“You’re not the boss of me now” is the chorus of “Boss of Me,” a catchy tune by They Might Be Giants. But when it comes to the SBA size and affiliation rules, there is a boss: the SBA Office of Hearings and Appeals.
Under the SBA size regulations, SBA OHA has the final authority to determine whether a company is small or “other than small” for purposes of a particular procurement. And,as one recent SBA OHA decision demonstrates, if a lower SBA office neglects to follow SBA OHA’s orders, SBA OHA will make sure that the lower office remembers who is the boss.
When we previously looked at Size Appeal of Chu & Gassman, Inc., SBA No. SIZ-5344 (2012), I discussed the case’s ruling on trustees and negative control. As I mentioned in that post, the Chu & Gassman SBA size appeal decision was also notable for SBA OHA’s reminder that it is the king of the hill for SBA size and affiliation matters.
The Chu & Gassman SBA size appeal involved a VA procurement for architect/engineering services. After Chu & Gassman was identified as the apparent successful offeror, a competitor filed a SBA size protest, alleging that Chu & Gassman was affiliated under the SBA affiliation rules with two other businesses: Chu & Gassman Consulting Engineers, PC and Sunrise Management Services, Inc. The SBA Area Office initially found Chu & Gassman affiliated with both Engineers and Sunrise.
Chu & Gassman filed a SBA size appeal. In October 2011, SBA OHA issued a decision, Size Appeal of Chu & Gassman, Inc., SBA No. SIZ-5291 (2011), holding that the SBA Area Office had erred by finding Chu & Gassman affiliated with Engineers, but remanding the matter to the SBA Area Office for further consideration of whether Chu & Gassman was affiliated with Sunrise.
Instead of following SBA OHA’s ruling, the SBA Area Office again found Chu & Gassman affiliated with both Engineers and Sunrise. Chu & Gassman appealed once more to SBA OHA, which was not exactly pleased with the SBA Area Office’s failure to follow its prior ruling.
SBA OHA wrote that the SBA Area Office “chose to completely ignore the instructions” in the first Chu & Gassman SBA size appeal decision. SBA OHA continued: “OHA reviewed the record before it, ruled that Appellant and Engineers are not affiliated, and remanded the matter to the Area Office for the determination of narrow questions on affiliation with Sunrise. Instead of following directions, however, the Area Office conducted a second size determination on a de novo basis, an action it had no authority to do, and it ignored the questions OHA had directed it to answer. This was clear error. Were area offices to do this in every case, no issue could be treated as settled, and OHA’s decisions would be meaningless.”
The Chu & Gassman SBA size appeal decision confirms that SBA OHA is the boss of the SBA Area Offices (and everyone else) when it comes to size and affiliation matters. Once SBA OHA issues its decision, that is that–the SBA Area Office cannot reach a different conclusion, even if the case has been remanded.