“SUMMARY:
This rule makes technical changes to regulations issued by the U.S. Small Business Administration (SBA) to conform those regulations to recent statutory changes. First, the rule incorporates a required change to SBA’s ownership requirements for small business concerns owned and controlled by service-disabled veterans. The rule adopts changes to the treatment of certain surviving spouses made by the National Defense Authorization Act of 2020. In addition, the rule incorporates changes to the dollar thresholds for certain contracting actions authorized for the 8(a) Business Development (BD) program made by the National Defense Authorization Act of 2020. Finally, the rule adjusts the competitive threshold dollar levels authorized for SBA’s contracting programs to changes made to the Federal Acquisition Regulation (FAR) due to inflation…”
“SUPPLEMENTARY INFORMATION:
On December 20, 2019, the National Defense Authorization Act for Fiscal Year 2020 (NDAA 2020), Public Law 116-92, 133 Stat. 1198, was signed into law. Section 876 of NDAA 2020 amended section 3 of the Small Business Act, 15 U.S.C. 632. This provision made changes to the treatment of surviving spouses with regard to the program’s ownership requirements. The changes require that SBA update its regulations to reflect two new time periods. Specifically, the statute creates a ten-year time period to remain eligible in the case of a surviving spouse of a veteran with a service-connected disability rated as 100 percent disabling or who dies as a result of a service-connected disability, and a three-year time period in the case of a surviving spouse of a veteran with a service-connected disability rated as less than 100 percent disabling who does not die as a result of a service-connected disability. This rule updates 13 CFR 125.12 to reflect these changes. SBA is changing the language in § 125.12(i)(1)(ii) to match the new statutory language. SBA is adding the ten-year time frame in § 125.12(i)(2)(iii). SBA is adding the three-year time frame in § 125.12(i)(2)(iv).
In addition, section 823 of NDAA 2020 changed the threshold for which a justification and approval is needed for Department of Defense (DoD) covered procurements. Section 811 of the NDAA for Fiscal Year 2010, Public Law 111- Start Printed Page 61671 84, 123 Stat. 2190, 2405, required the Federal Acquisition Regulations (FAR) to be amended to include a new requirement for a written justification of sole-source 8(a) awards over $20 million. The FAR increased this threshold to $22 million due to inflation on July 2, 2015. 80 FR 38293, 38296. While the section 811 requirement for a justification and approval applied to all civilian and defense agencies, section 823 of NDAA 2020 increased the threshold to $100 million only for the DoD. As such, this rule amends SBA’s regulations to increase the justification and approval requirement to $100 million only with respect to DoD 8(a) contracts. In addition, DoD, the General Services Administration (GSA), and the National Aeronautics and Space Administration (NASA) are charged with amending the FAR to adjust statutory acquisition-related thresholds for inflation every five years. On October 2, 2020, DoD, GSA, and NASA published a final rule in the Federal Register amending the FAR to implement new inflationary adjustments. 85 FR 62485. As part of that final rule, the $22 million justification and approval threshold authorized by section 811 of NDAA 2010 was increased to $25 million. Thus, in addition to increasing the threshold to $100 million for DoD-related 8(a) procurements, this rule also increases the justification and approval threshold from $22 million to $25 million for all other agencies. This rule amends § 124.502(c)(17) and § 124.506(b)(5) to adjust the justification and approval thresholds accordingly.
In addition to the justification and approval and 8(a) sole source thresholds identified above that were raised in response to the inflationary adjustments made to the FAR, that same FAR rule also adjusted other SBA-related contacting dollar thresholds for inflation. 85 FR 62485. Section 864 of the National Defense Authorization Act of 2021, Public Law 116-283, subsequently amended the Small Business Act to set the 8(a), HUBZone, and WOSB sole source thresholds for manufacturing contracts to $7,000,000. As such, this rule incorporates the FAR changes into SBA’s regulations except where section 864 retained a $7 million sole source threshold amount for manufacturing contracts. Specifically, this rule adopts the inflationary adjustments made to the sole source thresholds in the FAR for the 8(a) BD Program (by amending § 124.506(a)(2)(ii) of SBA’s regulations), the Service-Disabled Veteran-Owned Small Business Concern Program (by amending § 125.23(b)(1) of SBA’s regulations), the Historically Underutilized Business Zone Program (by amending § 126.612(b)(1) and (2) of SBA’s regulations), and the Women-Owned Small Business Program (by amending § 127.503(c)(2) and § 127.503(d)(2) of SBA’s regulations). SBA is also updating a threshold for its Small Business Subcontracting Program, which is contained in § 125.3(c).
SBA is also making corrections to § 126.200(f) and § 126.700(b)(1). Currently both sections contain an incorrect reference to § 126.5. The correct cross reference should be to § 125.6, and this rule corrects the typographical errors…” Read the full ruling here.
Source: National Defense Authorization Act of 2020, Definition of Surviving Spouse for Service-Disabled Veteran-Owned Small Businesses and Change to 8(a) Business Development Contracting Thresholds – November 8, 2021. Federal Register.
