SBA OHA: 21.2% Minority Owner Controlled Contractor

Posted on December 30, 2012 by Steven Koprince

A minority owner with a mere 21.2% stake in a government contractor controlled that contractor for SBA size and affiliation purposes, according to a recent SBA Office of Hearings and Appeals decision.

SBA OHA’s decision in Size Appeal of Civitas Group, LLC, SBA No. SIZ-5424 (2012) is an important reminder that a contractor’s single largest minority shareholder may be deemed to control the company under the SBA size and affiliation rules–even if the contractor’s governing documents do not grant that shareholder actual legal control.

Contractor Improperly Downgraded for Lack of Agency-Specific Experience, Says GAO

Posted on December 20, 2012 by Steven Koprince

A contractor bidding on a U.S. Department of State contract was improperly downgraded for failing to possess direct experience working with DOS, according to a recent GAO bid protest decision.

The GAO’s decision in Exelis Systems Corporation, B-407111; B-407111.2; B-407111.3; B-407111.4 (Nov. 13, 2012) is notable because it is not unusual for procuring agencies to consider agency-specific experience as part of a past performance and/or experience evaluation. According to Exelis Systems Corporation, such considerations may be deemed improper, unless they are spelled out in (or can be reasonably inferred from) the solicitation.

It’s Over: GAO Waves White Flag On Aldevra SDVOSB Cases

Posted on December 19, 2012 by Steven Koprince

Well, that was fast.

A little more than two weeks after the U.S. Court of Federal Claims held that the VA need not consider service-disabled veteran-owned small business set-asides before procuring goods and services using the Federal Supply Schedule, the GAO has ended its long-running dispute with the VA over the same issue.

The GAO’s decision, in a case also involving Kingdomware Technologies, puts a sudden end to a series of GAO cases (known by many as the Aldevra cases) holding that the VA has been acting contrary to the law by failing to consider SDVOSB set-asides before using the Schedule.

A New Addition To The SmallGovCon Family

Posted on December 13, 2012 by Steven Koprince

SmallGovCon will be on a short hiatus while Anne and I welcome Ryan Christopher Koprince to our family.

Ryan was born at 4:07 this afternoon. At birth, Ryan was 7 pounds, 15 ounces–a beautiful and healthy baby boy.

Ryan and his mother are resting comfortably. Ryan’s proud and happy father will return to his usual mix of GAO, SBA and other government contracting blogging in the near future.

AbilityOne Program: Court Shoots Down “Arbitrary and Capricious” Contract Award

Posted on December 12, 2012 by Steven Koprince

The AbilityOne Program cannot be used to award a contract when it is questionable whether the contractor will comply with the requirement that significant portions of the work be performed by the severely disabled, according to a recent decision of the U.S. Court of Federal Claims.

In Systems Application & Technologies, Inc., No. 12-526C (2012), Judge Eric Bruggink, in an opinion brimming with colorful quotes, shot down the Army’s effort to award a contract involving significant degrees of physical labor at a remote location to an erstwhile AbilityOne participant, holding that the prospective awardee had not come close to demonstrating that the work would (or could) be performed by the severely disabled.

For contractors concerned that the AbilityOne program may be subject to misuse, the Systems Application case is confirmation both that questionable practices occur in AbilityOne contracting, and that such practices will not be tolerated by the Court.

HUBZone Fraud: Contractors Agree To $6.25 Million Settlement

Posted on December 11, 2012 by Steven Koprince

Two Kentucky-based government contractors and their owners have agreed to pay $6.25 million to settle HUBZone fraud claims, according to a U.S. Department of Justice press release.

The costly settlement puts an end to a saga involving DOJ claims of a vacant “principal” office, undisclosed affiliation, and fraudulent statements made to the SBA and and the U.S. Army.

SBA OHA: Northrop Grumman Entity Was An Ostensible Subcontractor

Posted on December 10, 2012 by Steven Koprince

You would think a company as large as Northrop Grumman would know how to avoid ostensible subcontractor affiliation with a small prime, wouldn’t you?

You’d be wrong. In a recent SBA Office of Hearings and Appeals decision, a Northrop Grumman entity entered into a teaming arrangement with a small prime, in which all three key employees identified in the proposal were employed by the large subcontractor. The result: ostensible subcontractor affiliation.