SBA’s inspector general says agencies are overstating 8(a) and HUBZone contracting achievements

September 29, 2014 by

On September 24, 2014, the Small Business Administration’s Office of Inspector General (OIG) issued Evaluation Report 14-18, Agencies are Overstating Small Disadvantaged Business and HUBZone Goaling Credit by Including Contracts Performed by Eligible FirmsThis report presents the results of an evaluation of select Section 8(a) Business Development Program and Historically Underutilized Business Zones (HUBZone) contract awards.

The OIG identified over $400 million in contract actions that were awarded to ineligible firms, which may have contributed to the overstatement of small business goaling dollars for the Small Disadvantaged Business and the HUBZone Business preference programs in FY 2013.  Besides reporting inaccurate information in Federal Procurement Data System-Next Generation (FPDS-NG), procuring agencies may have limited contracting opportunities for firms currently participating in the 8(a) or HUBZone programs.

Further, the OIG found that HUBZone and 8(a) certification information is not consistently transmitted to the Dynamic Small Business Search (DSBS) and the System for Award Management (SAM).  As a result, the affected small businesses are not getting the visibility in the DSBS database, especially the HUBZone firms, and as a result, may impact federal agencies in meeting their HUBZone procurement goals.

Additionally, the OIG also identified over $1.5 billion dollars in contract actions for which the firms were in the programs at the time of contract award, but in FY 2013 were no longer in the 8(a) or HUBZone programs.  Specifically, SBA regulations permit procuring agencies to claim Small Disadvantaged Business and HUBZone goaling credit on certain contract actions even after firms have left the program.  In the opinion of the OIG, the amount of dollars the SBA reports to Congress and the public as being performed by 8(a) and HUBZone firms in the Small Business Goaling Report is significantly impacted by the inclusion of contract actions performed by former program participants.

The OIG made two recommendations to SBA’s Associate Administrator for Government Contracting and Business Development intended to strengthen controls between SBA databases on certification data of 8(a) and HUBZone firms and information reported in FPDS-NG. The recommendations are:

  1. In coordination with the Office of Federal Procurement Policy and the General Services Administration, the SBA should strengthen controls between the SBA’s Dynamic Small Business Search Database and the System for Award Management to ensure accuracy of 8(a) and HUBZone certification data in FPDS-NG.
  2. The SBA should modify DSBS so that a firm’s profile and certification information for HUBZone and 8(a) status remains visible and accurate to agency contracting officers, or develop an alternate list to verify a firm’s status.

The OIG reports that SBA’s management has agreed to pursue both recommendations.

Defense department’s ‘sources sought’ for IT services underscores importance of an effective capabilities statement

September 16, 2014 by

Market research undertaken last week by a unit of the Department of Defense places significant importance on small businesses having a written capabilities statement.

In fact, as the Defense Information Systems Agency (DISA) puts it, It is vitally important that Small Businesses responding to this Sources Sought Notice do so with highly effective Capability Statements.”

The call for submittal of capabilities statements comes in DISA’s posting of a sources sought notice on FedBizOpps on September 11, 2014.  The purpose of the sources sought is to determine the availability and technical capability of small businesses to provide a wide range of information technology services to the U.S. Cyber Command, including assistance for offensive and defensive cyber operations.

The sources sought notice is a precursor to an anticipated indefinite delivery, indefinite quantity IT contract which will be open only to small businesses.  Small businesses are being sought to provide support for cyber planning, training knowledge, records management, science and technology research and development, and more than 30 cyber exercises a year.

The small businesses that DISA is seeking to identify include Small Disadvantaged Businesses, HUBZone Firms; Certified 8(a), Service-Disabled Veteran-Owned Small Businesses, and Woman Owned Small Business.

The primary place of performance will be at USCYBERCOM Government facilities within the Ft. George G. Meade, MD local area. Local area is any facility within a 50 mile radius of Ft. Meade, Maryland.

Responses to the sources sough are due not later than 4:00 pm Eastern Time on September 29, 2014.

DISA’s sources sought notice may be seen at: https://www.fbo.gov/index?s=opportunity&mode=form&id=63a08d1386b0426debf21c53cd8572db&tab=core&_cview=0.

