The National 8(a) Association is holding its Winter Conference on Tuesday and Wednesday, Feb. 7 and 8, at the Walt Disney World Resort in Lake Buena Vista, FL.
The Association’s mission is to educate and promote its members, to advocate favorable legislation policies, and to serve and support the effectiveness and continuance of the 8(a) program.
The agenda for the conference can be found at http://www.national8aassociation.org/forms/n8a-2012-winter.pdf.
Registration information is at http://8awinter2012.eventbrite.com/.
Filed under Contracting News · Tagged with 8(a), DoD, HUBZone, OMB, PTAC, SBA, service disabled, set-aside, small business, VA, veteran, woman owned business, wosb
There may already be too many set-aside categories for small businesses, according to at least one expert. The sheer number of categories, and the targets set for agencies to award certain numbers of contracts to each, has the unintended consequence of squeezing some small businesses out of the game, he said.
The plethora of small business programs “has disenfranchised many of those who are not eligible to the extent that they no longer back the very programs they once were glad to support,” Scott Bellows, a program manager at the South Carolina Procurement Technical Assistance Center in Columbia, S.C., said Nov. 7.
And yet, the government is now considering creating yet another category, for businesses that employ military veterans.
During a hearing, Bellows told the House Small Business Committee’s Contracting and Workforce Subcommittee that the small-business programs, such as those helping companies owned by service-disabled veteran and women, and the 8(a) companies, don’t do as much as most people think to help small businesses at large.
Many of the same contractors tend to get the work over and over. That makes it hard for other small companies to break into the market, he said.
To break in, business owners “soon realize that it’s a long, uphill battle,” he said.
Bellows said the government, along with the Small Business Administration’s annual small business score card, should take a different look at the awarded set-aside contracts.
“If one asks how many ‘unique’ vendor contracts were awarded during a certain period of time, you might just come away with a different impression of how these programs are promoting small business development and helping to revitalize our economy,” he said.
The score card gave the government overall a B in awarding contracts to small businesses in fiscal 2010. The government has a goal to award 23 percent of contracts to small companies. In 2010, it reached 22.7 percent. It missed many of its goals for the specific categories of small businesses.
President Barack Obama’s Interagency Task Force on Veterans Small Business Development has recommended the government should consider giving companies with at least 35 percent of its employees as veterans a special status in federal contracting. They likened the new category to the Historically Underutilized Business Zone small business program. For HUBZone status, 35 percent of a small firm’s employees must live in an economically depressed zone.
The task force said the new small-business category would not take too much regulatory efforts. The task force wants the Veterans Affairs and Defense departments, as well as SBA and the Office of Management and Budget, to further explore the idea.
The task force is interested in the hiring aspect of creating the new category.
About the Author: Matthew Weigelt is a senior writer covering acquisition and procurement at Federal Computer Week. Published Nov. 9, 2011 at http://fcw.com/articles/2011/11/09/set-aside-small-business-programs-other-small-business-effects.aspx.
Filed under Contracting News · Tagged with 8(a), cloud, DHS, EDWOSB, FirstSource, HUBZone, IT, SBA, SDVOSB, small business, wosb
Homeland Security Department officials unveiled the details of their new seven-year, $3 billion FirstSource II contract.
The FirstSource II draft Request for Proposals was released Oct. 31. The final RFP is expected no later than December 31, officials said.
FirstSource I, a $2 billion contract launched in 2007, is expiring and its replacement will concentrate on commodity purchasing through value-added resellers, William Thoreen, director of the Acquisition Division in the Office of Procurement Operations, told 600 small business owners Tuesday at the Ronald Reagan Building.
“We really believe FirstSource II is going to become a very important piece of our portfolio both for IT and strategic sourcing,” he said.
Under FirstSource I, DHS has bought commodities through value-added resellers, including the purchase of computers, desktops, laptops, network cards, routers through small businesses, Thoreen said.
“The scope of the commodities we buy under it is very broad because we need a lot of different IT commodities,” Thoreen said, and added that FirstSource II will also include VAR purchases of new IT commodities.
“We have learned an incredible amount from that [initial] award and we are going to incorporate a lot of changes in FirstSource II that makes sense for us and we hope makes sense for you,” he said.
