83_FR_12907 83 FR 12849 - Conforming Statutory Amendments and Technical Corrections to Small Business Government Contracting Regulations

83 FR 12849 - Conforming Statutory Amendments and Technical Corrections to Small Business Government Contracting Regulations

SMALL BUSINESS ADMINISTRATION

Federal Register Volume 83, Issue 58 (March 26, 2018)

Page Range12849-12852
FR Document2018-06033

The U.S. Small Business Administration (SBA or Agency) is amending its regulations to incorporate a provision of the National Defense Authorization Act of 2018 (NDAA 2018) and to update and provide several technical corrections to SBA's regulations. Specifically, the NDAA 2018 amended the Small Business Act by replacing fixed dollar amount thresholds with references to the micro-purchase and simplified acquisition thresholds. SBA is updating its regulations to conform to this new statutory language. SBA is also updating the sole source dollar amounts for the Service-Disabled Veteran-Owned (SDVO) small business and the Historically Underutilized Business Zone (HUBZone) small business regulations. The thresholds for sole source contracting are contained in the Small Business Act, SBA's regulations, and the Federal Acquisition Regulations (FAR). These thresholds are updated in the FAR for inflation periodically, and therefore, over time, SBA's regulations and the FAR's numbers diverge. SBA is making this change to conform the thresholds contained in SBA's regulations to those in the FAR. This rule also allows indirect ownership by United States citizens in the HUBZone program to more accurately align with the underlying statutory authority. Finally, SBA is making several technical changes to address mistakes and typos made in previous rulemakings. For example, this final rule will update some cross-references that were not updated when a previous rulemaking changed numbering. Other changes made are for errors, grammar, syntax, and clarity.

Federal Register, Volume 83 Issue 58 (Monday, March 26, 2018)
[Federal Register Volume 83, Number 58 (Monday, March 26, 2018)]
[Rules and Regulations]
[Pages 12849-12852]
From the Federal Register Online  [www.thefederalregister.org]
[FR Doc No: 2018-06033]



========================================================================
Rules and Regulations
                                                Federal Register
________________________________________________________________________

This section of the FEDERAL REGISTER contains regulatory documents 
having general applicability and legal effect, most of which are keyed 
to and codified in the Code of Federal Regulations, which is published 
under 50 titles pursuant to 44 U.S.C. 1510.

The Code of Federal Regulations is sold by the Superintendent of Documents. 

========================================================================


Federal Register / Vol. 83, No. 58 / Monday, March 26, 2018 / Rules 
and Regulations

[[Page 12849]]



SMALL BUSINESS ADMINISTRATION

13 CFR Parts 121, 125, 126, and 127

RIN 3245-AH02


Conforming Statutory Amendments and Technical Corrections to 
Small Business Government Contracting Regulations

AGENCY: U.S. Small Business Administration.

ACTION: Direct final rule; request for comments.

-----------------------------------------------------------------------

SUMMARY: The U.S. Small Business Administration (SBA or Agency) is 
amending its regulations to incorporate a provision of the National 
Defense Authorization Act of 2018 (NDAA 2018) and to update and provide 
several technical corrections to SBA's regulations. Specifically, the 
NDAA 2018 amended the Small Business Act by replacing fixed dollar 
amount thresholds with references to the micro-purchase and simplified 
acquisition thresholds. SBA is updating its regulations to conform to 
this new statutory language. SBA is also updating the sole source 
dollar amounts for the Service-Disabled Veteran-Owned (SDVO) small 
business and the Historically Underutilized Business Zone (HUBZone) 
small business regulations. The thresholds for sole source contracting 
are contained in the Small Business Act, SBA's regulations, and the 
Federal Acquisition Regulations (FAR). These thresholds are updated in 
the FAR for inflation periodically, and therefore, over time, SBA's 
regulations and the FAR's numbers diverge. SBA is making this change to 
conform the thresholds contained in SBA's regulations to those in the 
FAR. This rule also allows indirect ownership by United States citizens 
in the HUBZone program to more accurately align with the underlying 
statutory authority. Finally, SBA is making several technical changes 
to address mistakes and typos made in previous rulemakings. For 
example, this final rule will update some cross-references that were 
not updated when a previous rulemaking changed numbering. Other changes 
made are for errors, grammar, syntax, and clarity.

DATES: This rule is effective on May 25, 2018 without further action, 
unless significant adverse comment is received by April 25, 2018. If 
significant adverse comment is received, SBA will publish a timely 
withdrawal of the rule in the Federal Register.

ADDRESSES: You may submit comments, identified by RIN 3245-AH02, by any 
of the following methods:
     Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.
     Mail, for paper, disk, or CD-ROM submissions: Kenneth 
Dodds, Director, Office of Procurement Policy and Liaison, 409 Third 
Street SW, Washington, DC 20416.
     Hand Delivery/Courier: Kenneth Dodds, Director, Office of 
Procurement Policy and Liaison, 409 Third Street SW, Washington, DC 
20416.
    SBA will post all comments on www.regulations.gov. If you wish to 
submit confidential business information (CBI) as defined in the User 
Notice at www.Regulations.gov, please submit the information to Brenda 
Fernandez, Office of Procurement Policy and Liaison, 409 Third Street 
SW, Washington, DC 20416, or send an email to Brenda.fernandez@sba.gov. 
Highlight the information that you consider CBI and explain why you 
believe SBA should hold this information as confidential. SBA will 
review the information and make the final determination of whether it 
will publish the information or not.

FOR FURTHER INFORMATION CONTACT: Brenda Fernandez, Office of 
Procurement Policy and Liaison, 409 Third Street SW, Washington, DC 
20416, 202-205-7337, Brenda.fernandez@sba.gov.

SUPPLEMENTARY INFORMATION: On December 12, 2017, President Trump signed 
into law the National Defense Authorization Act for Fiscal Year 2018 
(NDAA 2018), Public Law 115-91, 131 Stat. 1283. Section 1702 of NDAA 
2018 amended section 15(j)(1) of the Small Business Act, 15 U.S.C. 
644(j)(1), by removing the $2,500 and $100,000 thresholds found in the 
Small Business Act and replacing them with references to the micro-
purchase threshold and the simplified acquisition threshold, 
respectively. The Small Business Act previously required competition 
reserved exclusively for small business concerns for procurements with 
values falling between $2,500 and $100,000 (adjusted for inflation in 
regulations to $150,000). SBA also uses dollar value thresholds for the 
application of the limitations on subcontracting requirements and 
nonmanufacturer rule to small business set-asides. This direct final 
rule merely adopts the statutory change by replacing the dollar 
thresholds with references to the micro-purchase and simplified 
acquisition thresholds in an identical way that the Small Business Act 
was amended.
    SBA is also updating the sole source dollar amounts for the 
Service-Disabled Veteran-Owned (SDVO) small business and the 
Historically Underutilized Business Zone (HUBZone) small business 
regulations. The thresholds for sole source contracting are contained 
in the Small Business Act, SBA's regulations (Title 13 of the Code of 
Federal Regulations), and the Federal Acquisition Regulations (FAR) 
(Title 48 of the Code of Federal Regulations). These thresholds are 
updated in the FAR for inflation periodically, and therefore over time, 
SBA's regulations and the FAR's numbers diverge. The dollar thresholds 
set forth in the FAR below which contracts may be awarded on a sole 
source basis, as adjusted for inflation, are as follows: For the 8(a) 
Business Development (BD) program (FAR 19.805-1), $7 million, including 
options, for contracts assigned a manufacturing North American 
Industrial Classification System (NAICS) code, and $4 million, 
including options, for all other contracts; for the SDVO small business 
program (FAR 19.1406) and Women-Owned Small Business (WOSB) program 
(FAR 19.1506), $6.5 million, including options, for contracts assigned 
a manufacturing NAICS code, and $4 million, including options, for all 
other contracts; and for the HUBZone program (FAR 19.1306), $7 million, 
including options, for contracts assigned a manufacturing NAICS code, 
and $4 million, including options, for all other contracts. SBA's 
regulations for the 8(a) BD and WOSB programs have previously been 
updated in 13 CFR 124.506(a)(2) and 127.503(c)(2),

