Affiliation is a notorious term in the world of federal procurement, especially when it comes to SBA size determinations. And affiliation analyses can be even more confusing when it comes to joint ventures. A recent SBA OHA decision, however, answered some common questions regarding joint ventures and affiliation. It also reiterated some fundamental standards of a size determination and OHA size determination appeal.
At issue in DSC-EMI II, LLC, SBA No. SIZ-6387, 2026 (June 3, 2026), was a small business set-aside solicitation issued by the Navy for Multi-Function Support Services (MFSS) at the Marine Corps Logistics Base (MCLB) in Albany, Georgia. It was assigned NAICS code 561210, Facility Support Services, with a $47 million annual receipts size standard.
In August 2025, the agency notified DSC-EMI II, LLC, the protester and appellant, of its intended award to FL GCR JV, LLC (FL GCR), a joint venture between 51% owner and managing venturer, Frontline Enterprises, LLC (FEL), and 49% owner, Government Contracting Resources, Inc. (GCR). The size protest argued FL GCR was not a small business under the solicitation’s size standard once the total annual receipts of the joint venture’s partners and 12 alleged affiliates were aggregated. This included alleged “shared owners, management, or other means or resources that could allow direct or indirect control among and between the entities and the apparent awardee and its members.” In its response to the size protest, FL GCR acknowledged some alleged affiliates and disputed others.
In November 2025, the SBA Area Office found FL GCR to be a small business under the solicitation’s $47 million size standard. During its review, the Area Office found five of the twelve alleged affiliation relationships “moot on the basis of inactivity and/or dissolution.” It also found FEL was the controlling venturer and majority owner of another joint venture, Frontline King George JV, LLC, formed under SBA’s Mentor Protégé Program and thereby exempted from affiliation under 13 C.F.R. § 125.9(d)(1).
The Area Office’s size determination explained, without evidence of awards outside the regulatory two-year period, “a joint venture is not affiliated with joint ventures of which they are members[,]” and “two entities are not considered affiliated just because they are entered into a joint venture agreement.” The Area Office said, GCR, as the minority member, is not an affiliate; so, “GCR’s associated JV partnerships — GCR-MDI, LLC GCR-MDI II, LLC, GCR-DEAN, LLC, and GCR-DEAN II, LLC — are also not affiliates of FEL.”
The Area Office did find common management affiliation between FL GCR and Service Disabled Veterans Business Association, Inc. (SDVB). But “after reviewing the applicable annual receipts for FEL and GCR, including the receipts of the JV entities,” the Area Office found both businesses to be small under the $47 million size standard–meeting the regulatory size requirements. So, the Area Office considered FL GCR an eligible small business under the solicitation.
The protester appealed to OHA arguing, “the Area Office was required to analyze the size of FL GCR members, and to determine whether the members themselves — not just the joint venture as a whole — were affiliated” with the listed entities. It said, “a joint venture is only as small as its largest member.” The appeal also alleged, “the Area Office discarded” identified affiliates without a proper basis. It contended, dismissal was improper because the Area Office “ignored that inactive companies could still have relevant revenue/receipts” that should’ve been included in the annual receipts calculations, since according to protester, “being inactive” doesn’t mean a concern cannot be an affiliate. To summarize the additional appeal bases, the protester said, the Area Office: (a) failed to properly investigate all the alleged affiliates (adding, no affiliation argument should have been “tossed out simply due to an incomplete factual record”); and (b) the Area Office failed to perform a proper size analysis even for the recognized affiliates (adding, FEL’s proportionate share of the annual receipts for the mentor-protégé joint venture were not but should have been included in FEL’s size calculation).
FL GCR’s response to the OHA appeal argued that the protester failed to present specific facts of affiliation and failed to meet its burden of demonstrating the level of “control” required for affiliation. FL GCR said, it was “not required to disprove affiliation with 12 entities that were haphazardly grouped together without explanation in the initial size protest. And it said, the protester’s “assertion that receipts must be counted even for dissolved or inactive entities lacks both factual and legal support[,]” as it offered “no explanation as to how an inactive or dissolved entity could possibly exert control[.]”
FL GCR also argued the protester had fundamentally misinterpreted the size determination, “specifically in its claims that the Area Office looked only to see if the JV itself had affiliates[,]” and supposedly failed “to consider FEL’s proportionate share of the annual receipts with Frontline King George.” FL GCR referenced the size determination where the Area Office said it included all acknowledged affiliate and required joint venture proportionate receipts in its calculations. It just found FL GCR small for the solicitation regardless.
The protester even filed a supplemental appeal reiterating its stance that the Area Office didn’t consider all the alleged affiliates, “particularly GCR and that the record reveals affiliation between GCR and JSA Ventures.” It again said the size determination failed to account for the acknowledged affiliate’s size and “groundlessly discard[ed] affiliated entities named in the initial protest, despite lacking proper basis to do so.”
FL GCR responded that the appeal was just a “fishing expedition,” and the protester was hoping SBA would “would do the research and create arguments on its behalf.” FL GCR said, the protester fundamentally misunderstood the law—particularly in regard to dissolved and inactive entities and those with “no direct relation to FL GCR.” And it responded to each aspect of the size determination the protester claimed was missing from the record. FL GCR noted specifically, “GCR’s SBA Form 355, contained in the record, included all required information relating to JSA Ventures, and the Area Office properly considered it in its analysis.” FL GCR also said, the Area Office requested–and FL GCR provided–SDBV’s financial records, which were clearly reflected in the calculations on the record.