For one, “FirstSource II targets specific [small-business] categories that will help our program managers meet their individual goals,” Thoreen said.
FirstSource II “is going to be different. It will provide opportunities for small businesses to partner up for us. The most important thing is that it succeeds in fulfilling our mission needs. We’re not just contracting for contracting sake; there are mission needs and they need to be primary,” Thoreen said.
DHS CIO Richard Spires summed up the dilemma of most of his peers in government. “I’ve got more things coming at me than ever, more demands,” he said. “And I’m going to have less dollars – a pretty classic problem, right? – we’re feeling the squeeze right now.”
Spires said the new contract would address four DHS priorities: infrastructure rationalization, overall IT improvement, elimination of duplication and balancing the CIO workforce, which has grown to 260 employees during the past few years, to meet the new realities.
“We’ve got to make significant changes, particularly in our infrastructure and the commodity IT arena to be able to offer at least the same level of service – and I would hope more service – to my customer base,” he said.
“Data center consolidation, really looking hard and driving true cloud-based services both in the private cloud, out of our own enterprise data centers, as well as in the public services are certainly a couple of things that we’re doing that are very visible,” Spires said.
Spires added that he wants to leverage DHS’ great buying power as exemplified by FirstSource II “to bring components together in ways that we never have before across a lot of functions within DHS.”
As a result of discussions with the Small Business Administration and others, “we’re going to be able to use all five of the small business categories in which we have set-aside authority,” said Kevin Boshears, director of the DHS Office of Small and Disadvantaged Business Utilization.
“To our knowledge, this is the first time this has been done in the federal contracting arena,” he added.
As a result, FirstSource II will have clear set-aside awards to 8(a), HUBzone, Service Disabled Veteran-Owned, Economically Disadvantaged Woman-Owned, and general small business.
But Boshears urged all small businesses “to be aware of the individual aspects of these [five] programs. There are common themes that run through all five of them, but there are individual details that may be germane to [only] one of the individual five categories.”
“So be certain that you are comfortable with the rules and all that has been asked of you to participate in any of the five categories,” he added.
Addressing the issue of teaming, Boshears said although teaming has always been a successful part of DHS contracts and because First Source II is all for small business, “we want each participant to be absolutely clear about which firm is serving as the prime contractor in both the pre-award phase and the post-award phase.”
He said that’s important for proposal preparation, for meeting all the requirements of the small business program and for transparency.
To answer “the question I get the very most – how many awards are you going to make?’ Boshears said the proper answer is “competition determines the final number.”
But a scan of previous DHS-wide multiple award contracts, including Eagle I, have averaged 27 to 28 small business prime contracts, he added.
“That doesn’t give you the absolute final number,” he said, “but it does give you kind of an idea of what we’ve done on previous projects.”
Contractor fraud in small business set-aside programs is difficult to detect and prove, but its annual costs to government are significant in dollars and damage to legitimate business that deserve the work, two federal watchdogs told a House panel Thursday.
In fulfilling the Obama administration’s goal of giving 23 percent of prime federal contracts to small business, agencies need to do better at making a public example of “bad actors” and at vetting contractors that misrepresent their qualifications for minority advantages through self-certification, according to Peggy Gustafson, inspector general for the Small Business Administration, and Brian Miller, IG for the General Services Administration.
They spoke at a hearing of the House Small Business Subcommittee on Investigations, Oversight and Regulations called by Chairman Mike Coffman, R-Colo., who sought to learn why much contractor fraud goes unpunished and unprosecuted.
“Just as we all benefit from small business prime contracting, we all suffer when fraud rears its ugly head,” Coffman said. “Legitimate small businesses lose the ability to perform when contracts go to firms that do not qualify for, or who are not following the rules associated with, the small business contracting program. The government suffers from this fraud because bad actors give all small businesses a bad name, so contacting officers are more reluctant to use the small business programs, which in turn results in less competition and a less vibrant industrial base.”
The set-aside programs consist chiefly of preferences for section 8(a) business development, Historically Underutilized Business Zones, women-owned businesses and the service-disabled veteran-owned program. Both inspectors general testified that their own agencies had fallen victim to fraud. SBA and the HUBZone certification program played a role in the sensational case exposed with the arrests earlier this month involving $20 million in fraud allegedly committed by contractors and two employees of the Army Corps of Engineers, Gustafson noted.
