As our SmallGovCon readers might know, the SBA’s 8(a) Business Development Program is often thought of as the golden goose of federal government contracting, at least for small businesses. And it’s true, in some respects. While it is the most difficult of the SBA’s socioeconomic programs to gain admittance to, if admitted, you stand to reap large benefits such as access to competitive and sole-source contracts. And another SBA rule limits the ability to move contracts away from 8(a) Program set-asides. In that scenario, a contract that had been restricted to 8(a) Program Participants is recompeted as a set-aside for small businesses generally or a different socioeconomic category (SDVOSB, WOSB, HUBZone). Less frequently, it might not set aside for small businesses at all. If that happens, what should you do? Well, you should be familiar with what is commonly referred to as the “once 8(a), always 8(a)” rule as well as when to protest a violation of that rule.
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GovCon FAQs: Is There Still an Ostensible Subcontractor Rule?
We recently blogged about a decision that focused on the ostensible subcontractor rule and how the SBA’s Office of Hearings and Appeals (OHA) determines whether a subcontractor is an ostensible subcontractor or not. This and other similar cases have raised the question–how has SBA’s regulatory update affected the analysis of the ostensible subcontractor rule, and what remains of that rule. Below we will give a quick review of the decision from that case and look at a couple more principles of the ostensible subcontractor rule.
Continue readingOHA Says: Show me the Money! (in Ostensible Subcontracting Review)
Size and status protests, which are reviewed by the SBA’s Office of Hearings and Appeals (OHA), are far less common than GAO protests which protest an evaluation aspect of a solicitation or award. But when they are used they can be a powerful tool to keep contracting dollars intended for small businesses to stay with small businesses. In the case of Winergy, LLC, OHA takes a look at an award intended for SDVOSBs, to determine if the awardee is in compliance with the ostensible subcontractor rule or if it is subcontracting out the primary and vital parts of the contract. The lesson? If you want to keep an award, be sure that you, or a similarly situated subcontractor, will be performing the primary and vital parts of the contract and that you can support that assertion with evidence.
Continue readingSBA Reminder: Ensure all Joint Venture Requirements are Met to have a Successful JV
Joint ventures pursuing a contract under any of the SBA’s socioeconomic programs (Woman-Owned Small Business Program, Service-Disabled Veteran-Owned Small Business Program, 8(a) Program, and HUBZone) all have requirements beyond the general requirements that a non-joint venture prime contractor must meet to be eligible for those types of set-asides. The joint venture must be considered small, which may take into account the size of both venturers, and the joint venture agreement itself must contain specific information. But what happens when the regulatory text isn’t exactly clear on how those two requirements fit together? And how are unsuccessful offerors, contracting officers, and the SBA itself supposed to challenge the status of those joint ventures if the regulatory text doesn’t explicitly provide for the means to do so? Read our analysis of the decision in Chenega Base and Logistics Services, LLC to find out!
Continue readingFAR Council Establishes New Size and Status Rerepresentation Rules
The FAR Council recently published a final rule dealing with small business certification issues, effective on January 17, 2025. This final rule came about to ensure that certain parts of the FAR and SBA rules are consistent. The change? Adding additional circumstances that require an awardee to rerepresent its size and/or socioeconomic status for orders placed under a multiple-award contract (MAC) per FAR 52.219-28(c) Postaward Small Business Program Rerepresentation.
However, this FAR rule updates the regulation to match the SBA rule that had been issued in 2020, back when SBA consolidated its Mentor-Protégé Program. In the mean time, SBA had updated its recertification rules as discussed in this post outlining the new recertification rules. Under the recent regulation, SBA will be implementing its strategy to include new 13 C.F.R. § 125.12, which sets forth disqualifying size and status events, which would render a business “ineligible for future set-aside or reserved awards, including awards of set-aside or reserved orders against pre-existing unrestricted or set-aside multiple award contracts” if it causes the business to be other than small. In addition, “for a multiple award small business set-aside or reserve, a concern that recertified as other than small or other than the required small business program would be ineligible to receive options.
Unfortunately, the FAR rule will have to be updated again to deal with SBA’s January 2025 rule. Until then, below is what the FAR rule contains. Contractors must be aware of both rules to stay on top of their small business recertification requirements. And contractors may need to inform agencies about what the new SBA rules state.
Continue readingHow Extraordinary! Revised SBA Rule Gives Clear Guidance on Extraordinary Circumstances
Many of the SBA’s small business programs have restrictions on what are commonly referred to as “extraordinary circumstances” or “extraordinary actions.” It’s a topic that we have discussed many times before, including this blog post discussing a case at SBA’s Office of Hearings and Appeals, reviewing extraordinary circumstances in the context of control and operating agreements. SBA often discusses extraordinary circumstances in the context of joint venture control, where the managing venturer must control decisions except for those considered to be extraordinary. But there is a different meaning in the context of an entity seeking certification under an SBA socioeconomic program, where the qualifying individual must have control over all actions and circumstances except for those determined to be extraordinary. This post will focus on the latter situation. And, as any knowledgeable small business federal government contractor can attest to, knowing what actions are and are not extraordinary, is very important to maintain eligibility for the SBA’s programs.
Continue readingSBA Issues Final Rule to Streamline WOSB Program Rules
In June, we reported on a Notice of Proposed Rulemaking that applied to the SBA’s Woman-Owned Small Business/Economically Disadvantaged Woman-Owned Small Business (WOSB) regulations. These proposed rules were intended to take the WOSB regulations and make them more consistent with the other types of set-aside programs offered by the SBA. Now, following the required period for comments from the general public, the SBA has published its Final Rule which will be effective January 3, 2025. Read ahead to find out more!
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