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  1. Koprince Law LLC
    When a business is poised to win a federal contract award set aside for small businesses, there is always the potential for a competitor to challenge that award on the basis that the proposed winner is not actually a small business based on SBA’s size and affiliation rules. Or, if your company just lost an award, you may consider challenging that the proposed winner is a small business. Either way, it pays to know the basics behind size protests and appeals. While you could read through my recent handbook on Procedures and Pitfalls of Size Protests and Appeals (it’s a good read!), here are some key things to keep in mind when considering size protests and appeals.
    What is a size protest? As a refresher, an offeror has to be a small business under the NAICS code assigned to a solicitation set-aside for small businesses in order to qualify for the award.
    At bottom, a size protest is a challenge to a proposed awardee’s size. In essence, a protester argues that the contract awardee should not have been awarded the contract because it’s not a small business. Sometimes, protesters argue that the awardee on its own is just too large a business. But more commonly, a size protest argues that an awardee is affiliated with one or more other companies and, together with its affiliates, the awardee exceeds the applicable size standard.
    If the SBA determines that the awardee is not a small business, it can lose the award.
    Who can challenge a company’s size? A size protest must relate to a specific procurement. In most instances, this means that a person can’t protest a company’s size just because that person thinks the company is a large business—the supposedly large business must first be named an awardee under a particular solicitation.
    There are generally three different persons who might file a size protest against a particular company:
    A disappointed offeror. If an offeror loses out on the award (for reasons unrelated to its own size), that company could challenge the awardee’s size. Protests by a disappointed offeror must be sent to the contracting officer within five business days from the date the disappointed offeror receives notice of the award. The contracting officer will then forward the protest to the SBA for a decision.
    The contracting officer. If a contracting officer has reason to doubt the awardee’s size, she can ask the SBA for a size determination. Importantly, this request can be made at any time—meaning that, even a couple of years into performance, the SBA can ask for a size determination.
    The SBA. Like a contracting officer, the SBA can initiate its own size determination, at any time, if it has reason to doubt a company’s size.
    How are size protests decided? If a size protest is filed (and isn’t dismissed for untimeliness or some other reason), the SBA will immediately notify the awardee. The awardee must then submit a response to the size protest and provide a trove of documents with that response—including its articles of organization, bylaws, tax returns and financial statements for the preceding three fiscal years, and documents describing its relationship with any potential affiliates. This response (and supporting documentation) is usually due just a few days after the awardee is notified of the protest, although SBA will often grant a short extension.
    After it receives this information, the SBA will evaluate it thoroughly. Most of the time, it will ask for a more detailed response or additional documents from the company being protested. Once all of the needed information is received, the SBA will evaluate it and make a size determination (either finding that the company is a small or large business under the applicable NAICS code) within a couple of weeks.
    Can I appeal an adverse size determination? Yes. Any party that is adversely affected by a size determination can appeal it to the SBA’s Office of Hearings and Appeals. If your company is named the awardee and is subsequently found by the SBA to be an ineligible large business, you can appeal this determination to the OHA. Conversely, if your company loses a size protest against a different awardee, you can also appeal that determination.
    While there is no statistical summary of OHA size appeal decisions, in our experience OHA appeals are oftentimes successful. Size determinations are intensely fact-specific, and the SBA’s regulations are quite nuanced. So, if you think that a determination might have been in error, it could be worth appealing that determination to the OHA.
    What else should I know about size protests and appeals? Size protests are an important part of the procurement process, as they help make sure that small businesses get the benefit of set-asides. Used offensively, a protest might help take an award away from a competitor. But this cuts both ways: one of your competitors might try to take your award away, too.
    Size protests must be taken seriously. Size protests and appeals oftentimes involve complicated factual and legal questions. And failing to adequately respond to a protest, in fact, could be considered an admission that your company is not a small business.
    Questions about this post? Or need help with a government contracting legal issue? Email us or give us a call at 785-200-8919.
    Looking for the latest government contracting legal news? Sign up for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook.
    The post Back to Basics: Size Protests and Appeals first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  2. Koprince Law LLC
    The SBA’s 8(a) Business Development Program is the crème de la crème of federal government contracting and there are two ways for an individual and its business to get into the program. First, individuals can gain admission to the program by being a member of one of the recognized groups individuals that is automatically presumed to be socially and economically disadvantaged. If an individual does not fall into one of the presumed socially and economically disadvantaged groups, the individual must prove they were socially and economically disadvantaged throughout their life through what is called a social disadvantage narrative. Beyond that, there are a number of other qualifications, such as the business’s potential for success and evidence of good character that must also be met. 13 C.F.R. § 124.101. The bar for admittance is high, and once an individual is admitted, they no doubt want to make the most of it.  
    Oftentimes, small businesses that participate in the 8(a) SBA’s Business Development Program remain in the Program for the full 9 years that the SBA allows, which culminates in the small business “graduating” from the program. 13 C.F.R. § 124.302. Sometimes, the business grows so successfully that it no longer meets the qualifications of being small, and thus is required to graduate early from the 8(a) Program. So how exactly does that happen? Read on to find out.  
    Who can graduate the 8(a) Program early? 
    13 CFR § 124.301 covers graduation and voluntary early graduation from the 8(a) Business Development Program. Graduation occurs at the end of the 8(a) Program term, which is currently set at 9 years. While there was an extra year granted during the COVID-19 pandemic, that is the one exception. A participant can graduate prior to the expiration of its program term (early graduation) where SBA determines that: 
    (1) The concern has successfully completed the 8(a) BD program by substantially achieving the targets, objectives, and goals set forth in its business plan, and has demonstrated the ability to compete in the marketplace without assistance under the 8(a) BD program; or 
    (2) One or more of the disadvantaged owners upon whom the Participant’s eligibility is based are no longer economically disadvantaged. 
    13 CFR § 124.302.  
    The SBA will determine that the participant substantially achieved its targets, objectives, and goals in its business plan by looking at the “totality of the circumstances” of the following factors: (1) Degree of sustained profitability; (2) Sales trends, including improved ratio of non-8(a) sales to 8(a) sales since program entry; (3) Business net worth, financial ratios, working capital, capitalization, and access to credit and capital; (4) Current ability to obtain bonding; (5) A comparison of the Participant’s business and financial profiles with profiles of non-8(a) BD businesses having the same primary four-digit SIC code as the Participant; (6) Strength of management experience, capability, and expertise; and (7) Ability to operate successfully without 8(a) contracts. 13 CFR § 124.302(b).  
    The SBA may also require early graduation if the concern exceeds the size standard of the primary NAICS code for three successive program years, or if excessive funds or other assets have been withdrawn from the Participant, causing SBA to determine that the Participant has demonstrated the ability to compete in the marketplace without assistance under the 8(a) Program. 13 CFR § 124.302(c)-(d). 
    How does early graduation occur? 
    A concern may decide to voluntarily graduate early from the 8(a) Program, according to 13 CFR § 124.301, if the participant “has substantially achieved the goals and objectives set forth in its business plan.” To initiate early graduation, the Participant must notify its servicing SBA district office of its intent to do so in writing. Once the SBA servicing district office processes the request and the District Director recognizes the withdrawal or early graduation, the Participant is no longer eligible to receive any 8(a) BD program assistance. 
    There are no proactive steps the 8(a) participant must take when it determines it has exceeded the size standard for three successive program years. Rather, the SBA has the duty to notify participants via a Letter of Intent to Graduate Early when it believes the participant has exceeded the size standard. 13 CFR § 124.304(b). Upon notice from SBA, the 8(a) participant has 30 days to submit a written response explaining why the proposed grounds should not justify early graduation. If the concern does not have any objections to the Letter of Intent, SBA then refers the matter to the Assistant Administrator (AA) for DPCE to determine whether early graduation is warranted. 13 CFR § 124.304(c). If the AA determines early graduation is warranted, the matter is then referred back to SBA to process. The 8(a) participant will then receive a Notice of Early Graduation. It is at this point that the 8(a) participant is no longer eligible for program assistance. 13 CFR § 124.304(d). 
