under the SDVOSB Program, the SDVOSB set-aside shall be withdrawn and the requirement, if still valid, set aside for small business concerns, as appropriate (see 19.203).

(e) The procedures at 19.202-1 and, except for acquisitions not exceeding the simplified acquisition threshold, at 19.402 apply to this section. When the SBA intends to appeal a contracting officer's decision to reject a recommendation of the SBA procurement center representative (or, if a procurement center representative is not assigned, see 19.402(a)) to set aside an acquisition for competition restricted to SDVOSB, the SBA procurement center representative shall notify the contracting officer, in writing, of its intent within 5 working days of receiving the contracting officer's notice of rejection. Upon receipt of notice of SBA's intent to appeal, the contracting officer shall suspend action on the acquisition unless the head of the contracting activity makes a written determination that urgent and compelling circumstances, which significantly affect the interests of the Government, exist. Within 15 working days of SBA's notification to the contracting officer, SBA shall file its formal appeal with the head of the contracting activity, or that agency may consider the appeal withdrawn. The head of the contracting activity shall reply to SBA within 15 working days of receiving the appeal. The decision of the head of the contracting activity shall be final.

[69 FR 25278, May 5, 2004, as amended at 71 FR 36927, June 28, 2006; 76 FR 14568, Mar. 16, 2011; 77 FR 12932, Mar. 2, 2012; 89 FR 13958, Feb. 23, 2024]

Notes of Decisions

Cited in 7 cases, 2007–2020 · leading case: Knowledge Connections, Inc. v. United States

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Knowledge Connections, Inc. v. United States (2007) uscfc · cites it 2× “23, 2005); 48 C.F.R. § 19.1405 (a). In rejecting the proposed change, the Councils explained that by using the words “may award,” “[t]he statute established a discretionary, not mandatory, set-aside authority for SDVOSBs,” 70 Fed.”

Knowledge Connections, Inc. v. United States (2007) uscfc · cites it 2× “14,950, 14,953 (March 23, 2005); 48 C.F.R. § 19.1405 (a) (2004). The Councils explained that by using the words “may award” the Veterans Benefits Act of 2003 “established a discretionary, not mandatory, set-aside authority for [service-disabled, veteran-owned small businesses].”

DCMS-ISA, Inc. v. United States (2008) uscfc “1405(c)[, 48 C.F.R. § 19.1405 (c) (2006) ], and as recommended by the DHS OSDBU, the SDVOSB set-aside shall be withdrawn and set aside for small business concerns, as and if appropriate.”

Land Shark Shredding, LLC v. United States (2019) uscfc · cites it 2× “48 C.F.R. § 19.1405 (b)-(c) (2019). In addition, the VA’s implementing regulation for the Rule of Two doctrine, which is almost identical to the one contained in the FAR, indicates that the contracting officer, even after setting aside a procurement opportunity for only SDVOSBs,…”

Veteran Shredding, LLC v. United States (2020) uscfc · cites it 2× “48 C.F.R. § 19.1405 (b)-(c) (2019). Thus, pursuant to the VAAR and the FAR, even after a procurement process has been set aside pursuant to the Rule of Two, the contracting officer must still evaluate proposals to determine if the proposals received are “acceptable,” and…”

Veterans Electric, LLC v. United States (2018) uscfc “§ 8127 (d) and 48 C.F.R. § 19.1405 (c); and (3) the VA’s new solicitation contains several defects.”

Land Shark Shredding, LLC v. United States (2019) uscfc “1405(c), 48 C.F.R. § 19.1405 (c) (2017). 4 None of these authorities is persuasive.”

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