Author Archives: Steven Koprince

The Ostensible Subcontractor Rule and Key Personnel

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According to Executive Order 13,495, follow-on contractors must offer a “right of first refusal” to certain incumbent personnel.  Based on the Executive Order, the SBA Office of Hearings and Appeals has previously held that hiring non-management personnel from a subcontractor is no longer evidence of unusual reliance under the ostensible subcontractor rule.

I emphasize “non-management” for a reason: the Executive Order does not apply to non-management personnel.  According to SBA OHA, hiring a subcontractor’s management team—particularly when the subcontractor is an ineligible incumbent—continues to be strong evidence of a violation of the ostensible subcontractor rule.

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GAO Confirms: VA SDVOSB Set-Asides Trump Schedule Buys

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If this was a game of high-stakes poker, you might say the GAO has called the VA’s bluff.

Service-disabled veteran-owned small businesses rejoiced after the GAO held, in Aldevra, B-405271, B-405524 (Oct. 11, 2011) that federal law requires the VA to prioritize SDVOSB procurements over Federal Supply Schedule acquisitions.  But, to the shock and outrage of the SDVOSB community, the VA has refused to follow the GAO’s interpretation of the law.  Now, to mix card-game metaphors, the GAO has doubled down, issuing a second decision confirming its ruling in Aldevra.

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SBA OHA, Not GAO, Decides NAICS Code Appeals

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Appealing the NAICS code a procuring agency assigns to a set-aside solicitation can be a powerful tool: after all, if the NAICS code and corresponding size standard change, it can dramatically alter the competitive playing field.  But if a company wants to file a  NAICS code appeal, it must file with the SBA Office of Hearings and Appeals, not the GAO, which lacks jurisdiction to hear challenges to NAICS code designations—something the protester in BlueStar Energy Solutions, B-405690 (Dec. 12, 2011) learned too late.

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GAO Protests and Bias Claims: Fuhgettaboutit

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When small government contractors call me about potential GAO bid protests, they sometimes are convinced that the procuring agency was biased against them, or biased in favor of another offeor (in many cases, the incumbent).  Fired up, these clients want to file scathing GAO protests, accusing the source selection officials of improprieties.

It’s my unpleasant job to tell these angry contractors, “unless you have ironclad evidence, I think you should save your money.”  Although allegations of bias are relatively common in GAO protests, in my experience, the GAO almost never sustains a protest on this basis.  In other words, as my friends from the Northeast might say, fuhgettaboutit.

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Debriefings and SBA Size Protests: Sorry, No Extension

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Today’s public service announcement comes to us courtesy of the SBA Office of Hearings and Appeals.  Here it is: asking for and receiving a debriefing does not extend the deadline to file a SBA size protest.  Asking for a debriefing may extend the time frame for filing a GAO bid protest but does not extend the five-business-day period for filing a SBA size protest.

Case in point: the decision of SBA OHA in Size Appeal of Garco Construction, Inc., SBA No. SIZ-5308 (2011).  In that case, a small business learned of award to a competitor on September 26, but waited until after it received its debriefing on October 21 to file its SBA size protest.  The small business argued that its size protest should be considered timely, because it has no knowledge of the grounds of protest until after the debriefing.

Nice try.  SBA OHA made short work of this argument, stating “that a protester did not learn of the grounds for its protest until the debriefing is no basis for extending the deadline for filing a protest.”  SBA OHA held that the SBA Area Office had properly dismissed the size protest as untimely.

And that concludes today’s public service announcement for small government contractors.  As they say on NBC, “The More You Know.”

SBA Affiliation Rules and Family Matters: OHA OK’s Minor Business Dealings

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When it comes to the SBA affiliation rules, it’s a good idea to keep Steve Urkel in mind.  Why remember this lovable suspender-wearing nerd?  Well, because in the SBA affiliation world, “family matters.”

Okay, bad joke.  But hold the rotten tomatoes, because I have a point here.  In my experience, one of the most common ways small businesses find themselves with an SBA affiliation problem is through family relationships.  Many small government contractors are surprised to learn that the SBA presumes that firms controlled by close family members are affiliated due to a supposed “identity of interest” between the family members.  For example, if you control Company A and your spouse controls Company B, the two firms are presumed affiliated for SBA size purposes, and you must rebut the presumption (not an easy task) to avoid affiliation.

In some prior size appeal cases, the SBA Office of Hearings and Appeals held that two firms controlled by family members could not rebut the presumption if the companies had any business dealings whatsoever.  However, in a commonsense decision—albeit one creating a bit of a gray area—SBA OHA recently held that two companies controlled by family members are not necessarily affiliated just because they have minor business relations.

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GAO Protesters: Take Comments on the Agency Report Seriously (or Go Home)

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The GAO bid protest process involves more than just the initial protest itself.  After the protest is filed, the agency has the opportunity to take so-called “corrective action,” essentially conceding victory to the protester.  But if the agency elects to fight the protest, and produces an agency report countering the protester’s arguments, the ball is back in the protester’s court.

The GAO expects a protester to file a detailed response (called “comments” in GAO protest parlance) to the agency report.  Fail to file comments, and the GAO will dismiss the protest.  But, as demonstrated in the GAO’s decision in Ross Technologies, Inc., B-405266.2 (Dec. 7, 2011), if the comments do not address the arguments in the agency report, it may be no better than not filing them at all.

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