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U.S. DEPARTMENT OF INTERIOR
BUSINESS AND ECONOMIC
DEVELOPMENT PROGRAM
HANDBOOK
TABLE OF CONTENTS
CHAPTER 1. INTRODUCTION 3
CHAPTER 2. DEFINITIONS 4
CHAPTER 3. ROLES AND FUNCTIONS, OSDBU AND THE HEADQUARTERS BUDS
5
CHAPTER 4. GOALING 6
CHAPTER 5. ADVANCED ACQUISITION PLAN 6
CHAPTER 6. IDENTIFICATION OF SPECIFIC REQUIREMENTS
8(a) OR OTHER PREFERENCE PROGRAMS 7
CHAPTER 7. ACQUISITION SCREENING FOR INDIVIDUAL
PROCUREMENT ACTIONS 7
CHAPTER 8. ACCOMPLISHMENTS 8
CHAPTER 9. PURPOSE AND TYPE OF OUTREACH 8
CHAPTER 10. PROVIDING BEDP UPDATES AND GUIDANCE
FAR 19.201(c) and DIAR 1419.201(c)(2) 8
CHAPTER 11. BUNDLING 9
CHAPTER 12. SUBCONTRACTING PLANS (SF-294 AND SF-295 REPORTS) 10
CHAPTER 13. SMALL BUSINESS DEBRIEFING AND PERFORMANCE ISSUES 11
CHAPTER 14. FEDERAL ASSISTANCE 11
CHAPTER 15. HISTORICALLY BLACK COLLEGES AND UNIVERSITIES
AND MINORITY INSTITUTIONS11
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CHAPTER 1. INTRODUCTION
Background. The President and Congress of the United States recognize the key roles small
businesses play in ensuring the health of the nation’s economy. Small businesses employ more
people, create more new jobs, and bring more innovation to the marketplace than large
businesses. They also recognize the historical record that shows certain small businesses have
been at an unfair disadvantage in competing for federal contracts. Executive orders have been
issued and legislation enacted authorizing preference programs to provide federal procurement
opportunities to the small and small disadvantaged business communities. The Department of
the Interior (DOI) established the Office of Small and Disadvantaged Business Utilization
(OSDBU) within the Office of the Secretary (Secretary) and assigned Business Utilization and
Development Specialists (BUDS) to the contracting activities in the bureaus and offices, to
implement the laws and regulations directing these preference programs. The Director of the
OSDBU then instituted the Business and Economic Development Program (BEDP) to provide
guidance to these BUDS and the Acquisition and Assistance professionals in the Department.
Purpose. This handbook presents the policy of DOI concerning the BEDP to provide consistent
guidance for implementing the program. The BEDP addresses the legal requirement that all
federal contracting activities afford the maximum practicable opportunity for businesses in
various preference programs to participate, whether as prime contractors, direct recipients of
federal assistance, or as subcontractors. While the Secretary’s commitment to the BEDP doesn’t
change, the specifics of the individual preference programs, and the programs themselves,
change over time to reflect changes in law or regulation. DOI’s BEDP is tailored to the DOI
organization and culture. The DOI bureaus and offices may tailor their individual programs
further to suit their missions, structure and business practices, without reducing the minimum
requirements in this handbook.
Scope. All DOI acquisitions or federal assistance actions, including actions undertaken by
partnerships, cooperative agreements, interagency agreements or other arrangements where
funding is received from other public or private sources, are within the scope of this handbook.
Purchases under the Micro Purchase Threshold in FAR 13.2 are exempt.
Applicability. This handbook applies to all DOI managers with authority to commit federal
funds. It applies to OSDBU and all DOI BUDS, contracting officers, purchasing agents, grant
and assistance officers. It is not applicable to purchase card holders.
Authority. The Small Business Act of 1953, as amended, authorizes small and small
disadvantaged business preferential contracting programs to ensure that small business concerns
receive a fair share of Government contracts. PL 95-507 extended preference programs to
subcontracting on federal contracts. Statutory and regulatory basis for the BEDP is set forth in
FAR Part 19 (FAR 19.000, Scope of part). The DIAR, Part 1419, provides general guidance on
the BEDP.