Miller described a recent $6 million contract awarded to a company that claimed to be run by a disabled veteran whose documents said he served three tours of duty during the Vietnam War and received medals and citations. It turned out, Miller said, he was a mechanical engineer serving stateside in the National Guard.
“It’s difficult to prove a monetary loss to the government because it did receive the goods and services,” Miller said. “But the real loss is to program integrity, to the legitimate small businesses that didn’t get the contract.” He added that fraudulent self-certification is difficult to detect and agencies rely on such information in the majority of the preference contract awards because their resources are limited.
“Strong penalties are needed to deter” the fraud, he said. “The tougher it is to detect, the tougher penalties must be,” though the rules should avoid punishing innocent companies simply because of a clerical error, he said.
Gustafson said each type of set-aside has its own level of vetting and the Section 8 program is the hardest for contractors to qualify for. She agreed that agencies could deter more fraud by publicizing their reviews of such programs, which in one instance prompted “contractors to drop out in droves.” It is acknowledged by all IGs, she added, “that the federal government doesn’t use suspension and debarment enough — that hits contractors in the pocketbook.”
Miller noted that GSA has an interactive map on its website providing other agencies with links to state databases reporting contractors that have been suspended or debarred.
Coffman asked whether agencies should take more responsibility for policing fraud. “It’s hard to draw simple rules,” Gustafson said. “Overburdened” agencies focused on awarding contracts are “not expected to know all the ins and outs” of the set-aside programs. Also, “the more difficult the rules are to administer, the harder it is to present the case to a jury,” she said.
But the issue “needs more discussion in the executive branch and guidance from Congress since it’s not always clear who’s minding the store,” she said. “If the programs don’t have integrity, we might as well throw them open to open competition.”
– by Charles S. Clark - Government Executive – October 27, 2011 – http://www.govexec.com/story_page.cfm?articleid=49156&dcn=e_gvet
Each year our Top 25 8(a) rankings reveal some of the hidden and not-so-hidden gems of the government market.
This year is no exception, and the gem sitting at the top of the rankings for the third year running is MicroTech LLC, a business with a record of growth that is bringing it a higher profile in the government market.
This year, MicroTech has landed at No. 1 on the 2011 Top 25 8(a) rankings, No. 2 on the Washington Technology 2011 Fast 50 list of the fastest growing government contractors, and No. 75 on our 2011 Top 100. In 2010, the company also captured spots on all three Washington Technology rankings.
The 2011 Top 25 8(a) rankings are based on an analysis of federal procurement data using the same group of product and service codes we use to rank the annual Top 100 contractors. The codes cover IT, telecommunications, systems integration, engineering services, professional services and other IT-related spending by government agencies.
The companies on the list are all participants in the Small Business Administration’s 8(a) business development program, which is designed to promote the growth of minority-owned small businesses. There are five companies on the rankings that have graduated from the program, but we left them on because their graduation dates fell so late in fiscal 2011.
We took a second step in our analysis by pulling out companies owned by Alaska Native Corporations and American Indian tribes. We’ve listed those companies in a separate chart.
In addition to MicroTech, there are eight other companies making a repeat appearance on the Top 25. These include ActioNet, USfalcon, Alon Inc., 2020 Co., Guident Technologies, Ace Info Solutions, and M2 Technology.
The capabilities and services provide by the Top 25 cover the breadth of the IT-related services that the government is buying.
For example, Primescape Solutions Inc., No. 14, provides strategic planning, software development, business intelligence, enterprise content management and IT services. Customers include the State and Health and Human Services departments, the Government Printing Office, the Army, and the Navy.
2020 Co., No. 7, has focused its solutions in three core areas: health care, education and science.
Advanced C4 Solutions, No. 18, targets military customers with enterprise IT services, intelligence, and tactical and strategic communications.
In fact, focus seems to be a common thread among these companies, with each finding and excelling in its particular niche.
“We’re a reseller, but we only resell what we are experts in,” said MicroTech’s CEO Tony Jimenez in an interview earlier this year. “That’s how you bring value.”
The Small Business Administration will expand the reach of it mentor-protégé programs it was announced during testimony on Sept. 15 during the House Small Business Committee Subcommittee on Contracting and Workforce.