[[Page 12850]]

respectively, to synchronize those programs with the inflation 
adjustments made by the FAR. The sole source thresholds for the SDVO 
and HUBZone programs have not been similarly updated. This direct final 
rule merely incorporates the inflation adjustments made by the FAR for 
the SDVO and HUBZone programs into SBA's regulations.
    The rule also amends the HUBZone regulations to allow indirect 
ownership by United States citizens to more accurately align with the 
underlying statutory authority. Direct ownership is not statutorily 
mandated, and SBA believes that the purposes of the HUBZone program--
capital infusion in underutilized geographic areas and employment of 
individuals living in those areas--may be achieved whether ownership by 
U.S. citizens is direct or indirect. The regulations first implementing 
the HUBZone program were largely based on those governing the Small 
Disadvantaged Business (SDB) program, which is no longer in existence 
and which served different goals than the HUBZone program. The SDB 
program and SBA's other currently active socioeconomic programs 
(including the 8(a) BD program, the WOSB small business program, and 
the SDVO small business program) are intended to assist the business 
development of small concerns owned and controlled by certain 
individuals, so requiring direct ownership for these programs is 
consistent with their purposes. The HUBZone program differs in that the 
program's goals do not center on the socioeconomic status of the SBC 
owner but rather the location of the business and the residence of its 
employees. This direct final rule deletes the requirement that 
ownership by United States citizens in the HUBZone program must be 
direct, and instead it merely copies the statutory requirement that a 
HUBZone small business concern must be at least 51% owned and 
controlled by United States citizens.
    Finally, SBA is making several technical changes to address 
mistakes and typos made in previous rulemakings. For example, this 
final rule will update some cross-references that were not updated when 
a previous rulemaking changed numbering.

Section by Section Analysis

Section 121.103(h)(3)(ii)

    This section deals with exceptions to SBA's general affiliations 
rule for joint ventures. Specifically, the exception in subparagraph 
(ii) is for joint ventures participating in SBA's mentor 
prot[eacute]g[eacute] program. The rule is intended to classify a joint 
venture between a small business and its SBA-approved mentor as small, 
as long as the prot[eacute]g[eacute] qualifies as small for the size 
standard corresponding to the NAICS code assigned to the contract and 
meets SBA's general joint venture requirements for the type of contract 
at issue. In other words, the joint venture can qualify as small for 
any contract (8(a), small business set aside, WOSB, SDVO, or HUBZone) 
provided it meets SBA's joint venture rules for the type of contract to 
be performed. However, the current regulation is missing cross-
references to the joint venture requirements for 8(a) contracts and 
small business set asides. These cross-references were inadvertently 
left out. This change merely fixes that error.

Sections 121.404(g), 125.18(e)(1), 126.601(h)(1), and 127.503(h)(1)

    SBA is making a technical correction to these sections. The 
paragraphs in question deal with the identical issue, recertification 
of size and/or status. The language and intent of each regulation is 
the same; the only difference is that each section deals with a 
separate socio-economic contracting program. It has been brought to 
SBA's attention that as drafted, it is not clear which sentence or 
clause the final sentence is referencing. It was SBA's intent, as made 
clear in the proposed and final rule enacting this regulation, entitled 
Acquisition Process: Task and Delivery Order Contracts, Bundling, 
Consolidation, 78 FR 61114 (Oct. 2, 2013), that SBA wanted the sentence 
and the referenced exceptions to be applied to the entirety of the 
preceding paragraph. 78 FR 61114, 61119-20 (Oct. 2, 2013). Therefore, 
SBA is adding additional language to clearly align the paragraph to the 
intent of the regulation. This rule is not intended to make any 
substantive change to the paragraphs. SBA is also changing the heading 
to Sec.  126.601(h), the recertification paragraph for the HUBZone 
program, in order to make it identical to the recertification 
paragraphs relating to the other programs. There is no intended 
difference regarding recertification between the programs, so there is 
no need for the additional language in the HUBZone paragraph after the 
word recertification.

Section 121.406(a)

    SBA is making a correction to paragraph (a) of this section in 
order to correct a missing word. With reference to the clause dealing 
with SDVO SBC contracting, SBA left out the modifier ``sole'' before 
``source contract'' in the final rule enacting this regulation, 
entitled Small Business Government Contracting and National Defense 
Authorization Act of 2013 Amendments, 81 FR 34243, 34259 (May 31, 
2016).

Section 121.406(d)

    SBA is making a change to paragraph (d) of this section. This 
change removes the dollar value thresholds and replaces them with 
references to the micro-purchase and simplified acquisition thresholds, 
respectively. As explained above, the NDAA 2018 modified the Small 
Business Act by changing the dollar thresholds to references to the 
micro-purchase threshold and the simplified acquisition threshold. This 
direct final rule merely conforms the regulation to the statutory 
changes made by the NDAA 2018.

Section 125.3

    This change removes the term ``$150,000'' in paragraphs 
(c)(1)(viii) and (ix) and replaces it with a reference to the 
simplified acquisition threshold. As explained above, the NDAA 2018 
modified the Small Business Act by changing the dollar thresholds to 
references to the micro-purchase threshold and the simplified 
acquisition threshold. Thus, this direct final rule merely conforms the 
regulation to the statutory changes made by the NDAA 2018 and does not 
make any substantive change to the regulations.

Section 125.6

    This change removes the dollar value thresholds and replaces them 
with references to the micro-purchase and simplified acquisition 
thresholds, respectively. As explained above, the NDAA 2018 modified 
the Small Business Act by changing the dollar thresholds to references 
to the micro-purchase threshold and the simplified acquisition 
threshold. Thus, this direct final rule merely conforms the regulation 
to the statutory changes made by the NDAA 2018 and does not make any 
substantive change to the regulations.

Sections 125.22 and 125.23

    This direct final rule changes Sec. Sec.  125.22 and 125.23 to 
correct cross-reference citations that were not updated when SBA 
renumbered its regulations. SBA is also amending the values authorized 
for SDVO small business sole source awards in order to be consistent 
with the current values set forth in FAR 19.1406, as adjusted for 
inflation.

