FAR 52.226-3—Disaster or Emergency Area Representation.
Plain-English Summary
FAR 52.226-3 is the representation provision used when a solicitation sets aside work for firms that reside or primarily do business in a designated disaster or emergency area. It tells offerors exactly what geographic area is covered, requires them to state whether they do or do not meet the area-based eligibility standard, and explains how that standard is evaluated. The provision defines the core test for residency or primary business activity, then lists additional factors the contracting officer may consider when the basic test is not met, such as office location, licenses, past work, subcontractor and supplier relationships, revenue concentration, employee presence, and local organizational ties. It also allows the contracting officer to require supporting documentation with the offer or later request it if the offeror claims eligibility. In practice, this provision helps agencies target disaster/emergency set-asides to firms with a real local economic presence, while giving offerors a clear way to self-certify and substantiate their status.
Key Rules
Area must be defined
The contracting officer must insert the definite geographic boundaries of the disaster or emergency set-aside area. Eligibility is tied to that specific area, so the solicitation must clearly identify what location is covered.
Offeror must make a representation
Each offeror must state whether it does or does not reside or primarily do business in the designated area. This is a formal representation, not just background information, and it affects eligibility for the set-aside.
Primary business test
An offeror is considered to reside or primarily do business in the area if, during the last 12 months, its main operating office was in the area and that office generated at least half of gross revenues and employed at least half of permanent employees. Meeting both elements creates a strong basis for eligibility.
Additional factors may apply
If the offeror does not meet the basic test, the contracting officer may consider other evidence of local presence, including office locations and establishment dates, state licenses, past work in the area, subcontractor and supplier history, revenue percentage from area work, number of permanent employees in the area, membership in local or state organizations, and other supporting evidence.
Documentation may be required
If the offeror claims it resides or primarily does business in the area, it must provide documentation if the contracting officer requests it. The solicitation may also require submission of supporting documents with the offer itself.
Evidence can be broad
The provision allows a wide range of proof, including practical business records such as utility bills and bank statements for sole proprietorships. This means eligibility can be supported by both formal corporate records and other credible evidence.
Responsibilities
Contracting Officer
Define the disaster or emergency set-aside area with definite geographic boundaries, include the provision in the solicitation when prescribed, evaluate the offeror’s representation, and request or require supporting documentation when needed to verify eligibility.
Offeror/Contractor
Review the designated area, determine whether it resides or primarily does business there, make an accurate representation in the offer, and provide supporting documentation if requested or if the solicitation requires it.
Agency
Use the provision only when the acquisition is being set aside for firms in a disaster or emergency area, and ensure the solicitation structure supports a clear, enforceable local-area eligibility determination.
Practical Implications
This provision is about local economic presence, not just having a mailing address or occasional work in the area. Offerors should be ready to show that the area is their real operating base or a substantial part of their business.
The 12-month lookback matters. A company that recently opened a local office may still fail the primary-business test if the office has not yet generated enough revenue or employed enough permanent staff.
Contracting officers should not rely on a bare yes/no representation when eligibility is unclear. The listed factors provide a practical framework for asking for records that confirm the offeror’s actual ties to the area.
Offerors should keep documentation organized before submitting an offer, especially if the solicitation says proof must be included with the proposal. Common supporting records include leases, licenses, payroll records, revenue summaries, utility bills, and bank statements.
A false or unsupported representation can jeopardize award eligibility and create post-award problems. Firms should make sure the representation matches their business records and the solicitation’s exact geographic boundaries.
Official Regulatory Text
As prescribed in 26.206 (a) , insert the following provision: Disaster or Emergency Area Representation (Nov 2007) (a) Set-aside area. The area covered in this contract is: ________________________________________________ [ Contracting Officer to fill in with definite geographic boundaries. ] (b) Representations. The offeror represents that it □ does □ does not reside or primarily do business in the designated set-aside area. (c) An offeror is considered to be residing or primarily doing business in the set-aside area if, during the last twelve months- (1) The offeror had its main operating office in the area; and (2) That office generated at least half of the offeror’s gross revenues and employed at least half of the offeror’s permanent employees. (d) If the offeror does not meet the criteria in paragraph (c) of this provision, factors to be considered in determining whether an offeror resides or primarily does business in the set-aside area include- (1) Physical location(s) of the offeror’s permanent office(s) and date any office in the set-aside area(s) was established; (2) Current state licenses; (3) Record of past work in the set-aside area(s) ( e.g. , how much and for how long); (4) Contractual history the offeror has had with subcontractors and/or suppliers in the set-aside area; (5) Percentage of the offeror’s gross revenues attributable to work performed in the set-aside area; (6) Number of permanent employees the offeror employs in the set-aside area; (7) Membership in local and state organizations in the set-aside area; and (8) Other evidence that establishes the offeror resides or primarily does business in the set-aside area. For example, sole proprietorships may submit utility bills and bank statements. (e) If the offeror represents it resides or primarily does business in the set-aside area, the offeror shall furnish documentation to support its representation if requested by the Contracting Officer. The solicitation may require the offeror to submit with its offer documentation to support the representation. (End of provision)