At a hearing titled “Helping Small Businesses Compete: Challenges Within Programs Designed to Assist Small Contractors,” Joseph Jordan, SBA’s associate administrator for government contracting and business development, testified that the Small Business Jobs Act of 2010 gave the SBA authority to implement additional mentor-protégé programs for HUBZone, women-owned, and service-disabled veteran-owned small businesses.
In the past the SBA’s program was only open to disadvantaged businesses that participated in the 8(a) business development program.
“We are in process of implementing these new programs,” Jordan said at the hearing. “We conducted robust public outreach via a 13-city Small Business Jobs Act Tour and have held several meetings with various agency and public stakeholders to collect input and feedback on the implementation of these programs.”
SBA is now drafting proposed regulations for public comment.
The mentor-protégé programs arranges relationships between experienced contractors and inexperienced small businesses to provide them business development assistance. The program provides incentives for mentor participation, such as credit toward subcontracting goals.
This hearing reviewed three recent Government Accountability Office reports including one that criticized the mentor-protégé programs for not tracking the results of the mentor-protégé relationships after they are formed.
The portion of sales going to small businesses in the Solutions for Enterprise-Wide Procurement (SEWP) IV reached 42 percent last year, an increase of 7 percent from the previous year, according to SEWP IV officials.
“The NASA SEWP program office has always promoted the use of small businesses,” said Joanne Woytek, SEWP IV program manager. “Two of our four contract groups are forms of small business set-asides, which all agencies can utilize to help meet their small business goals.”
• 42 percent of SEWP IV spending goes through SEWP’s small businesses.
• 7.2 percent of SEWP IV spending goes through SEWP’s Service-Disabled Veteran-Owned Small Businesses (SDVOSB).
[Download a .pdf version of this special report at http://download.1105media.com/GIG/Custom/2011PDFS/SEWP2011.pdf.]
SEWP IV has 38 contract holders, including 21 small businesses. Of the 21 small businesses, six are 8(a) small, disadvantaged businesses and 10 are veteran-owned small businesses, including seven service-disabled veteran-owned small businesses (SDVOSBs). SEWP IV has set-aside authority for small business task orders and SDVOSB task orders. Last year, SEWP IV sales going to SDVOSBs reached 7.2 percent, up from 6 percent the previous year.
SEWP IV’s pool of small businesses also includes woman-owned businesses, Alaska Native businesses, and businesses in historically underutilized business (HUB) zones. Agencies can hold competitions among all small businesses, but then give preference to these other sub-categories in addition to the 8(a) companies.
– from Washington Technology, 7/29/2011 at http://washingtontechnology.com/microsites/2011/sewp2011/07-sewp-iv-small-business-utilization.aspx
The General Services Administration is blaming “ambigous” language in an email to bidders on its $10 billion 8(a) contract for giving the mistake impression that it had made contract awards.
The email was intended to give notice that GSA was extending the selection process for the Streamlined Technology Acquisition Resources for Services (STARS) II governmentwide acquisition contract, according to a statement made June 23 by Mary Davie, assistant Federal Acquisition Service commissioner for integrated technology service at GSA.
Davie said the agency intends to award its major governmentwide small-business IT contract by the end of July, although it may have caused some confusion about awards.
GSA asked for a monthlong extension to try to get better prices from the companies bidding on its five-year, $10 billion contract. But because of the language issues some companies believe they had a spot on the IT GWAC and then lost it, Davie said.
A first correspondence, sent June 1, intended to say that officials, who are reviewing bids for STARS II, were continuing their review of submissions. The second letter, sent June 21, gave companies an opportunity for written discussions and called for a final proposal and pricing revision, Davie wrote.
“The second letter did specifically rescind a portion of earlier communications, which appeared to indicate that offerors were considered to be ‘apparently successful.’ This phrasing was ambiguous and should not have been used in these communications,” Davie said.
That second e-mail message, sent to companies, states: “Any part of previous communications from GSA stating or implying that offerors were deemed apparently successful is hereby rescinded.”
GSA was giving the small businesses time to re-examine the prices they offered in their initial bid proposals and adjust the pricing to “amplify its potential to be favorably considered,” the second message also states. Officials included the median price and prices in the 25th percentile as a guide for companies to make their revisions.
GSA had to get the extension to get better prices, Davie said.
