The SBA’s Utah District Office has imposed tough new restrictions on the approval of 8(a) mentor-protege agreements and joint ventures.
The Utah SBA obviously hopes that these restrictions will lead to more successful 8(a) mentor-protege and joint venture relationships–but I worry that these District-specific restrictions may backfire, and put Utah 8(a)s at a significant competitive disadvantage against 8(a)s serviced by other SBA District Offices.
Large prime contractors operating under individual subcontracting plans would receive credit for small businesses performing at any subcontracting tier, according to a proposed rule issued yesterday by the SBA.
The proposed rule also requires large primes to assign a NAICS code and size standard to “solicitations” for subcontracts–a notion that may come as a surprise to prime contractors, many of whom do not typically issue formal subcontract solicitations.
When the SBA found a subcontractor to be affiliated with its prime contractor under the ostensible subcontractor rule, the subcontractor could not appeal the SBA’s finding to the SBA Office of Hearings and Appeals.
In a recent size appeal decision, OHA held that a subcontractor lacks the ability to file a size appeal because the subcontractor is not directly affected by the size determination.
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.
A large business was tossed out of a government competition because the company’s small business subcontracting goal was substantially below the agency’s stated goal.
In a recent bid protest decision, the GAO held that the agency acted reasonably when it rated the large business as “unacceptable” for failing to propose a sufficiently high small business subcontracting goal.
When a Contracting Officer determines that subcontracting possibilities will exist under a qualifying unrestricted contract, subcontracting plans are required from all offerors other than small businesses–including entities that do not intend to issue any subcontracts.
In a recent bid protest decision, the GAO rejected a protester’s argument that the subcontracting plan requirement is to be determined on an “offeror by offeror” basis, and held that the requirement to provide a subcontracting plan is broadly applied.