Legal Information & Resources for Federal Construction Contractors
By: Michael H. Payne and Edward T. DeLisle
In order to qualify as a Historically Underutilized Business Zone (“HUBZone”) contractor, a firm must be a “small business” based on the size standards provided by the North American Industry Classification System (NAICS); the firm must be at least 51% owned and controlled by citizens of…
By: Edward T. DeLisle
In recent testimony provided to the House of Representative’s Committee on Small Business, a disturbing fact was revealed: millions of dollars earmarked for Service-Disabled Veteran-Owned Businesses (“SDVOSBs”) have been paid to companies that do not qualify for the program. Compounding the problem is the fact that insufficient fraud-prevention programs exist to…
A protest was filed recently in the United Stated Court of Federal Claims by our firm on behalf of a small business construction contractor challenging a solicitation issued by the Fort Worth District of the U.S. Army Corps of Engineers. The solicitation, No. W9126G-07-R-0123, is one of four similar solicitations for the construction of military projects…
A recent Government Accountability Office decision, Tessa Structures, LLC, B-298835, highlights the difference between responsiveness and responsibility determinations and the obligation of an agency to refer responsibility determinations to the Small Business Administration (SBA). The protestor, a small business, responded to a Federal Highway Administration solicitation seeking bids for bridge painting. As part of its bid, each prospective contractor was required to state the number of days of performance, not to exceed 305 days. The protestor, Tessa Structures, submitted the low bid and stated that it would perform in 120 days.
The FHWA reviewed Tessa’s bid and requested that Tessa explain how it would perform in 120 days. Tessa advised the FHWA that it planned to begin at the end of August and complete before Christmas; significantly, as discussed below, Tessa did not include its assumption that it would receive notice to proceed by August 28 with its bid. The FHWA believed that Tessa’s plan to begin at the end of August was contrary to the solicitation because the agency reserved the right to issue a notice to proceed as late as October 24th. The FHWA rejected Tessa’s bid as non-responsive, based upon Tessa’s 120 day performance period and its assumption regarding the notice to proceed, without seeking any input from the SBA.
The GAO determined that Tessa’s bid with a 120 day planned performance period was improperly rejected by the FHWA because the issue of performing within a set period of time was a matter of responsibility, not responsiveness. The GAO found that because the solicitation specified only a maximum performance period, (305 days) and no minimum period, Tessa could properly bid to perform in a shorter period. Furthermore, Tessa did not insert anything in its bid that restricted or qualified its performance in contravention of the solicitation. Of particular importance to the GAO was the fact that Tessa did not insert its assumption about the issuance of the notice to proceed in its bid, and, therefore, did not contravene the solicitation’s notice to proceed requirements. Had Tessa provided these assumptions in its bid, it most likely would have been found non-responsive. Continue Reading Agency Confuses Responsiveness with Responsibility
A recent Court of Federal Claims case, Diversified Maintenance Systems, Inc., December 4, 2006, reinforces the necessity for contracting officers to refer all protests regarding a company’s HUBZone status to the Small Business Administration (SBA). In Diversified, the agency set aside a procurement for HUBZone businesses only. All but two of the seven offerors were disqualified for various reasons. The agency awarded a contract to Cadence Contract Services and the other offeror, Diversified, immediately submitted a protest to the contracting officer, challenging the HUBZone status of the awardee.
Diversified’s protest alleged that the awardee’s office in Utah was not located in a certified HUBZone and that Utah’s records did not list a HUBZone company by that name at that address. The contracting officer denied the protest, stating that the awardee’s address in New York was in a HUBZone and that he had verified the HUBZone eligibility of the offeror at the New York address by checking the SBA’s website. Diversified then filed its protest with the Court of Federal Claims. After the litigation began, the government conceded to the Court that the contracting officer had failed to submit the offeror’s protest to the SBA, as required. Consequently, the government requested that the protest be submitted to the SBA. Continue Reading A HUBZone Protest Must Be Referred to the SBA
The Office of Federal Contract Compliance Programs (OFCCP) has published a Technical Assistance Guide designed to help federal government construction contractors and subcontractors comply with the federal laws and regulations that prohibit government contractors from discriminating in employment, and require that they undertake affirmative action to ensure equal employment opportunity in their workforces. It is intended for government contractors who have construction contracts and/or subcontracts. The obligations of government contractors and subcontractors who hold non-construction contracts differ in significant ways and are covered in a separate guide.
This Guide does not create new legal requirements or change current legal requirements. Instead, it reflects the views of OFCCP and is intended to serve as a basic resource document on OFCCP-administered laws. The legal requirements related to equal employment opportunity that apply to Federal supply and service contractors are contained in the statutes, executive orders, and regulations cited in the Guide. Every effort has been made to insure that the information contained in the Guide is accurate and up to date.Continue Reading Technical Assistance Guide for Federal Construction Contractors
A new regulation announced by the Small Business Administration on November 15, 2006, to be effective on June 30, 2007, requires small businesses to recertify their size when they are purchased by or merged with a larger business, or at the end of the five-year point of a contract. The rules are intended to help small businesses obtain more federal contracts and to assure that contracts set aside for small businesses are not going to larger companies. As reported in the Thompson West publication, the Government Contractor Online Update, “According to SBA Administrator Steven Preston, the changes “will go a long way toward ensuring that contract awards get in the hands of small business owners, federal agencies get the proper credit toward their small business contracting goals and small business contracts are fairly and accurately reported..’”
There are critics of the new policy, however, who contend that the SBA has not gone far enough to prevent larges businesses from intruding into the small business marketplace. The American Small Business League has commented that “A new policy proposed by the Small Business Administration (SBA) and the Office of Federal Procurement Policy (OFPP) will allow the government to continue reporting awards to large companies as federal small business contracts.” (See the full article).
Pertinent parts of the new regulation are as follows:Continue Reading New SBA Regulations Require Small Businesses to Recertify After Five Years