Section 126.200(b)(1)

    As set forth above in more detail, this rule deletes the 
requirement that

[[Page 12851]]

ownership by United States citizens in the HUBZone program must be 
direct, and instead it merely copies the statutory requirement that a 
HUBZone small business concern must be at least 51% owned and 
controlled by United States citizens.

Section 126.612(b)(1) and (2)

    SBA is amending these paragraphs to update the values authorized 
for HUBZone sole source awards in order to be consistent with the 
current values set forth in FAR 19.1306, as adjusted for inflation.

Section 126.616(d)(2)

    SBA is amending this paragraph by replacing the word 
prot[eacute]g[eacute] with the term SBC. The inclusion of the word 
prot[eacute]g[eacute] was a mistake. The mistake could be interpreted 
to mean the availability of the benefits of this provision were 
available only to HUBZone SBCs partaking in the SBA's mentor-
prot[eacute]g[eacute] program. However, the clear intent of the final 
rule entitled ``Small Business Mentor Prot[eacute]g[eacute] Programs, 
81 FR 48557 (July 25, 2016), was for the joint venture benefits to be 
available to all certified HUBZone SBCs. In this regard, the 
supplementary information to the Small Business Mentor 
Prot[eacute]g[eacute] Programs rule, in which this provision was 
adopted, provided that ``the final rule revises the joint venture 
provisions contained in Sec.  125.15(b) (for SDVO SBCs, which are now 
contained in Sec.  125.18(b)), Sec.  126.616 (for HUBZone SBCs), and 
Sec.  127.506 (for WOSB and Economically Disadvantaged Women-Owned 
Small Business (EDWOSB) concerns) to more fully align those 
requirements to the requirements of the 8(a) BD program.'' 81 FR 48557, 
48558, 48559 (July 25, 2016) (Emphasis added). This direct final rule 
merely conforms the HUBZone regulatory language to that of the other 
programs, something that was specifically intended in the original 
regulatory authority.

Compliance With Executive Orders 12866, 12988, 13132, and 13771, the 
Paperwork Reduction Act (44 U.S.C. Ch. 35) and the Regulatory 
Flexibility Act (5 U.S.C. 601-612)

Executive Order 12866

    The Office of Management and Budget (OMB) has determined that this 
direct final rule does not constitute a significant regulatory action 
under Executive Order 12866. This rule is also not a major rule under 
the Congressional Review Act, 5 U.S.C. 800.

Executive Order 12988

    This action meets applicable standards set forth in Sections 3(a) 
and 3(b)(2) of Executive Order 12988, Civil Justice Reform, to minimize 
litigation, eliminate ambiguity, and reduce burden. The action does not 
have retroactive or preemptive effect.

Executive Order 13132

    For the purposes of Executive Order 13132, SBA has determined that 
this direct final rule will not have substantial, direct effects on the 
States, on the relationship between the national government and the 
States, or on the distribution of power and responsibilities among the 
various levels of government. Therefore, for the purpose of Executive 
Order 13132, Federalism, SBA has determined that this direct final rule 
has no federalism implications warranting preparation of a Federalism 
assessment.

Executive Order 13771

    This final rule is not an Executive Order 13771 regulatory action 
because it is not significant under Executive Order 12866.

Paperwork Reduction Act, 44 U.S.C., Ch. 35

    SBA has determined that this direct final rule does not impose 
additional reporting or recordkeeping requirements under the Paperwork 
Reduction Act, 44 U.S.C., Chapter 35.

Regulatory Flexibility Act, 5 U.S.C. 601-612

    The Regulatory Flexibility Act (RFA), 5 U.S.C. 601, requires 
administrative agencies to consider the effect of their actions on 
small entities, small non-profit enterprises, and small local 
governments. Pursuant to the RFA, when an agency issues a rulemaking, 
the agency must prepare a regulatory flexibility analysis, which 
describes the impact of the rule on small entities. However, section 
605 of the RFA allows an agency to certify a rule, in lieu of preparing 
an analysis, if the rulemaking is not expected to have a significant 
economic impact on a substantial number of small entities. Within the 
meaning of RFA, SBA certifies that this direct final rule will not have 
a significant economic impact on a substantial number of small 
entities.

List of Subjects

13 CFR Part 121

    Government procurement, Government property, Grant programs--
business, Individuals with disabilities, Loan programs--business, Small 
businesses.

13 CFR Part 125

    Government contracts, Government procurement, Reporting and 
recordkeeping requirements, Small businesses, Technical assistance.

13 CFR Part 126

    Administrative practice and procedure, Government procurement, 
Penalties, Reporting and recordkeeping requirements, Small businesses.

13 CFR Part 127

    Government contracts, Reporting and recordkeeping requirements, 
Small businesses.

    Accordingly, for the reasons stated in the preamble, SBA amends 13 
CFR parts 121, 125, 126, and 127 as follows:

PART 121--SMALL BUSINESS SIZE REGULATIONS

0
1. The authority citation for part 121 continues to read as follows:

    Authority: 15 U.S.C. 632, 634(b)(6), 662 and 694a(9).


0
2. Amend Sec.  121.103 by revising paragraph (h)(3)(ii) to read as 
follows:


Sec.  121.103  How does SBA determine affiliation?

* * * * *
    (h) * * *
    (3) * * *
    (ii) Two firms approved by SBA to be a mentor and 
prot[eacute]g[eacute] under Sec.  125.9 of this chapter may joint 
venture as a small business for any Federal government prime contract 
or subcontract, provided the prot[eacute]g[eacute] qualifies as small 
for the size standard corresponding to the NAICS code assigned to the 
procurement, and the joint venture meets the requirements of Sec. Sec.  
124.513 (c) and (d), Sec. Sec.  125.8(b) and (c), Sec. Sec.  
125.18(b)(2) and (3), Sec. Sec.  126.616(c) and (d), or Sec. Sec.  
127.506(c) and (d) of this chapter, as appropriate.
* * * * *

0
3. Amend Sec.  121.404 by revising the last sentence of the 
introductory text of paragraph (g) to read as follows:


Sec.  121.404  When is the size status of a business concern 
determined?

* * * * *
    (g) * * * However, the following exceptions apply to this paragraph 
(g):
* * * * *

0
4. Amend Sec.  121.406 by:
0
a. Adding the word ``sole'' after the words ``veteran-owned small 
business set-aside or'' and before the words ``source contract,'' in 
paragraph (a); and
0
b. Revising paragraph (d) to read as follows:

[[Page 12852]]

Sec.  121.406  How does a small business concern qualify to provide 
manufactured products or other supply items under a small business set-
aside, service-disabled veteran-owned small business, HUBZone, WOSB or 
EDWOSB, or 8(a) contract?

