May 24, 2018

By Wayne Simpson, CFCM, CSCM

Discretionary Use by VA Contracting Officers Authorized; Must Be Approved First

In what many will see as VA’s continued assault on its Veterans First Contracting Program post-Kingdomware, VA recently implemented “Cascading” set-asides.  VA refers to these set-asides as “Tiered Evaluations,” noting they are also known as “Cascading” set-asides.

VA issued Acquisition Policy Flash (No. 18-15), transmitting Procurement Policy Memorandum (PPM) No. 2018-04, dated and effective February 8, 2018.  VA issued the PPM in response to requests from VA contracting officers requesting guidance and procedures for the use of tiered evaluations within a single synopsized solicitation when applying the “VA Rule of Two.”

The “goal” of the PPM is to minimize delays in the re-solicitation process incurred subsequent to the application of the “VA Rule of Two” at either the Service-Disabled Veteran-Owned Small Business (SDVOSB) and the Veteran-Owned Small Business (VOSB) priority tiers within a single-synopsized solicitation

According to VA, this change will also streamline the process of satisfying VA’s obligation under Section 8127 of Title 38 United States Code when “viable” offers are not received at the SDVOSB or VOSB priority tiers within a single synopsized procurement.

There are three types of tiered evaluations which VA will use.  The first is “Tiered Evaluations Limited to SDVOSB or VOSB.”  The second, “Tiered Evaluations Including Small Business Concerns.  The third is “Tiered Evaluations Including Large Business Concerns.”  The type tiered evaluation used will be based on the results of market research which must be conducted and documented in advance of the solicitation’s issuance.   VA must include a notice in all solicitations issued using tiered evaluation.

VA issued a Class Deviation to the Federal Acquisition Regulation (FAR) on March 22, 2018, which was also effective immediately.  The FAR Class Deviation was required to allow VA contracting officers to follow tiered evaluation procedures in PPM No. 2018-004.  The language at FAR 19.502, prior to issuance of the Class Deviation limited the effectiveness of VA’s PPM No. 2018-04, as the FAR required contracting officers to withdraw the set-aside and resolicit the requirement if no acceptable offers are received from responsible small business concerns.

PPM No. 2018-04 applies to all competitive procurements using tiered evaluations.  The use of tiered evaluations for procurements of supplies, products, and services (including commercial items) is at the discretion of the contracting officer.  When using tiered evaluations, the solicitation must be approved by a contracting official at least one level above the contracting officer who issues and prepares the solicitation.  The approving official will validate the supporting market research has been thoroughly documented in advance of issuing the solicitation.


About the Author:

Wayne Simpson
Wayne Simpson is retired from the U.S. Department of Veterans Affairs (VA) after 38 years of federal service. He served as the Executive Assistant to VA’s Deputy Assistant Secretary for Acquisition and Logistics where he was the primary staff advisor to the Deputy Assistant Secretary, who serves concurrently as VA’s Senior Procurement Executive and Debarring Official.


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  • Brad says:

    As a VA Contracting Officer, I see the potential for sustained protest with the way the Tiered Evaluations policy is written. In PPM 2018-04, It specifies evaluating “the offers, if any, submitted…” from the highest tier on down to the lowest tier until a Successful Offeror is identified. My issue where I see the potential for protest is that the Tiered Evaluations do not maintain the qualification basis for SDVOSB or VOSB set-aside (2 or more reasonably expected offerors), as well as for Small Business set-aside Tiered Evaluation. The PPM states “if any,” which implies one will do. This is where the Protest would be argued.

    For example, let’s say that I have a requirement where there is only one SDVOSB that could be reasonably expected to respond to the solicitation. This one SDVOSB would not be sufficient for an SDVOSB set-aside due to the “Rule of Two.” So in turn, I announce the requirement with TIERED EVALUATIONS notice. In response to the solicitation, I receive 3 offers: 1 SDVOSB; 1 Small Business; and 1 Large Business. The way the PPM is written, I am required to do an SDVOSB set-aside evaluation, and if they are a Successful Offeror, I proceed to award to that one SDVOSB. But my interpretation of the FAR and the Rule of Two is that this minimum threshold for qualifying an SDVOSB set-aside is not met. If I were to only consider a single SDVOSB, the Small and Large Businesses will likely Protest on the grounds of inadequate competition, and I believe that would be a sustained Protest.

  • Bob Perkins says:

    I’m 100% disabled combat Vet.. ( VA letter) and have operated our Sub S corp since 1983. Wife is also 10% disabled.
    WE are the owners. Yet. the VA in is “infinite wisdom” doesn’t recognize us as a SDVOB. The hurdles you have to jump over are redundant and in many case unnecessary. We do a lot of work for the VA through bids in GPO. Good track record and we could do a lot for the VA….”procedure” and common sense seem to get in the way.

    Any way to fast track and/ or eliminate some of the paperwork? Interesting article

    Bob Perkins
    Premiums & Specialties, In.c

    • Wayne Simpson says:

      Mr. Perkins,

      Thank you for your post and for your service and that of your wife. America owes a great debt of gratitude to her Veterans who sacrificed their youth so liberty may grow old.

      Obtaining verification from VA through its Center for Verification and Evaluation can be an arduous process for sure. In 2012, the Small Business Administration indicated there are approximately 2.5 million businesses owned by Veterans in America. The VA Vendor Information Pages Database, as of May 29, 2018, has a total of 14,016 verified firms–10,367 of these firms are Service-Disabled Veteran-Owned Small Businesses (SDVOSBs) and 3,649 are Veteran-Owned Small Businesses (VOSBs).

      Since we don’t have the specifics of your case, we are unable to offer an opinion or guidance in the matter. One thing you may want to do is reach out the National Veterans Small Business Coalition (NVSBC). Scott Denniston is the Executive Director, and perhaps one of the most authoritative sources outside of VA regarding CVE Verification. Scott and his organization have their finger on the pulse of verification issues and can certainly provide recommendations in this area.

      Beginning October 1, 2018, companies denied verification or inclusion in VA’s VIP Database may file appeals with the Small Business Administration’s Office of Hearings and Appeals–VA no longer has the final say in this area.

      We regret your difficulties in this area and hope this issue soon resolves itself so you, too, can participate in and benefit from VA’s Veterans First Contracting Program. Thank you for your post in response to our article and best wishes to you and Mrs. Perkins for every continued success in the Federal Marketplace!