While every federal government contractor is likely familiar with bid protests, whether directly involved in one or not, it is far less likely that those same contractors are as familiar with NAICS code appeals. This is probably due to the infrequent nature of NAICS code appeals, with roughly 20 being filed each year. However, even if so few are filed annually, they tend to have a relatively high success rate, with appeals decided on the merits being decided in favor of the Appellant about 50% of the time. Below, I will take a look at a recent NAICS code appeal to help demonstrate what the Small Business Administration’s (SBA) Office of Hearings and Appeals (OHA) takes into account when reviewing NAICS code appeals, and why you, as a contractor, should review a solicitation’s classification to potentially give you a leg up.
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Breaking: HUBZone Appeals Coming Soon!
SBA has released its proposed rule allowing for HUBZone appeals to go to the Office of Hearings and Appeals. Below are the key items from this proposed rule, and how it will affect potential and current HUBZone companies.
Continue readingTechnically Unacceptable Offeror Cannot Protest Awardee’s Size, Says OHA
In a recent size determination appeal, OHA confirmed that an offeror found technically unacceptable does not have standing to protest an awardee’s size under SBA’s regulations. As such, OHA denied the appeal and affirmed the Area Office’s size determination dismissing the size protest on such grounds.
Continue readingThe Dog Ate my Addendum: Don’t Neglect your Joint Venture Addendum, says OHA
Spring is upon us, and for many of us, it evokes thoughts of friendly weather, and new life. In the world of federal contracting, new life is often seen through the forming of new joint ventures. As most contractors and readers of this blog know, there are many requirements placed on a joint venture that intends to bid on set-asides, and most deal with the content of a joint venture agreement between the joint venture members. In a recent case, the SBA Office of Hearings and Appeals (OHA) reviewed a joint venture agreement and addendums. Through its decision, OHA sent a clear warning to the industry to complete and sign both the joint venture agreement and any addendums, and make sure to have all items completed and signed prior to proposal submission deadlines, at the latest, the date of final proposal revisions.
Continue readingBreaking: SBA Proposed Rule Gives OHA Jurisdiction over HUBZone Status Protests
The Small Business Administration (SBA) has proposed to amend the rules of practice for its Office of Hearings and Appeals (OHA) and the Historically Underutilized Business Zone (HUBZone) Program to “implement procedures authorizing appeals to OHA” from adverse status determination protests for certified HUBZone small business concerns. Currently, HUBZone status protest determinations are decided by the Associate Administrator of Government Contracting and Business Development per 13 C.F.R. § 126.805. But those appeals, in our experience, are fairly limited and SBA does not publish the appeal decisions, meaning they provide little help for companies and attorneys wishing to understand how SBA interprets its HUBZone This is a big step for SBA and will certainly bring consistency and insights to the protest process and regulatory interpretation for HUBZone participants, bringing that program more in line with other SBA programs.
Nonprofit Parent Companies do not Automatically Cause Affiliation for SBA Size Determinations
The Office of Hearings and Appeals, more commonly referred to as OHA, is tasked with deciding size determination appeals that arise under the Small Business Act of 1958, as well as 13 C.F.R. parts 121 and 134. When an unsuccessful offeror raises a question, via a size protest, regarding an Awardee’s size under the North American Industry Classification System (NAICS) code on any given solicitation, the SBA Area Office will review the protest and issue a size determination. Then, a losing party can appeal the size determination to OHA.
Affiliation is a common topic that OHA addresses. In a recent decision, OHA looked at the question of how nonprofits fit into the affiliation rules. Since a small business has to be a for-profit entity, can a small business be affiliated with a nonprofit parent company?
Continue readingOHA to Area Office: Prime-Subcontractor Teams are Different than Joint Ventures for Size Purposes
The ostensible subcontractor rule says that, for a small business or socioeconomic set-aside such as 8(a), the small business prime contractor must perform the primary and vital parts of the contract and can’t be unduly reliant on a subcontractor. If the small business is found to violate the rule, the size of the small prime contractor and the large subcontractor are grouped for size purposes, which can result in loss of award. But the ostensible subcontractor rule is different from SBA’s joint venture rules, because SBA rules (and other federal law) distinguish between a prime-sub team and a joint venture. In a recent decision, OHA reversed a determination that a small business prime was affiliated with a subcontractor where the Area Office mixed up the analysis of the ostensible subcontractor rule and the joint venture rules.
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