The SBA has finalized its “universal” mentor-protege program for all small businesses.
In a final rule scheduled to be published in the Federal Register on July 25, 2016, the SBA provides the framework for what may be one of the most important small business programs of the last decade–one that will allow all small businesses to obtain developmental assistance from larger mentors, and form joint ventures with those mentors to pursue set-aside contracts.
An 8(a) joint venture was unable to show that its mentor-protege agreement had been renewed by the SBA for a particular year–and the missing reauthorization caused the joint venture to be ineligible for a small business set-aside contract.
In a recent decision, the SBA’s Office of Hearings and Appeals held that an 8(a) joint venture could not avail itself of the mentor-protege exemption from affiliation when there was no evidence to show that the SBA had renewed the mentor-protege relationship for the year in which the joint venture’s proposal was submitted.
Teaming and joint venturing are essential components of success for many small government contractors, and the emphasis on teaming is increasing in light of the SBA’s proposed rule allowing “similarly situated entities” to join together to pursue prime contracts. But teaming and joint venturing are not without risks–there are many unique rules that must be followed, and many pitfalls for the unwary.
That is why I am very pleased to announced that I am joining with the Government Contractors Resource Network to present a three-part webinar series on compliant and effective teaming. Directed at small contractors, this series will begin with an overview of the rules and regulations governing teaming. The series will continue with a discussion of how to prepare effective and compliant teaming agreements, subcontracts, and joint venture agreements. The series will wrap up with an in-depth discussion of federal mentor-protege programs, including the SBA’s new proposed “universal” mentor-protege program.
The first webinar will broadcast on June 19, and the others will follow on June 23 and 25. To register, or for more information, visit the GCRN website. I hope to see you (virtually, anyway) this summer.
An 8(a) small business was found to be affiliated with its large subcontractor under the ostensible subcontractor rule based in part on the fact that the large subcontractor was providing mentoring services to the small business–even though the SBA had rejected a proposed mentor-protege agreement between the companies.
The recent decision of the SBA Office of Hearings and Appeals in Size Appeal of Brown & Pipkins LLC, SBA No. SIZ-5621 (2014) is a warning to 8(a) firms about the potential dangers of accepting mentoring services outside the confines of a SBA-approved mentor-protege agreement.