The 8(a) Program can offer incredible opportunities: sole source contracts, set-aside competitions, mentor-protege relationships, SBA business training and much more.
But for business owners older than 59 1/2, getting admitted to the 8(a) Program can be very difficult: unlike their younger counterparts, funds these owners have saved in traditional retirement accounts will likely count against the 8(a) Program’s $250,000 adjusted net worth cap.
How is this fair? (Spoiler alert: in my opinion, it ain’t).
I am very pleased to announce that Robert Kampen has joined our team of attorney-authors here at SmallGovCon. Rob is an associate attorney with Koprince Law LLC, where his practice focuses on federal government contracts law.
Rob is a graduate of the University of Kansas School of Law. Before joining the firm, Rob worked for several years in financial services and telecommunications, where he focused on negotiating, drafting and managing contracts. Check out Rob’s full biography to learn more about our newest author, and don’t miss his first SmallGovCon post on limits BPA awardees face in attempting to challenge fellow awardees.
The Small Business Runway Extension Act, signed into law earlier this week, changes the small business size calculation under revenue-based NAICS codes from a three-year to five-year average.
The new law has sparked a great deal of discussion in the government contracting community, with some commentators pointing out that not all small businesses will benefit. But how does the SBA–the agency tasked with implementing the new law–feel?
Well, according to commentary published earlier this year, the SBA thinks the five-year period is a bad idea.
by Erin Andrew
One of the biggest mistakes small business owners make is planning their exit strategy too soon. Whether a contractor wants to enter, grow, or exit the market, a small business owner must understand how buying or selling their business can play a large role in their success. Below are some tips for all three phases:
The House and Senate have passed the “Small Business Runway Extension Act of 2018,” which appears poised to become law in the coming days. As my colleague Matt Moriarty has written, the bill would amend the SBA’s small business size rules to use a five-year average, instead of a three-year average, in calculations using receipts-based size standards.
The purpose of the bill is to help contractors avoid becoming “other than small” following a period of quick growth, but not all companies will benefit. For companies with declining revenues, the bill may backfire, causing those companies to be stuck as large businesses longer.
The FAR Council’s proposed update to the limitations on subcontracting, and the DoD’s subsequent FAR deviation, have been met with widespread approval by small contractors.
But for HUBZone Program participants, the proposed rule and DoD deviation contain a glaring problem: a requirement that the HUBZone member of a joint venture take sole responsibility for meeting the applicable limitations on subcontracting. This requirement, which doesn’t apply to joint venturers in other socioeconomic programs, is unfair to HUBZones, and at odds with SBA regulations.
Earlier this week, the FAR Council issued a proposed rule to conform the FAR to the SBA’s regulation governing limitations on subcontracting. But the DoD isn’t waiting around while the FAR Council finishes the process.
The DoD has issued a comprehensive FAR deviation, effective immediately. The DoD’s FAR deviation will, effectively, temporarily conform the DoD’s use of the FAR to the SBA’s regulation while the FAR Council works on a final rule.