* * * * *
    (d) The performance requirements (limitations on subcontracting) 
and the nonmanufacturer rule do not apply to small business set-aside 
acquisitions with an estimated value between the micro-purchase 
threshold and the simplified acquisition threshold (as both terms are 
defined in the FAR at 48 CFR 2.101).
* * * * *

PART 125--GOVERNMENT CONTRACTING PROGRAMS

0
5. The authority citation for part 125 continues to read as follows:

    Authority: 15 U.S.C. 632(p), (q); 634(b)(6); 637; 644; 657f; 
657r.


Sec.  125.3  [Amended]

0
6. Amend Sec.  125.3 by removing the term ``$150,000'' and adding in 
its place the phrase ``the simplified acquisition threshold (as defined 
in the FAR at 48 CFR 2.101)'' in paragraphs (c)(1)(viii) and (ix).

0
7. Amend Sec.  125.6 by:
0
a. Removing the term ``$150,000'' and adding in its place the phrase 
``the simplified acquisition threshold (as defined in the FAR at 48 CFR 
2.101)'' in paragraph (a) introductory text; and
0
b. Revising paragraph (f)(1) to read as follows:


Sec.  125.6  What are the prime contractor's limitations on 
subcontracting?

* * * * *
    (f) * * *
    (1) Small business set-aside contracts with a value that is greater 
than the micro-purchase threshold but less than or equal to the 
simplified acquisition threshold (as both terms are defined in the FAR 
at 48 CFR 2.101); or
* * * * *

0
8. Amend Sec.  125.18 by revising the last sentence of paragraph (e)(1) 
to read as follows:


Sec.  125.18  What requirements must an SDVO SBC meet to submit an 
offer on a contract?

* * * * *
    (e) * * * (1) * * * However, the following exceptions apply to this 
paragraph (e)(1):
* * * * *

0
9. Amend Sec.  125.22 by revising paragraph (a) to read as follows:


Sec.  125.22  When may a contracting officer set-aside a procurement 
for SDVO SBCs?

    (a) The contracting officer first must review a requirement to 
determine whether it is excluded from SDVO contracting pursuant to 
Sec.  125.21.
* * * * *

0
10. Amend Sec.  125.23 by revising paragraphs (a), and (b)(1) and (2) 
to read as follows:


Sec.  125.23  When may a contracting officer award sole source 
contracts to SDVO SBCs?

* * * * *
    (a) None of the provisions of Sec. Sec.  125.21 or 125.22 apply;
    (b) * * *
    (1) $6,500,000 for a contract assigned a manufacturing NAICS code, 
or
    (2) $4,000,000 for all other contracts;
* * * * *

PART 126--HUBZONE PROGRAM

0
11. The authority citation for part 126 continues to read as follows:

    Authority: 15 U.S.C. 632(a), 632(j), 632(p), 644, and 657a.


Sec.  126.200  [Amended]

0
12. Amend Sec.  126.200 by removing the words ``unconditionally and 
directly'' in paragraph (b)(1)(i).

0
13. Amend Sec.  126.601 by revising the heading of paragraph (h) and 
the last sentence of the introductory text of paragraph (h)(1) to read 
as follows:


Sec.  126.601  What additional requirements must a qualified HUBZone 
SBC meet to bid on a contract?

* * * * *
    (h) Recertification. (1) * * * However, the following exceptions 
apply to this paragraph (h)(1):
* * * * *

0
14. Amend Sec.  126.612 by revising paragraphs (b)(1) and (2) to read 
as follows:


Sec.  126.612  When may a CO award sole source contracts to qualified 
HUBZone SBCs?

* * * * *
    (b) * * *
    (1) $7,000,000 for a contract assigned a manufacturing NAICS code, 
or
    (2) $4,000,000 for all other contracts.
* * * * *


Sec.  126.616  [Amended]

0
15. Amend Sec.  126.616 by removing the words ``HUBZone 
prot[eacute]g[eacute]'' and adding in their place the words ``HUBZone 
SBC'' in paragraph (d)(2).

PART 127--WOMEN-OWNED SMALL BUSINESS FEDERAL CONTRACT PROGRAM

0
16. The authority citation for part 127 continues to read as follows:

    Authority: 15 U.S.C. 632, 634(b)(6), 637(m), 644 and 657r.


0
17. Amend Sec.  127.503 by revising the last sentence of the 
introductory text of paragraph (h)(1) to read as follows:


Sec.  127.503  When is a contracting officer authorized to restrict 
competition or award a sole source contract or order under this part?

* * * * *
    (h) * * *
    (1) * * * However, the following exceptions apply to this paragraph 
(h)(1):
* * * * *

    Dated: March 19, 2018.
Linda E. McMahon,
Administrator.
[FR Doc. 2018-06033 Filed 3-23-18; 8:45 am]
BILLING CODE 8025-01-P



                                                                                                                                                                                             12849

                                              Rules and Regulations                                                                                         Federal Register
                                                                                                                                                            Vol. 83, No. 58

