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27 Percent Of DoD Mentor-Protege Agreements Are Deficient, GAO Says

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Koprince Law LLC

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The GAO estimates that 27 percent of DoD mentor-protege agreements are deficient.

In a comprehensive new report, the GAO says that many active DoD mentor-protege agreements are missing basic (and necessary) information, like the protege’s primary NAICS code.  Also missing, in some cases: the parties’ signatures

The GAO’s report, titled “Small Business Contracting: DOD Should Take Actions to Ensure That Its Pilot Mentor-Protege Program Enhances the Capabilities of Protege Firms,” begins with an excellent background on the history of the DoD mentor-protege program, and the legal relationship between the DoD program and SBA’s new All Small Mentor-Protege Program (spoiler alert: there isn’t one; the two programs are separate and independent).  The GAO then explains the many required elements of a DoD mentor-protege agreement, such as an assessment of the protege’s needs, a description of the specific assistance the mentor will provide to the protege, and so on.

However, many of the active DoD mentor-protege agreements are missing some of the required elements.  GAO writes:

Our review of a randomly selected probability sample of 44 of the 78 total active DOD mentor-protege agreements in place as of June 2016 found that a number of these agreements were missing required elements.  Specifically, based on our review, we estimate that 27 percent of the agreements did not address all required elements.  With respect to specific elements, we estimate that 25 percent of the agreements did not include the signature of the mentor and protege, 9 percent did not include the protege’s primary NAICS code, and 7 percent did not include an anticipated start and end date for the agreement.  These missing elements suggested that the [DoD] components’ procedures for approving mentor-protege agreements do not provide reasonable assurance that agreements are completed in accordance with DOD requirements.

These omissions can be important.  For instance, GAO noted, “missing industry codes are used to determine whether proteges are eligible to participate in the program” in the first place.  And of course, without signatures, it’s not clear that an agreement exists at all.  It’s stunning that an estimated one-fourth of active DoD mentor-protege agreements are unsigned.

In addition to these problems, the GAO writes that the DoD “lacks performance goals and other measures needed to fully assess the program.”  In other words, GAO concludes, the DoD lacks the tools and data necessary to “fully assess how well the program is enhancing the capabilities of small businesses to perform under DOD and other contracts.”

The DoD submitted comments concurring with the GAO’s findings and recommendations for improvements; DoD has pledged to take action to address the GAO’s findings.  We’ll keep you posted on changes to the DoD mentor-protege program if and when they happen.


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