Federal Construction Contracting Blog

Federal Construction Contracting Blog

Legal Information and Resources for Federal Construction Contractors

SBA Clarifies HUBZone Program Requirements

Posted in Contractor Information Sources, Small Business Contracting

As we blogged about earlier this month, the SBA’s May 31, 2016 final rule made some major changes to a number of regulations dealing with small business procurement. Some of those changes relate to the SBA HUBZone contracting program.

Specifically, finding that the current regulations set forth at 13 C.F.R. 126.200(b)(6) and (d) were duplicative, the SBA proposed to revise the regulation by deleting 13 C.F.R. 126.200 (d) in its entirety, and revising 13 C.F.R. 126.200(b)(6) to state that a small business concern must, in its HUBZone application, represent that it will comply with the applicable limitations on subcontracting with respect to any procurement that it receives as a qualified HUBZone small business concern. These subcontracting limitations are provided in 13 CFR 125.6(c) and 13 CFR 126.700 (and, as we blogged about earlier this month, are also changing effective June 30).

Continue Reading

Identity of Interest Affiliation: Further Defined by the SBA

Posted in Contractor Information Sources, Small Business Contracting

In its final rule published on May 31, 2016, the SBA modified the regulations relating to affiliation based on an “identity of interest” pursuant to 13 C.F.R. § 121.103(f). Specifically, the SBA provided clearer guidelines regarding identity of interest affiliation due to familial relationships and economic dependence.

The final rule limits tCompliance Guidelines Regulations Concepthe presumption of affiliation based on familial relationships to firms that conduct business with each other and are owned or controlled by married couples, parties to a civil union, parents, children and siblings. This presumption may be rebutted by showing a clear line of fracture between the firms. It is notable that the rule suggests that affiliation is presumed only if the firms conduct business with each other. This appears to allow family members who own firms to escape the presumption of affiliation so long as the companies are not engaged in any business transactions with each other.

Additionally, the final rule presumes an identity of interest affiliation based on economic dependence if the firm in question “derived 70% or more of its receipts from another concern over the previous three fiscal years.” Under the old rule, there was no such fixed percentage, however, the 70% figure was regularly used by SBA’s Office of Hearings and Appeals in its decisions. The presumption may be overcome by a showing that the firm in question is not solely dependent upon another firm. The final rule suggests that this presumption may be rebutted by, for example, a showing that a concern has only been in business for a short period of time, and therefore has only been able to secure a limited number of contracts.

The final rule has provided much needed clarity to the identity of interest basis of affiliation. It will be interesting to see how the SBA Office of Hearings and Appeals interprets and applies this rule going forward.

Michael H. Payne is Chair of the Firm’s Federal Contracting Practice Group and, together with other experienced members of the group, frequently advises contractors on federal contracting matters including bid protests, claims and appeals, procurement issues, small business issues, and dispute resolution.

Jacqueline J. Ryan is an Associate in the Federal Contracting Practice Group and focuses her practice on government contracts and construction litigation. She assists the Firm’s federal construction clients in matters involving contracts, bid protests, claim drafting and litigation in the federal courts.

Big Changes to Limitations on Subcontracting Requirements

Posted in Contractor Information Sources, Small Business Contracting

Change Ahead SignEarlier this week, we blogged about a final rule issued on May 31 by the Small Business Administration (“SBA”), which made several major changes to the small business regulations. This new rule implements changes mandated by the 2013 National Defense Authorization Act, (“NDAA”) and finalizes the proposed rule issued by the SBA back in December of 2014.

As we explained in our earlier blog, one of the new rule’s most important changes relates to the self-performance requirements and limitations on subcontracting contained at 13 C.F.R. § 125.6. Below is a more detailed look at the numerous changes to that regulation, which go into effect on June 30, 2016.

 Background and Purpose

As many of you know, 13 C.F.R. § 125.6 establishes minimum self-performance requirements for small business prime contractors performing various types of set-aside contracts. The intent of this regulation was to avoid “pass-through” situations (where small businesses awarded set-aside contracts subcontracted virtually their entire contracts to large businesses), which would divert government dollars from the intended small business beneficiaries, and thereby negate the purpose of the agency’s small business programs. To avoid this problem, SBA enacted 13 C.F.R. § 125.6, requiring small business prime contractors to self-perform a certain percentage of the work on its set-aside contracts.

