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Small Business

GSA has an equity plan

For the first time in its history, GSA has an equity action plan. Their goal is to increase investments in small disadvantaged businesses (SDB)s. This while the Biden Administration addresses systemic issues, negatively affecting underserved communities. (Federal Computer Week April 14, 2022)

Last week, GSA announced its plan to administer $75 billion in annual contracts. GSA plans to focus on three particular areas: federal procurement, federal buildings, and federal technology design and delivery. (ibid)

The GSA plan identified five barriers impacting SDBs from achieving equitable outcomes in the federal marketplace:

  • Lack of centralized portal
  • Inability to access potential awards
  • Lack of knowledge of federal procurement requirements
  • Inability to navigate and or comply with federal procurement requirements. (ibid)

GSA is looking for new ways for SDBs to find places on existing governmentwide acquisition contracts while creating a supplier diversity plan along with a “robust post-award engagement strategy” to make sure SDBs are successful. GSA is simplifying the process for new candidates, educating and creating new pathways into the federal procurement arena. (ibid)

According to Robin Carnahan, GSA Administrator, “this plan lays out how GSA intends to integrate diversity, equity, inclusion, and accessibility as a priority in everything we do, from delivering projects to designing websites. For government to work, it needs to work for everyone. That’s why we are focused on improving how we at GSA, and our federal partners, can improve how we deliver services to all of America’s communities.” (ibid)

In support of the Biden Administration’s goal to increase federal contract spending on SDBs, GSA plans to increase federal contract spending by 50% over the coming five years. The Small Business Administration is investing in technology to improve program applications. The goal is to increase access to capital for minority-owned businesses. In addition, the White House plans to invest $31 billion in various forms of assistance for socially and economically disadvantaged businesses. (ibid)

Are you an SDB or minority-owned business looking to work with the Federal Government? Give us a call.

The SBA should focus on small businesses, not fraudulent businesses

Last week the small business community urged lawmakers to shrink administrative burdens complicating entry into the Small. Business Administration’s (SBA’s) 8(a) program.

This is timely as the Biden Administration has set a goal to bolster the share of federal contracts awarded to small disadvantaged businesses from 5% to 15% by 2025. A former SBA official suggests the SBA focus on expanding entry to the program for disadvantaged businesses and not spend time penalizing those who fraudulently attempt to gain entry. This will go a long way to help achieve the goals as set by the administration.

Jackie Robinson-Burnette, CEO of Senior Executive Strategic Solutions and a former SBA senior program executive said SBA should, “shift their focus to include every firm that is eligible'” for the 8(a) program. She mentioned that she served at the SBA, the SBA received over 2,000 applications a year and accepted only 300 participants. The Government Accountability Office believes steps were taken to address fraudulent applications to the 8(a) program. Unfortunately, there remains no official verification procedure. The Government Accountability Office did not take steps to improve oversight of the program, according to report filings.

Robinson-Burnette said, “right now, the focus is making sure they mitigate the risk of firms getting into the program that shouldn’t be in the program – focusing on the fraud – when really that’s 1% or 2% of firms that apply. The other 90-plus percent of firms are struggling to get in … because the SBA is focused on the wrong thing.”

In addition to misplaced focus, Rep. Kweisi Mfune (D-MD) said business owners have reported concerns with the length of the program and that it takes most firms multiple years to receive their first awards. Mfune said, “this hinders the development of program participants and raises the question of whether enterprises are ready for graduation when they exit the program.”

Darryl Hairston, the SBA’s former associate administrator of business development, said he submitted a proposal to redesign the 8(a) program a few years ago. Hairston took into account the complexities small businesses encounter in navigating the federal marketplace during their initial years in operation.

Hairston said, “one of the things that we talked about was that most firms coming into the program, who are truly eligible for the program, had little experience in the federal marketplace. The timeframe is highly dependent upon how successful you are coming into the program and how well you take off with the benefits that are available to you.”

Robinson-Burnette feels adding priority access for SDB mentors will increase successful outcomes. This will occur by shifting some of the SBA’s dependence from their assigned business opportunity and creating additional inroads to work opportunities. Mfume is considering meeting with the SBA administrator to figure out “what can be done in the time we have.”

Are you a small disadvantaged business or a business looking to work with one on an upcoming contract? Give us a call.

Acquisition of Professional Services is about to get a whole lot better

Sheri Meadema, acting assistant commissioner of GSA’s Office of Professional Services and Human Capital Categories recently explained the current focus of the Services Marketplace. The Information Technology Category and Professional Services and Human Capital Categories are teaming to align how they introduce contracts and tools to aid buyers as well as suppliers of services.(FAS office of Information Technology February 17, 2022)

Their three main goals:

  • Expand GSA’s contract offerings.
  • Refine FAS’s market research and buying tools.
  • Better the data and reporting systems used in support of the current acquisition programs. (ibid)

Meadema envisions a future with standardized engagement and solicitation processes regardless of the type of services provided. The priority is on using a consistent set of best practices and tools for IT and professional services for solicitations, evaluation, negotiations, awards, and contract management. (ibid)

Meadema wants an easier final outcome compared to open market procurements. Under the Services Marketplace, the next generation of contracts is being built. These contracts include the Services MAC, Polaris, and the follow-on to Alliant 2. Currently in progress are:

  • 8(a) STARS III Government wide Acquisition Contract – a small business set-aside, Beset-in-Class GWAC. The the 8(a) STARS III, federal agencies can access award-winning 8(a) firms for emerging technologies via an established contract vehicle. This saves not only time but also taxpayer monvery over open markets methods.
  • IT GWAC Polaris is in development. The RFP for the new Polaris small business IT contract is expected in February 2022. Once awarded, Polaris will enable federal agencies to set-aside IT task orders to small business, women-owned small business, service disable veteran-owned small businesses, and businesses located in HUBZones.
  • PSHC is working on a new Services Multi-Agency Contract to support procurement requirements for services. This comes as OASIS winds down in 2024.
  • Improvement of Multiple Award Schedule service offerings. Contractors with multiple contracts will consolidate down to one. This means fewer overall contracts for the acquisition workfovce and industry parnters to manage. Ultimately this will make is easier for agencies to find the vendors to meet their requirements.(ibid)

Meadeama says they have also started standardizing the scope review process. A digital tool/portal allows customers to submit their scope review requests. This streamlines tracking, management, and coordination across portfolios as well as creating a single customer experience. The discovery phase has started for an order management tool for all services task orders. This allows for better solicitation development, tracking, and task order management on GSA contracts. (ibid)

Questions about how this might affect a current GSA schedule contract or upcoming bid? Give us a call.

There’s more to a Small Business Affiliation than meets the eye

Small business contracting has been gaining momentum through the Small Business Administration’s (SBA) “all small” mentor-protege program. This program allows a large business to form a joint venture with a small business to compete for set-aside contracts. The SBA has several ways to determine if a company is actually small. And just because you meet the size standard for a procurement does not necessarily mean you are eligible for an award. (Federal News Network January 14, 2022)

Every procurement has a size standard assigned. Size standards set the largest size that a business (including its subsidiaries and affiliates) may be. Therefore, it is crucial to note whether the small business has any affiliates. Size standards are based on the number of employees or average annual receipts of a company. An affiliate’s number of employees and annual receipts are included in business size determination. (ibid)

Many award protests arise when offerors allege the winning company is ineligible, based on size. A protestor will argue that a company is not a small business due to its affiliation with a large company. The affiliation thereby exceeds the size standard. Should the SBA find that a bidding company exceeds the size standard due to an affiliation, the result can be the loss of a contract. (ibid)

Affiliation is when one company controls another company, or a third party controls both businesses. It doesn’t matter if the control is exercised. It only matters that it exists. (ibid)

Common ownership can give rise to affiliation. Common ownership happens when an owner of a firm holds an ownership interest in one or more other firms. This gets complicated if a company is owned by multiple shareholders. (ibid)

Affiliation can occur due to the relationship between the firms themselves, such as an affiliation based on the ostensible subcontractor rule. This rule provides that a prime contractor and subcontractor are affiliated if the subcontractor is performing the primary requirements of a contract and the prime contractor is reliant upon the subcontractor. If the SBA dins an affiliation under the ostensible contractor rule, it is limited to the procurement in question. Both companies may be eligible for award of other small business contracts. (ibid)

The rules around affiliation are subtle and often complicated. Many times a company finds out about an affiliation only after a protest is filed. An unfavorable size determination will result in the loss of a contract. This can affect a vendor’s ability to compete for future set-aside contracts. If this happens, a firm must be recertified as small. It is the same if a protested frim is a protege in a mentor-protege joint venture. The protege must be recertified. (ibid)

Affiliations are preventable. All agreements should include representations concerning the prime contractor’s small business status. All parties should be knowledgeable of the circumstances that may result in affiliation. (ibid)

Do you have affiliation questions? Give us a call.

Federal contractors minimum wage reset

Federal contractors enjoyed a minimum wage raise on January 1, 2021. This was the first increase since President Obama was in office. Even so, on April 27, 2021, President Biden signed EO 14026, raising the hourly minimum wage to $15 ($10.50 for tipped workers.) The United States Department of Labor published Field Assistance Bulletin (FAB) No. 2022-1 clarifying the requirements of EO 14026. (JD Supra January 17, 2022)

The four categories of contracts covered are:

  • Procurement contracts for construction covered by the Davis-Bacon Act (DBA).
  • Service Contracts covered by the Service Contract Act (SCA).
  • Concessions contracts.
  • Contracts entered into with the Federal Government in connection with Federal property or lands and related to offering services for Federal employees, their dependents, or the general public. (ibid)

The FAB includes all 50 states, Washington DC, Puerto Rico, and the Virgin Islands. It also includes the Outer Continental Shelf Lands as defined in the Outer Continental Shelf Lands Act, American Samoa, Guam, the Commonwealth of the Northern Mariana Islands, Wake Island, and Johnston Island. (ibid)

EO 14026 covers workers whose wages are governed by the FLSA, SCA, or DBA and are employed on or in connection with a covered contract. (ibid)

In addition to the increase in minimum wages, the FAB supplies information on worker notice requirements, subcontractor requirements, recordkeeping requirements, and anti-retaliation provisions and remedies. The FAB also requires contracting agencies to incorporate all applicable EO contract clauses into covered prime contracts and flow down to subcontractors’ contracts. (ibid)

Questions about the Field Assistance Bulletin (FAB) and its requirements? Give us a call.