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Supercession. This Handbook supercedes the DOI BUDS SOP Handbook (405 DM) issued 29
August 1988. While DOI Bureaus may supplement this Handbook, any supplements written
prior to the date of this handbook are also superceded.
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CHAPTER 2. DEFINITIONS
AAP - Advanced Acquisition Plan
BEDP - Business and Economic Development Program
BUDS - Business Utilization and Development Specialist
CCO - Chief of the Contracting Office
CO - Contracting Officer
DIAR - Department of Interior Acquisition Regulations
DOI - Department of Interior
FAR - Federal Acquisition Regulations
FPDS - Federal Procurement Data System
FSS - Federal Supply Schedule
Goaling Category - Small Business firms, Section 8(a) awards, Small Disadvantaged Business
firms, Women-Owned Small Business entities, HUBZone firms, Veteran-Owned firms.
HBCU - Historically Black Colleges and Universities
HBCU/MI - Historically Black Colleges and Universities and Minority Institutions
HCA - Head of the Contracting Activity
HeadBUDS - Headquarters Business Utilization and Development Specialist
IAP - Individual Acquisition Plan
IDEAS-PD - Interior Department Electronic Acquisition System-Procurement Desktop
IPDS - Interior Procurement Data System
OSDBU - Office of Small and Disadvantaged Business Utilization
OMB - Office of Management and Budget
PCR - Procurement Center Representative
PRO-NET - Small Business Administration’s Procurement Marketing and Access Network
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SAT - Simplified Acquisition Threshold
SBA - Small Business Administration
CHAPTER 3. ROLES AND FUNCTIONS
OSDBU AND THE HEADQUARTERS BUDS
Function of OSDBU Office. The Small Business Act requires each agency with contracting
authority to establish an OSDBU office. OSDBU manages the BEDP for DOI. OSDBU is
responsible for developing and maintaining policies, procedures, regulations, and guidelines for
effective administration of the Department’s small business and small disadvantaged business
programs. The office provides functional direction and policy guidance to personnel for
implementation of the BEDP. OSDBU works with the SBA to establish meaningful
socioeconomic acquisition program goals for Interior and its bureaus/offices. The office
facilitates small business participation as contractors, including small business contract teams.
OSDBU facilitates small business participation as subcontractors and suppliers where
participation by small business concerns as prime contractors is unlikely. The office assists
small business concerns in obtaining payments under their contracts, late payment, interest
penalties, or other information on contractual payment provisions. OSDBU makes
recommendations, when appropriate, as to whether a particular acquisition should be awarded
under FAR Subpart 19.5, as a small business set-aside, under FAR Subpart 19.8 as a Section 8(a)
award, or under FAR Subpart 19.13 as a HUBZone set-aside. OSDBU identifies proposed
solicitations that involve bundling.
Responsibility of HeadBUDS. The HeadBUDS is primarily responsible for implementing and
managing the bureau/office’s BEDP. The HeadBuds facilitates implementation of Federal
socioeconomic programs mandated by statue and regulation through leadership provided to
operational BUDS. The HeadBUDS manages the BEDP by conducting an ongoing program to
ensure bureau/office conformance with existing socioeconomic statutes and regulations. The
HeadBUDS negotiates annually with bureau/office operational offices and DOI to establish
BEDP goals by specific socioeconomic category. The HeadBUDS manages the development of
ad hoc, interim, and annual BEDP reports. He or she reviews and analyzes bureau/office BEDP
quarterly accomplishments and recommends improvements. He or she assists bureau/office
operational acquisition offices, as requested, in identifying projects suitable for acquisition in
support of socioeconomic development programs. The HeadBUDS conducts a program to
recognize BEDP accomplishments within the bureau/office. He or she represents the
bureau/office and DOI at Federal, State, and local small business programs, trade fairs, and other
socioeconomic development advocacy events, providing marketing assistance and counseling to
small socially and economically disadvantaged business enterprises. The HeadBUDS prepares
an annual message of BEDP support from the head of the bureau/office (Director or
Commissioner).