Continue Reading

SBA Makes It Easier for Small Businesses To Joint Venture for Federal Contracts

Posted in Contractor Information Sources, Small Business Contracting

Business People Meeting Discussion Communication ConceptAs we blogged Wednesday, this week the Small Business Administration (“SBA”) published a lengthy final rule that implements the long-awaited small business regulation changes mandated by the National Defense Authorization Act (“NDAA”) of 2013. The rule makes a number of very important changes affecting Federal contractors.  One of the more important changes makes it easier for small businesses to form joint ventures (JVs) to compete for government procurements and removes prior, and often confusing, restrictions.

A JV will now be considered as a small business for Federal procurement purposes as long as each individual JV partner would qualify alone as a small business under the relevant contract.  Essentially, this rule expands the exception to affiliation for all joint ventures where both concerns making up the JV are individually “small.” Of course, each small business must not otherwise be affiliated for different reasons.

Currently, in addition to the exclusion from affiliation given to an 8(a) protégé firm that joint ventures with its SBA-approved mentor for any small business procurement, there is also an exclusion from affiliation between two or more small businesses that seek to perform a small business procurement as a JV where the procurement is bundled or large (i.e., the value of the procurement is greater than half the size standard corresponding to the NAICS code assigned to the contract – for revenue based size standards, or $10 million for employee-based size standards).

The new rule, however, expands and clarifies this exception to affiliation, allowing small businesses to joint venture as long as both are small, regardless of the value of the procurement.  Thus, the size of the procurement no longer presents a restriction.   

The final rule takes effect on June 30, 2016.

Michael H. Payne is the Chairman of the firm’s Federal Contracting Practice Group and, together with other experienced members of the group, frequently advises contractors on federal contracting matters including bid protests, claims and appeals, procurement issues, small business issues, and dispute resolution.

Robert G. Ruggieri is a Senior Associate in the firm’s Federal Contracting Practice Group. He practices law in the areas of government contracts, procurement, and construction and has significant experience assisting small businesses with teaming and joint venture agreements.

SBA Issues Important Changes and Clarification Concerning Small Business Regulations

Posted in Contractor Information Sources, Small Business Contracting

sba logo

The Small Business Administration (“SBA”) has had a very busy week. First, on May 24, 2016, the agency issued “Statement of General Policy No. 3” (“the Statement”) clarifying the hotly debated inter-affiliate sales exclusion (an issue relating to the counting of annual receipts for purposes of determining size). Then, yesterday, the agency published a lengthy final rule, which implements the long-awaited small business regulation changes mandated by the National Defense Authorization Act (“NDAA”) of 2013. Collectively, the Statement and the rule make a number of very important changes affecting Federal contractors. Some of the most important changes are:

  • Changes regarding small business self-performance requirements and limitations on subcontracting pursuant to 13 C.F.R. § 125.6 (which we previously wrote about when the SBA issued its proposed rule, in December of 2014, and blogged about all the way back when the 2013 NDAA was enacted);
  • Expansion of exception to affiliation for all joint ventures where both concerns are individually “small” in connection with 13 C.F.R. § 121.103(h);
  • Clarification regarding what types of familial relationships will result in a rebuttable presumption of “identify of interest” affiliation pursuant to 13 C.F.R. § 121.103(f) (previously discussed here);
  • Addition of a rebuttable presumption of “identify of interest” affiliation pursuant to 13 C.F.R. § 121.103(f) based on 70% economic dependence between companies (previously discussed here);
  • Clarification regarding the calculation of annual receipts pursuant to 13 C.F.R. § 121.104, and, specifically, the exclusion from that calculation of inter-affiliate sales from a broader variety of affiliates;

Unfortunately, the expansion of the Mentor-Protégé program – which everyone has anxiously been awaiting since the proposed rule was issued back in February, 2015 – was not addressed. In a March 4th interview, SBA’s Associate Administrator of Government indicated that the mentor-protégé final rule should be issued this summer, with a pilot program to start in the fall.