In its appeal analysis, OHA first addressed the protester’s claim that “a joint venture is only as small as its largest member[,]” stating:
Per SBA regulation, concerns who create a joint venture “may submit an offer as a small business for a Federal procurement, subcontract or sale so long as each concern is small under the size standard corresponding to the NAICS code assigned to the contract.” 13 C.F.R. § 121.103(h)(2)(i).
On that basis, OHA found the protester’s claim that “the Area Office failed to analyze whether each member of FL GCR was small under the NAICS assigned to the instant procurement” unpersuasive. In response to the allegations that the Area Office didn’t include all required affiliate receipts (or proportionate shares thereof), OHA said the record was clear that the Area Office indeed “collected and reviewed” the prior five years’ worth of financial documents for FEL and GCR, “independently of each other”–even if the Area Office didn’t “elaborate on the specific breakdown of FEL and GCR’s receipts in the size determination.”
Next, OHA addressed the Area Office’s decision “that any joint venture that FEL or GCR were a part of did not count towards an affiliation analysis.” It explained:
While it is established OHA precedent, it is worth noting that a business concern is not an affiliate of a joint venture of which it is a member. Size Appeal of Acacia7 JV, SBA No. SIZ-6331 (2025) (“It is well established that business concerns are not affiliates of joint ventures of which they are members for size purposes.” Citing 87 Fed. Reg. 380, 381 (Jan. 5, 2022)); Size Appeal of Zin Techs., Inc., SBA No. SIZ-6305, at 14 (2024) (“[a] concern is not an affiliate of a joint venture of which it is a member.”). Therefore, the Area Office correctly dismissed any affiliation claim involving FL GCR and the following entities: Frontline King George, GCR-MDI, LLC, GCR-MDI II, LLC, GCR DEAN, LLC, GCR-DEAN II, LLC, and Veteran Resource Group.
Additionally, OHA found that receipts from the joint ventures had properly been accounted for, as required by 13 C.F.R. § 121.103(h)(4), as the Area Office had received JSA Venture’s tax returns, which were consistent with GCR’s SBA Form 355. And OHA said, “the record shows the Area Office did in fact receive SDBV’s tax returns and explained that a concern’s average annual receipts is calculated not only by averaging the concern’s receipts, but also for those of its affiliates.”
Next addressing the appeal’s numerous allegations regarding considerations “missing” from the size analysis and calculations, OHA said:
While the size determination could have benefitted from more detailed language regarding the inclusion of SDBV and JSA Ventures, I find no merit in Appellant’s allegations that the Area Office failed to account for affiliates of either FEL or GCR. The size determination’s explanation shortcomings do not rise to an outcome-determinative error. Size Appeal of Melton Sales & Service, Inc., SBA No. SIZ-5893 (2018) (“OHA has consistently held an area office’s error is harmless when rectifying the error would not have changed the result.” Citing Size Appeal of Automation Precision Technology, LLC, SBA No. SIZ-5850, at 17 (2017); Size Appeal of Synergy Solutions, Inc., SBA No. SIZ-5843 (2017).)
OHA also dismissed the appeal argument “that the Area Office erred by not further investigating potential affiliation between the JV partners” and several entities FL GCR had demonstrated “had no relation to FL GCR.” It explained, “FL GCR was fully aware the SBA required financial statements and tax returns for the last five completed fiscal years, preceding self-certification, for FL GCR and any affiliates[,]” and “[t]he record shows FL GCR’s response addressed the relationship between the JV partners and all the concerns Appellant’s protest mentioned, along with others[.]” And OHA added:
Once the Area Office reviewed the responses and accompanying documents, it had no duty to go on an expedition regarding SL Supplies and GCRS. The protest simply mentioned these concerns as those “that could allow” control between them and FL GCR. Beyond that, the protest made no allegations or provided any information regarding the relationship between FL GCR, SL Supplies, and GCRS. As OHA has previously stated, it is settled law that “[a]n area office has no obligation to investigate issues beyond those raised in the protest.”
OHA further elaborated on this standard, stating:
SBA regulations require an area office to base its decision “primarily on the information supplied by the protestor or the entity requesting the size determination and that provided by the concern whose size status is at issue”, and must “give greater weight to specific, signed, factual evidence than to general, unsupported allegations or opinions”. Accordingly, the Area Office properly relied upon the sworn statements in the SBA Form 355, Federal income tax returns, and other supporting documentation submitted by FL GCR.
OHA concluded:
Here, the Area Office requested information from FL GCR regarding its creation, status, and organizational structure, along with any information regarding the alleged affiliated concerns in Appellant’s protest. The Area Office then received a response, including extensive documentation, regarding the allegations and reasonably found that under 13 C.F.R. § 121.103(h)(2)(i), each concern in the joint venture was small under the applicable NAICS size standard.
So, based on the appeal record, OHA refused to “find error in the Area Office’s findings of fact or law[,]” denied the appeal, and affirmed the size determination.
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In regard to filing and appealing a size protest, this OHA denial is a good reminder that the burden of proving size ineligibility falls on the protester—not the SBA. Neither the SBA’s Area Office nor OHA are required to go on their own expeditions to prove a concern is other-than-small. The protest must provide sufficient factual and legal support for all of its grounds. This OHA denial also answered a common affiliation question we see in the federal procurement world by confirming SBA’s stance that a business concern is not automatically considered an affiliate of a joint venture it is party to. And finally, it established an Area Office’s failure to spell out each step of its considerations and calculations in its size determinations alone doesn’t mean the size determination was in error. Instead, OHA looks to what the Area Office requested, received, and considered in its calculations of size.
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