    Conclusion 
    While early graduation from the 8(a) Program is a good indicator of how a business is growing, it also means the end of the benefits that come along with being a part of the 8(a) Program. Though many participants remain in the 8(a) Program the full 9 years, some grow so exponentially that they no longer qualify, which leads me to a final question to dwell on: 
    Do you think it is better to remain in the 8(a) Program for the full 9-year term, or do you think the goal of early graduation is a better measurement of long-term success? 
    Questions about this post? Email us or give us a call at 785-200-8919. 
    Looking for the latest government contracting legal news? Sign up here for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook. 
    The post Top of the Class: 8(a) Early Graduation first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  3. Koprince Law LLC
    Happy Friday, Readers! I hope you had a very productive week. It’s hard to believe that we are almost through the month of April already and It won’t be long before the kids are out of school. Parents get ready!!!
    The world of federal government contracting just seems to get busier and busier. This week there were several articles on the Pentagon’s budget increasing for AI capabilities and the implementation of Buy American Preference for infrastructure. We’ve also included a few cautionary tales on why it’s a terrible idea for contractors, or anyone else, to try to defraud the federal government. Enjoy and have a great weekend!

    Biden requests $773 billion for Pentagon, a 4% boost [FedTimes] State Department tech leader says pace of operational demands has helped to spur cloud transition [FedScoop] Mysterious American robotic ships headed to Ukraine [FedScoop] Missouri contractor charged with fraud for minority business claims [ConstDive] JAIC director sees improvement in Pentagon contracting for artificial intelligence capabilities [FedScoop] Initial Implementation Guidance on Application of Buy America Preference in Federal Financial Assistance Programs for Infrastructure [Whitehouse] Government Contractor Pleads Guilty to Bribing a Government Official [DoJ] GSA’s busy 2022 so far: Inflation, 876 and a new strategy [FedNewsNet] Department of Veterans Affairs receives $10.5M from TMF to support Login.gov transition [FedScoop] Despite delay, experts not concerned by DOD’s JWCC cloud contract timeline [FedScoop] Why Congress should reauthorize, strengthen the SBIR program [FedNewsNet] Idaho woman pleads guilty in case involving more than $11 million in government contracts [EastIdahonews] GSA Announces Actions to Advance Equity and Supplier Diversity in Federal Procurement [GSA] Biden to require US-made steel, iron for infrastructure [FedNewsNet] DHS Outlines Steps to Increase Contract Opportunities in Equity Action Plan [HSToday] The post SmallGovCon Week in Review, April 18-22, 2022 first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  4. Koprince Law LLC
    To qualify as a small business under most set-aside or sole-source contracts seeking manufactured products or supplies, SBA’s regulations require an offeror to be the item’s manufacturer or, alternatively, comply with the nonmanufacturer rule.
    In this post, we’ll discuss qualifying under the nonmanufacturer rule.
    1. Do I need to qualify under the nonmanufacturer rule?
    That depends on the type of procurement you’re bidding on. Again, the nonmanufacturer rule comes into play for solicitations seeking manufactured items or supplies, and only if the offeror doesn’t qualify as the manufacturer itself.
    Keep in mind, too, that under the SBA’s regulations, acquisitions set-aside for small businesses under the simplified acquisition threshold are not subject to the nonmanufacturer rule. The FAR currently has a simplified acquisition threshold of $250,000. This exemption doesn’t apply, however, to any other socio-economic designation—for example, if it’s an SDVOSB set-aside under the simplified acquisition threshold, the offeror will have to either be the item’s manufacturer or qualify under the nonmanufacturer rule.
    2. How do I qualify as the nonmanufacturer?
    To qualify under the nonmanufacturer rule, an offeror generally must meet four requirements:
    The offeror cannot exceed 500 employees; The offeror must be primarily engaged in the retail or wholesale trade and normally sell the type of item supplied; The offeror must take ownership or possession of the item being supplied with its own personnel, equipment, or facilities (in a manner consistent with industry practice); and The item must be manufactured or produced by a small business in the United States (unless this requirement has been waived). Though they might sound straightforward, each of these requirements presents its own separate analysis. For example, the SBA will consider sales of similar items—not the exact item procured—to determine compliance with the second factor. It might also be difficult to know whether the domestic production requirement has been waived. And in the case of a joint venture supplying a manufactured item, compliance might be even more confusing.  
    All told, these four requirements make complying with the nonmanufacturer rule one of the most confusing aspects of working with the federal government as a small business manufacturer.
    3. What if I assemble multiple manufactured items into a single kit?
    Small businesses that assemble several different manufactured items as part of an acquisition must also comply with the nonmanufacturer rule. In the case of a kit assembler, an eligible offeror must be smaller than 500 employees; moreover, at least half the assembled kit (measured by total value) must be manufactured domestically by small businesses.  
    4. Does the nonmanufacturer rule apply to multiple item procurements?
    Yep. But again, compliance can be tricky:
    For acquisitions under which less than half of the contract value is for items manufactured by small businesses, then the items will comply with the nonmanufacturer rule. If more than half a contract (measured by total value) is for items manufactured by large businesses, the offeror will need a waiver from the SBA in order to qualify as a small business under the procurement. 5. Can a competitor protest my compliance?
    Yes. An offeror can protest a small business’s compliance with the nonmanufacturer rule as part of a size protest (to the SBA) or a bid protest (to GAO or the Court of Federal Claims). A size protest might be a more viable option, as GAO will generally only sustain a protest challenging compliance with the nonmanufacturer rule (or any other limitation on subcontracting) if the proposal, on its face, shows noncompliance. The SBA, however, will dig into the issue to confirm compliance.
    Challenging an awardee’s compliance with the nonmanufacturer rule is an important way to ensure the integrity of the acquisition process. Keep in mind, too, that if a competitor can protest your compliance in the event you win an award, so too can you protest that competitor’s compliance in the event your competitor wins.
    ***
    Complying with the SBA’s requirements for manufactured items can be very tricky—if not done properly, you might end up losing an award.
    Questions about this post? Email us or give us a call at 785-200-8919.
    Looking for the latest government contracting legal news? Sign up here for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook.
    The post Back to Basics: The Nonmanufacturer Rule first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  5. Koprince Law LLC
    Hello, readers and happy Friday! The trees are starting to bloom here in the Midwest and they are beautiful but they have many of us sneezing. A small price to pay for warmer weather and a beautiful spring landscape. Am I right?
    This week in the federal government landscape world saw a hearing on the federal contractor vaccine mandate, greener IT contracts, and a new GSA contracting vehicle.
    Former Federal Official Sentenced To Prison For Contract Bribery Conspiracy And Tax Fraud [DoJ] Appeals court sees high bar to restoring federal contractor vaccine mandate [FedNewsNet] State Dept lets federal employees renew their passports online ahead of public launch [FedNewsNet] After six years, OPM has a permanent inspector general [FedNewsNet] Former State Department Employee Sentenced To Prison For Honest Services Fraud [DoJ] Former DHS official convicted of stealing government data, software to create commercial version [FedScoop] OPM Issues More Guidance to Encourage Collective Bargaining at Agencies [GovExec] GSA Adds Sustainability Criteria to Push For Greener IT Contracts [GovExec] How sherpas guide startups through government contracting terrain [Spacenews] A new look at how agencies use contractors in the act of rulemaking [FedNewsNet] Three Florida Men Indicted for Rigging Bids and Defrauding the U.S. Military [DoJ] GSA rises to the occasion with ASCEND, its new cloud acquisition vehicle [FedNewsNet] Star Woman Pleads Guilty to False Statement in Case Involving More Than $11 Million in Government Contracts [DoJ] Former U.S. Department of Homeland Security Official Agrees to Pay $10,000 to Resolve Conflict-of-Interest and False Claims Act Allegations [DoJ] Statement by SBA Administrator Guzman on Agency’s New Equity Action Plan [SBA]
    The post SmallGovCon Week in Review: April 11-15, 2022 first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  6. Koprince Law LLC
    Please join this informative Q & A session hosted by Nick Bernardo, the president and founder of MyWatchGov.com, as he speaks with Koprince McCall Pottroff LLC’s equity partner, Nicole Pottroff, on April 20, 2022 at 1:00pm EDT. Nick has extensive experience helping “companies of all sizes figure out how to find, compete for, and actually win government contracts.” Nick’s program, MyGovWatch Live: The B2G Roundtable, is “a casual, talk-show style, interactive monthly online forum for anyone to join and learn more about how to win government contracts at all levels.” This month, the expert joining in on the roundtable is our own Nicole Pottroff, who will be answering questions on the legal side of government contracting. You can register for the event here. Hope to see you there!