                                                                                                                                                            Monday, March 26, 2018



                                              This section of the FEDERAL REGISTER                    example, this final rule will update                  to the micro-purchase threshold and the
                                              contains regulatory documents having general            some cross-references that were not                   simplified acquisition threshold,
                                              applicability and legal effect, most of which           updated when a previous rulemaking                    respectively. The Small Business Act
                                              are keyed to and codified in the Code of                changed numbering. Other changes                      previously required competition
                                              Federal Regulations, which is published under           made are for errors, grammar, syntax,                 reserved exclusively for small business
                                              50 titles pursuant to 44 U.S.C. 1510.
                                                                                                      and clarity.                                          concerns for procurements with values
                                              The Code of Federal Regulations is sold by              DATES: This rule is effective on May 25,              falling between $2,500 and $100,000
                                              the Superintendent of Documents.                        2018 without further action, unless                   (adjusted for inflation in regulations to
                                                                                                      significant adverse comment is received               $150,000). SBA also uses dollar value
                                                                                                      by April 25, 2018. If significant adverse             thresholds for the application of the
                                              SMALL BUSINESS ADMINISTRATION                           comment is received, SBA will publish                 limitations on subcontracting
                                                                                                      a timely withdrawal of the rule in the                requirements and nonmanufacturer rule
                                              13 CFR Parts 121, 125, 126, and 127                     Federal Register.                                     to small business set-asides. This direct
                                              RIN 3245–AH02                                           ADDRESSES: You may submit comments,                   final rule merely adopts the statutory
                                                                                                      identified by RIN 3245–AH02, by any of                change by replacing the dollar
                                              Conforming Statutory Amendments                         the following methods:                                thresholds with references to the micro-
                                              and Technical Corrections to Small                         • Federal eRulemaking Portal: http://              purchase and simplified acquisition
                                              Business Government Contracting                         www.regulations.gov. Follow the                       thresholds in an identical way that the
                                              Regulations                                             instructions for submitting comments.                 Small Business Act was amended.
                                              AGENCY: U.S. Small Business                                • Mail, for paper, disk, or CD–ROM                    SBA is also updating the sole source
                                              Administration.                                         submissions: Kenneth Dodds, Director,                 dollar amounts for the Service-Disabled
                                                                                                      Office of Procurement Policy and                      Veteran-Owned (SDVO) small business
                                              ACTION: Direct final rule; request for
                                                                                                      Liaison, 409 Third Street SW,                         and the Historically Underutilized
                                              comments.
                                                                                                      Washington, DC 20416.                                 Business Zone (HUBZone) small
                                              SUMMARY:   The U.S. Small Business                         • Hand Delivery/Courier: Kenneth                   business regulations. The thresholds for
                                              Administration (SBA or Agency) is                       Dodds, Director, Office of Procurement                sole source contracting are contained in
                                              amending its regulations to incorporate                 Policy and Liaison, 409 Third Street                  the Small Business Act, SBA’s
                                              a provision of the National Defense                     SW, Washington, DC 20416.                             regulations (Title 13 of the Code of
                                              Authorization Act of 2018 (NDAA 2018)                      SBA will post all comments on                      Federal Regulations), and the Federal
                                              and to update and provide several                       www.regulations.gov. If you wish to                   Acquisition Regulations (FAR) (Title 48
                                              technical corrections to SBA’s                          submit confidential business                          of the Code of Federal Regulations).
                                              regulations. Specifically, the NDAA                     information (CBI) as defined in the User              These thresholds are updated in the
                                              2018 amended the Small Business Act                     Notice at www.Regulations.gov, please                 FAR for inflation periodically, and
                                              by replacing fixed dollar amount                        submit the information to Brenda                      therefore over time, SBA’s regulations
                                              thresholds with references to the micro-                Fernandez, Office of Procurement Policy               and the FAR’s numbers diverge. The
                                              purchase and simplified acquisition                     and Liaison, 409 Third Street SW,                     dollar thresholds set forth in the FAR
                                              thresholds. SBA is updating its                         Washington, DC 20416, or send an email                below which contracts may be awarded
                                              regulations to conform to this new                      to Brenda.fernandez@sba.gov. Highlight                on a sole source basis, as adjusted for
                                              statutory language. SBA is also updating                the information that you consider CBI                 inflation, are as follows: For the 8(a)
                                              the sole source dollar amounts for the                  and explain why you believe SBA                       Business Development (BD) program
                                              Service-Disabled Veteran-Owned                          should hold this information as                       (FAR 19.805–1), $7 million, including
                                              (SDVO) small business and the                           confidential. SBA will review the                     options, for contracts assigned a
                                              Historically Underutilized Business                     information and make the final                        manufacturing North American
                                              Zone (HUBZone) small business                           determination of whether it will publish              Industrial Classification System
                                              regulations. The thresholds for sole                    the information or not.                               (NAICS) code, and $4 million, including
                                              source contracting are contained in the                 FOR FURTHER INFORMATION CONTACT:                      options, for all other contracts; for the
                                              Small Business Act, SBA’s regulations,                  Brenda Fernandez, Office of                           SDVO small business program (FAR
                                              and the Federal Acquisition Regulations                 Procurement Policy and Liaison, 409                   19.1406) and Women-Owned Small
                                              (FAR). These thresholds are updated in                  Third Street SW, Washington, DC                       Business (WOSB) program (FAR
                                              the FAR for inflation periodically, and                 20416, 202–205–7337,                                  19.1506), $6.5 million, including
                                              therefore, over time, SBA’s regulations                 Brenda.fernandez@sba.gov.                             options, for contracts assigned a
                                              and the FAR’s numbers diverge. SBA is                   SUPPLEMENTARY INFORMATION: On                         manufacturing NAICS code, and $4
                                              making this change to conform the                       December 12, 2017, President Trump                    million, including options, for all other
                                              thresholds contained in SBA’s                           signed into law the National Defense                  contracts; and for the HUBZone program
                                              regulations to those in the FAR. This                   Authorization Act for Fiscal Year 2018                (FAR 19.1306), $7 million, including
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                                              rule also allows indirect ownership by                  (NDAA 2018), Public Law 115–91, 131                   options, for contracts assigned a
                                              United States citizens in the HUBZone                   Stat. 1283. Section 1702 of NDAA 2018                 manufacturing NAICS code, and $4
                                              program to more accurately align with                   amended section 15(j)(1) of the Small                 million, including options, for all other
                                              the underlying statutory authority.                     Business Act, 15 U.S.C. 644(j)(1), by                 contracts. SBA’s regulations for the 8(a)
                                              Finally, SBA is making several technical                removing the $2,500 and $100,000                      BD and WOSB programs have
                                              changes to address mistakes and typos                   thresholds found in the Small Business                previously been updated in 13 CFR
                                              made in previous rulemakings. For                       Act and replacing them with references                124.506(a)(2) and 127.503(c)(2),


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                                              12850              Federal Register / Vol. 83, No. 58 / Monday, March 26, 2018 / Rules and Regulations

