Commentary by Maj. Daniel Dunn
CANNON AIR FORCE BASE — In today’s environment of limited budgets and funding cuts, squadrons rightfully expect the most bang for the buck when contracting for goods and services. However, an integral part of being good stewards of our tax dollars involves much more than getting our requirements at the lowest possible cost.
One of the many characteristics that make our nation the greatest in the world, and one that we as a military fight for, is that we are a land of opportunity—for both the small upstart companies as well as the established large businesses that are common household names.
To foster an opportunistic environment for all, federal acquisition policy is to “provide maximum practicable opportunities” in its acquisitions to small business concerns. This includes veteran-owned small business, service-disabled veteran-owned small business, HUBZone (Historically Underutilized Business Zones) small businesses, small disadvantaged business, and women-owned small business concerns.
What does this mean to your squadron? To be blunt, it means you might pay a little more for on an item or service than what you thought you would.
Requirements often come to Contracting in a nice, well prepared package – three price quotes and a recommendation to go with the “low bid.” Customers are often puzzled to learn we can’t award to the lowest priced vendor because that vendor isn’t a small business.
The law requires all purchases between $3,000 and $100,000 to be reserved exclusively for small business competition. Does this mean we’re at the mercy of a business who might want to take advantage of this requirement? Definitely not.
Even with this requirement, we can’t award any contract unless it contains a fair market price. So the next logical question is “What constitutes a fair market price?” There’s no objective formula or percentage to determine a fair market price. That determination is based on receiving adequate price competition (normally three or more quotes) and prices paid in the past for the same or similar goods or services.
If fair market pricing isn’t received from a small business, then award will not be made to a small business. Your contract will be awarded to the vendor whose proposal represents a fair and reasonable price to the government, regardless of that vendor’s socioeconomic status.
So the next time you send a requirement over to contracting, keep in mind our collective responsibility to serve as good stewards of our taxpayer dollars — it includes helping the “little guy” make good here in the land of opportunity.
Maj. Daniel Dunn is the 27th Contracting Squadron commander.
