Tag Archives: SBA size standards

SmallGovCon Week In Review: January 25-28, 2016

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It is hard to believe that Tuesday is Groundhog Day already. As we all wait in anticipation for him to emerge from his burrow, and hopefully not see his shadow, we offer you some reading material to help make your wait more enjoyable.

This final January 2016 edition of SmallGovCon Week In Review brings you a look at the Lockheed Martin/Leidos merger, a cautionary tale about the dangers of violating federal prevailing wage laws, new principles behind the VA’s procurement strategies, and much more.

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No Wholesaler NAICS Codes For Set-Aside Contracts, SBA OHA Confirms

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Federal agencies must classify procurements for supplies under the appropriate manufacturing or supply NAICS code, not under a wholesale trade or retail trade NAICS code.

In a recent NAICS code appeal decision, the SBA Office of Hearings and Appeals confirmed that supply procurements should not be classified under wholesale or retail trade NAICS codes–and rejected a prospective offeror’s claim that the agency should have assigned a wholesale trade NAICS code to the solicitation.

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SBA Proposes Credit For Lower-Tier Subcontracts

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Large prime contractors operating under individual subcontracting plans would receive credit for small businesses performing at any subcontracting tier, according to a proposed rule issued yesterday by the SBA.

The proposed rule also requires large primes to assign a NAICS code and size standard to “solicitations” for subcontracts–a notion that may come as a surprise to prime contractors, many of whom do not typically issue formal subcontract solicitations.

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SBA Proposed Rule Would Allow PTAC and SBDC Size Status Opinions

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Small Business Development Centers and Procurement Technical Assistance Centers would be permitted to issue advisory small business size status opinions under a proposed rule published last week by the SBA.

The proposed rule, which implements a section of the 2013 National Defense Advisory Act, establishes a “safe harbor” from fraudulent misrepresentation penalties for a small business that obtains an advisory size opinion from a SBDC or PTAC.  But the proposed rule acknowledges that SBDCs and PTACs are not required to provide such advisory opinions–and that new funding will not be awarded for this purpose.

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SBA OHA: Small Business Size Not Measured By Profits

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A firm’s small business size status for federal procurements is measured by the firm’s revenues, not by its profits.

As the SBA Office of Hearings and Appeals explained in a recent size determination, measuring small business status by reference to profits would allow some very large companies to qualify as “small.”

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SBA Eliminates Megawatt Hours Size Standards

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The SBA has issued a final rule eliminating the unusual megawatt hours size standard applicable to six NAICS codes in NAICS Sector 22.  The SBA’s revision replaces the megawatt hours size standard with a 500-employee size standard, and eliminates the requirement that a firm must be “primarily engaged” in the generation, transmission  or distribution of energy for sale.

Although the megawatt hours size standard may have made sense when it was adopted in the 1970s, the SBA appropriately recognized that the market has changed.  Perhaps most important, the “primarily engaged” component of the megawatt hours size standard unfairly excluded many companies from competing as “small” in NAICS Sector 22.

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VA CVE: SDVOSBs Must Remove “Large” NAICS Codes From VetBiz Within 30 Days

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The VA CVE has instructed verified SDVOSBs to remove so-called “large NAICS codes” from their VetBiz Vendor Information Pages profiles within 30 days–or else.

According to a recent email from the VA CVE (which was kindly shared with me), SDVOSBs must remove any NAICS codes for which they do not qualify as a small business.  Failing to remove these “large NAICS codes” may result in potentially harsh penalties, including debarment.

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