F-16_SLEP_SBO_QAs.pdf

Background: The Air Force is in the pre-solicitation phase of an acquisition for F-16 fighter jet repair parts. These parts will be used by the Air Force to repair the F-16 when needed to enhance and lengthen the service life of this weapon system. The contract line items (CLINS) will be structured as

“Kits.” Each kit will have several different repair parts. Current market research indicates that many of these parts that make up each kit can be manufactured by small businesses. Additionally, some of the parts are only manufactured by multiple large businesses and some parts can only be manufactured by one large business (all of the manufacturers of the parts must be pre-qualified by the government before they can be eligible for an award). During recent Industry Days and Pre-Proposal conferences for this requirement several business have requested clarification on the issue of what would qualify a firm to be a small business under this acquisition as it is acquiring a “kit” as opposed to a specific supply item(s). The Contracting Officer has selected NAICS code 336413 as the most appropriate code which has a corresponding size standard of 1,250 employees. This NAICS code is not identified on the Non-

Manufacturer Waiver List.

13 CFR 121.406(c)

(c) Kit Assemblers. (1) Where the manufactured item being acquired is a kit of supplies or other goods provided by an offeror for a special purpose, the offeror cannot exceed 500 employees, and 50 percent of the total value of the components of the kit must be manufactured by business concerns in the United States which are small under the size standard for the NAICS codes of the components being assembled. The offeror need not itself be the manufacturer of any of the items assembled.

(2) Where the Government has specified an item for the kit which is not produced by U.S.

small business concerns, such item shall be excluded from the calculation of total value in paragraph (c)(1) of this section.

The above definition of a kit assembler is met by several of the potential small business firms showing interest in being an offeror on this acquisition. These firms plan on acting as the prime contractor and assembling the kits. The parts of the kits will be acquired by the prime contractor from manufacturing firms, some small and some large but at least 50% of the parts or components of the kit will be acquired from small business manufacturers or from large manufacturers where the government has specified the specific part be acquired from a specific approved large business manufacturer (only approved source due to safety of flight issues).

Question No. 1: There is no mention of a waiver (individual waiver to the non-manufacturer rule) in paragraph 121.406(c) (2). Is one required or can the Government stipulate which parts are to be acquired by large business manufacturers without SBA waiver?

No waiver required for Kitting

Question No. 2: Per the CFR reference, at least 50% of the total value of the components of the kit must be manufactured by business concerns in the US which are small under the size standards for the NAICS codes of the components being assembled. Does it matter at what subcontract level (first tier, second tier etc.) this manufacturing percentage is obtained? For example, can a small business kit assembler subcontract for the actual parts from a large business who in turns obtains the parts from the actual manufacturer of the parts which is a small business?

It does not matter at what tier the parts are manufactured.

Question No. 3: Some of the potential small business offerors will actually be manufacturing some or the majority of the parts of the kits (over 50%). In this case can a firm qualify as a small business under the size standard of 1,250 employees rather than the 500 employees even though the acquisition is identified as a kit?

If the offeror is proposing as a Kitter, then the size standard would be 500 employees and the

Kitting rules of providing 50% of parts manufactured by a small business applies to all items except government directed sources. If the offeror is proposing as a Manufacturer, then the size 1,250 and the Manufacturer rule of 50% applies to all items.

Question No. 4: One of the components of the kit is identified as “hardware.” It is an individual item in the kit but it is not in and of itself a part but rather misc. nuts and bolts that will be used for installing the parts to the aircraft during repairs. Can these hardware items be considered material costs and therefore excluded from the cost of manufacturing? SB is required to manufacture 50% of the cost of the item excluding material costs.

Miscellaneous Common Nuts, Bolts, and Washers can be considered materiel costs. Any specialized hardware will be considered manufactured items.