The HeadBUDS work is crucial in encouraging expansion of the national industrial base by
developing new or improved small business firms to assure increase opportunities to contract and
subcontract with bureaus/offices, other Federal, State, and local entities, and with prime
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contractors. This work affects the economic well-being of small and socially and economically
disadvantaged businesses.
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CHAPTER 4. GOALING
This part identifies authorities and presents background information and procedures for proposal
and negotiation of BEDP goals between DOI and various Bureaus and Offices.
As required by the general policy statement found at FAR 19.201 and 401 DM 1419.201, the
HCA shall develop annual BEDP goals for their small business and small disadvantaged
business utilization program (see current DIAR). The purpose of these goals is to increase
participation of 8(a) firms, small business, service-disabled veteran-owned small business,
veteran-owned small business, HUBZone small business, small disadvantaged business, and
women-owned small business concerns. All such goals must comply with the criteria established
by OSDBU.
After consultation with the Regional BUDS and the CCO, the headquarters BUDS develops
annual BEDP goals for proposal to OSDBU. The proposed goals are reviewed and approved by
the Bureau Procurement Chief and submitted to OSDBU by September 1. They are based on
available budget information, historical data, current fiscal year achievements, and information
obtained on specific contract opportunities which have been identified in the BUDS review of
the AAP.
OSDBU reviews the proposed goals and forwards recommendations in each goaling category to
the HeadBUDS by September 15. If the bureau/office does not concur with the OSDBU
proposal, it must respond to the OSDBU within ten (10) working days. Where no response is
received, the OSDBU will consider the goals to be accepted by the bureau/office. The BEDP
goals are bureau-wide with headquarters, Service Centers, and the regions having equal
responsibility for their achievement.
CHAPTER 5. ADVANCED ACQUISITION PLAN
FAR Part 7
The most opportune time in the acquisition process for a bureau or office to ensure that a fair
proportion of its acquisitions are placed with small business and small disadvantaged business
concerns is during the development of its annual AAP.
In order to ensure that all reasonable action is taken to increase the participation of businesses
which are a part of the BEDP in the activity contracting program, the BUDS will participate to
the maximum extent practical in the AAP process as prescribed by FAR 7.102(b).
The BUDS shall take action to ensure that the Bureau or Office AAP is posted to the agency
website so that interested firms can review it for possible procurement actions. The
AAP/Forecast shall be reviewed and updated as frequently as possible, but not less than
quarterly.
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CHAPTER 6. IDENTIFICATION OF SPECIFIC REQUIREMENTS
8(a) OR OTHER PREFERENCE PROGRAMS
BUDS will review the AAP to identify upcoming requirements that can be reserved for 8(a) or
set-aside under one of the preference programs listed in FAR Part 19.
Section 8(a) of the Small Business Act authorizes SBA to enter into prime contracts with
Government departments or agencies for the procurement of products or services. Under this
procedure SBA negotiates subcontracts with small business concerns owned and controlled by
socially and economically disadvantaged firms. SBA has delegated its contract formation
authority to DOI under a Partnership Agreement . The BUDS shall refer to the Partnership
Agreement for procedural guidance.
CHAPTER 7. ACQUISITION SCREENING FOR INDIVIDUAL
PROCUREMENT ACTIONS
All acquisitions expected to exceed the SAT shall be screened by the Bureau or Office BUDS
prior to synopsis. Screening ensures that all small business preference programs (as defined in
FAR Part 19) are given the maximum practical opportunity to participate in the Federal
contracting process.
Upon request from SBA, contracting officers may be required to obtain SBA approval to enter
into interagency agreements under the Economy Act.
Bureaus may develop their own policy for screening actions below the SAT and for FSS awards.
