Subcontractor Price Proposals: A Cautionary Tale

Subcontractors sometimes prefer to submit their cost or price proposals directly to the government, instead of submitting their cost or pricing information through the prime contractor.  In cases where a procuring agency allows it, such independent submissions can ease a subcontractor’s concerns about disclosing sensitive information to the prime contractor.

But when a subcontractor circumvents the prime contractor and independently submits its pricing, the prime contractor is unable to review the subcontractor’s proposal to ensure that it complies with the terms of the solicitation.  As demonstrated in a recent GAO bid protest decision, if the subcontractor’s proposal is non-compliant, the entire team may pay the price.

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WOSB Self-Certification Elimination: The SBA Weighs In

The SBA has acknowledged that Congress eliminated WOSB self-certification in the 2015 NDAA–but suggests that WOSB self-certification may continue until the SBA adopts a regulatory framework for a formal certification program.

In a proposed rule released today, the SBA adopts a pragmatic approach that nonetheless may be legally problematic given that Congress did not authorize a continuation of WOSB self-certification pending SBA regulatory action.

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WOSB Sole Source Contracts: One Step Closer

Women-Owned Small Business sole source contracts have moved one step closer to becoming a reality.

Today, the SBA issued a proposed rule implementing the WOSB sole source authority contained in the 2015 National Defense Authorization Act.  The relative speed with which the proposed rule was issued suggests that WOSBs could begin receiving sole source awards later this year.

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Compliant, Winning Teams: A Three-Part Webinar

Teaming and joint venturing are essential components of success for many small government contractors, and the emphasis on teaming is increasing in light of the SBA’s proposed rule allowing “similarly situated entities” to join together to pursue prime contracts.  But teaming and joint venturing are not without risks–there are many unique rules that must be followed, and many pitfalls for the unwary.

That is why I am very pleased to announced that I am joining with the Government Contractors Resource Network to present a three-part webinar series on compliant and effective teaming.  Directed at small contractors, this series will begin with an overview of the rules and regulations governing teaming.  The series will continue with a discussion of how to prepare effective and compliant teaming agreements, subcontracts, and joint venture agreements.  The series will wrap up with an in-depth discussion of federal mentor-protege programs, including the SBA’s new proposed “universal” mentor-protege program.

The first webinar will broadcast on June 19, and the others will follow on June 23 and 25.  To register, or for more information, visit the GCRN website.  I hope to see you (virtually, anyway) this summer.

SBA Affiliation Rules: “Inter-Affiliate Transactions” Exception Is Narrow

Under the SBA’s affiliation rules, the so-called “inter-affiliate transactions” exception applies only where the companies in question would be eligible to file a consolidated tax return.

In a recent size appeal decision, the SBA Office of Hearings and Appeals held that the inter-affiliate transactions exception does not apply when affiliated companies are ineligible to file a consolidated tax return–a result that seems to authorize “double counting” of affiliated companies’ revenues in the context of SBA size determinations.

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VA CVE Verification Does Not Provide Affiliation Shield, Says SBA OHA

Even if the VA Center for Verification and Evaluation has found that a service-disabled veteran “unconditionally” controls a SDVOSB, the SBA may nonetheless determine that other individuals or entities also control the company within the meaning of the SBA’s affiliation rules.

As demonstrated by a recent decision of the SBA’s Office of Hearings and Appeals, VA CVE verification does not shield a SDVOSB from an adverse SBA affiliation determination, even if that determination is based on a finding that non-veterans control the company.

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8(a) Program: Follow-On To Competitive Award Can Be Sole Sourced

An 8(a) contract was properly awarded on a sole source basis to a tribally-owned entity, even though the contract was a follow-on to a competitive 8(a) set-aside award.

In a recent decision, the GAO deferred to the SBA’s interpretation of the 8(a) program regulations–which, according to the SBA, allow such sole source awards.

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