    The post MyGovWatch Live: The B2G Roundtable with Federal Contracts Attorney Nicole Pottroff: April 20, 2022 @ 1:00pm EDT first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  7. Koprince Law LLC
    GSA recently released new solicitations for the Small Business Pool and the Women Owned Small Business Pool. The Q&A has some additional details on the Polaris solicitation. As we’ve written about, the purpose of the Polaris solicitation is to provide federal agencies with information technology services from qualified small businesses. I’ll mention some of the highlights from both the solicitations and the update, which includes some more information on the timing for the solicitation, other small business pools, and other items. Also, GSA will be extending the due date for proposals.
    Here are a few key items from the solicitation and the Q&A.
    Extension
    On April 6, GSA issued a notice stating it was examining how joint ventures would be handled:
    So, the proposal due date will be extended after some deliberation by GSA.
    Small Business and WOSB Solicitations
    The solicitations appear to be quite similar, just covering different set-aside designations. Task orders will cover a wide variety of IT services, such as cloud computing and cybersecurity and many more.
    Basics:
    There will be an optional pre-proposal conference released online to provide an overview of the Polaris RFP. Polaris will use a Polaris Submission Portal (PSP), which will open for registration no earlier than April 5, 2022. Offerors must submit all questions regarding the solicitation via the PSP or they won’t be answered. “Individual task orders may require facility security clearances.” “When the rerepresentation identifies other than a small business, the novation will not be deemed to be in the Government’s best interest.” If there is a a merger or acquisition without novation and the company is no longer small, the contract will be terminated for convenience and task orders may continue at discretion of the CO. CTAs
    The Polaris solicitation has the following definition of CTAs at section , which matches the definition under FAR 9.601.
    Section, L.5.1.3.1 Joint Venture, has a number of requirements for joint ventures. Be sure to pay close attention.
    For instance,
    That language appears to require joint venture members to split up their work done as part of a joint venture for purposes of experience.
    As for subcontractors, the solicitation has fewer details and requirements. It does state that “The Offeror and all proposed subcontractors must represent as small businesses for North American Industry Classification System (NAICS) 541512 within SAM.gov.” This is interesting as it would appear to not allow large business subcontractors.
    “The Offeror must submit a Subcontractor Letter of Commitment for each proposed subcontractor.” In addition, there is a requirement for subcontract reporting.
    Here are some of the key updates from the recent Q&A.
    Nuts and Bolts
    Timeline. GSA said that the RFPs for HUBZone and SDVOSB RFPS are expected in the fourth quarter of 2022. Submission method. GSA wants companies to use the Symphony Polaris Submission Portal, with details to come later. Other Items
    There are detailed requirements for claiming experience, so be sure to review those closely. For instance, note that “Non-federal Contracts are not eligible to receive points for elements L.5.2.2.3, L.5.2.2.4, L.5.2.2.5, or L.5.2.2.6.” That makes sense because these sections all deal with federal contracts, but it does mean that higher point totals would likely go to offerors with federal experience.
    Points will now be awarded for CPA certified accounting systems, whereas before points were only available for DCAA or DCMA certified systems. The CPA certified systems are worth less than government certified systems.
    There are, of course, detailed rules relating to the self-scoring system, that any offeror must review thoroughly.
    Those are a few of the highlights from the Polaris solicitation. But GSA is already going back to the drawing board on joint ventures. So stay tuned for more updates.
    The post Polaris: GSA Releases Solicitations, New Q&A first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  8. Koprince Law LLC
    Happy Friday, Readers! Our hometown Kansas Jayhawks won the NCAA National Basketball Championship and it’s an understatement to say that we are very excited about it here in Lawrence, Kansas. Thousands of people took to the streets in downtown Lawrence on Saturday night to celebrate the win and the energy was incredible! What a fun ride!
    There were several announcements by the SBA this week concerning adding more industries that are eligible for the Women-Owned Business Federal Contract Program as well as expanding the standards to increase eligibility for federal contracting and loan programs. You can read more about that along with other news in the article below. Have a great weekend!
    FAR Council finalizes more stringent procurement rules under Buy American Act [FedNewsNet] SBA Adds More Industries Eligible for Women-Owned Business Federal Contract Program [SmBizTrends] Air Force Notifies Industry of $999M Follow-On Range Support Contract Vehicle [GovConWire] What the 2023 fiscal budget will look like for contractors [FedNewsNet] Inland Empire Man Agrees to Plead Guilty in Bid-Rigging Scheme to Obtain Contracts to Provide Food to Federal Prison Facilities [DoJ] U.S. Cyber Command providing cyber expertise and intelligence in Ukraine’s fight against Russia [FedScoop] DoD’s budget inflation story is more complicated than you think [FedNewsNet] Eight Individuals Facing Federal Indictment for a $3 Million Scheme to Defraud Walter Reed National Military Medical Center and the Defense Health Agency [DoJ] Government Contractor vs. Subcontractor: What’s The Difference? [ExecGov] Federal Contractors Could Soon Have to Disentangle Themselves Completely From Russia [GovExec] Top Government Contracting Events for 2022 [ExecGov] SBA expands standards to increase eligibility for federal contracting, loan programs [OCGNews] and read our extended post here. PF 2022-29 Acquisition Guide Chapter 19.2 Revision, Small Business Program [EnergyGov] The post SmallGovCon Week in Review: April 4-8, 2022 first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  9. Koprince Law LLC
    These days it often seems like both sides of the congressional aisle cannot agree on anything and bipartisan support is in short supply. However, one thing that Congress can agree on is the fact that organizational conflicts, which can lead to unfair advantages, have no place in Federal contracting. On March 23, 2022, Michigan Senator Gary Peters, with support of three other senators, introduced S. 3905, the Preventing Organizational Conflicts in Federal Acquisition Act (the Act). The bill aims to identify and prevent organizational conflicts of interest (OCI) that have been slipping through the cracks, stating that “[p]rotecting against conflicts of interest in Federal acquisition is vital to the integrity of Government operations.”
    The FAR’s current OCI regulation is found at FAR 1352.209-74, but recent reports and Comptroller General bid protest decisions have uncovered failures in both identification and mitigation of OCIs. A press release issued by Senator Peters included information on some recently identified OCIs that had gone unnoticed and stressed the importance of identification from the outset of the contracting process. According to Senator Peters, the enactment of the Act would “ensure tax dollars are being used to hire contractors that are focused on working in the best interest of the American people.”
    The Act would require federal contractors to disclose business relationships that conflict with the work an agency has hired them to do. Additionally, private companies currently under contract with the U.S. Government would be required to disclose new potential business that opposes the work being done for an agency.  Finally, the Act would ensure federal contractors understand disclosure requirements and know how working with agencies could potentially affect other parts of their business. Federal agencies would be required to assess and update their procedures for determining whether there is an OCI.
