Author Archives: Steven Koprince

SBA OHA: Inactive Employees Count for SBA Size Purposes

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Back in my undergraduate days at Duke, I attended almost all of the home basketball games.  Occasionally, sometime in the second half, with the Blue Devils up 20 points or more, an opposing player would execute an impressive dunk, and proceed to do a little celebration.  I, along with my fellow Cameron Crazies, would immediately begin chanting, “scoreboard, scoreboard,” while pointing at the device in question.  Our message was, “that’s nice, but it just doesn’t matter.”  (Actually, we Crazies sometimes chanted “just doesn’t matter,” too).

“That’s nice, but it just doesn’t matter” is what the SBA’s Office of Hearings and Appeals had to say in a recent size appeal decision involving the question of whether employees who are sick, on vacation, or even comatose count toward a company’s employee-based SBA size standard.  SBA OHA’s answer: if they’re on the payroll, they count.  Period.

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Three Website Mistakes Small Government Contractors Should Avoid

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The late, great Whitney Houston famously mused, “How will I know?”  Whitney was singing about the uncertainty of love, but small government contractors often ask the same question in a different sense—that is, “How will I know if my competitor is too large for a particular size standard?”

There are plenty of places to research a competitor’s size, but one of the most fruitful may be the competitor’s own website.  Of course, small government contractors should be aware that their competitors know how to use Google, too.  Often, SBA size protests arise from information a government contractor should have thought twice about posting on its website.

Here are three common website mistakes small government contractors make, sometimes leading to SBA size protests.

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Win a GAO Bid Protest? You May be Entitled to Attorneys’ Fees

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As a government contracts attorney, there is nothing I enjoy more than winning a victory on behalf of a client–then having the government pick up the tab.  It doesn’t happen all the time, of course.  The general rule in the United States is that everyone pays his or her own attorneys’ fees.  But a recent GAO decision highlights the fact that, under the right circumstances, a successful GAO protester is entitled to recover its attorneys’ fees.

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Three Common SBA Size Protest Mistakes

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Nobody’s perfect, the old saying goes.  While I might beg to differ in the case of my daughter (who, in my unbiased opinion, is perfectly adorable), the saying definitely holds true when it comes to SBA size protests.

I read every published SBA Office of Hearings and Appeals decision (I’m sure you are jealous), and I see many of the same mistakes repeated over and over,  Often, these mistakes cost the protester its chance at a successful size protest.

So, without further ado, here are my top three most common SBA size protest mistakes.

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The FAR’s Limitations on Subcontracting and IDIQ Contracts

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Here’s a question I get with some frequency: “do I have to comply with the FAR’s subcontracting limitations for every task or delivery order?”  You will be happy to learn that the GAO, at least, has answered this question “no.”

Although the FAR Limitations on Subcontracting clause, FAR 52.219-14, does not address IDIQs, task or delivery orders, the GAO has held that the subcontracting limitation FAR clause “applies to the contract as a whole and does not require that each delivery order placed under the contract satisfy the requirements of the clause.”  Spectrum Security Servs., Inc., B-297320.2 (Dec. 29, 2005).  According to the GAO in the Spectrum Security Services bid protest, the “contract as a whole” means that where a solicitation provides for the price evaluation of base and option years, the entire contract—both base and all priced options—will be reviewed to determine whether the offer complies with the subcontracting limits.

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Ohio Firm Pays $500,000 to Settle DBE Fraud Claim–Is Subcontracting Plan Abuse Next?

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An Ohio-based construction company has paid $500,000 to settle federal False Claims Act allegations related to the Department of Transportation’s Disadvantaged Business Enterprise program, according to a statement published by the U.S. Department of Justice.

This case is particularly interesting because the allegations made by the government sound an awful lot like circumstances that, I have heard, may occur on many government projects requiring small business subcontracting plans.   Some in the industry have complained that sometimes, a small and/or socioeconomically disadvantaged business is named as a subcontractor under a large prime’s subcontracting plan, but the small business is expected to pass all or most of the work through to a large, second-tier sub.

It’s not that different from what happened in Ohio, and now the prime contractor in question is half a million dollars poorer.  The settlement begs the question: will the government use the False Claims Act to root out this type of subcontracting plan abuse in the near future?

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SBA Size Appeals and Confidential Information

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Clients thinking about filing a SBA size appeal with the SBA Office of Hearings and Appeals are sometimes nervous when they find out that SBA size appeal decisions are publicly published.  “What if the judge publishes our confidential information?” they ask.

As a small business in a competitive market, it is always wise to think about protecting your proprietary and confidential business information, including by having employees and teaming partners sign non-disclosure agreements.  But what do you do when the person with your confidential information is an administrative judge, like the ones at SBA OHA?
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