On October 16, 2020, the Small Business Administration (“SBA”) issued a final rule enacting a number of now-effective changes to SBA’s regulations, including changes to the rules governing size recertifications on unrestricted multiple award contracts (“MACs”).
The final rule requires contractors to certify their size and socioeconomic status at the time of initial offer for an order under unrestricted MACs, except for those under Federal Supply Schedule contracts or Blanket Purchase Agreements. Previously, size certifications were not required at the order level on MACs unless the contracting officer requested a recertification in connection with a specific order. Relatedly, the rule now also allows for size protests at the time of the award of individual orders, instead of at the time of the MAC award.
Further, contractors must recertify at the order level for all set-aside orders where the required socioeconomic status for the order differs from that of the underlying set aside MAC. For example, if a MAC has a set-aside for women-owned small businesses, the MAC awardees must qualify for that status at the time of the offer made on that order, in addition to the size certification at the time of award for the set-aside MAC. The rule does not require recertification if the agency issues the order under a MAC offeror pool which is already set aside in the same category as the order.
Additionally, the final rule requires contracting officers administering MACs to assign a NAICS code at the order level that is most accurate to the work that will be performed under that order. The NAICS code must be among the ones listed on the MAC itself.
The bottom line is that while under the old rule contractors were generally considered small for each order issued against a MAC for the initial five years (unless a contracting officer requested recertification at the order level), under the new rule businesses will have to recertify in connection with each small business set-aside proposal under an unrestricted MAC. Small businesses that have outgrown their small business status over the course of a MAC may find themselves on the outside looking in for subsequent task order competitions.