For background information on the “sources sought” process, read: http://gtpac.org/2010/09/what-is-a-sources-sought-heres-the-answer

For general information on putting together a capabilities statement, read: http://gtpac.org/2010/05/what-is-a-capabilities-statement-and-why-should-i-have-one/

Clients of the Georgia Tech Procurement Assistance Center may ask their assigned counselor for a sample capabilities statement as well as for a review of their capabilities statement before submitting it in response to any sources sought notice.

 

8(a) certification is subject of SBA’s Oct. 23rd workshop

September 16, 2014 by

The 8(a) Business Development program is a part of the U.S. Small Business Administration’s efforts to promote equal business access for socially and economically disadvantaged individuals, including Black Americans, Hispanic Americans, Native Americans, Asian Pacific Americans, subcontinent Asian Americans, and in in some cases women business owners.

Companies with an 8(a) Certification can benefit from the wide-range of services offered including government contracting set-asides, access to capital, management and technical assistance, and much more.

In order to benefit from the 8(a) program, a company must first qualify and be certified by the SBA.  The SBA’s Georgia District Office is conducting a 3-hour workshop to explain the required qualifications and the certification program.

Tech to offer professional coursework on government contracting in October

September 16, 2014 by

Interested in deepening your understanding of the federal government’s contracting rules?

Want to develop your professional skills in winning and managing government contracts?

If your answer to these questions is yes, you’ll want to consider attending two important courses being offered by Georgia Tech’s Contracting Education Academy next month.

The first course is CON 260B, Small Business Programs.  It provides an in-depth review of the federal government’s efforts to improve small business participation in prime contracting and subcontracting.  This 3-day course focuses particular attention on the Small Business Managers’ role as a vital member of the acquisition team.   As a part of this course, business people:

  • Discover business growth opportunities for your company in the government sector.
  • Learn how to better develop a bid proposal that will put you ahead of the competition.
  • Gain insight on ways to get your small business subcontracting plan approved.
  • Network with and learn alongside government contracting officials to gain a better understanding of the process, roles, and responsibilities of government contracting.
  • Understand how your company fits in as an important member of the government’s overall acquisition team.

The second course is CON 170, Fundamentals of Cost and Price Analysis.  This course begins with an in-depth review of the market research process, and provides instruction to help students understand and analyze contractor pricing strategies. This is a 10-day course where students learn how to:

  • Demonstrate ability to execute fundamental quantitative pricing skills.
  • Successfully distinguish various seller pricing strategies given an acquisition situation.
  • Describe the Truth in Negotiations Act, including its purpose in mitigating government cost risk.
  • Identify the policies and procedures for applying the Cost Accounting Standards Board (CASB) rules and regulations to negotiated contracts and subcontracts.
  • Identify contract cost principles and procedures.

CON 260B, Small Business Programs is offered Oct. 14-16, 2014.  Learn more about this course at: http://www.pe.gatech.edu/courses/con-260b-small-business-programs.

4 face prison for alleged fraud in claiming 8(a) and SDVOSB status for millions of dollars of federal contracts

September 15, 2014 by

Four individuals pleaded not guilty last week to three counts of fraud involving federal contracts intended for 8(a) and service-disabled veteran-owned small businesses.

A federal grand jury in Greeneville, Tennessee returned an indictment on Aug. 12, 2013, against Ricky Anthony Lanier, 47, and Katrina Reshina Lanier, 40, of LaGrange, N.C.; Latoya Montrevette Speight, 37, of Snow Hill, N.C.; and Emanuel Louis Hill, 47, of Louisville, Ky., for wire fraud, conspiracy to commit wire fraud, and major fraud against the United States.

These individuals appeared in court on Sept. 9, 2014 before U.S. Magistrate Judge Dennis Inman and pleaded not guilty. All were released on bond pending trial, which has been set for Nov. 18, 2014 in U.S. District Court, in Greeneville, Tennessee.