                                              respectively, to synchronize those                      a joint venture between a small business              Contracting and National Defense
                                              programs with the inflation adjustments                 and its SBA-approved mentor as small,                 Authorization Act of 2013
                                              made by the FAR. The sole source                        as long as the protégé qualifies as small           Amendments, 81 FR 34243, 34259 (May
                                              thresholds for the SDVO and HUBZone                     for the size standard corresponding to                31, 2016).
                                              programs have not been similarly                        the NAICS code assigned to the contract
                                                                                                                                                            Section 121.406(d)
                                              updated. This direct final rule merely                  and meets SBA’s general joint venture
                                              incorporates the inflation adjustments                  requirements for the type of contract at                SBA is making a change to paragraph
                                              made by the FAR for the SDVO and                        issue. In other words, the joint venture              (d) of this section. This change removes
                                              HUBZone programs into SBA’s                             can qualify as small for any contract                 the dollar value thresholds and replaces
                                              regulations.                                            (8(a), small business set aside, WOSB,                them with references to the micro-
                                                 The rule also amends the HUBZone                     SDVO, or HUBZone) provided it meets                   purchase and simplified acquisition
                                              regulations to allow indirect ownership                 SBA’s joint venture rules for the type of             thresholds, respectively. As explained
                                              by United States citizens to more                       contract to be performed. However, the                above, the NDAA 2018 modified the
                                              accurately align with the underlying                    current regulation is missing cross-                  Small Business Act by changing the
                                              statutory authority. Direct ownership is                references to the joint venture                       dollar thresholds to references to the
                                              not statutorily mandated, and SBA                       requirements for 8(a) contracts and                   micro-purchase threshold and the
                                              believes that the purposes of the                       small business set asides. These cross-               simplified acquisition threshold. This
                                              HUBZone program—capital infusion in                     references were inadvertently left out.               direct final rule merely conforms the
                                              underutilized geographic areas and                      This change merely fixes that error.                  regulation to the statutory changes made
                                              employment of individuals living in                                                                           by the NDAA 2018.
                                                                                                      Sections 121.404(g), 125.18(e)(1),
                                              those areas—may be achieved whether                     126.601(h)(1), and 127.503(h)(1)                      Section 125.3
                                              ownership by U.S. citizens is direct or
                                              indirect. The regulations first                            SBA is making a technical correction                  This change removes the term
                                              implementing the HUBZone program                        to these sections. The paragraphs in                  ‘‘$150,000’’ in paragraphs (c)(1)(viii)
                                              were largely based on those governing                   question deal with the identical issue,               and (ix) and replaces it with a reference
                                              the Small Disadvantaged Business (SDB)                  recertification of size and/or status. The            to the simplified acquisition threshold.
                                              program, which is no longer in                          language and intent of each regulation is             As explained above, the NDAA 2018
                                              existence and which served different                    the same; the only difference is that                 modified the Small Business Act by
                                              goals than the HUBZone program. The                     each section deals with a separate socio-             changing the dollar thresholds to
                                              SDB program and SBA’s other currently                   economic contracting program. It has                  references to the micro-purchase
                                              active socioeconomic programs                           been brought to SBA’s attention that as               threshold and the simplified acquisition
                                              (including the 8(a) BD program, the                     drafted, it is not clear which sentence or            threshold. Thus, this direct final rule
                                              WOSB small business program, and the                    clause the final sentence is referencing.             merely conforms the regulation to the
                                              SDVO small business program) are                        It was SBA’s intent, as made clear in the             statutory changes made by the NDAA
                                              intended to assist the business                         proposed and final rule enacting this                 2018 and does not make any substantive
                                                                                                      regulation, entitled Acquisition Process:             change to the regulations.
                                              development of small concerns owned
                                                                                                      Task and Delivery Order Contracts,
                                              and controlled by certain individuals, so                                                                     Section 125.6
                                                                                                      Bundling, Consolidation, 78 FR 61114
                                              requiring direct ownership for these
                                                                                                      (Oct. 2, 2013), that SBA wanted the                      This change removes the dollar value
                                              programs is consistent with their
                                                                                                      sentence and the referenced exceptions                thresholds and replaces them with
                                              purposes. The HUBZone program differs
                                                                                                      to be applied to the entirety of the                  references to the micro-purchase and
                                              in that the program’s goals do not center
                                                                                                      preceding paragraph. 78 FR 61114,                     simplified acquisition thresholds,
                                              on the socioeconomic status of the SBC
                                                                                                      61119–20 (Oct. 2, 2013). Therefore, SBA               respectively. As explained above, the
                                              owner but rather the location of the
                                                                                                      is adding additional language to clearly              NDAA 2018 modified the Small
                                              business and the residence of its
                                                                                                      align the paragraph to the intent of the              Business Act by changing the dollar
                                              employees. This direct final rule deletes
                                                                                                      regulation. This rule is not intended to              thresholds to references to the micro-
                                              the requirement that ownership by
                                                                                                      make any substantive change to the                    purchase threshold and the simplified
                                              United States citizens in the HUBZone
                                                                                                      paragraphs. SBA is also changing the                  acquisition threshold. Thus, this direct
                                              program must be direct, and instead it
                                                                                                      heading to § 126.601(h), the                          final rule merely conforms the
                                              merely copies the statutory requirement
                                                                                                      recertification paragraph for the                     regulation to the statutory changes made
                                              that a HUBZone small business concern
                                                                                                      HUBZone program, in order to make it                  by the NDAA 2018 and does not make
                                              must be at least 51% owned and
                                                                                                      identical to the recertification                      any substantive change to the
                                              controlled by United States citizens.
                                                                                                      paragraphs relating to the other                      regulations.
                                                 Finally, SBA is making several
                                                                                                      programs. There is no intended
                                              technical changes to address mistakes                                                                         Sections 125.22 and 125.23
                                                                                                      difference regarding recertification
                                              and typos made in previous
                                                                                                      between the programs, so there is no                    This direct final rule changes
                                              rulemakings. For example, this final
                                                                                                      need for the additional language in the               §§ 125.22 and 125.23 to correct cross-
                                              rule will update some cross-references
                                                                                                      HUBZone paragraph after the word                      reference citations that were not
                                              that were not updated when a previous
                                                                                                      recertification.                                      updated when SBA renumbered its
                                              rulemaking changed numbering.
                                                                                                                                                            regulations. SBA is also amending the
                                                                                                      Section 121.406(a)
                                              Section by Section Analysis                                                                                   values authorized for SDVO small
                                                                                                         SBA is making a correction to                      business sole source awards in order to
                                              Section 121.103(h)(3)(ii)
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                                                                                                      paragraph (a) of this section in order to             be consistent with the current values set
                                                This section deals with exceptions to                 correct a missing word. With reference                forth in FAR 19.1406, as adjusted for
                                              SBA’s general affiliations rule for joint               to the clause dealing with SDVO SBC                   inflation.
                                              ventures. Specifically, the exception in                contracting, SBA left out the modifier
                                              subparagraph (ii) is for joint ventures                 ‘‘sole’’ before ‘‘source contract’’ in the            Section 126.200(b)(1)
                                              participating in SBA’s mentor protégé                 final rule enacting this regulation,                    As set forth above in more detail, this
                                              program. The rule is intended to classify               entitled Small Business Government                    rule deletes the requirement that


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                                                                 Federal Register / Vol. 83, No. 58 / Monday, March 26, 2018 / Rules and Regulations                                             12851