“It would not have been possible to ask for more competitive pricing without going back to offerors to ask for an extension, provide them with an opportunity for additional discussions, and then request a final proposal revision,” Davie said.
She added that GSA’s GWAC program office is responding to contractors’ questions as part of the written discussions.
Although GSA’s follow-up message may be awkward, Larry Allen, president of Allen Federal Business Partners, said it’s better than being criticized throughout the life of the contract because of high prices.
General Services Administration officials quickly rescinded an e-mail message
sent to small businesses telling them they had won spots on its major small
business governmentwide IT contract, according to an e-mail message obtained by
Washington Technology and Federal Computer Week.
Officials wrote in a follow-up message, which came a day after the award
notice, that they were checking prices again for the 8(a) Streamlined Technology
Acquisition Resources for Services (STARS) II contract. The message contained an
unsubtle suggestion that bidders might want to offer lower prices.
“Any part of previous communications from GSA stating or implying that
offerors were deemed apparently successful is hereby rescinded,” agency
officials wrote. “This discussion e-mail serves as notice that GSA has made the
decision to hold additional discussions, with an emphasis on pricing.”
STARS II is a 5-year, $10 billion indefinite-delivery, indefinite-quantity
(IDIQ) IT contract. GSA issued the first solicitation for the GWAC in July 2009.
Officials expect an award this month, according to GSA.gov.
GSA officials didn’t immediately respond to requests for comment..
Prices are becoming a central theme in the government as Congress and the
Obama administration attempte to rein in spending.
GSA is giving the 8(a) small businesses time to reexamine the prices they
offered in their initial bids and adjust the pricing to “amplify its potential
to be favorably considered,” according to the follow-up message.
The opportunity for price revisions is not merely a request for an update,
but it will play into GSA’s evaluations. “This is a competitive 8(a) procurement where comparative analysis with other
offerors’ pricing in response to this [Final Proposal Revision] opportunity, and
possibly other price analysis, will occur in order to assess price
reasonableness [or] unreasonableness,” GSA wrote.
In the rescission e-mail message, GSA gave companies pricing averages from
the initial bids as a guide for what’s been offered so far to let companies know
where their prices compare to other bidders.
Observers speculated that someone may have sent out an email too soon, or a
senior management official could have recognized in the 12th hour that the
agency needed look over the prices again.
“Oops,” Larry Allen, president of Allen Federal Business Partners, said about
the initial message.
Either way, the STARS GWAC is “a crown jewel” of GSA and its small business
contracts. It’s next to the GSA’s Schedules in importance to the agency, he
said.
The follow-up rescission message may be awkward, but, Allen said, it’s better
than being criticized throughout the life of the contract because of high
prices.
Nevertheless, the small-business aspect, such as getting a good mix of
various business types, likely would get officials’ attention from the outset
before prices, he said. STARS offers customer agencies an avenue to boost their
small-business contacting percentages, which has helped to make the GWAC
successful.
Across the government though, pricing has become another essential topic in a
time when funding is set to diminish. It’s important enough that the Defense
Department made Shay Assad, a senior procurement policy official, the first
director of defense pricing in May.
That appointment points to the weight of the pricing issue, said Hope Lane, a
government contract consultant at Aronson Consulting.
“The government has to start implementing austerity measures,” said Lane, who
focuses on GSA Schedules.
It isn’t surprising that GSA may have rescinded its award notice in order to
make contractors improve their prices, she said. As agencies hunt for the best
value for their money, GSA’s STARS GWAC has to prove that it can actually save
money, or GSA will lose business to another IDIQ hosted by another agency, she
said.
“IT, in particular, is a competitive market among GWACs,” she said.
This mix-up may cost GSA by way of protests to the contract. Allen said the
likelihood of protests just jumped much higher.
About the Author: Matthew Weigelt is acquisition editor for Federal Computer Week -
June 22, 2011 – http://washingtontechnology.com/Articles/2011/06/22/GSA-rescinds-STARS-II-GWAC-award.aspx?p=1
Filed under Contracting News · Tagged with 8(a), bundling, certification, contract bundling, GSA, HUBZone, IDIQ, joint venture, mentor-protege, mentorship, multiple award contract, OFPP, SBA, Schedules, size standards, small business, small disadvantaged, subcontracting
The federal government finally could reach its goal of awarding 23 percent of all contract dollars to small businesses by allowing, and possibly mandating, agencies to set aside orders against the General Services Administration’s Multiple Awards Schedule and other indefinite delivery-indefinite quantity contracts, according to a senior Small Business Administration official.
