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Subpart 19.10—Small Business Competitiveness Demonstration Program

19.1001  General.

The Small Business Competitiveness Demonstration Program was established by the Small Business Competitiveness Demonstration Program Act of 1988, Public Law 100-656 (15 U.S.C. 644 note). The program is implemented by a joint OFPP and SBA Policy Directive and Implementation Plan, dated May 25, 1999. The program consists of two major components—

(a) Unrestricted competition in designated industry groups; and

(b) Enhanced small business participation in 10 agency targeted industry categories.

19.1002  Definitions.

“Emerging small business,” as used in this subpart, means a small business concern whose size is no greater than 50 percent of the numerical size standard applicable to the North American Industry Classification System (NAICS) code assigned to a contracting opportunity.

“Emerging small business reserve amount,” for the designated groups described in 19.1005, means a threshold established by the Office of Federal Procurement Policy of—

(1) $30,000 for construction, refuse systems and related services, non-nuclear ship repair, landscaping and pest control services; and

(2) $50,000 for architectural and engineering services.

19.1003  Purpose.

The purpose of the Program is to—

(a) Assess the ability of small businesses to compete successfully in certain industry categories without competition being restricted by the use of small business set-asides. This portion of the program is limited to the designated industry groups listed in section 19.1005.

(b) Expand small business participation in 10 targeted industry categories through continued use of set-aside procedures, increased management attention, and specifically tailored acquisition procedures, as implemented through agency procedures.

(c) Measure the extent to which awards are made to a new category of small businesses known as emerging small businesses (ESB’s), and to provide for certain acquisitions to be reserved for ESB participation only. This portion of the program is also limited to the designated industry groups listed in section 19.1005.

19.1004  Participating agencies.

The following agencies have been identified as participants in the demonstration program:

The Department of Agriculture.

The Department of Defense, except the National Imagery and Mapping Agency.

The Department of Energy.

The Department of Health and Human Services.

The Department of the Interior.

The Department of Transportation.

The Department of Veterans Affairs.

The Environmental Protection Agency.

The General Services Administration.

The National Aeronautics and Space Administration.

19.1005  Applicability.

(a) Designated industry groups.


NAICS Description

1. Construction (except dredging)

Subsector 236—Construction of Buildings


New Single-Family Housing Construction (except Operative Builders)


New Multi-Family Housing Construction (except Operative Builders)


New Housing Operative Builders


Residential Remodelers


Industrial Building Construction


Commercial and Institutional Building Construction

Subsector 237—Heavy and Civil Engineering Construction


Water and Sewer Line and Related Structures Construction


Oil and Gas Pipeline and Related Structures Construction


Power and Communication Line and Related Structures Construction


Land Subdivision


Highway, Street, and Bridge Construction


Other Heavy and Civil Engineering Construction (except dredging)

Subsector 238—Specialty Trade Contractors


Poured Concrete Foundation and Structure Contractors


Structural Steel and Precast Concrete Contractors


Framing Contractors


Masonry Contractors


Glass and Glazing Contractors


Roofing Contractors


Siding Contractors


Other Foundation, Structure, and Building Exterior Contractors


Electrical Contractors


Plumbing, Heating, and Air-Conditioning Contractors


Other Building Equipment Contractors


Drywall and Insulation Contractors


Painting and Wall Covering Contractors


Flooring Contractors


Tile and Terrazzo Contractors


Finish Carpentry Contractors


Other Building Finishing Contractors


Site Preparation Contractors


All Other Specialty Trade Contractors

2. Non-nuclear Ship Repair


Ship Building and Repairing

PSC J998

Non-nuclear Ship Repair (East) Ship Repair (including overhauls and conversions) performed on non-nuclear propelled and nonpropelled ships east of the 108th meridian

PSC J999

Non-nuclear Ship Repair (West) Ship Repair (including overhauls and conversions) performed on non-nuclear propelled and nonpropelled ships west of the 108th meridian

3. Architectural and Engineering Services (including surveying and mapping)


Architectural Services


Engineering Services

PSC C111

Administrative and Service Buildings

PSC C112

Airfield, Communication and Missile Facilities

PSC C113

Educational Buildings

PSC C114

Hospital Buildings

PSC C115

Industrial Buildings

PSC C116

Residential Buildings

PSC C117

Warehouse Buildings

PSC C118

Research and Development Facilities

PSC C119

Other Buildings

PSC C121

Conservation and Development

PSC C122

Highways, Roads, Streets, Bridges and Railways

PSC C123

Electric Power Generation (EPG)

