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Barry McVay's FEDERAL CONTRACTS DISPATCH

DATE: April 24, 2000

FROM: Barry McVay, CPCM

SUBJECT: Department of Energy (DOE); Small Business Programs

SOURCE: DOE Policy Flash 2000-11, April 20, 2000

AGENCIES: Office of Procurement and Assistance Policy, DOE

ACTION: Notice

SYNOPSIS: Policy Flash 2000-11 forwards Acquisition Letter AL-2000-02 to DOE contracting officers and management and operating (M&O) contractors guidance on effectively utilizing small businesses, small disadvantaged businesses, women-owned businesses, and Historically Underutilized Business Zone (HUBZone) businesses.

EDITOR'S NOTE: For more on Secretary of Energy Bill Richardson's memorandum on maximizing small business participation in DOE M&O contracts, see the February 22, 2000, FEDERAL CONTRACTS DISPATCH "Department of Energy (DOE); Maximizing Small Business Utilization."

FOR FURTHER INFORMATION CONTACT: Robert Webb, 202-586-8264, or e-mail to Robert.Webb@pr.doe.gov.

SUPPLEMENTAL INFORMATION: Beginning in 1991, DOE was advised by the Office of Federal Procurement Policy (OFPP) to count M&O small business subcontracts as prime contract awards because M&O contractors are considered to be extensions of DOE, so M&O subcontracts should be counted as if they are DOE prime contracts. However, the OFPP recently rescinded its previous direction. As a result, DOE's socioeconomic accomplishments will now be based solely on federally awarded prime contract awards. Under the old method, about 18% of DOE contract dollars went to small businesses; under the new method, about 3% of DOE contract dollars will go to small businesses.

Furthermore, on October 8, 1999, OFPP issued Policy Letter 99-1, Small Business Procurement Goals, which establishes an aggregate governmentwide goal of 23% for contracts with small business, small disadvantaged business, women-owned small businesses, and HUBZone small businesses. Therefore, DOE "needs to exercise all appropriate means to improve its performance in making awards to small businesses in order to help achieve the governmentwide goal to counteract the impact of the recent OFPP decision, and to ensure that small business receives a fair portion of DOE's business."

On February 11, 2000, Secretary of Energy Bill Richardson issued a memorandum announcing several initiatives to maximize small business participation in DOE's contracts. The issuance of Acquisition Letter 2000-11 is one of the initiatives.

Acquisition Letter AL-2000-02 is divided into two parts: Section I applies in the award of prime contracts by DOE, and Section II applies to the award of subcontracts under contracts for the management and operation of major DOE sites and facilities.

AL-2000-02 lists the following as among the "tools" available to DOE contracting officers:


AL-2000-02 lists the following as among the "tools" available to DOE contractors to increase small business subcontract awards:


FOR FURTHER INFORMATION CONTACT: Barry McVay at 703-451-5953 or by e-mail to BarryMcVay@FedGovContracts.com.

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