When Bureau’s or Offices are required to prepare IAP, the IAP shall state the proposed method
of procurement and include consideration of preference programs. The IAP shall address the
extent and results of the market research and indicate their impact on the various elements of the
IAP.
DI-1886 Approval process. Upon receipt of the requirement in the contracting office, the
requirement shall be screened by the BUDS. The BUDS shall identify goaling category sources
through the use of the SBA’s PRONET system and any other available market research sources.
The BUDS shall provide the results of the query to the contracting officer for use in developing
an acquisition strategy.
The CO shall prepare and sign the DI-1886 form and forward it to the BUDS for review. The
DI-1886 shall include an adequate description of the product or services being procured so that
the BUDS can adequately determine the potential for a set-aside. The DI-1886 must be signed
by the BUDS prior to synopsis of the requirement. The DI-1886 must also thoroughly document
the reasons why individual procurement actions are not suitable for 8(a) or HUBZone set-asides.
The BUDS must have an adequate lead time in order to perform a market analysis of larger and
more complex requirements.
For offices where a SBA PCR is assigned, determinations to solicit using full and open
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competition, or other than full and open competition to a non-goaling category source, must be
approved by the PCR. The BUDS will forward the DI-1886 to SBA for approval.
If the BUDS determines that the individual procurement would be appropriate for some form of
set-aside or 8(a), the BUDS shall attempt to resolve the matter with the CO. If no successful
resolution is reached, the issue shall be submitted to the CCO for resolution. If the CCO is the
CO, this determination should be made by the Bureau Procurement Chief. A copy of the
determination, documentation leading to the final decision, and the DI-1886 shall become a part
of the official contract file. The BUDS shall retain a copy of each completed DI-1886 for three
years.
CHAPTER 8. ACCOMPLISHMENTS
FAR 4.6 requires that data on contract actions be transmitted to the FPDS. The SF-279 form and
the SF-281 form (or the 281 form in IDEAS-PD) are used to transmit this information. The
information is submitted to IPDS which in turn transmits the data to FPDS.
The BUDS shall obtain FPDS accomplishment reports on a quarterly basis and at the end of the
fiscal year. The BUDS shall utilize the data to ensure that BEDP goals are being accomplished.
CHAPTER 9. PURPOSE AND TYPE OF OUTREACH
One of the primary roles/purposes of the BUDS is to counsel business owners, or their
representatives, in their attempts to do business with DOI as well as with other elements of the
Government. The BUDS shall provide counseling on a daily basis and at congressionally-
sponsored and other outreach events, including SBA activities.
An important aspect to the BUDS counseling is to provide follow-up responses to all inquiries.
Counseling shall also include researching and identifying prime contracting opportunities and
possible subcontracting opportunities.
The BUDS shall be familiar with various resources (i.e., Internet websites, SBA PRO-NET, etc.)
and maintain an adequate supply of appropriate publications designed to assist the small business
owner when marketing to the Government.
The BUDS shall be familiar with the Federal Government’s Single Point of Entry and be able to
provide assistance to small businesses on the basic functions of the website.
The BUDS shall maintain a relationship with Interior and other Government acquisition offices;
State and local agencies, civic organizations; and the SBA in matters concerning the interests of
small business, small minority business, women-owned business, veteran-owned business and
HUBZone concerns.
CHAPTER 10. PROVIDING BEDP UPDATES AND GUIDANCE
FAR 19.201(c) and DIAR 1419.201(c)(2)
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The BUDS shall provide updates and guidance on the program to management, contracting,
federal assistance, requirements, and technical personnel on FAR and DOI BEDP policies,
procedures, and regulations.
Periodically the BUDS, accompanied by the CCO, should meet with management, contracting,
federal assistance, requirements, and technical personnel, as a group or individually, to ensure
that there is a good understanding of the Small Business Act (P.L. 95-507), the BEDP, goals, the
order of precedence, the role and authority of the BUDS, and the role and authority of SBA.