Currently, agencies are not required to, and they often are discouraged from setting aside small businesses task and delivery orders that are placed against multiple award contracts. But the Small Business Jobs Act, signed by President Obama in September 2010 instructs SBA and the Office of Federal Procurement Policy to develop guidance that would reverse that policy.
To further its policy deliberations, SBA met with hundreds of small business owners on Wednesday in Manhattan as part of its Small Business Jobs Act tour. The event, one of 13 scheduled in locations across the country in March and April, is designed to provide the public with information about the provisions in the legislation, including 19 focused on contracting.
Arguably the most important, and potentially difficult to implement, provision would dramatically alter how agencies use the GSA schedules and IDIQ contract vehicles, which now represent 28 percent of the federal procurement marketplace. In 1990, IDIQs represented just 14 percent of the total contracting dollars spent by agencies.
SBA and OFPP have held five outreach events in recent months seeking feedback from the public on the best way to implement this provision. The crux of the issue, according to Joe Jordan, associate administrator for government contracting and business development at SBA, is whether to mandate small business set-asides on multiple award and IDIQ contracts, or to allow agencies the discretion to use them.
“We need to get the ‘shall’ versus ‘may’ language right,” he said.
SBA’s decision could make the difference in whether the government finally meets its small business contracting goals. In fiscal 2009, small businesses won 21.9 percent of all small business contract dollars, amounting to $96.8 billion. To meet its 23 percent goal, agencies would have to spend roughly $5 billion more on small businesses, Jordan said.
Mandating small business set-asides could push agencies over that threshold. About $40 billion in contracts was awarded last year off GSA’s Multiple Awards Schedule, and another $150 billion was spent governmentwide through IDIQ contracts.
But the Obama administration also is weighing whether a mandate would discourage agencies from using these contracts, particularly the GSA Schedules. One possible solution, Jordan said, is developing a hybrid solution in which agencies could be required to set aside task-and-delivery orders if they do not meet their small business goals. The agencies that are meeting those goals then would be allowed, but not forced, to use the set-asides.
“The question is how to make this happen without taking away from the speed and efficiency” he said.
The jobs act also establishes a mentor-protégé program to assist small businesses owned by women, service-disabled veterans and those operating in Historically Underutilized Business Zones in competing for contract opportunities. The initiative would be modeled after the 8(a) mentor-protégé program and also take into account the staffing and resources SBA has devoted for these programs, Jordan said.
But these new joint ventures bring possible perils, including opening the door for mammoth contractors, such as Lockheed Martin Corp. and Boeing Co., to begin winning a high percentage of contracts that are intended for small businesses.
“How do we balance that?” Jordan asked. “These can’t be pass-throughs. We can’t let companies play that way.”
SBA expects to submit a proposed rule creating the mentor-protégé programs by the end of May.
Other job act contracting provisions include:
- Requiring OFPP to establish a governmentwide policy for contract bundling — a process in which several small contracts are consolidated and awarded to one firm, often out of the reach of small businesses. (Before bundling a contract, procurement officials would be required to conduct market research and to have a senior acquisition official sign off on the decision. The rationale for bundling then would be publicly disclosed, either on a federal database, or on the agency’s website. )
- Establishing a pilot program for collaboration and joint ventures involving small business contractors. (Under the five-year program, $5 million in federal grants will be awarded to nonprofit groups that would then collaborate with small business teams seeking to compete collaboratively for larger procurement contracts. Thus far, 80 to 90 grant proposals have been received, and SBA expects to choose from 10 to 20. Proposals must be received by April 11.)
- Mandating small businesses to recertify their size status annually. The law also establishes a governmentwide policy for prosecuting companies that fraudulently disclose themselves to be a small business. (The policy would allow an agency to keep the product or services the fraudulent company provided and still sue the business for the entire sum the agency paid through the contract.)
- Requiring SBA to re-examine its size standards in each of its business categories every five years.
– by Robert Brodsky – GovExec.com – March 30, 2011