Notice From The Department of Small and Local Business Development

The DC Department of Small and Local Business Development (DSLBD) prioritizes principles of fairness, consistency, and the establishment of clear expectations regarding procurement opportunities. It is important to note that current legislation mandates specific subcontracting requirements for construction and non-construction projects exceeding $250,000 aimed at supporting local enterprises. This framework ensures that firms based in the District are afforded preferential treatment in these procurement processes. In instances where a contractor is unable to fulfill these requirements due to the insufficient availability of Small Business Enterprises (SBE) or Certified Business Enterprises (CBE) to provide the requisite goods or services, the procuring agency is permitted to request a waiver from the subcontracting stipulations. This waiver serves to facilitate contractors in advancing their projects without incurring penalties for non-compliance attributable to an inadequate market capacity.  

Criteria for Waivers: 

• Current law (2–218.51. Waiver of subcontracting requirements) allows a waiver only if there aren’t enough available SBE/CBEs to provide the required goods or services or if the class of good or service is such that there exists no subcontracting opportunities (e.g., direct travel purchases, goods or services with proprietary or federal funding restrictions, etc.), making it impossible to meet the requirements. 
• Procuring agencies must submit waiver requests to the Director at least 20 days before issuing a solicitation or acting on a contract option. 
• Once the contract is awarded, approved waivers become fixed, key terms of the contract. 

Waiver Approval and Applicability: 

• Unless the solicitation specifies otherwise, when a waiver of CBE subcontracting requirements is approved, it applies to the entire contract, including all option periods. 
• Option periods are not new contracts but extensions of the original agreement. 

Changing Subcontracting Requirements: 

• DSLBD can approve different waiver amounts for each option period, but these must be approved and clearly outlined in the solicitation and contract award before the contract is awarded. 
• Procuring agencies can request changes to subcontracting requirements before acting on an option, but they must provide at least 20 days’ notice to the Director and obtain approval. 
• A subcontracting plan is a critical and binding element of any competitive solicitation. Any changes during the exercise of an option period that significantly alter the nature of the contract or compromise fair competition will likely necessitate re-solicitation. For example, changes to the subcontracting requirements that could affect the price, quantity, quality, or delivery of an offeror’s original proposal will likely require re-solicitation for goods or services. 

DSLBD takes the integrity of the procurement process and support of small businesses with the utmost seriousness. Adhering to the guiding laws is not only a requirement but a fundamental part of ensuring fairness and fostering healthy competition. Maintaining transparency and equity in these processes is essential to uphold the trust and confidence of all stakeholders.