The BUDS should provide verbal and/or written guidance to contracting and federal assistance
personnel as changes occur in the FAR and in DOI policies, procedures, and regulations which
directly affect the program.
Periodically, the BUDS shall insure that standard solicitation and contract provisions and clauses
included in the contracting offices standard format are as prescribed in FAR Part 19.
CHAPTER 11. BUNDLING
“Bundling” is the consolidation of two or more requirements for supplies or services, previously
provided or performed under “separate smaller contracts,” into a solicitation for a single contract
that is likely to be unsuitable for award to a small business concern due to one or more of the
following factors: the diversity, size, or specialized nature of the elements of the performance
specified; the aggregate dollar value of the anticipated award; or the geographical dispersion of
the contract performance sites. A “separate smaller contract” means that the requirement was
previously performed by one or more small business concerns or was suitable for award to one or
more small business concerns. The BUDS should be proactive on this issue by conducting
informational briefings to relevant customer groups, identified by review of the AAP.
Based on economies of scale, bundling may provide substantial benefits to the Government.
However, because of the potential impact on small business participation, Congress has directed
that agencies must conduct market research to determine whether bundling is necessary and
justified. This may be the case if an agency would derive “measurably substantial benefits.”
These benefits must be quantified, and adequacy thresholds are spelled out at FAR 7.107(b) and
(d). If the expected benefits do not meet these thresholds, the Deputy Secretary may determine
that bundling is still necessary if the benefits are critical to mission success and if the acquisition
strategy provides for maximum practicable participation by small business concerns. The BUDS
is responsible for coordinating this market research effort with the local SBA PCR, or, if one is
not assigned, the cognizant SBA Office of Government Contracting Area Office.
These justification requirements do not apply if a cost comparison analysis will be performed in
accordance with OMB Circular A-76. However, the following “substantial bundling”
requirements do apply to A-76 (as well as non-A-76) scenarios.
“Substantial bundling” is any bundling that results in a contract with an average annual value of
$10 million or more. In this case, the agency must identify the specific benefits anticipated to be
derived from bundling, include an assessment of the specific impediments to participation by
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small business concerns, and specify actions designed to maximize small business participation
as contractors (including small business teams) and subcontractors (including suppliers).
When the bundled requirement is received in the contracting office, the BUDS must ensure that
sufficient justification to support bundling is in the file before approving the DI-1886. For
solicitations involving bundling that offer a significant opportunity for subcontracting, the BUDS
should work with the CO to develop evaluation factors on the extent of proposed small business
subcontracting participation and on the offeror’s past performance in attaining goals for small
business participation under prior contracts that required subcontracting plans. At least 30 days
before release of the solicitation, the BUDS must notify any affected incumbent small business
concerns of the Government’s intention to bundle the requirement and how the concerns may
contact the appropriate SBA representative.
CHAPTER 12. SUBCONTRACTING PLANS
(SF-294 AND SF-295 REPORTS)
FAR 19.7 requires that each solicitation to perform a contract or contract modification, expected
to exceed $500,000 ($1,000,000 for construction), and having subcontract possibilities shall
require the apparent successful large business to submit an acceptable subcontracting plan. An
acceptable plan must include specific percentage goals as specified in FAR Part 19.704
(Subcontracting plan requirements). Prime contractors required to submit subcontracting plans
should establish positive, realistic, and justifiable percentage and dollar goals.
The CO is responsible in determining whether a proposed contractual action requires a
subcontracting plan. If it is determined that there are no subcontracting possibilities, the written
determination must be approved at a level above the CO, coordinated with the BUDS, and
included in the contract file. A copy of the determination shall be forwarded to OSDBU within
five working days.
Subcontracting goals shall be negotiated at a level which represents a good faith, aggressive, and
comprehensive effort of the apparent successful offeror to use to the maximum extent
practicable, small and small disadvantaged subcontractors after giving appropriate consideration
to technical capability, price and other pertinent factors.