    The bill is currently in the hands of the Committee on Homeland Security and Governmental Affairs. If the bill goes all the way, the Federal Acquisition Regulatory Council will be required to identify the contracting methods, types, and services that raise concerns for potential OCIs that are not already identified in the FAR and revise the FAR to include methods to identify and mitigate OCIs.
    Please visit congress.gov to view the full language of the bill, and to stay up to date on any forthcoming amendments. Senator Peter’s press release may be viewed here.
    Questions about this post? Email us or give us a call at 785-200-8919.
    Looking for the latest government contracting legal news? Sign up here for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook.
    The post New Senate Bill Takes Aim at Organizational Conflicts of Interest first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  10. Koprince Law LLC
    If you’re a small business owner interested in government contracts, you’ve probably heard about the SBA’s 8(a) Business Development Program. The 8(a) Program itself is complex, and its eligibility rules are some of stricter rules out there; but its potential benefits are tremendous. In this Back to Basics post, I’ll break down some of the very basics about the 8(a) Program. But don’t worry, not only will I follow this post up with another to unpack more of the complexities, I have also included links throughout this post to other posts doing the same.
    What is the 8(a) Program?
    Like SBA’s other contracting programs, the 8(a) Program is a business development program—its purpose is to assist eligible disadvantaged small businesses compete in the American economy through business development.
    What are the benefits to participating?
    Participating in the 8(a) Program opens several doors to success. Each year, the federal government’s goal is to award at least 5% of all prime contracts to small disadvantaged businesses, which include 8(a) Program participants. To meet this goal, the government issues billions of dollars of awards annually to 8(a) Program participants through sole-source awards and set-asides. Participants are also allowed to join in mentor/protégé and joint venture relationships to further increase their ability to participate in the American economy. Additionally, the SBA provides targeted business development counseling to 8(a) participants.
    Is your business eligible to participate?
    Given these incentives, the desire to participate in the 8(a) Program is obvious. But can your business participate? That is the real question.
    SBA has laid out detailed eligibility requirements, and has recently updated some of those rules too. A future post will discuss them in greater detail but, in general, a business typically must be small under its primary NAICS code, and be unconditionally owned and controlled by one or more socially– and economically-disadvantaged individuals who are of good character. (There are some separate requirements for businesses owned by Indian Tribes, Alaska Native Corporations, Native Hawaiian Organizations, and Community Development Corporations.) The business, moreover, must maintain its eligibility throughout the course of its participation.
    One more thing: 8(a) Program participation is a one-time thing. So if your business has previously participated in the 8(a) Program, or if you’re a disadvantaged individual that has already participated, the SBA won’t allow you to participate again—although Tribes, ANCs, NHOs and CDCs have some different rules.
    How long can your business participate in the 8(a) Program?
    The presumptive term is 9 years. But this term can be shortened by the participant or the SBA—if, for example, the concern is successful enough to graduate from the Program or fails to maintain its eligibility. The term cannot be lengthened, although it can be temporarily suspended in rare instances. In early 2021, SBA also issued a rule providing a limited one-year 8(a) term extension for certain 8(a) Program participants affected by the COVID-19 pandemic.
    How can your business apply?
    Applications must be submitted electronically to the SBA and must include any supporting information requested by the SBA (like corporate organization documents and personal and business tax returns). Your local SBA office should be able to provide a list of all required documents.
    ***
    Participating in the 8(a) Program can be a great way to grow your small business. Look for additional Back to Basics posts discussing its requirements and benefits in greater detail.
    Questions about this post? Email us or give us a call at 785-200-8919.
    Looking for the latest government contracting legal news? Sign up here for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook.
    The post Back to Basics: SBA’s 8(a) Business Development Program first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  11. Koprince Law LLC
    Our attorneys will be presenting a Government Contracts Legal Update 2022 in cooperation with The University of Texas at San Antonio Institute for Economic Development PTAC. We will provide a comprehensive update on the most important government contracting legal changes of late 2021 and the first months of 2022.
    This free event will take place on April 14 from 10:00 AM – 11:30 AM (CDT). Be sure to check out the registration link if you are interested!
    The post Event: Government Contracts Update with UTSA PTAC first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  12. Koprince Law LLC
    Happy April 1st, everyone! In honor of April Fools’ Day, here are some noteworthy pranks over the years. In 1957, the BBC reported that Swiss farmers were experiencing a record spaghetti crop and showed footage of people harvesting noodles from trees. In 1985, Sports Illustrated writer George Plimpton tricked many readers when he ran a made-up article about a rookie pitcher named Sidd Finch who could throw a fastball over 168 miles per hour. And in 1996, Taco Bell, the fast-food restaurant chain, duped people when it announced it had agreed to purchase Philadelphia’s Liberty Bell and intended to rename it the Taco Liberty Bell. 
    So be careful out there, readers, and don’t be fooled! But it’s no joke that there have been some important federal contracting updates this week, including a bipartisan bill introduced in Congress that would tighten contractor oversight related to conflicts of interest and increasing use of large sole-source 8(a) awards. Have a great weekend!
    DOD Small Business Contracting: Use of Sole-Source 8(a) Contracts over $22 Million Has Increased [GAO] Lawmakers aim to strengthen transparency in the lucrative — and murky — federal contracting process [ABCNews] GSA Administrator Statement on the President’s Fiscal Year 2023 Budget [GSA] Senators look to root out contractor conflicts of interest [FSW] The Hiring Surges in Biden’s 2023 Budget Proposal [GovExec] Administrator Guzman Announces Expansion of the Women’s Business Center Network to All 50 States [SBA] Federal contractor launches pre-award challenge over $15B Polaris solicitation [FedScoop] Pentagon expects to award up to $9 billion in cloud contracts in December [CNBC] On April 4, say goodbye to DUNS and hello to UEI [FedNewsNet] Postal inspectors’ digital intelligence team sometimes acted outside of legal authorities, report says [FedNewsNet] DOD Acquisition Officers Will Learn to Better Acquire and Transition Commercial Technologies [DoD] Fayetteville Woman Sentenced to Nine Years in Prison for Multi-Million Dollar Contract Fraud Schemes [DoJ] Texas Man Sentenced for Selling Chinese-Made Military Helmets and Body Armor to Federal Agencies [DoJ] Former NGO Procurement Official Pleads Guilty to Bribery [DoJ] DOE unveils new efficiency standards for federal buildings [ConstDive] OD’s JWCC enterprise cloud award delayed until December [FedScoop] Inspection Report: DOE-OIG-22-28 [OIG] ​DOD Acquisition Officers Will Learn to Better Acquire and Transition Commercial Technologies [DoD] Preventing Organizational Conflicts of Interest in Federal Acquisition Act [Congress] The post SmallGovCon Week in Review: March 28-April 1, 2022 first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  13. Koprince Law LLC
    SBA has issued final rules updating some of its size standards. Below are highlights from the recent size changes. Be sure to review the particular NAICS code on any upcoming solicitations to see if one of these increased size standards applies.
    SBA has issued final rules updating size standards in the categories summarized below. The new size standards will become effective April 30, 2022.
    Agriculture, Forestry, Fishing and Hunting; Mining, Quarrying, and Oil and Gas Extraction; Utilities; Construction. (Final Rule)
    SBA is increasing size standards for 68 industries in those sectors. This includes categories such as agriculture, where many size standards (which were already quite low) increased modestly. While SBA considered reducing size standards in the construction industry, it left most of those the same to avoid negative impacts on construction businesses.
    Education Services; Health Care and Social Assistance; Arts, Entertainment and Recreation; Accommodation and Food Services; Other Services. (Final Rule)
    “SBA is increasing the size standards for 70 industries in those sectors, including 14 industries in NAICS Sector 61 (Education Services), 18 industries in Sector 62 (Health Care and Social Assistance), 11 industries in Sector 71 (Arts, Entertainment and Recreation), four industries in Sector 72 (Accommodation and Food Services), and 23 industries in Sector 81 (Other Services).” One example is NAICS code 811213, Communication Equipment Repair and Maintenance, going from $12.0 up to $19.5 million.
