GSA Report: Be Truthful about Small Business Certifications

The federal small business representation system relies in some part on self-certification and in some part on review by the Small Business Administration (SBA) and protests by competitors. The System for Award Management (SAM) is one key part of the federal procurement apparatus. Small businesses looking to take advantage of SBA’s socioeconomic programs must be registered in SAM, and crucially, must maintain up-to-date information in the system. Failure to do so can carry severe consequences, ranging from suspension and disbarment to civil and/or criminal penalties, including massive fines and even imprisonment. We’ve written before about some of the confusion contractors may have regarding self-reporting in SAM.

A recent General Services Administration (GSA) Office of Inspector General (OIG) report is a reminder to federal contractors about the importance of being accurate in representing small business status. It details several investigations into small business misrepresentations, and reminds contractors of the severe penalties that can result from misrepresentation. In this post we’ll highlight the examples provided by GSA OIG to show just what is at stake when a small business fails to update (or knowingly misrepresents) their status, and offer some clarification of the Federal Acquisition Regulations to help you avoid similarly extreme penalties.

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Somewhat Appealing: Which SBA Certifications Can You Appeal From?

The U.S. Small Business Administration (SBA) runs four socioeconomic programs aimed at providing equal opportunity to participate in federal contracting. And one would think that all of them have similar options if a contractor is denied certification. One would be wrong. SBA’s Office of Hearings and Appeals (OHA) recently dismissed an appeal for lack of jurisdiction, showcasing the different options in the various programs. The contractor was decertified from the Women Owned Small Business Program (WOSB). Its owners ran afoul of an important distinction in OHA’s appeals jurisdiction, particularly the substantial difference between appealing a competitor’s protest of a contractor’s SBA certification and the government’s initial denial of a program certification. This provides an excellent opportunity to assess the regulatory differences in appellate jurisdiction between the four programs, with an eye toward successfully navigating future encounters with the OHA.

Editor’s Note: Special thanks to our law clerk Will Orlowski for his immense help in drafting this post.

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