FAR:  19.1406 Sole source awards to service-disabled veteran-owned small business concerns. All Government agencies can award sole source solicitations to qualified Service-Disabled Veteran-Owned Small Businesses (SDVOSBs). The basis is the Veterans Benefits Act (VBA) of 2003 (Public Law 108-183) Section 308 establishing a sole source and set-aside procurement program for SDVOSB concerns. Contracting officers may award a sole source contracts to SDVOSBs, if certain conditions are met (see FAR19.1406): Such concern is determined to be a responsible contractor with respect to performance of such contract opportunity and the contract officer does not have a reasonable expectation that 2 or more small business concerns owned and controlled by service-disabled veterans will submit offers for the contracting opportunity; the anticipated award price of the contract (including options) will not exceed $6 million for a requirement within the NAICS codes for manufacturing; or $4 million for a requirement within any other NAICS code; in the estimation of the contracting officer, the contract award can be made at a fair and reasonable price.

SDVOSB Set Aside: On May 5, 2004 the Small Business Administration published implementation guidance providing the key linkage to transform the vision of Public Law 108-183 into Procurement reality. Section 15(g) of the Small Business Act (15 U.S.C. 644(g)), which provides that the President must establish a goal of not less than 3 percent for participation by service-disabled veteran businesses in Federal contracting, and section 36 of that Act (15 U.S.C. 657f), which gives agency contracting officers the authority to reserve certain procurement’s for service disabled veteran owned businesses.

Contracting officers may set-aside solicitations to allow only SDVOSB concerns to compete (see FAR19.1405). No separate justification or determination and findings are required to set aside a contract action for SDVOSB concerns when the following requirements can be satisfied: Offers will be received from two or more SDVOSB concerns; and Award will be made at a fair market price. If the contracting officer receives only one acceptable offer from a SDVOSB in response to a setaside, the contracting officer should make an award to that SDVOSB