    Professional, Scientific and Technical Services; Management of Companies and Enterprises; Administrative and Support and Waste Management and Remediation Services. (Final Rule)
    “SBA is increasing the size standards for 46 industries in those sectors, including 27 industries in NAICS Sector 54 (Professional, Scientific and Technical Services), two industries in Sector 55 (Management of Companies and Enterprises), and 17 industries in Sector 56 (Administrative and Support and Waste Management and Remediation Services).”
    Within these categories, here are a few common NAICS codes that will see increases:
    NAICS 541310 (Architectural Services) from $8 million to $11 million NAICS 541330 (Engineering Services) from $16.5 million to $22.5 million NAICS 541611 (Administrative Management and General Management Consulting Services) from $16.5 million to $21.5 NAICS 541990 (All Other Professional, Scientific and Technical Services) from $16.5 million to $17 million Transportation and Warehousing; Information; Finance and Insurance; Real Estate and Rental and Leasing. (Final Rule)
    “SBA is increasing the size standards for 45 industries in those sectors, including 18 industries in NAICS Sector 48-49 (Transportation and Warehousing), eight industries in NAICS Sector 51 (Information), ten industries in NAICS Sector 52 (Finance and Insurance), and nine industries in NAICS Sector 53 (Real Estate and Rental and Leasing).” One example in these categories was NAICS 531210 (Offices of Real Estate Agents and Brokers), increasing from $8 million to $13 million.
    Be sure to check the particular size standards related to your company and industry. While many are staying the same, quite a few are increasing and could allow small businesses to stay small for a longer period of time.
    Questions about this post? Email us or give us a call at 785-200-8919.
    Looking for the latest government contracting legal news? Sign up here for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook.
    The post SBA Issues Final Rule Increasing Some Size Standards first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  14. Koprince Law LLC
    We at SmallGovCon try to stay cognizant of the fact that there are new contractors every day, as well as seasoned contractors venturing into the federal government contracting realm every day. As such, we are proudly introducing our new Back to Basics series of posts that will (yes, you guessed it) take you back through some of the basics of various federal government contracting programs, regulations, and procedures. If you are new to federal government contracting, new to specific programs (i.e. 8(a), WOSB, SDVOSB, etc.), a first time protester, or simply looking for a refresher on some of the basics, this series is for you! You can use the category bar on our blog website to find all posts in the Back to Basics series, but also, keep an eye out for new ones!
    The post Introducing: SmallGovCon’s “Back to Basics” Posts Series first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  15. Koprince Law LLC
    Happy Friday, Readers. It’s been an exciting March Madness so far and we are looking forward to our hometown Kansas Jayhawks basketball game later today. There have been some major upsets and we are hoping the Jayhawks can hang in there on the road to the championship. Fingers and toes are crossed.
    This week in federal contracting there were several announcements such as the Senate passing a 2022 Federal spending bill and the Department of Labor Announcing a Proposed Rule for Modifying Procedures to Identify, Remedy Discrimination in Federal Contracting. You can read more about these announcements and a few other noteworthy articles below. Have a great weekend!
    Lancaster Company Agrees to Pay $820,000 for Improper Billing of Defense Intelligence Agency [DoJ] Senate passes 2022 federal spending bill, sends to Biden’s desk [FedNewsNet] 2022 spending bill fills holes in DoD’s long-underfunded facility maintenance budgets [FedNewsNet] Maryland legislators ask for investigation into potential discrimination within its National Guard [FedNewsNet] Women Entrepreneurs Are Critical to America’s Economic Recovery [Inc] Becoming a Government Contractor: Tips to Success [ExecGov] US Department of Labor Announces Proposed Rule for Modifying Procedures to Identify, Remedy Discrimination in Federal Contracting [DoL] GSA Launches Modernized Federal IT Dashboard to Enhance Transparency and Accountability in Federal IT Modernization [GSA] Defense Federal Acquisition Regulation Supplement: Post-award Debriefings (DFARS Case 2018-D009) [FedReg] Chairwoman Maloney Introduces Legislation to Prohibit the U.S. Government from Conducting Business with Companies Operating in Russia [Oversight] Defense Bid protest could lead to ‘protracted fight’ over $11B DISA contract award [FedScoop] Contractors ponder the short fiscal year and the new money for Ukraine [FedNewsNet] Agencies look to streamline payment data collection in contracting [FCW] Requirement for NASA Recipients of Financial Assistance Awards To Obtain a Quotation From Small and/or Minority Businesses, Women’s Business Enterprises and Labor Surplus Area Firms [FedReg] UPS to Pay $5.3 Million to Settle False Claims Act Allegations for Falsely Reporting Delivery Times of U.S. Mail Carried Internationally [DoJ] All-Black Female WWII Unit to Receive Congressional Gold Medal [DoD] GSA wants to cast wider net for federal building architects [FedNewsNet] Man Sentenced to 99 Months in Prison for Committing Mail Fraud while Serving Federal Sentence for Previous Fraud [DoJ] GovCon Expert Emily Murphy: Debunking SBIR Program Myths[GovConWire] The post SmallGovCon Week in Review: March 21-25, 2022 first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  16. Koprince Law LLC
    Join me at the UTSA SBDC Government Contracting Conference – Building Business in Government Markets. I’ll be discussing how federal contractors can avoid common legal mistakes. The event is March 30, 2022 from 9:00 AM – 3:30 PM central, and there are lots of interesting topics, all for free. I’ll be presenting at 2 pm central.
    Registration is here. Mark your calendars!
    The post Webinar Event: UTSA SBDC – Top 10 Common Legal Mistakes for Federal Contractors first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  17. Koprince Law LLC
    The Department of Defense (DoD) has proposed to revise the Defense Federal Acquisition Regulations (DFARS) to reauthorize and improve the DoD Mentor-Protégé Program (MPP). The primary purpose of the proposed rule (Proposed Rule) is to reauthorize the DoD MPP, provide incentives to large DoD contractors to serve as mentors to small businesses, and extend opportunities for small businesses to participate in the MPP. In addition, the proposed rule removes restrictions on the eligibility of small businesses by aligning the size of the small business with the size standard associated with its primary NAICS code.
    The Proposed Rule is here.
    Reauthorization of the DoD MPP
    The Proposed Rule basically reauthorizes the DoD MPP program by resetting many of the dates under the current rules. Specifically:
    –      The date for entering into a mentor-protégé agreement will be extended to September 30, 2024 (Appendix I-103);
    –      The date for mentor reimbursements to be paid for developmental assistance costs incurred under the Program will be extended to September 30, 2026 (DFARS 219.7104(b);
    –      The date for a mentor to receive credit toward attainment of the subcontracting goals in its small business subcontracting plan for developmental assistance costs incurred under the Program will be extended to September 30, 2026  (DFARS 219.7104(d));
    –      The maximum length of participation in the MPP is reduced from three to two years—unless approval is otherwise obtained for an additional period not to exceed three years (Appendix I-107).
    Expands Maximum Size Standards
    The Proposed Rule aligns the size of the small business with the size standard associated with its primary North American Industry Classification System (NAICS) code. Currently, to be eligible for the MPP a business must be less than half the size standard for its primary NAICS code. For eligibility under the Proposed Rule, a business just must not exceed its primary NAICS size standard.  The change in the rule benefits small businesses by expanding the number of small businesses that will be eligible to participate in the MPP. The Proposed rule is also expected to benefit large businesses and the government, as well, by expanding the defense industrial base.
    Other Changes
    The Proposed rule also:
     –     Adds as a component included in the MPP, a preliminary assessment of the protégé firm’s cybersecurity readiness. The DoD Office of Small Business Program (OSBP ) will provide the assessment; and
    –      Adds a provision in the Policies and Procedures for the MPP that the DoD is authorized to terminate the mentor-protégé agreement for the convenience of the Government.
