News Flash: SBA Releases Final HUBZone Rule Update, Other Small Business Changes

SBA has released the final rule for the HUBZone Program Updates and Clarifications, and Clarifications to Other Small Business Programs on December 17, 2024. As we have discussed, this rule made a lot of changes to the HUBZone program. But it also updated a lot of other small business rules. Below are the details on some of these significant changes. This rule will be effective on January 16, 2025.

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News Flash: SBA Issues Proposed Rule with HUBZone and Small Business Changes

The SBA has issued a new proposed rule addressing both the Historically Underutilized Business Zone
(HUBZone) Program and other small business updates. It is titled: “HUBZone Program Updates and Clarifications, and Clarifications to Other Small Business Programs.” In this post, we’ll provide an overview of some of the main highlights of the proposed rule, and will do a deeper dive on some aspects of the regulation in later posts.

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SBA Confirms that Size Status Relates Back to Time of Offer, Even After Sale of Small Business

Over the years, SBA size regulations have included the general rule that the size status of a business generally relates back the time of initial offer on a contract. Therefore, a small business generally stays small for the duration of a federal contract, with some exceptions. However, there was also language in the rule that required small businesses to recertify their size status after being acquired or going through similar transactions. The effect of this recertification requirement was always a little unclear. If you recertify as large, does that have any effect on your small business status for orders under contracts awarded when the business was small? Now, OHA has answered that concern.

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Are You a Small Business Being Acquired by a Large Business? Check Your Pending Bids

Many small business clients of mine have been approached by or considered acquisition by a larger firm. Well, if this sort of sale or merger would turn a small business into a large business, the small business should pay close attention to a little-publicized change stemming from SBA’s Mentor-Protégé Consolidation rule that came out last fall. The new rule could result in a company losing out on an otherwise successful bid.

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Alert: SBA Issues Final Rule on Consolidation of Mentor-Protégé Programs and Other Contracting Rules

As we discussed, in late 2019 the SBA issued a proposed rule that would make a number of significant changes to the Mentor/Protégé programs and other small business contracting rules. Well, the SBA will soon issue its final rule on these changes, so make sure you are aware of the new rules.

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SBA Proposes to Change When Companies Need to Recertify Size and Status for Orders

SBA recently proposed changes to a number of its small business rules, as we’ve written about in earlier posts. The same proposed rule includes a small but significant change to when a business has to recertify its size and status for orders under multiple award contracts.

Based on the number of times we’ve written about size and status protests for orders under multiple award contracts (see the related content at the bottom of this post for a sampling), this is an area in need of clarity.

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Size Protest Was Untimely Because CO Did Not Require Size Recertification

Let’s suppose that you, a small business, were previously awarded a long-term contract set aside for small businesses. But over the past few years, business has been good and you’ve outgrown the size standard assigned to the contract. Can you still be awarded a task order under the contract? Yes–if the contracting officer doesn’t require you to recertify your size in connection with the task order request, and no contract-specific terms–like mandatory off-ramps–say otherwise.

This important principle recently played out in DNT Solutions, LLC et al., SBA No. SIZ-5962 (2018).

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