PSC C124


PSC C129

Other Non-Building Structures

PSC C130


PSC C211

Architect-Engineering Services (including landscaping, interior layout, and designing)

PSC C212

Engineering Drafting Services

PSC C213

A&E Inspection Services (non-construction)

PSC C214

A&E Management Engineering Services

PSC C215

A&E Production Engineering Services (including Design and Control, and Building Programming)

PSC C216

Marine Architect and Engineering Services

PSC C219

Other Architect and Engineering Services


Geophysical Surveying and Mapping Services or


Surveying and Mapping (except Geophysical) Services

PSC T002

Cartography Services

PSC T004

Charting Services

PSC T008

Photogrammetry Services

PSC T009

Aerial Photographic Services

PSC T014

Topography Services

PSC R404

Land Surveys, Cadastral Services (non-construction)

4. Refuse Systems and Related Services


Solid Waste Collection or


Other Waste Collection or


Other Nonhazardous Waste Treatment and Disposal

PSC S205

Trash/Garbage Collection Services—including Portable Sanitation Services

5. Landscaping and Pest Control Services


Exterminating and Pest Control Services


Landscaping Services

(b) Targeted industry categories. Each participating agency, in consultation with the Small Business Administration, designates its own targeted industry categories for enhanced small business participation.

19.1006  Exclusions.

This subpart does not apply to—

(a) Orders placed against Federal Supply Schedules;

(b) Contract awards to educational and nonprofit organizations; or

(c) Contract awards to governmental entities.

19.1007  Procedures.

(a) General.

(1) All solicitations must include the applicable NAICS code and size standards.

(2) The face of each award made pursuant to the program must contain a statement that the award is being issued pursuant to the Small Business Competitiveness Demonstration Program.

(b) Solicitations greater than the ESB reserve amount.

(1) Solicitations for acquisitions in any of the designated industry groups that have an anticipated dollar value greater than the emerging small business reserve amount must not be considered for small business set-asides under Subpart 19.5. However, agencies may reinstate the use of small business set-asides as necessary to meet their assigned goals, but only within organizational units that failed to meet the small business participation goal.

(2) Acquisitions in the designated industry groups must continue to be considered for placement under the 8(a) Program (see Subpart 19.8), the HUBZone Program (see Subpart 19.13), and the Service-Disabled Veteran-Owned Small Business Procurement Program (see Subpart 19.14).

(c) Solicitations equal to or less than the ESB reserve amount.

(1) Solicitations for acquisitions in the designated industry groups with an estimated value equal to or less than the emerging small business reserve amount must be set aside for ESBs, provided that the contracting officer determines that there is a reasonable expectation of obtaining offers from two or more responsible ESBs that will be competitive in terms of market price, quality, and delivery. If no such reasonable expectation exists, the contracting officer must—

(i) For acquisitions $30,000 or less, proceed in accordance with Subpart 19.5, 19.8, 19.13, or 19.14; or

(ii) For acquisitions greater than $30,000 and less than or equal to the ESB reserve amount, proceed in accordance with paragraph (b) of this section.

(2) If the contracting officer proceeds with the ESB set-aside and receives a quotation from only one ESB at a reasonable price, the contracting officer must make the award. If there is no quote from an ESB, or the quote is not at a reasonable price, then the contracting officer must cancel the ESB set-aside and proceed in accordance with paragraph (c)(1)(i) or (ii) of this section.

(d) Expanding small business participation in targeted industry categories. Each participating agency must develop and implement a time-phased strategy with incremental goals, including reporting on goal attainment. To the extent practicable, provisions that encourage and promote teaming and joint ventures must be considered. These provisions should permit small business firms to effectively compete for contracts that individual small businesses would be ineligible to compete for because of lack of production capacity or capability.

19.1008  Solicitation provisions.

(a) Insert in full text the provision at 52.219-19, Small Business Concern Representation for the Small Business Competitiveness Demonstration Program, in all solicitations in the designated industry groups.

(b) Insert in full text the provision at 52.219-20, Notice of Emerging Small Business Set-Aside, in all solicitations for emerging small businesses in accordance with 19.1007(c).

(c) Insert in full text the provision at 52.219-21, Small Business Size Representation for Targeted Industry Categories under the Small Business Competitiveness Demonstration Program, in all solicitations issued in each of the targeted industry categories under the Small Business Competitiveness Demonstration Program that are expected to result in a contract award in excess of $30,000.

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