    This rule does not create any new solicitation provisions or contract clauses. Also, it does not impact any existing provisions or clauses or their applicability to contracts at or below the simplified acquisition threshold, acquisitions of commercial products including commercially available off-the-shelf items, and acquisitions of commercial services.
    While the changes aren’t revolutionary, they should make the DoD MPP program work more smoothly. The goal of the changes in the Proposed Rule is to expand opportunities for small businesses to participate in the MPP and encourage large businesses to provide assistance to small businesses. These goals support the overall objective of the MPP  of enhancing the capabilities of small businesses, and increasing the participation of small businesses to perform as subcontractors and suppliers under DoD, Federal Government, and commercial contracts.
    The DoD invites comments from small businesses and other interested parties should review the Proposed Rule and consider providing comments by the April 29, 2022, deadline.
    Questions about this post? Email us or give us a call at 785-200-8919.
    Looking for the latest government contracting legal news? Sign up here for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook.
    The post Department of Defense Proposes Rule to Reauthorize and Improve the Mentor-Protégé Program first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  18. Koprince Law LLC
    Happy Friday! We hope you were able to get out an enjoy the St. Patrick’s Day festivities this week and the start of March Madness. As the hometown of the #1 seeded Kansas Jayhawks, we are especially excited about the NCAA tournament. We have our brackets locked in and are hoping for another fun ride!
    It was also a big week in Federal Government contracting! For one, the Whitehouse and SBA released statements on advancing economy, efficiency, and effectiveness in Federal contracting by promoting pay equity and transparency. Also, a major DoD IT contract award is facing a bid protest.
    You can read those articles and more below. Have a great weekend!
    ICYMI: On Equal Pay Day, See What Americans Are Saying About SBA Efforts to Empower Women Entrepreneurs [SBA] OTAs and beyond: Scaling innovation in Defense contracting [FedNewsNet] Army Seeks Proposals for $99M Construction Services Multiple Award Task Order Contract [GovConWire] US Department of Labor Will Offer Prevailing Wage Compliance Seminars for Federal Contractors, Contracting Agencies, Unions, Workers [DoL] GSA Announces New Director for Presidential Innovation Fellows and Director of Public Engagement for Office of Strategic Communication [GSA] White House launches data initiative to help ease supply chain logjams [FedScoop] Space Development Agency about to issue solicitation for new missile tracking satellites [FedScoop] Sherman: Pentagon’s new CDAO office needs to create ‘decision advantage’ [FedScoop] Executive Order on Advancing Economy, Efficiency, and Effectiveness in Federal Contracting by Promoting Pay Equity and Transparency [WH] Is the GSA throwing sand in the gears of the multiple award schedule machinery? [FedNewsNet] Major DoD IT contract award unsurprisingly faces bid protest [FedNewsNet] FACT SHEET: Biden Harris Administration Announces Commitments to Advance Pay Equity and Support Women’s Economic Security [WH] Grant fosters innovative technology to adapt disabled veterans’ homes [FedNewsNet] Don’t underestimate the power of relationships in the federal market [FedNewsNet] U.S. Small Business Administration and Public Private Strategies Institute Announce Launch of New Engagement Series, Building a Better America: A Small Business Resource Community [SBA] Statement by SBA Administrator Guzman Observing Equal Pay Day 2022 [SBA] The post SmallGovCon Week in Review: March 14-18, 2022 first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  19. Koprince Law LLC
    Koprince McCall Potroff LLC is presenting a 3-part series focused on teaming agreements, joint venture agreements and subcontracts which can be essential to winning and successfully performing federal government contracts. Shane McCall and Nicole Pottroff explain how to develop, negotiate and administer agreements that are both compliant and effective for both small and large contractors. The presentations will cover both the key rules (such as flow-downs and ostensible subcontractor affiliation) and best practices for agreements that go beyond the bare minimum legal requirements.
    If you are interested in this informative webinar, March 22-24, 12:00-1:30pm CDT, we invite you to register here.

    The post Event: Compliant and Effective Teaming Agreements, Joint Ventures & Subcontracts – 3-Part Series (2022 Update), March 22-24, Hosted by Govology first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  20. Koprince Law LLC
    If March is supposed to come in like a lion and leave like a lamb, we are certainly still in the lion stage this week, with another winter snow storm that arrived here yesterday. No worries, however, because next week the lamb arrives with 70 degree weather and we are ready for it. Hopefully, this will be winter’s last gasp as warmer temperatures are sure to follow and we spring forward into daylight savings time.
    There was a lot happening in federal government contracting news this week, such as the new Buy American Act final rule and updates on more cybersecurity requirements being considered for government agencies. We have included those and some additional articles that we hope you will find informative.
    Have a great weekend!
    Ready or not, here comes the new buy-American procurement rule [FedNewsNet] Contractors need agencies to help them “whip inflation now!”[FedNewsNet] International Women’s Day and small business: What’s changed in the past 30 years? [USAToday] Class Waiver of the Nonmanufacturer Rule [FedReg] Two small agencies win awards from Technology Modernization Fund board [FedNewsNet] Spurred on by Russia, Senate bill carries slew of cyber requirements for agencies, industry [FedNewsNet] Agencies continue to struggle with data center optimization [FedScoop] White House Reminds Agencies to Adopt NIST’s Software Supply Chain Security Framework [GovExec] Biden Executive Order Takes Major Steps Toward Regulating Cryptocurrencies [NextGov] VA Acquisition Regulation: Acquisition Planning; Required Sources of Supplies and Services; Market Research; and Small Business Programs [FedReg] The New Limitations on Subcontracting: New Rules, New Uncertainties[WifCon] Contractor Pays $930,000 to Settle False Claims Act Allegations Relating to Medical Services Contracts at State Department and Air Force Facilities in Iraq and Afghanistan [DoJ] DOD Wants to Shepherd Small Business Innovators [DoD] DHS Annual Assessment: Most Acquisition Programs Are Meeting Goals Even with Some Management Issues and COVID-19 Delays [GAO] Federal jury convicts two Texas men on federal fraud and false statements charges [DoJ] MOX Services Agrees to Pay $10 Million to Resolve Allegations of Knowingly Presenting False Claims to Department of Energy for Non-Existent Construction Materials [DoJ] The post SmallGovCon Week in Review: March 7-11, 2022 first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  21. Koprince Law LLC
    We at SmallGovCon just wanted to take a minute to wish all the amazing women out there a Happy International Women’s Day! And we would like to send an extra-special shout-out to all of our WOSBs and EDWOSBs while we are at it! It’s been a big year for you all with SBA’s implementation of its new WOSB/EDWOSB certification program.
    Here’s to commemorating women’s history of achievement and celebrating the bright future to come!
    Questions about SBA’s new WOSB/EDWOSB certification program or WOSB/EDWOSB eligibility? Or need help with a WOSB/EDWOSB contracting legal issue? Email us or give us a call at 785-200-8919.
    Looking for the latest government contracting legal news? Sign up here for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook.
    The post Happy International Women’s Day From All of Us at SmallGovCon! first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  22. Koprince Law LLC
    SBA is currently considering terminating some class waivers for its small business Nonmanufacturer Rule, as it has received information to established the existence of small business manufacturers of
    the subject products.
    As SBA explains, the Nonmanufacturer Rule is the “requirement that recipients of Federal supply contracts issued as a small business” or other socioeconomic set-asides (8(a) Program, HUBZone, WOSB/EDWOSB, or VOSB/SDVOSB) “provide the product of a small business manufacturer or processor if the recipient is other than the actual manufacturer or processor of the product” (you can learn more about the specifics of the Nonmanufacturer Rule here).