Over the next week or so, we will be publishing a series of blogs explaining each of the above-listed changes in more detail. Stay tuned!

Michael H. Payne is the Chairman of the firm’s Federal Contracting Practice Group and, together with other experienced members of the group, frequently advises contractors on federal contracting matters including bid protests, claims and appeals, procurement issues, small business issues, and dispute resolution.

Maria L. Panichelli is an Associate in the firm’s Federal Contracting Practice Group. Her practice includes a wide variety of federal contracting and construction matters, as well as all aspects of small business procurement.

Legal Landscape: SBA Expands the WOSB/EDWOSB Contract Program, Importance of the Economic Loss Rule and Self-Reporting Requirement Changes

Posted in Contractor Information Sources, Small Business Contracting

WelcomeOnviaLegalLandscape to the fourth edition of Legal Landscape, a series we have developed with Onvia’s blog to provide government contractors with a quick, but thorough, summary of important legal developments and regulations in government contracting, as well as a plain-English explanation of how those developments may affect contractors at all levels of government. Contractors should keep in mind that state and local agencies often look to changes in federal regulations as a guide for future changes at their respective levels. Changes recently made in the federal arena are likely to trickle down to state and local governments.

SBA Expands WOSB/EDWOSB Program

As many of you know, the federal government attempts to steer a percentage of government contracts to small businesses by “setting aside” certain contracts exclusively for those businesses. With regard to women-owned businesses, there is a 5% contracting goal, meaning that the government aims to award at least 5% of all federal government contracts to women-owned businesses.

To that end, the Small Business Administration’s (SBA) contract program for Women-Owned Small Businesses (WOSB) and Economically Disadvantaged Women-Owned Small Businesses (EDWOSB) authorizes federal contracting officers to set a contract aside for WOSBs or EDWOSBs under certain limited circumstances:

An agency may set a contract aside for a WOSB if the contract’s NAICS code relates to an industry in which WOSBs are considered substantially underrepresented and federal contracts can be set aside for EDWOSBs if  the NAICS code relates to an industry in which WOSBs are considered underrepresented.

Continue Reading

Procurement Technical Assistance Center of Delaware: Two Seminars on the Same Day

Posted in Bid Protests, Contractor Information Sources, Event

On March 9th, 2016, join Maria Panichelli and Amy Kirby for their two seminars, “The Fundamentals of the Far Part 1, 2 and 3,” and “Debriefings, Bid Protests and Size Status Eligibility,”as part of the Procurement Technical Assistance Center of Delaware‘s (PTAC) two part seminar event, Two Seminars on the Same Day, One Price.

For more information on these seminars, please click here.

1.   The Fundamentals of the FAR Part 1, 2 and 3:

The United States Government is the world’s largest buyer of products and services. However, these purchases are governed by a very special set of rules and regulations known as the FAR, and its supplementary regulations. If you want to become a successful government contractor, you have to be intimately familiar with these governing rules and regulations, and the ways in which they affect the procurement process. In this session, experienced Federal Contracting attorneys provide an overview of the FAR, with a particular focus on how the FAR impacts the source selection process. We will walk you through the procurement process, from solicitation to award, explaining the most common types of contracts used by the government (Firm-Fixed Price, Cost-Reimbursable, IDIQ, MATOC etc), the various methods of procurement (Sealed Bidding, Contracting by Negotiation, LPTA, etc), and – most importantly – how the government will evaluate your bid/offer.

2.   Debriefings, Bid Protests and Size Status Eligibility:

In today’s federal contracting market, the source selection process is extremely competitive. Understanding protests and the procedures relating to protests can make the difference between getting the contract or getting left out of the race altogether.

There are so many questions: Was a contract improperly awarded to someone else? Is there any way to fight the agency’s decision and get the award after all? What are the differences between the various types of protests (Bid Protests, Size Protests, and Status Protests) and Size/Eligibility Investigations, and which one should you use?

