A NAICS code appeal can be a powerful vehicle for influencing the competitive landscape of an acquisition. A successful NAICS code appeal can dramatically alter a solicitation’s size standard, causing major changes in the number (and sizes) of potential competitors.
But a NAICS code appeal cannot be filed until the solicitation is issued. As the SBA Office of Hearings and Appeals recently confirmed, a NAICS code appeal cannot be filed with respect to a presolicitation.
OHA’s decision in Marvin Test Solutions, Inc., SBA No. NAICS-5826 (2017) involved a Navy procurement for Common Aircraft Armament Test Set systems and Pure Air Generator System Adapter Set units. On March 28, 2017, the Navy published a presolicitation notice. The presolicitation notice indicated that the forthcoming solicitation would be classified under NAICS code 334519 (Other Measuring and Controlling Device Manufacturing), with an associated 500-employee size standard.
On April 13, 2017, Marvin Test Solutions filed a NAICS code appeal with OHA. Marvin alleged that the procurement should be classified under NAICS code 336413 (Other Aircraft Parts and Auxiliary Equipment Manufacturing), with an associated 1,250-employee size standard.
OHA noted that under the SBA’s regulations, “[a] NAICS code appeal must be filed within 10 calendar days after issuance of the initial solicitation.” OHA explained that “mere publication of a presolicitatoin notice does not guarantee that the procuring agency will issue a solicitation or that it will assign the NAICS code anticipated in the presolicitation.” OHA continued: “[p]ublication of a presolicitation notice does not constitute a NAICS code designation within the meaning of [the SBA’s regulations] and, therefore, an appeal of a presolicitation notice must be dismissed as premature.”
OHA dismissed Marvin Test Solutions’ NAICS code appeal.
While Marvin Test Solutions confirms that it is too early, when a presolicitation notice is issued, to file a NAICS code appeal, it doesn’t mean that a prospective contractor must sit on its hands until the solicitation is issued. The period after a presolicitation notice is issued provides a window to lobby the contracting officer to change the NAICS code, and–if that fails–get a head start on drafting a persuasive NAICS code appeal. Given the limited 10-day window in which a NAICS code appeal is viable, that head start can be quite beneficial.
On a final note, speaking of that 10-day window: because Marvin Test Solutions’ NAICS code appeal was premature, Marvin Test Solutions will get a second chance to file its appeal if the solicitation is issued under NAICS code 334519. But Marvin Test Solutions is lucky that the March 28, 2017 publication was only a presolicitation, and not the solicitation itself. By my count, Marvin Test Solutions filed its NAICS code appeal 16 days after the presolicitation was issued. Had the March 28 publication been the solicitation itself, Marvin Test Solutions’ NAICS code appeal likely would have been dismissed as untimely–and there would be no second bite at the apple.