DEVIATION:
OFFICE OF THE UNDER SECRETARY OF DEFENSE
3000 DEFENSE PENTAGON
WASHINGTON, DC 20301-3000
MEMORANDUM FOR COMMANDER, UNITES STATES SPECIAL OPERATIONS
COMMAND (ATTN: ACQUISITION EXECUTIVE)
COMMANDER, UNITED STATES TRANSPORTATION COMMANDER, (ATTN: ACQUISITION EXECUTIVE)
DEPUTY ASSISTANT SECRETARY OF THE ARMY (POLICY AND PROCUREMENT), ASA(ALT)
DEPUTY ASSISTANT SECRETERY OF THE NAVY
(ACQUISITION & LOGISTICS MANAGEMENT), ASN(RDA)
DEPUTY ASSISTANT SECRETARY OF THE AIR FORCE (CONTRACTING), SAF/AQC
DIRECTORS, DEFENSE AGENCIES
DIRECTOR, DOD FIELD ACTIVITIES
SUBJECT: Class Deviation - Suspension of the Price Evaluation Adjustment for Small Disadvantaged Businesses
Department of Defense (DoD) contracting activities shall continue to suspend the use of the price evaluation adjustment for small disadvantaged businesses (SDBs) in DoD procurement, as prescribed in the Federal Regulation (FAR) subpart 19.11 and Defense Federal Acquisition Regulation Supplement (DFARS) subpart 219.11. The suspension is in effect for a one year period 30 days after the date of this deviation and applies to all solicitations issued from March 13, 2009 through March 12, 2010. The current deviation authority expires on March 9, 2009.
On November 4, 2008, in the case Rothe Development Corp. v. Dept. of Defense, the U.S. Court of Appeals for the Federal Circuit found 10 United States Code (U.S.C.) section 2323 unconstitutional. The appellate court returned the case to the U.S. District Court for the Western district of Texas with orders to enter judgment. The scope of the District Court’s final order, expected in the near future, will affect the future viability of section 2323. Additional guidance will be provided at that time.
Subsection 2323(e) of title 10, United States Code (U.S.C.), as amended by section 801 of the Strom Thurmond National Defense Authorization Act for Fiscal Year 1999 and section 816 of the Bob Stump National Defense Authorization Act for Fiscal Year 2003, requires DoD to suspend the regulation implementing the authority to enter into a contract for a price exceeding fair market cost if the Secretary determines at the beginning of the Fiscal Year that DoD achieved the five percent goal established in 10 U.S.C. 2323(a) in the most recent fiscal year for which data are available. Based on the current available data for Fiscal Year 2008, the determination is made that DoD exceeded the five percent goal established in 10 U.S.C. 2323(a) for contract awards to SDBs. Accordingly, use of the price evaluation adjustment prescribed in FAR 19.11 and DEARS 219.11 is suspended for DoD.
My staff point of contact for this subject is Ms. Susan Pollack at (703) 697-8336 or [email protected].