                                              ownership by United States citizens in                  Executive Order 12988                                 Loan programs—business, Small
                                              the HUBZone program must be direct,                                                                           businesses.
                                                                                                         This action meets applicable
                                              and instead it merely copies the                                                                              13 CFR Part 125
                                                                                                      standards set forth in Sections 3(a) and
                                              statutory requirement that a HUBZone
                                                                                                      3(b)(2) of Executive Order 12988, Civil                 Government contracts, Government
                                              small business concern must be at least                 Justice Reform, to minimize litigation,
                                              51% owned and controlled by United                                                                            procurement, Reporting and
                                                                                                      eliminate ambiguity, and reduce                       recordkeeping requirements, Small
                                              States citizens.                                        burden. The action does not have                      businesses, Technical assistance.
                                              Section 126.612(b)(1) and (2)                           retroactive or preemptive effect.
                                                                                                                                                            13 CFR Part 126
                                                SBA is amending these paragraphs to                   Executive Order 13132
                                                                                                                                                              Administrative practice and
                                              update the values authorized for                          For the purposes of Executive Order                 procedure, Government procurement,
                                              HUBZone sole source awards in order to                  13132, SBA has determined that this                   Penalties, Reporting and recordkeeping
                                              be consistent with the current values set               direct final rule will not have                       requirements, Small businesses.
                                              forth in FAR 19.1306, as adjusted for                   substantial, direct effects on the States,
                                              inflation.                                              on the relationship between the national              13 CFR Part 127
                                                                                                      government and the States, or on the                    Government contracts, Reporting and
                                              Section 126.616(d)(2)                                                                                         recordkeeping requirements, Small
                                                                                                      distribution of power and
                                                 SBA is amending this paragraph by                    responsibilities among the various                    businesses.
                                              replacing the word protégé with the                   levels of government. Therefore, for the                Accordingly, for the reasons stated in
                                              term SBC. The inclusion of the word                     purpose of Executive Order 13132,                     the preamble, SBA amends 13 CFR parts
                                              protégé was a mistake. The mistake                    Federalism, SBA has determined that                   121, 125, 126, and 127 as follows:
                                              could be interpreted to mean the                        this direct final rule has no federalism
                                                                                                      implications warranting preparation of a              PART 121—SMALL BUSINESS SIZE
                                              availability of the benefits of this                                                                          REGULATIONS
                                              provision were available only to                        Federalism assessment.
                                              HUBZone SBCs partaking in the SBA’s                     Executive Order 13771                                 ■ 1. The authority citation for part 121
                                              mentor-protégé program. However, the                                                                        continues to read as follows:
                                              clear intent of the final rule entitled                    This final rule is not an Executive
                                                                                                      Order 13771 regulatory action because it                Authority: 15 U.S.C. 632, 634(b)(6), 662
                                              ‘‘Small Business Mentor Protégé                                                                             and 694a(9).
                                              Programs, 81 FR 48557 (July 25, 2016),                  is not significant under Executive Order
                                              was for the joint venture benefits to be                12866.                                                ■ 2. Amend § 121.103 by revising
                                              available to all certified HUBZone SBCs.                                                                      paragraph (h)(3)(ii) to read as follows:
                                                                                                      Paperwork Reduction Act, 44 U.S.C.,
                                              In this regard, the supplementary                       Ch. 35                                                § 121.103 How does SBA determine
                                              information to the Small Business                                                                             affiliation?
                                              Mentor Protégé Programs rule, in which                   SBA has determined that this direct
                                                                                                      final rule does not impose additional                 *       *    *     *     *
                                              this provision was adopted, provided                                                                             (h) * * *
                                              that ‘‘the final rule revises the joint                 reporting or recordkeeping requirements
                                                                                                                                                               (3) * * *
                                              venture provisions contained in                         under the Paperwork Reduction Act, 44
                                                                                                                                                               (ii) Two firms approved by SBA to be
                                              § 125.15(b) (for SDVO SBCs, which are                   U.S.C., Chapter 35.
                                                                                                                                                            a mentor and protégé under § 125.9 of
                                              now contained in § 125.18(b)), § 126.616                Regulatory Flexibility Act, 5 U.S.C. 601–             this chapter may joint venture as a small
                                              (for HUBZone SBCs), and § 127.506 (for                  612                                                   business for any Federal government
                                              WOSB and Economically Disadvantaged                                                                           prime contract or subcontract, provided
                                                                                                         The Regulatory Flexibility Act (RFA),              the protégé qualifies as small for the size
                                              Women-Owned Small Business
                                                                                                      5 U.S.C. 601, requires administrative                 standard corresponding to the NAICS
                                              (EDWOSB) concerns) to more fully align
                                                                                                      agencies to consider the effect of their              code assigned to the procurement, and
                                              those requirements to the requirements
                                                                                                      actions on small entities, small non-                 the joint venture meets the requirements
                                              of the 8(a) BD program.’’ 81 FR 48557,
                                                                                                      profit enterprises, and small local                   of §§ 124.513 (c) and (d), §§ 125.8(b) and
                                              48558, 48559 (July 25, 2016) (Emphasis
                                                                                                      governments. Pursuant to the RFA,                     (c), §§ 125.18(b)(2) and (3), §§ 126.616(c)
                                              added). This direct final rule merely
                                                                                                      when an agency issues a rulemaking,                   and (d), or §§ 127.506(c) and (d) of this
                                              conforms the HUBZone regulatory
                                                                                                      the agency must prepare a regulatory                  chapter, as appropriate.
                                              language to that of the other programs,
                                                                                                      flexibility analysis, which describes the
                                              something that was specifically                                                                               *       *    *     *     *
                                                                                                      impact of the rule on small entities.
                                              intended in the original regulatory                                                                           ■ 3. Amend § 121.404 by revising the
                                                                                                      However, section 605 of the RFA allows
                                              authority.                                              an agency to certify a rule, in lieu of               last sentence of the introductory text of
                                              Compliance With Executive Orders                        preparing an analysis, if the rulemaking              paragraph (g) to read as follows:
                                              12866, 12988, 13132, and 13771, the                     is not expected to have a significant                 § 121.404 When is the size status of a
                                              Paperwork Reduction Act (44 U.S.C.                      economic impact on a substantial                      business concern determined?
                                              Ch. 35) and the Regulatory Flexibility                  number of small entities. Within the                  *      *    *     *     *
                                              Act (5 U.S.C. 601–612)                                  meaning of RFA, SBA certifies that this                  (g) * * * However, the following
                                                                                                      direct final rule will not have a                     exceptions apply to this paragraph (g):
                                              Executive Order 12866                                   significant economic impact on a
                                                                                                      substantial number of small entities.                 *      *    *     *     *
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                                                 The Office of Management and Budget                                                                        ■ 4. Amend § 121.406 by:
                                              (OMB) has determined that this direct                   List of Subjects                                      ■ a. Adding the word ‘‘sole’’ after the
                                              final rule does not constitute a                                                                              words ‘‘veteran-owned small business
                                                                                                      13 CFR Part 121
                                              significant regulatory action under                                                                           set-aside or’’ and before the words
                                              Executive Order 12866. This rule is also                  Government procurement,                             ‘‘source contract,’’ in paragraph (a); and
                                              not a major rule under the                              Government property, Grant programs—                  ■ b. Revising paragraph (d) to read as
                                              Congressional Review Act, 5 U.S.C. 800.                 business, Individuals with disabilities,              follows:


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                                              12852              Federal Register / Vol. 83, No. 58 / Monday, March 26, 2018 / Rules and Regulations