    SBA is authorized to waive the Nonmanufacturer Rule for a “class of products” when “there are no small business manufacturers or processors available to participate in the Federal market.” These waivers can be found on SBA’s List of Class Waivers. But SBA will periodically review this list “to determine whether small business manufacturers or processors have become available to participate in the Federal market.” And “[u]pon receipt of information that such a small business manufacturer or processor exists, the SBA will announce its intent to terminate the NMR waiver for a class of products[,]” which is what SBA has just done here.
    As explained in SBA’s first announcement (Fed. Reg. Doc. 2022-03201), SBA is considering terminating the Nonmanufacturer Rule class waiver for:
    Furniture Frames and Parts, Metal, Manufacturing under NAICS code 337215 and PSC 7195; Furniture Frames, Wood, Manufacturing under NAICS code 337215 and PSC 7195; Furniture Parts, Finished Plastics, Manufacturing under NAICS code 33725 and PSC 7195; Furniture, Factory-type (e.g. cabinets, stools, tool stands, work benches), Manufacturing under NAICS code 337127 and PSC 7110; Furniture, Hospital (e.g. hospital beds, operating room furniture) Manufacturing under NAICS
    code 339113 and PSC 7195; and Furniture, Laboratory-type (e.g. benches, cabinets, stools, tables) Manufacturing under NAICS code 339113 and PSC 7195. And per the second announcement (Fed. Reg. Doc. 2022-03202), SBA is also considering terminating the Nonmanufacturer class waiver for the following, under NAICS code 334517 and PSC 6525:
    irradiation apparatus manufacturing, computerized axial tomography (CT/CAT) scanners manufacturing; CT/CAT (computerized axial tomography) scanners manufacturing; fluoroscopes manufacturing; fluoroscopic X-ray apparatus and tubes manufacturing; generators, X-ray, manufacturing; irradiation equipment manufacturing; X-ray generators manufacturing; and X-ray irradiation equipment manufacturing. As the SBA explained:
    Based on this information, the SBA is now seeking comment on all of the potential waiver terminations detailed in these announcements. And unless public comment reveals that there are no small businesses available for these classes of products, SBA will publish its “Final Notice of Termination in the Federal Register” for these class waivers.
    ***
    Complying with SBA’s Nonmanufacturer Rule requirements for can be pretty tricky. And failure to comply can result in the loss of an award, contract terminations, and other unfortunate consequences. So it is important to keep up on which products are covered by these class waivers.
    Questions about this post? Or need help with a government contracting legal issue? Email us or give us a call at 785-200-8919.
    Looking for the latest government contracting legal news? Sign up here for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook.
    The post SBA Proposes to Eliminate Some Nonmanufacturer Rule Class Waivers first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  23. Koprince Law LLC
    Hello, Readers. As we move into spring, we at SmallGovCon have been observing the optimism of nature as winter releases its grip. Small green plant shoots are pushing their way up towards the sunshine and the trees are preparing to bud as our temperatures warm up. The birds are getting involved as well. There’s no doubt that they are enjoying the warmer weather and looking forward to spring, too. Hope you are able to observe equally inspiring things in your neck of the woods.
    As usual there was a lot of news in federal government contracting, this week including articles on the future of federal government contracting, cybersecurity bills, and news on GSA multiple award contracts. Have a great weekend!
    The Pros And Cons of Being a Government Contractor [GovConWire] Defense contractor revenue is strong, so why is the state of the sector weakening? [FedNewsNet] Defense Federal Acquisition Regulation Supplement: Reauthorization and Improvement of Mentor-Protégé Program (DFARS Case 2020-D009) [FedReg] Clearview AI CEO says company focused on winning federal agency contracts this year [FedScoop] Defense Acquisitions Additional Actions Needed to Implement Proposed Improvements to Congressional Reporting [GAO] NASA Lunar Programs: Moon Landing Plans Are Advancing but Challenges Remain [GAO] Ernst bill to enhance government procurement process for small businesses becomes law [RiponAD] Looking at all the rules, no wonder small business contractors base is shrinking [FedNewsNet] Cybersecurity Bill Passes in Senate to Counter Russian Threats [Bloomberg] Procurement isn’t always just about procurement — a tale from Ukraine [FCW] Ensuring Compliance with the Davis-Bacon Act Under the Bipartisan Infrastructure Law [FoprConstPros] New COVID guidance for federal agencies to match CDC recommendations [FedNewsNet] Partnering with 8(a) Companies as a Large Contracting Firm [BloombergGov] The state of government contracting programs [FedNewsNet] GSA Releases Small Business Procurement Strategy for Services Multi-Agency Contract [GovConWire] Statement by SBA Administrator Guzman on President Biden’s State of the Union Address [SBA] Statement by SBA Administrator Guzman Observing Women’s History Month 2022 [SBA] The post SmallGovCon Week in Review: February 28- March 4, 2022 first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  24. Koprince Law LLC
    The case of Superior Optical Labs, Inc. (Superior) v. United States focuses on the control of a Service-Disabled Veteran Owned Small Business (SDVOSB) and how that control, or more precisely, lack of control, can disqualify an SDVOSB with 69% service-disabled veteran ownership from a solicitation set aside for SDVOSBs. This particular Solicitation was set aside entirely for an SDVOSB to provide prescription eyeglasses and related services through the Veterans Integrated Services Network (VISN). Superior was awarded the contract, which was then protested by PDS Consultants, Inc. (PDS) challenged the SDVOSB eligibility of Superior. In the end, OHA held that Superior did not qualify as a SDVOSB for purposes of the procurement due to a lack of control as required by SBA rules. PDS then challenged OHA’s decision at the Court of Federal Claims.
    Because this is a case at the Court of Federal Claims, there is a substantial amount of background for those who need it. If you are already well-versed in SDVOSB requirements, the next two paragraphs will be easy reading for you.
    Background
    Under SDVOSB rules, 13 C.F.R. § 125.12 requires any small business claiming to be owned by a service-disabled veteran to meet specific criteria in order to be eligible for an award of an SDVOSB set aside contract. The SDVOSB must be “at least 51% unconditionally and directly owned by one or more service-disabled veterans.” The management and daily business operations of an SDVOSB must be controlled by one or more service-disabled veterans. 13 C.F.R. § 125.13(a).  
    It’s not enough that a business be primarily owned by a service-disabled veteran, the service-disabled veteran must also control the business to qualify, and the Department of Veterans Affairs (VA) Center for Verification and Evaluation (CVE) looks beyond the primary relationships to determine that control. The management and daily business operations, including both long-term decisions and day-to-day management, must be controlled and conducted by one or more service-disabled veterans. 13 C.F.R. § 125.13(a). The service-disabled veteran will not be found to have control of the concern if the concern has a business relationship “with non-service-disabled veteran individuals or entities which cause such dependence that the applicant or concern cannot exercise independent business judgment without great economic risk,” 13 C.F.R. § 125.13(i)(7). Notably, this same general requirement applies to all of the various socio-economic statuses recognized by the SBA.  
    Superior was 69% owned by a service-disabled veteran when it submitted its proposal for the solicitation. Superior’s President and CEO owned 51% of the company and two additional service-disabled veterans each owned a 9% interest in Superior. At all times relevant, Superior’s President owned and controlled more than 50% of the company. Superior was certified by the Department of Veterans Affairs (VA) Center for Verification and Evaluation (CVE) in April 2018. The VA issued this Solicitation in August 2020, Superior submitted its offer in September 2020, and the VA awarded it to Superior in October 2020. This all seems to be in line with the requirements, correct? Not so fast! 
    PDS Consultants, Inc. (PDS) came along and filed a protest on the basis that Superior was controlled by, and shared resources with, Essilor of America, Inc. (Essilor). Additionally, PDS claimed Superior received “critical financial support from Essilor” and that Superior was required to use Essilor products. PDS alleged that this control came from a Services and Supply Agreement (the Agreement) between Superior and Essilor that was executed on November 1, 2017, when Superior’s current President and CEO obtained a controlling interest in the company.  
