Includes decisions of the SBA Office of Hearings and Appeals, including size appeal decisions, service-disabled veteran-owned small business appeal decisions, NAICS code appeal decisions, and women-owned small business appeal decisions.
A federal regulation states that NAICS code appeals are timely if filed within ten business days. So why was one small business’s NAICS code appeal dismissed even though it filed the appeal within the time period called for by the regulation?
According to SBA OHA, the regulation was erroneous, and the actual NAICS code appeal deadline is ten calendar days. I don’t know about you, but to me, the result doesn’t seem particularly fair to the contractor.
NAICS code appeals can be powerful competitive weapons–either shrinking or expanding the competitive playing field if they are successful. Sometimes, simply filing a NAICS code appeal can convince the procuring agency that the wrong NAICS code was assigned, leading to a successful outcome before the SBA Office of Hearings and Appeals even has the opportunity to rule on the merits.
SBA size protests are only timely if received within five business days. The SBA size protest timeliness rule can confuse potential protesters, because it is different than the 10-day rule applicable to most post-award GAO bid protests.
In a recent SBA Office of Hearings and Appeals decision, a would-be protester apparently got tripped up by the different filing periods, incorrectly interpreting a solicitation provision regarding GAO bid protests as establishing an extended SBA size protest filing deadline. SBA OHA held that the protester’s misunderstanding did not entitle it to file a late SBA size protest.
A little more than a week ago, I blogged about the SBA Office of Hearings and Appeals decision in NAICS Appeal of Delphi Research Inc., SBA No. NAICS-5377 (2012), in which a small business used the NAICS code appeal process to change the relevant size standard from 1,500 employees to $25.5 million. The Delphi NAICS code appeal decision effectively lowered the solicitation’s size standard, increasing the ability of smaller companies like the protester to compete.
However, it is important to remember that the NAICS code appeal process works both ways. If a company is too large for the size standard the procuring agency assigns to a solicitation, it may be able to use the NAICS code appeal process to replace the agency’s preferred NAICS code with a NAICS code carrying a higher size standard. This is precisely what happened in a recently-decided SBA OHA case, NAICS Appeal of CHP International, Inc., SBA No. NAICS-5367 (2012).
For small government contractors, SBA size and eligibility issues are of critical importance. Recognizing this, the SBA provides an independent forum–the SBA Office of Hearings and Appeals–to review potential mistakes made by the SBA Area Offices, which decide SBA size protests.
Small government contractors must remember, however, that SBA OHA exists to evaluate the decisions made by SBA Area Offices, not to evaluate new allegations raised for the first time in the course of a SBA OHA appeal. Case in point: SBA OHA’s recent decision in Size Appeal of In & Out Valet Co., SBA No. SIZ-5354 (2012), in which the protester apparently attempted to “file” a SDVOSB protest with SBA OHA during the course of its SBA size appeal.
The SBA’s ostensible subcontractor rule has tripped up many small businesses over the years. The rule states that a small prime contractor is affiliated with its subcontractor when the prime is unusually reliant upon the subcontractor and/or the subcontractor will perform the primary and vital portions of the contract work.
It is worth remembering, however, that the ostensible subcontractor rule only matters if affiliation between the prime contractor and subcontractor would cause a size standard problem. If the sizes of the prime contractor and its ostensible subcontractor, added together, do not exceed the size standard, a violation of the ostensible subcontractor rule doesn’t matter.
That is what happened in one recent decision of the SBA Office of Hearings and Appeals, in which a small prime contractor had an ostensible subcontractor–but was declared an eligible small business anyway.
Go on, go on. Call me Captain Obvious for writing this post if you must, but the question actually comes up quite often: can a small business joint venture with a large business and qualify as “small” for purposes of a federal small business set-aside contract?
The answer, as confirmed in a recent SBA Office of Hearings and Appeals SBA size appeal decision, is “no,” unless the joint venturers are participants in the SBA’s 8(a) mentor-protege program. Unfortunately for the joint venturers in Size Appeal of BY&R Contractors, LLC & West Coast Contractors of Nevada, Inc. JV, SBA No. SIZ-5349 (2012) not only were they not an 8(a) mentor and protege, but neither company was even an 8(a) participant.