Three Common SBA Size Protest Mistakes

Nobody’s perfect, the old saying goes.  While I might beg to differ in the case of my daughter (who, in my unbiased opinion, is perfectly adorable), the saying definitely holds true when it comes to SBA size protests.

I read every published SBA Office of Hearings and Appeals decision (I’m sure you are jealous), and I see many of the same mistakes repeated over and over,  Often, these mistakes cost the protester its chance at a successful size protest.

So, without further ado, here are my top three most common SBA size protest mistakes.

1.         Misunderstanding the Five-Day Timeliness Rule.

To be timely, a SBA size protest must be received by the contracting officer within five business days after bid opening (for sealed bid procurements) or within five business days after notification of the identity of the prospective awardee (for negotiated procurements).

Unlike for many GAO bid protests, the five-day period is not extended by a request for a debriefing.  Confusion about the effect of a debriefing has led the SBA to dismiss a number of size protests, such as the one at issue in Size Appeal of Garco Construction, Inc., SBA No. SIZ-5308 (2011).

Note also that the size protest must be received by the contracting officer within the five-day period, not merely mailed within that period.  Make sure the protest arrives on time.

2.         Failing to Provide “Specificity”

The SBA will dismiss a size protest unless it is “sufficiently specific to provide reasonable notice as to the grounds upon which the protested concern’s size is questioned.”  In order to meet this standard, the protester must provide some reasonable basis to conclude that the protested business is not small; vague or irrelevant evidence will not do the trick.

For instance, in Size Appeal of SoftConcept, Inc., SBA No. SIZ-5197 (2011), the protester alleged only that it did not know the sales figures of the protested company, and that the company did not list the solicitation’s primary NAICS code on its CCR profile.  The SBA Area Office dismissed the size protest for lack of specificity, because nothing about these contentions reasonably suggested that the protested company was not small.  The SBA Office of Hearings and Appeals affirmed the dismissal.

The SoftConcept size protest would have met the specificity standard if the CCR profile had stated that the protested company was not a small business under the applicable NAICS code (instead of omitting the NAICS code altogether), or if the protester had presented other evidence suggesting that the protested company was not small, like a Dun & Bradstreet report showing that the company exceeded the size standard.  But in the absence of any specific information tending to show that the protested company was not small, this size protest failed—as have countless others tripped up by the specificity hurdle.

3.         Omitting Important Evidence

Clearing the specificity hurdle is critical, but so is providing the SBA with every piece of evidence you can reasonably discover suggesting that the protested company is not a small business.  There is no second bite at the apple: fail to present evidence to the SBA Area Office, and the SBA Office of Hearings and Appeals is very unlikely to look at the evidence on appeal.

Consider SBA OHA’s decision in Size Appeal of Native Energy & Technology, Inc., SBA No. SIZ-5249 (2011).  In that case, after the SBA Area Office determined that the protested company was an eligible small business, the protester appealed to SBA OHA.  With its size appeal, the protester attempted to introduce a number of additional documents it contended demonstrated that the protested company was actually large, including State of Nevada official filings for an alleged affiliate of the company.

SBA OHA refused to consider the new evidence.  It wrote that these documents “are all public records that were available to Appellant at the protest stage.  Appellant neglected to gather and submit this evidence at that time, and cannot be permitted to submit it now on appeal.”  Perhaps not surprisingly, SBA OHA went on to deny the size appeal.

In the Native Energy & Technology case, the State of Nevada filings may have proved an affiliation existed, had they been submitted with the protest.  But we—and the protester—will never know, because the documents were submitted too late.

Five business days isn’t a lot of time, but that doesn’t matter when it comes to gathering the evidence you need to support a SBA size protest.  As the protester, it is your obligation to find and submit all reasonably available evidence with the size protest itself, or the SBA Area Office and SBA OHA will be very unlikely to consider it.

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