    Under the Agreement, Superior was required to purchase from Essilor, in the course of contract performance, the majority of the volume of lenses, frames, contact lenses, and consumables if such products were offered by Essilor. Superior was required to submit monthly reports to Essilor to verify compliance. If a contract with VISN or another VA contract restricted purchasing from Essilor, Superior was required to purchase the maximum volume from Essilor without jeopardizing Superior’s SDVOSB status. Superior was required to use Essilor’s pricing, and Superior was required to notify Essilor in writing and receive Essilor’s approval prior to bidding if Superior planned to bid on a fixed-price government contract.
    The agreement further obligated Superior to obtain Essilor’s written approval to assign any part of the agreement or to make any change in control of the Superior.  The agreement stated, with respect to change in control, that Essilor had to give written approval for a “(i) ‘change in possession, directly
    or indirectly, of the power to direct or cause the directing of the management or policies of
    Superior,’ (ii) any sale or transfer of 50 percent or more of Superior’s assets, (iii) any sale or transfer of 50 percent or more of Superior’s stock, (iv) any merger resulting in a change of ownership of 50 percent or more, and (v) any change of Superior’s SDVOSB status.”
    One could imagine a subcontractor potentially putting a similar type of provision in a subcontract. But OHA found, and the court agreed, that this “went beyond the five “extraordinary circumstances’ in
    which the SBA will not find that a lack of control exists even though a service-disabled veteran
    does not have unilateral power and authority to make decisions.”
    The agreement was effective from November 1, 2017, to October 31, 2027, unless shorted in accordance with the terms of the agreement. Superior and Essilor executed a Termination Agreement on October 20, 2020, with a retroactive effective date of January 29, 2018, the date upon which Superior and Essilor had made a verbal agreement to terminate the agreement (Oral Agreement).  
    Superior’s response to the protest included the argument that Superior’s President and CEO (its President) had, at all times relevant, been both the majority shareholder and controlling director of Superior. Superior also claimed Essilor did not have a controlling interest in Superior since 2017 and that the business relationship between Superior and Essilor did not give Essilor any control of Superior. Further, Superior argued the agreement was not in effect because it had been terminated by the oral agreement in January 2018. Finally, Superior claimed “that the agreement was drafted so as not to jeopardize Superior’s status as a SDVOSB and had never been enforced.”  
    Unfortunately for Superior, OHA found that Superior was not controlled by its President on the September 2020 date it submitted its offer for the solicitation, nor on the October date PDS filed its protest, the two relevant dates identified by OHA. Due to the terms of the agreement which required a written agreement for termination, the Termination Agreement was not found to take effect until the October 20, 2020, date. As such, the agreement was still in effect and the need for Superior to receive Essilor’s written approval prior to changes in control was found to “plainly interfere with [Superior’s President]’s ability to make all business decisions and exercise complete control over Superior” as required per SBA rules. The minimum purchase terms and conditions requiring Essilor’s approval prior to bidding further interfered.  
    Following the finding by OHA, VA cancelled the VISN 8 contract with Superior in accordance with 13 C.F.R. § 134.1007(j)(2). The United States Court of Federal Claims, upon review of the case, determined OHA’s finding that Superior was not eligible for award at the time of the procurement was correct, and that VA acted rationally when it cancelled the VISN 8 contract. The court has a deferential ability to review, and will only disturb an SBA ruling when it didn’t consider key facts, ignored evidence or is just plain implausible.
    There are two important takeaways from this example. First, know all the terms of any contracts you enter into. It is likely Superior would have never been in this situation had it executed a written termination agreement, as required in its contract terms. And second, be wary of other entities where there is any possibility of finding the other party has control, and do not make bids at a time when control may be deemed in the hands of any entity that is not of a similar socio-economic status.  These kind of “change in control” provisions are quite common in commercial agreements. So, for SDVOSB or other companies under SBA’s WOSB or 8(a) programs, it’s important to review any agreement for potential impact on control over the company.
    Questions about this post? Or need help with a government contracting legal issue? Email us or give us a call at 785-200-8919.
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    The post Control Matters: For SDVOSB Companies, Pay Attention to Appearances as Well as Realities first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  25. Koprince Law LLC
    Without wanting to make the audience feel too old, I was not yet born when Transformers was a pop culture phenomenon. Still, it’s a simple but fun concept: robots that transform to and from cool vehicles. Regardless of what form they take, they are still the same character.
    The same cannot be said of government contractors submitting an initial bid for the first phase of a solicitation as a prime contractor and a bid as a member of a contractor teaming agreement (CTA) for the second phase of said solicitation. While the same company is involved, the bids are treated as being from different entities. Such was the case in the GAO matter of Softrams, LLC, B-419927.4 (Feb. 7, 2022).
    In this case, the Department of Health and Human Services (DHHS) issued the solicitation via the GSA’s federal supply schedule for operations and management of the agency’s identity management system. Award was to be made on a best-value tradeoff basis considering corporate experience, performance work statement response, a challenge exercise, and section 508 compliance. Evaluation of quotes was to be made in two phases. During the first phase, vendors were to submit quotations covering corporate experience only. During the second phase, the other factors and price would be considered.
    OmniFed LLC (Omni), a small business, submitted a quote for phase one. For this phase, Omni submitted its quote as the prime contractor quoting the use of a second vendor, Bana Solutions (Bana), as a subcontractor. However, for phase two, Omni asked if it could submit its quotation as a Contractor Team Arrangement (CTA) with Bana. Note, GSA CTAs are different than other CTAs, these CTAs are not a separate legal entity. See more information here. The agency approved, and so Omni and Bana (for clarity we will call the CTA OB) submitted their phase two quotation with Bana as the team leader and Omni as a team member. The agency based its evaluation of OB off the original Omni quote for phase one and the OB quote for phase two, and awarded OB.
    A protest followed in which the agency said it would take corrective action as Bana did not have a valid FSS contract at the time Omni submitted its phase one quotation. OB was excluded as was Omni. However, after another dispute, Omni was allowed to continue in the competition as the prime. Omni correctly noted to the agency that the original arrangement had Omni as prime, and primes can use subcontractors not on the FSS.
    The offerors again made their submissions. Curiously, in the subsequent evaluations, the agency evaluated Omni’s quote for three of the four factors and pricing but evaluated the old OB quote for the final factor. The agency then awarded Omni the contract, and this protest followed.
    The agency responded that because Omni “did not form a separate legal entity when entering into the GSA CTA with Bana, nothing under the GSA rules or the solicitation prohibited them from changing their formation under the same quotation.” GAO rejected this argument, noting:
    “In allowing the Omni-Prime vendor to submit a revised quotation to replace the phase two quotation submitted by the eliminated Bana-Omni CTA vendor, the agency failed to obtain a complete replacement quotation from Omni-Prime by not conducting or allowing for a new factor 3 oral presentation. In sum, the agency based its selection decision on a quotation that was composed of submissions from two different vendors. This…is squarely at odds with the agency’s contemporaneous finding in response to Omni’s agency-level protest challenging the elimination of the Bana‑Omni CTA vendor from the competition.  There, the agency recognized that the two vendor configurations were separate respondents to the solicitation.”
    The protest was sustained as a result.
    This is an unusual case as the DHHS, even after excluding a quotation, nonetheless used information from that quotation as part of its evaluation. It sort of makes sense: In the original phase two solicitation, Omni and Bana were the companies working together. The same went for the evaluation that was protested in this matter. It goes to show that the form does matter, and that simply rearranging into a CTA after the fact can completely disrupt an offeror’s chances if they are not careful.
    Questions about this post? Or need help with a government contracting legal issue? Email us or give us a call at 785-200-8919.
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    The post Transformers: Offerors in Disguise – GAO Sustains Protest Regarding Evaluation Based on Separate Offers from the same Offeror first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
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