The CO shall review the subcontracting plan in accordance with FAR 19.705-4, obtaining advice
and recommendations from the BUDS and the SBA as appropriate. The BUDS shall review the
plan and submit written recommendations and/or concurrence to the CO within 5 working days.
Deficiencies in the plan, if any, shall be corrected by the offeror to the satisfaction of the
CO/BUDS. The CO is responsible for forwarding a copy of the award document and
subcontracting plan, with the necessary approvals to the appropriate SBA office. A copy of the
subcontracting plan should be distributed pursuant to individual bureau procedures.
In coordination with the CO, the BUDS shall take all practicable and reasonable actions to
ensure that prime contractors carry out their contractual obligations to maximize subcontracting
opportunities for firms covered under the BEDP.
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If a contract contains an individual contract subcontracting plan, the Contractor is required to
submit both the SF-294 (semiannually) and the SF-295 (annually). These reports are used to
provide a basis for monitoring and reporting achievements in Contractors’ subcontracting plans.
Post Performance Analysis. In situations where contractors have not made a good faith effort
to comply with the subcontracting goals, contracting officers in coordination with BUDS should
remember to perform an analysis of the contractor’s best efforts in performing the subcontracting
plan for possible assessment of liquidated damages pursuant to FAR 19.705-7 (Liquidated
damages).
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CHAPTER 13. SMALL BUSINESS DEBRIEFING
AND PERFORMANCE ISSUES
The BUDS shall assist in the resolution of any issues in regards to small business and
unsuccessful proposals and performance issues.
Prior to meeting with any small business firm to discuss an unsuccessful proposal or a
performance issue, the CO is to meet with the BUDS to discuss the agency position and to
resolve any issues that the BUDS perceives as unfair or unreasonable. All issues are to be
resolved prior to meeting with the firm. The BUDS is to be given the opportunity to participate
in any meeting between contracting personnel and the small business firm. The BUDS role is as
an observer, and if required, will provide input on regulations, policies, or procedures related to
the Small Business Act and the BEDP.
CHAPTER 14. FEDERAL ASSISTANCE
Grants and Cooperative Agreements. Federal Assistance recipients are required by OMB
Circulars A-102 and A-110 to take specific actions to ensure that a fair share of contracts
awarded by recipients to vendors to pursue the purpose of the assistance are placed with small
business firms targeted for benefit under the preference programs in this Handbook.
In accordance with Department Manual Part 505, bureaus shall comply with the policy to include
the appropriate notice in award documents which affords opportunities for purchases from the
business community to reflect the Department’s implementation and support to Executive Order
12432. The notice for Grants and Cooperative Agreements with State and Local Governments is
available at URL: http://elips.doi.gov/elips/release/3216.htm. The notice for Grants and
Agreements with Institutions of Higher Education, Hospitals, and Other Nonprofit Organizations
is available at URL: http://elips.doi.gov/elips/release/3217.htm.
CHAPTER 15. HISTORICALLY BLACK COLLEGES AND UNIVERSITIES
AND MINORITY INSTITUTIONS
HBCU Program. The DOI HBCU Program concerns the development of relationships between
the Department and these institutions in order to encourage and promote DOI as an employer of
first choice, as well as developing student employment opportunities within the Department. It is
a part of the Equal Employment Opportunity Outreach effort and unrelated to Acquisition and
Federal Assistance.
HBCU/MI. HBCU/MI are encouraged to participate fully in Acquisition and Federal Assistance
opportunities across the DOI. They are particularly encouraged to participate in research efforts.
DOI and the Bureaus are directed under EO 12677, April 1989, to increase participation of
HBCU/MI’s in these areas. There are no procurement preference programs or goals for
HBCU/MI within DOI. However, to assist in monitoring the Department HBCU Program, Field
and Regional BUDS shall report HBCU awards (contracts, grants, and cooperative agreements)
to the HeadBUDS. Award information consists of award number, type, date, amount, and
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description. Each year, the HeadBUDS for each bureau shall consolidate this information and
insert it in an annual report to the Department HBCU Program Manager.
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