Board of Governors of the Federal Reserve System

Attachment E

Small and Disadvantaged Business Acquisition Procedures Policy

73-209 O

93 - 10

The Board of Governors of the Federal Reserve System has a policy of assisting the interest of small businesses and socially and economically disadvantaged small businesses. The purpose of these guidelines is to establish a program for acquisition of goods, services, and construction from such businesses.

DEFINITIONS

"Contract Representative" means a person with authority to enter into contracts on behalf of the Board.

"Covered Company" means a firm qualified as a small business concern under the Small Business Act and regulations thereunder or a firm qualifying as a small business concern eligible for assistance under Section 8(a) of the Small Business Act.

GENERAL PROVISIONS

Small-Company Specialist

The Director of the Division of Support Services shall designate one or more individuals to act as a Small-Company Specialist, whose responsibilities will include-

compiling and maintaining comprehensive lists of covered companies;

consulting with Contract Representatives to implement these guidelines;

making recommendations to Contract Representatives concerning acquisition procedures designed to increase the opportunities for covered companies to do business with the Board; and

assisting the Contract Representative in developing covered-company set-aside preference procedures.

- making available to covered companies material which sets forth (a) the general nature of the Board's business; (b) Board acquisition procedures; (c) how to obtain information regarding proposed purchases; (d) a listing of types of purchases that may be set aside for covered companies; and (e) the

address and telephone number of the Small-Company Specialist who may be contacted for further information.

Source Lists

To encourage maximum participation by covered companies, the Contract Representative shall, after consultation with the Small-Company Specialist, make reasonable efforts to include covered companies on mailing lists of prospective suppliers for goods, services, and construction and add any such company requesting inclusion to such lists.

General Acquisition Procedures

To aid covered companies in competing for Board contracts, the Contract
Representative will--

consider the needs of covered companies in formulating acquisition procedures, including but not limited to, lengthened delivery schedules and time for the submission of offers or bids and, to the extent practicable, dividing proposed acquisitions to permit offers in quantities less than the total requirement and

send solicitations to all covered companies on the mailing list, or to a pro rata number of such companies when less than a complete list is used.

SET-ASIDE, PREFERENCE, AND SUBCONTRACTING PROCEDURES

Set-Asides

All acquisitions of goods, services, and construction with an anticipated value of $10,000 or less will be set aside for covered companies unless, after consultation with the Small-Company Specialist, the Contract Representative determines in writing, with regard to a particular acquisition or a class of acquisitions, that it is unlikely that the Board will receive quotations from two or more responsible covered companies that will be reasonably competitive with quotations in terms of price, quality, delivery, or other factors. То further the Board's policy of assisting covered companies, the Board may also, in its discretion, set aside for covered companies an acquisition or a class of acquisitions with an anticipated value over $10,000.

If such a set-aside results in the receipt of a reasonable quotation from only one responsible covered company, the Contract Representative will make an award to that company. However, if a reasonable quotation is not received from a covered company, the Contract Representative may cancel the set-aside and acquire the goods and services from a noncovered company.

If comparable quotations are received from a covered company eligible for the Section 8(a) program of the Small Business Act and another covered company, preference will be given to the company eligible under Section 8(a).

Covered-Company Preference

In the case of all acquisitions except contracts for services that are personal in nature, where a responsible covered company submits a responsive bid, quotation or proposal, the Contract Representative will select such a bid, quotation, or proposal, provided (a) the bid, quotation, or proposal would be selected under ordinary Board acquisition procedures or (b) its price, quality, and other features are comparable to the bid, quotation, or proposal that would otherwise be selected.

In the case of all acquisitions except contracts for services that are personal in nature, if more than one responsible covered company submits a responsive bid, quotation, or proposal and the price, quality, and other features of each bid, quotation, or proposal are determined to be comparable, preference should be given to a covered company which is eligible for the Section 8 (a) program of the Small Business Act.

A bid, quotation, or proposal need not be deemed to be comparable if (a) for all acquisitions up to $500,000 the price is more than 3 percent above the price of the lowest responsive bid, quotation, or proposal, or for acquisitions over $500,000 the price is more than the sum of $15,000 plus 1 percent of the amount over $500,000 above the lowest responsive bid, quotation, or proposal, or (b) the quality maintenance or other factors evaluated, as set forth in the invitation for bids (IFB) or request for proposal (RFP), are unsatisfactory.

In the case of acquisitions above $10,000, except contracts for services that are personal in nature, the Contract Representative will include a provision in each solicitation stating that a factor will be considered in awarding the contract is the Board's policy of assisting covered companies, and any resulting contract will contain a provision substantially similar in effect to the provision stated in Appendix A.

Subcontracting with Small 'and Disadvantaged Business

Each IFB or RFP which has subcontracting possibilities and which is expected to exceed $500,000 ($1,000,000 for construction) will specify as an evaluation criterion the submission of a subcontracting plan including (a) plans for using covered companies and (b) procedures for documenting compliance with the plan.

In determining whether subcontracting possibilities exist, the Contract Representative may consider whether firms engaged in the business of furnishing the goods, services, or construction to be acquired customarily contract for performance of part of the work or maintain in-house capability, as well as a potential contractor's long-standing relationship with its suppliers. Determinations that no subcontracting possibilities exist will be documented. Subcontracting plans are not required from covered companies or for contracts for services that are personal in nature.

ANNUAL REVIEW

At least annually, the Small-Company Specialist will consult with Board management concerning the Board's acquisition record with covered companies, possible categories for acquisitions above $10,000 to be wholly or partially set aside for covered companies, and ways of increasing covered companies' participation.

Each year, the Small-Company Specialist will document the proportional and dollar amount of the Board's acquisition let to covered companies and its plans for the following year.