The 8(a) Business Development Mentor-Protégé Program has officially been consolidated into the All-Small Mentor-Protégé Program. The goal: to eliminate duplications in regulations and to alleviate confusion between the two programs.
This change has been years in the making. Since the All-Small Mentor-Protégé Program was introduced in 2016, confusion between the two programs has persisted. SBA began looking at how to streamline the programs. We first wrote about the proposed rule changes back in November 2019.
SBA has now implemented its overhaul and consolidation through a final rule; follow along as we take you through what you need to know about the new rules.
SBA regulations say that size is determined as of the date an offeror submits its initial proposal, with price. On its face, this rule seems pretty straight forward. But what happens if the initial proposal was filed six years ago? And what if the joint venture that submitted the proposal has since expired?
Following OHA’s recent logic, the proposal-date rule stands even in these unique circumstances.
The SBA’s All Small Mentor-Protégé program offers a tremendous opportunity for participants to pursue set-aside contracts as joint venture partners. But misunderstandings and misconceptions about how SBA mentor-protégé joint ventures work are pervasive.
One very common misconception is that the SBA must pre-approve a mentor-protégé joint venture. In most cases, that’s not so. In a recent bid protest decision, even the GAO appeared a little confused, repeatedly mentioning SBA approval of a joint venture even though no such approval was required for the contract in question.
Stating that populated joint ventures have now been eliminated, the SBA has revised its 8(a) joint venture regulations to reflect that change.
In a technical correction published today in the Federal Register, the SBA flatly states that an earlier major rulemaking eliminated populated joint venture, and tweaks the profit-sharing piece of its 8(a) joint venture regulation to remove an outdated reference to populated joint ventures. But even following this technical correction, there are three important points of potential confusion that remain (at least in my mind) regarding the SBA’s new joint venture regulations.
A former 8(a) protege was not automatically entitled to take advantage of the past performance it obtained as part of a mentor-protege joint venture, in a case where the former mentor would not be involved in the new contract.
In a recent bid protest decision, the GAO held that a procuring agency erred by crediting the protege with the joint venture’s past performance without considering the extent to which that past performance relied on the mentor–and the extent to which the mentor’s absence under the new solicitation might impact the relevance of the past performance as applied to the new work.
Populated joint ventures (or at least most populated JVs) will no longer be permitted in the SBA’s small business programs, under a new regulation set to take effect on August 24, 2016.
The SBA’s major new rule, officially issued today in the Federal Register, will be best known for implementing the long-awaited small business mentor-protege program. But the rule also makes many other important changes to the SBA’s small business programs, including the elimination of populated joint ventures.
The SBA’s Utah District Office has rescinded the questionable new restrictions on 8(a) mentor-protege agreements and joint ventures that the District Office imposed last month.
A brief email to Utah 8(a)s on May 5, which was forwarded to me by an industry connection, states “The Utah District Office hereby rescinds the e-mail dated April 21, 2016 regarding Mentor Protégé and Joint Venture relationships.”
No reason was given for the sudden change, but I think it’s the right call.