Author Archives: Steven Koprince

AbilityOne Program: False Claims Act Allegation Leads to $5 Million Settlement

Posted on by

More than once, a small government contractor has complained to me that there is “just no way” a particular AbilityOne contract recipient is performing at least 75% of direct labor hours with people who are blind or have other significant disabilities, as is required for a non-profit agency to participate in the AbilityOne Program.

Now those same contractors might be saying “I told you so.”  The U.S. Department of Justice announced yesterday that a Texas company has agreed to pay $5 million to resolve False Claims Act allegations that the company failed to comply with the 75% direct hour requirement over a period of six years, but misreported its compliance to the government.

Continue reading →

SBA OHA: Small Business Affiliated With Four Ostensible Subcontractors

Posted on by

Dividing key contract work among several subcontractors will not necessarily allow a small business to avoid affiliation under the SBA’s ostensible subcontractor rule, according to a recent decision issued by the SBA Office of Hearings and Appeals.  In that case, the prime contractor divided the primary and vital contract work among four subcontractors–and according to SBA OHA, was affiliated under the ostensible subcontractor rule with all four subs.

Continue reading →

GAO: Large Prime Deserved “Significant Weakness” For Unmet Small Business Goals

Posted on by

Some folks call it “October,” others prefer the more general “fall.”  But in my family, this time of year is better known as “protest season.”  So if you’re wondering where SmallGovCon has been the last few days, thank the government and its flurry of spending at the end of the fiscal year, which briefly led to a personal routine consisting almost entirely of of eating, sleeping (when my 1-year old daughter would allow it), and protesting.

While I have been busy protesting, the GAO has continued issuing bid protest decisions.  Recently, it held that a large prime contractor was appropriately assigned a “significant weakness” due to the prime’s failure to propose meeting two of five small business subcontracting goals.  I, for one, am happy to see another indication of a procuring agency putting teeth behind the small business subcontracting goals.

Continue reading →

GAO: Contractor Cannot Claim “Experience” From Novated Contract

Posted on by

Michael Jackson famously bought the publishing rights to most of the Beatles’ songs, but purchasing the Beatles’ music didn’t mean that Jackson could claim to have appeared on the Ed Sullivan Show in 1964.

As the GAO recently held, a similar principle applies in government contracting: simply buying another company’s government contract does not necessarily entitle the new contractor to lay claim to the other company’s experience.

Continue reading →

Non-Manufacturer Rule: SBA OHA OK’s Drop Shipments

Posted on by

The SBA’s non-manufacturer rule allows a drop shipper to qualify as a small business, so long as the drop shipper takes legal ownership of the items in question, according to the SBA Office of Hearings and Appeals.  In an important decision interpreting recent amendments to the non-manufacturer rule, SBA OHA rejected the argument that a company must take physical possession of the items in question in order to qualify as a non-manufacturer–which would have essentially prohibited drop shipments.

Continue reading →

Contractor Alters Agency’s Pricing Table, Gets Bounced From Competition

Posted on by

During the NFL’s recent replacement referee debacle, the rules of the game sometimes seemed to be in flux.  San Francisco coach Jim Harbaugh, for instance, convinced the replacement refs to give him two extra challenges by playing dumb about how the challenge process works.  But with the “real” referees back on the field, NFL teams now know that they once again need to play by the rules.

When it comes to proposals, contractors, too, need to play by the rules.  An agency solicitation sets forth the ground rules of the competition, and varying from those stated rules can result in an unacceptable offer–as one contractor recently discovered when it attempted to amend the solicitation’s pricing table.

Continue reading →

Newly Organized Concern Affiliation Rule: GovCon Manager Not a “Key Employee”

Posted on by

The SBA’s newly organized concern affiliation rule is designed to prevent former officers, directors, principal stockholders or “key employees” of a large business from evading the SBA size rules by spinning off a new company.

But who is a “key employee” for purposes of the newly organized concern affiliation rule?  As demonstrated in a recent SBA Office of Hearings and Appeals decision, the mere fact that an employee has the word “manager” in his or her title does not necessarily make that person a key employee under the newly organized concern rule.

Continue reading →