This seminar will cover all aspects of the protest process. Learn how to use debriefings and protests as an affirmative tool to get the contract you want. We will walk through the debriefing and protest process and explain the who, what, when, where, why & how of filing a protest. You will also learn how to defend your business against, or even avoid, protests filed by frustrated competitors.

Maria L. Panichelli is an Associate in the firm’s Federal Contracting Practice Group. Her practice includes a wide variety of federal contracting and construction matters, as well as all aspects of small business procurement.

Amy M. Kirby is an Associate in the firm’s Federal Contracting Practice Group and focuses her practice on government construction litigation. Amy’s practice includes a wide variety of federal construction matters.

In a Major Win for Women Owned Businesses, SBA Expands WOSB/EDWOSB-Eligible Industry List

Posted in Contractor Information Sources, Small Business Contracting

On March 3, 2016, the SBA announced that it has expanded the list of industries in which a contract can be set-aside for women-owned small businesses (“WOSB”) or economically disadvantaged women-owned small businesses (“EDWOSB”). This expansion was mandated last year by section 825 of the National Defense Authorization Act for Fiscal Year 2015 (“NDAA”), which required numerous changes be made to the SBA’s WOSB/EDWOSB contracting program.

By way of background, the WOSB program authorizes Federal contracting officers to set a contract aside for WOSBs if: (1) there is “a reasonable expectation” that at least two WOSBs will submit offers that meet the requirements of the acquisition “at a fair and reasonable price”; and (2) if the acquisition is for a good or service in a North American Industry Classification System (“NAICS”) industry code in which SBA has determined that WOSBs are “substantially underrepresented.”  Similarly, EDWOSBs can receive set-asides in industries where the SBA has determined that WOSBs are “underrepresented” (but not “substantially” so). In other words, federal contracts can be set aside for WOSBs only if the contract’s NAICS code relates to an industry in which WOSBs are considered “substantially underrepresented” and federal contracts can be set aside for EDWOSBs if the NAICS code relates to an industry in which WOSBs are considered “underrepresented.”

Continue Reading

TargetGov: REAs and CDA Claims: Key Strategies in Seeking Compensation

Posted in Contractor Information Sources, Webinar

Thank you for joining us for Ed DeLisle and Maria Panichelli‘s  TargetGov webinar, “REAs and CDA Claims: Key Strategies in Seeking Compensation” on February 16, 2016.

After you’ve secured your Federal government contract award, what comes next? As any Federal contractor will tell you, the contract award is only the beginning. The FAR and its supplementary regulations impose a host of obligations on contractors, and can impact the ways in which a contractor performs a contract. These rules and regulations also dictate the ways in which those contractors can seek compensation for unanticipated costs incurred on the job. In this webinar, Ed and Maria will explore Requests for Equitable Adjustment, Claims, and the differences between the two. As they walk you through the Contract Disputes Act process, you will also learn how to maximize your chance of success when making claims against the Federal government.

You can listen to their webinar here.

Edward T. DeLisle is Co-Chair of the Federal Contracting Practice Group. Ed frequently advises contractors on federal contracting matters including bid protests, claims and appeals, procurement issues, small business issues and dispute resolution.
Maria L. Panichelli is an Associate in the firm’s Federal Contracting Practice Group. Her practice includes a wide variety of federal contracting and construction matters, as well as all aspects of small business procurement.

The National 8(a) Association 2016 Winter Conference

Posted in Bid Protests, Events, Small Business Contracting

Ed DeLisle will present his seminar, “Navigating the Protest and Claims Processes as a Small Business,” on February 9th at the National 8(a) Association 2016 Winter Conference in Orlando, FL.

The conference is a two day event held on February 9th and 10th and will focus on federal and legal updates and how to navigate the ever-changing world of federal contracting. The nation’s top legal firms and the industry’s best consultants will be there to help 8(a) certified and non-8(a) certified businesses gain the valuable education, promotion, and federal contracting information they need to further advance their level of experience and achieve a higher degree of success.

For more information, and to register for the National 8(a) Association Winter Conference, please click here.

Edward T. DeLisle is Co-Chair of the Federal Contracting Practice Group. Ed frequently advises contractors on federal contracting matters including bid protests, claims and appeals, procurement issues, small business issues and dispute resolution.