Category Archives: SBA OHA Decisions

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.

From 1,500 Employees To $25.5 Million: Successful NAICS Code Appeal Shakes Up Competition

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A successful NAICS code appeal can be a powerful competitive game changer.  Case in point: the recent decision of the SBA Office of Hearings and Appeals in NAICS Appeal of Delphi Research, Inc., SBA No. NAICS-5377 (2012).

In the Delphi Research NAICS code appeal, a contractor questioned the procuring agency’s decision to assign a NAICS code carrying a 1,500-employee size standard.  SBA OHA agreed with the appellant, rewriting the solicitation to exclude companies with more than $25.5 million in average annual receipts–in essence, a much lower size standard.

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Agency Gets SBA Size Standard Wrong; SBA OHA Dismisses Late NAICS Code Appeal

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Know your SBA size standards.  That’s the lesson to be drawn from the decision of the SBA Office of Hearings and Appeals in NAICS Appeal of Ash Stevens, Inc., SBA No. NAICS-5368 (July 12, 2012).

In the Ash Stevens NAICS code appeal, the solicitation erroneously stated that the SBA size standard associated with a particular NAICS code was much larger than is actually the case.  By the time the agency corrected its mistake, SBA OHA held that it was too late for a contractor to challenge the NAICS code.

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8(a) Mentor-Protege Joint Venture Shielded From “Three-In-Two” Rule Affiliation

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According to the SBA Office of Hearings and Appeals, an 8(a) mentor-protege joint venture may be entitled to an affiliation “shield,” even if the joint venture violates the so-called “three-in-two” rule by receiving more than three contracts over a two-year period.

SBA OHA’s decision in Size Appeal of Magnum Opus Technologies, Inc., SBA No. SIZ-5372 (2012), should reassure 8(a) proteges and their mentors that if the SBA District Office has approved a contract award to an 8(a) mentor-protege joint venture, the joint venturers are very unlikely to be found affiliated as a result of that contract award.

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SBA OHA: Contractors Must Be Permitted To Contest Affiliation

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If you have ever gotten a traffic ticket, you know the ticket typically presents you with two options: send in your fine (essentially admitting guilt), or appear in court and contest the ticket.  The second option is available because in our democracy, a citizen accused of wrongdoing–even a minor traffic infraction–has the right to contest the charges.

The same is true when it comes to SBA size protests.  According to a recent decision by the SBA Office of Hearings and Appeals, a contractor cannot be found affiliated with another company unless the contractor is given the opportunity to respond to the particular basis of affiliation at issue.

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SBA OHA: SBA Cannot Belatedly Oppose Size Appeal

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No matter your political persuasion, it’s hard to forget the image of Senator John Kerry windsurfing in the famous 2004 Bush-Cheney ad.  The ad attacked Kerry for supposedly changing his mind too often–“flip-flopping,” in political parlance.

It turns out that the dangers of flip-flopping are not limited to politics.  In a recent SBA size appeal decision of the SBA Office of Hearings and Appeals, SBA OHA held that if the SBA’s Office of Government Contracting, or OGC elects not to formally oppose a SBA size appeal, it cannot later change its mind and ask SBA OHA to revisit the size appeal decision.  Because the SBA OGC does not formally oppose most SBA size appeals, SBA OHA’s decision forces the SBA OGC to make up its mind quickly about whether it will play a role in the SBA size appeal process.

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Subcontractors And Past Performance: What Are The Risks?

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Inexperienced small government contractors sometimes rely primarily (or completely) on larger subcontractors to boost their past performance scores.  Although this practice sometimes results in better past performance scores, there are two risks small government contractors should be aware of when it comes to relying on a subcontractor’s past performance: poor evaluations and ostensible subcontractor affiliation.

A recent GAO bid protest decision, coupled with a decision of the SBA Office of Hearings and Appeals, demonstrates how each risk may affect a small government contractor.

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SBA OHA: On SBA Size Rules, We’re The Boss

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“You’re not the boss of me now” is the chorus of “Boss of Me,” a catchy tune by They Might Be Giants.  But when it comes to the SBA size and affiliation rules, there is a boss: the SBA Office of Hearings and Appeals.

Under the SBA size regulations, SBA OHA has the final authority to determine whether a company is small or “other than small” for purposes of a particular procurement.  And,as one recent SBA OHA decision demonstrates, if a lower SBA office neglects to follow SBA OHA’s orders, SBA OHA will make sure that the lower office remembers who is the boss.

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