Steven Koprince GovCon Legal Update 2014 Government Procurement Conference August 6, 2014 Government Procurement Conference August 6, 2014 Steven J. Koprince Petefish, Immel, Heeb & Hird LLP

Steven Koprince Overview Bids and Proposals Teaming & Joint Venturing SDVOSB Programs HUBZone Programs Small Business Eligibility Interesting Cases: Strange But True What’s On The Horizon Bids and Proposals Teaming & Joint Venturing SDVOSB Programs HUBZone Programs Small Business Eligibility Interesting Cases: Strange But True What’s On The Horizon

Steven Koprince Bids and Proposals

Steven Koprince Bids and Proposals JV Derichebourg-BMAR & Associates, LLC, B (Nov. 20, 2013): Proposals due July 8 at 3:00 pm Offeror submits proposal by but forgets to include the price proposal and other attachments Two days later, offeror resends missing attachments Proposal excluded as untimely; GAO upholds exclusion

Steven Koprince Bids and Proposals AeroSage LLC, B (July 2, 2014) 45-minute “bid confirmation deadline” was unreasonable & contrary to FedBid terms OASIS Systems, LLC, B et al. (June 19, 2014): Subcontracting plan discrepancy partly to blame for lost spot on EAGLE II IDIQ contract

Steven Koprince Teaming & JVs

Steven Koprince Teaming & JVs Sealift, Inc., B (Jan. 6, 2014): 2013 NDAA allows small primes to meet performance requirements by subbing to other small businesses Example: Company A, a small business, bids on a small business set-aside contract for services. Company A self-performs 30%, subs 30% to Company B, another small business, and 40% to Company C, a large business

Steven Koprince Teaming & JVs BGI-Fiore JV, LLC, B (May 20, 2014) 8(a) JVs need not be approved by SBA at proposal submission SOF Associates- JV, SBA No. VET- 234 (2013): Supermajority provision in JV agreement rendered JV ineligible for SDVOSB set-aside

Steven Koprince SDVOSB Programs

Steven Koprince SDVOSB Programs “Two programs” confusion continues MJL Enterprises, LLC, SBA No. VET-240 (2013): Verification program applicable only to VA and FAA set-asides Reese Services, Inc., SBA No. VET-231 (2013): Verified SDVOSB found ineligible for Navy procurement

Steven Koprince SDVOSB Programs Kingdomware Battle Ends? Kingdomware Technologies, Inc. v. U.S., No (Fed Cir. 2014): Federal Circuit upholds COFC decision allowing VA to use GSA schedule without “Rule of Two” Federal Circuit scope may be broad

Steven Koprince SDVOSB Programs New VA appeal right (Sept. 2013) VA, SBA unable to agree on interagency appeal VA “reconsiders” and decides to keep appeal jurisdiction Initial VA SDVOSB protests decided by CVE Director Appeals decided by OSDBU Executive Director Potential flaws: no independent judges; appeal decisions not published

Steven Koprince HUBZone Program

Steven Koprince HUBZone Program Wakan, LLC, B ( June 19, 2014) HUBZone certified company bids on unrestricted procurement for supplies Proposal states that manufacturing will be performed at facilities of a non- HUBZone company Procuring agency determines that subcontractor will perform more than 50% of manufacturing Agency declines to apply HUBZone price preference clause, FAR GAO upholds agency decision

Steven Koprince Small Business

Steven Koprince Small Business Bell Pottinger Communications USA, LLC, SBA No. SIZ-5495 (2013): Management alone is not performance of “primary and vital” work under ostensible subcontractor rule TISTA Science & Technology Corp., SBA No. SIZ-5529 (2014): No automatic size recertifications for GSA task orders TLS Contracting, Inc., SBA No. SIZ-5527 (2014): Small business size status measured by annual receipts, not profits

Steven Koprince Small Business PTAC/SBDC Advisory Size Opinions Proposed rule issued in late June 2014 Rule allows PTACs and SBDCs to issue advisory size status determinations Small business acting in good faith reliance on PTAC/SBDC advisory opinion has “safe harbor” from misrepresentation penalties PTACs & SBDCs not required to provide advisory size opinions No new funding allotted for size opinions Comments on proposal due August 25

Steven Koprince New SBA Rules on Multiple Award Contracts

Steven Koprince New SBA Rule on Multiple Award Contracts Where “Rule of Two” is not met for a MAC, Agency must give “meaningful consideration” to other small business alternatives: Partial set-aside - Can be used where procurement’s requirements can be broken up into smaller, discreet requirements Reservation of awards - Awards under a MAC solicitation can be reserved for small business even where Rule of Two not satisfied Order set asides - Agencies may issue unrestricted solicitations but commit in the solicitation to set-aside or reserve some orders for small business New Tools are encouraged but not required On Ramp/Off Ramp: Contracting Officers have authority to allow new small businesses onto a MAC during performance and can remove contractors that are no longer small.

Steven Koprince New SBA Rule on Multiple Award Contracts Every MAC and every order must be assigned a single NAICS code Prohibits agencies from assigning multiple NAICS codes and taking credit if MAC/order is awarded to a business that is small under some, but not all, of multiple codes Limitations on Subcontracting For set-aside contracts, compliance with limitations on subcontracting will be determined by each period of the contract (base and each option) Previous rule: compliance determined as of period of performance used in evaluating the bid (often base plus all options) For order set aside under unrestricted contract, compliance determined based on period of the order If order is competed among both small and large businesses, no subcontracting limit applies

Steven Koprince Interesting Cases: Strange But True

Steven Koprince Strange But True Emax Financial, B (July ) Small business protests small business set-aside Argues that set-aside interferes with its ability to structure its team GAO denies protest, finding that “Rule of Two” was satisfied The two? The incumbent-and EMax

Steven Koprince Strange But True Trailboss Enterprises, Inc., No C (2013): Contractor protests its own award – Contract awarded in November After stop work order, contractor directed to resume – Contractor complains that pricing is now outdated and files a protest in effort to escape contract – Court dismisses protest and suggests that contractor should have filed CVA claim instead Trailboss Enterprises, Inc., No C (2013): Contractor protests its own award – Contract awarded in November After stop work order, contractor directed to resume – Contractor complains that pricing is now outdated and files a protest in effort to escape contract – Court dismisses protest and suggests that contractor should have filed CVA claim instead

Steven Koprince What’s On The Horizon?

Steven Koprince On the Horizon New SBA mentor-protégé programs for SDVOSBs, HUBZones and WOSBs SBA may also establish mentor-protégé programs for all small businesses Reorganization of other agency’s mentor-protégé programs Under 2013 NDAA, SBA will establish rules and approve other agencies’ M-P programs

Steven Koprince On the Horizon SDVOSB Program Changes May 2014: House passes 2015 NDAA House-passed NDAA requires: VA to begin using SBA SDVOSB definitions immediately VA to transfer verification function to SBA Senate bill: No immediate transfer; study Government-wide verification

Steven Koprince On the Horizon WOSB Program Improvements House-passed 2015 NDAA allows sole source contracts for WOSBs WOSB sole source thresholds: $6.5 million (manufacturing); $4 million (other industries)

Steven Koprince Conclusion & Questions

Steven Koprince For More Information Steven J. Koprince Partner (785) Visit smallgovcon.com to sign up for our free monthly electronic newsletter Steven J. Koprince Partner (785) Visit smallgovcon.com to sign up for our free monthly electronic newsletter