                                              § 121.406 How does a small business                     § 125.22 When may a contracting officer               PART 127—WOMEN-OWNED SMALL
                                              concern qualify to provide manufactured                 set-aside a procurement for SDVO SBCs?                BUSINESS FEDERAL CONTRACT
                                              products or other supply items under a                                                                        PROGRAM
                                                                                                        (a) The contracting officer first must
                                              small business set-aside, service-disabled
                                              veteran-owned small business, HUBZone,                  review a requirement to determine
                                                                                                      whether it is excluded from SDVO                      ■ 16. The authority citation for part 127
                                              WOSB or EDWOSB, or 8(a) contract?
                                                                                                      contracting pursuant to § 125.21.                     continues to read as follows:
                                              *      *    *    *     *
                                                                                                      *     *    *     *    *                                 Authority: 15 U.S.C. 632, 634(b)(6),
                                                 (d) The performance requirements                                                                           637(m), 644 and 657r.
                                              (limitations on subcontracting) and the                 ■ 10. Amend § 125.23 by revising
                                              nonmanufacturer rule do not apply to                    paragraphs (a), and (b)(1) and (2) to read            ■ 17. Amend § 127.503 by revising the
                                              small business set-aside acquisitions                   as follows:                                           last sentence of the introductory text of
                                              with an estimated value between the                                                                           paragraph (h)(1) to read as follows:
                                                                                                      § 125.23 When may a contracting officer
                                              micro-purchase threshold and the                                                                              § 127.503 When is a contracting officer
                                                                                                      award sole source contracts to SDVO
                                              simplified acquisition threshold (as both               SBCs?                                                 authorized to restrict competition or award
                                              terms are defined in the FAR at 48 CFR                                                                        a sole source contract or order under this
                                              2.101).                                                 *     *    *     *     *
                                                                                                                                                            part?
                                                                                                        (a) None of the provisions of §§ 125.21
                                              *      *    *    *     *                                                                                      *     *    *    *     *
                                                                                                      or 125.22 apply;
                                                                                                                                                              (h) * * *
                                              PART 125—GOVERNMENT                                       (b) * * *                                             (1) * * * However, the following
                                              CONTRACTING PROGRAMS                                      (1) $6,500,000 for a contract assigned              exceptions apply to this paragraph
                                                                                                      a manufacturing NAICS code, or                        (h)(1):
                                              ■ 5. The authority citation for part 125                  (2) $4,000,000 for all other contracts;
                                              continues to read as follows:                                                                                 *     *    *    *     *
                                                                                                      *     *    *     *     *                                Dated: March 19, 2018.
                                                Authority: 15 U.S.C. 632(p), (q); 634(b)(6);
                                              637; 644; 657f; 657r.                                   PART 126—HUBZONE PROGRAM                              Linda E. McMahon,
                                                                                                                                                            Administrator.
                                              § 125.3   [Amended]
                                                                                                      ■ 11. The authority citation for part 126             [FR Doc. 2018–06033 Filed 3–23–18; 8:45 am]
                                              ■ 6. Amend § 125.3 by removing the                      continues to read as follows:                         BILLING CODE 8025–01–P
                                              term ‘‘$150,000’’ and adding in its place                 Authority: 15 U.S.C. 632(a), 632(j), 632(p),
                                              the phrase ‘‘the simplified acquisition                 644, and 657a.
                                              threshold (as defined in the FAR at 48                                                                        DEPARTMENT OF TRANSPORTATION
                                              CFR 2.101)’’ in paragraphs (c)(1)(viii)                 § 126.200    [Amended]
                                              and (ix).                                               ■ 12. Amend § 126.200 by removing the                 Federal Aviation Administration
                                              ■ 7. Amend § 125.6 by:                                  words ‘‘unconditionally and directly’’ in
                                                                                                      paragraph (b)(1)(i).                                  14 CFR Part 39
                                              ■ a. Removing the term ‘‘$150,000’’ and
                                              adding in its place the phrase ‘‘the                    ■ 13. Amend § 126.601 by revising the                 [Docket No. FAA–2017–1096; Product
                                              simplified acquisition threshold (as                                                                          Identifier 2017–NM–072–AD; Amendment
                                                                                                      heading of paragraph (h) and the last
                                              defined in the FAR at 48 CFR 2.101)’’                                                                         39–19221; AD 2018–06–01]
                                                                                                      sentence of the introductory text of
                                              in paragraph (a) introductory text; and                 paragraph (h)(1) to read as follows:                  RIN 2120–AA64
                                              ■ b. Revising paragraph (f)(1) to read as
                                              follows:                                                § 126.601 What additional requirements                Airworthiness Directives; Airbus
                                                                                                      must a qualified HUBZone SBC meet to bid              Airplanes
                                              § 125.6 What are the prime contractor’s                 on a contract?
                                              limitations on subcontracting?                          *     *    *     *      *                             AGENCY:  Federal Aviation
                                              *     *     *     *    *                                  (h) Recertification. (1) * * *                      Administration (FAA), Department of
                                                                                                      However, the following exceptions                     Transportation (DOT).
                                                (f) * * *
                                                                                                      apply to this paragraph (h)(1):                       ACTION: Final rule.
                                                (1) Small business set-aside contracts
                                              with a value that is greater than the                   *     *    *     *      *                             SUMMARY:    We are adopting a new
                                              micro-purchase threshold but less than                  ■ 14. Amend § 126.612 by revising                     airworthiness directive (AD) for certain
                                              or equal to the simplified acquisition                  paragraphs (b)(1) and (2) to read as                  Airbus Model A318, A319, A320, and
                                              threshold (as both terms are defined in                 follows:                                              A321 series airplanes; all Model A330–
                                              the FAR at 48 CFR 2.101); or                                                                                  200 Freighter, –200, and –300 series
                                              *     *     *     *    *                                § 126.612 When may a CO award sole                    airplanes; and all Model A340–200,
                                                                                                      source contracts to qualified HUBZone
                                              ■ 8. Amend § 125.18 by revising the last                SBCs?
                                                                                                                                                            –300, –500, and –600 series airplanes.
                                              sentence of paragraph (e)(1) to read as                                                                       This AD was prompted by reports of
                                                                                                      *     *    *    *      *                              false traffic collision avoidance system
                                              follows:
                                                                                                        (b) * * *                                           (TCAS) resolution advisories. This AD
                                              § 125.18 What requirements must an                        (1) $7,000,000 for a contract assigned              requires modifying the software in the
                                              SDVO SBC meet to submit an offer on a                   a manufacturing NAICS code, or                        TCAS computer processor or replacing
                                              contract?
                                                                                                        (2) $4,000,000 for all other contracts.             the TCAS computer with a new TCAS
                                              *     *    *      *    *                                                                                      computer. We are issuing this AD to
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                                                                                                      *     *    *    *      *
                                                (e) * * * (1) * * * However, the                                                                            address the unsafe condition on these
                                              following exceptions apply to this                      § 126.616    [Amended]                                products.
                                              paragraph (e)(1):
                                                                                                      ■ 15. Amend § 126.616 by removing the                 DATES:This AD is effective April 30,
                                              *     *    *      *    *                                words ‘‘HUBZone protégé’’ and adding                2018.
                                              ■ 9. Amend § 125.22 by revising                         in their place the words ‘‘HUBZone                      The Director of the Federal Register
                                              paragraph (a) to read as follows:                       SBC’’ in paragraph (d)(2).                            approved the incorporation by reference


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Document Created: 2018-03-24 00:59:54
Document Modified: 2018-03-24 00:59:54
CategoryRegulatory Information
CollectionFederal Register
sudoc ClassAE 2.7:
GS 4.107:
AE 2.106:
PublisherOffice of the Federal Register, National Archives and Records Administration
SectionRules and Regulations
ActionDirect final rule; request for comments.
DatesThis rule is effective on May 25, 2018 without further action, unless significant adverse comment is received by April 25, 2018. If significant adverse comment is received, SBA will publish a timely withdrawal of the rule in the Federal Register.
ContactBrenda Fernandez, Office of Procurement Policy and Liaison, 409 Third Street SW, Washington, DC 20416, 202-205-7337, [email protected]
FR Citation83 FR 12849 
RIN Number3245-AH02
CFR Citation13 CFR 121
13 CFR 125
13 CFR 126
13 CFR 127
CFR AssociatedGovernment Procurement; Government Property; Grant Programs-Business; Individuals with Disabilities; Loan Programs-Business; Small Businesses; Government Contracts; Reporting and Recordkeeping Requirements; Technical Assistance; Administrative Practice and Procedure and Penalties

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