SBA OHA: Providing Specifications & Funding Is Not “Manufacturing”

A business was not engaged in “manufacturing” within the meaning of the SBA’s regulations where the firm provided another entity with specifications and financing, and the second entity produced the end item being acquired by the government.

As demonstrated in a recent SBA Office of Hearings and Appeals decision, being a “manufacturer” means engaging in the primary activities of transforming substances into an end item.  Merely providing specifications and financing doesn’t do the trick.

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SDVOSB Fraud: Large Business Pays $1.1 Million

A large business has agreed to pay $1.1 million to resolve allegations that it created a “front company” to be awarded a SDVOSB set-aside contract–and then served as a “pass through” by performing the work itself.

In addition to the $1.1 million penalty agreed to by the large contractor, the putative SDVOSB has agreed to pay the government $50,000, plus five annual contingency payments equal to one percent of its total annual revenues.

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Thank You, APTAC!

I am on my way home from Denver, where I have been since Tuesday for the Association of Procurement Assistance Centers Spring Conference.  My talk today was the final presentation of the conference (I like to think that APTAC saves the best for last!) and focused on recent SBA proposals regarding the limitations on subcontracting, “universal” mentor-protege, and women-owned small businesses, among other topics.

It was great to see so many familiar faces and have the chance to talk to so many PTAC counselors.  Thank you to Becky Peterson, Jason Porch, and the APTAC leadership for inviting me to speak, and thank you to all the PTAC-ers who stayed until the end of the conference to catch my presentation.  As always, you were a fantastic audience.

If you are a small business, you may be surprised at the many ways that your local PTAC can help you–usually free of charge.  Visit the APTAC website to get started.

Offeror’s Email Proposal “Bounces Back,” Agency Not To Blame

A procuring agency was not at fault when an offeror’s emailed proposal “bounced back” because of the large size of the email.

In a recent decision, the GAO applied the general rule that it is “an offeror’s responsibility to deliver its proposal to the proper place at the proper time” and held that the agency was not to blame when its email server rejected the large email containing the offeror’s proposal.

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Large Prime Hit For “Consistent Failure” To Meet Subcontracting Goals

A large prime contractor’s “consistent failure” to meet its small business and socioeconomic subcontracting goals on prior projects resulted in a lower past performance score–and led to the prime’s elimination from the competition.

In a recent bid protest decision, the GAO held that the agency properly eliminated a prospective prime contractor from the competition in part because the large business had not met its subcontracting goals on three recent contracts.

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Price Realism Evaluation: Only If Solicitation Says So

An agency awarding a fixed-price contract can only evaluate offerors’ proposals for price realism–that is, determine whether offerors’ proposed pricing is so low as to be unrealistic–if the solicitation calls for a price realism evaluation.

In a recent bid protest decision, the GAO confirmed that when a fixed-price solicitation does not advise offerors that a price realism evaluation will be conducted, the agency is not permitted to reject an offeror’s proposal because of unrealistically low pricing.

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Thank You, Alliance Northwest!

I am at the tail end of a great visit to the Pacific Northwest, where I spoke yesterday at the Alliance Northwest procurement conference.  My presentation focused on the many recent legal changes (and proposed changes) affecting small contractors, including SBA proposals on the limitations on subcontracting and a new “universal” SBA mentor-protege program.

Many thanks to the organizers of this wonderful event, which gets bigger and better every year.  Special thanks to Tiffany Scroggs, Stephanie Scott, Traci Hansen and their colleagues at the Washington PTAC for all of their hard work on the conference, and a big thank you to Ashley Coronado of the Washington PTAC for facilitating my session (including flawless pronunciation of “Petefish, Immel, Heeb & Hird.”)  And of course, a big “thank you” to everyone who attended my presentation and stopped by to visit on the trade show floor.

It’s a year away, but I certainly plan to be back in Washington next year for the 2016 Alliance Northwest event.  In the meantime, if you weren’t able to attend this year, I would be happy to send you my slides–please just contact me.