If convicted, they all face a term of 20 years in prison as to each wire fraud charge and up to 10 years in prison for the charges of major fraud against the United States. Additionally, they face fines of up to $250,000 and up to three years of supervised release as to each count. The indictment also seeks forfeitures of approximately $15 million as to the Laniers and Speight and approximately $5 million as to Hill.

Details of this conspiracy are included in the indictment on file with the U.S. District Court, which alleges that the Laniers, Speight, and Hill conspired from November 2005 to April 2013 to defraud the United States government through a scheme to fraudulently obtain federal contracts intended to be awarded to businesses lawfully participating in the Small Business Administration’s 8(a) Business Development program and the Department of Veterans Affairs’ Service-Disabled Veteran-Owned Small Business Concern program.

Court records state Ricky Lanier was an owner of Global Construction Inc. (GCI), which participated in the SBA’s 8(a) business development program from 1998 to 2007. Katrina Lanier and Speight worked at GCI.  From 2001 to 2007 GCI received over $23 million in federal contracts.

In 2007, however, GCI graduated from the 8(a) program and was no longer eligible to receive 8(a) set-asides.

Kylee Construction, founded in 2005, originally had a mailing address of Emanuel Louis Hill’s father’s home, then a post office box opened by Ricky Lanier, and eventually changed to Hill’s home address.   Between 2010 and 2013, Kylee Construction received over $5 million in contracts under the Department of Veterans Affairs program for small businesses owned by service-disabled veterans.

Lanier also convinced a North Carolina-based company, JMR Investments, that he would handle all of their construction business.   From 2008 to 2013, JMR received over $9 million in federal contracts designated under SBA and VA programs.

This indictment is the result of an investigation by Department of Veterans Affairs Office of Inspector General, Department of Interior Office of Inspector General, Small Business Administration Office of Inspector General, and United States Secret Service, with assistance from the National Park Service and General Services Administration Office of Inspector General. Assistant U.S. Attorneys Neil Smith and David Gunn will represent the United States.

 

SBA proposes revisions to employee-based size standards for manufacturing and other industry sectors

September 11, 2014 by

The U.S. Small Business Administration (SBA) has published two proposed rules to revise small business size standards in North American Industry Classification System (NAICS) Sector 31-33 (Manufacturing) and industries with employee-based size standards that are not a part of NAICS Sector 31-33, Sector 42 (Wholesale Trade), and Sector 44-45 (Retail Trade).  The proposed rules were published in the Federal Register on Sept. 10, 2014.

As part of its comprehensive size standards review required by the Small Business Jobs Act of 2010, the SBA evaluated employee-based size standards for all 364 industries in NAICS Sector 31-33 and 57 industries and five exceptions that are not in NAICS Sectors 31-33, 42, or 44‑45 to determine whether they should be retained or revised.

In the first rule, SBA proposes to increase size standards for 209 industries in Sector 31-33.  The SBA also proposes to increase the refining capacity component of the Petroleum Refiners (NAICS 324110) size standard to 200,000 barrels per calendar day total capacity for businesses that are primarily engaged in petroleum refining.  The proposed rule also eliminates the requirement that 90 percent of a refiner’s output being delivered should be refined by the bidder.

In the second rule, SBA proposes to increase the employee-based size standards for 30 industries and three exceptions and decrease them for three industries that are not in Sectors 31-33, 42, or 44‑45.

Additionally, SBA proposes to remove the Information Technology Value Added Resellers exception under NAICS 541519 (Other Computer Related Services) together with its 150-employee-based size standard.  Similarly, SBA also proposes to eliminate the Offshore Marine Air Transportation Services exception under NAICS 481211 and 481212 and Offshore Marine Services exception under NAICS Subsector 483 and their $30.5 million receipts based size standard.  Accordingly, the second proposed rule also removes Footnotes 15 and 18 from the table of size standards.

If the changes in the two rules are adopted as proposed, nearly 1,650 more firms will become small and eligible for federal procurement and SBA’s loan programs.

Comments can be submitted on the proposed rules on or before November 10, 2014 at www.regulations.gov, identified by the following RIN numbers: (RIN 3245-AG50 for Sector 31‑33) and (RIN 3245-AG51 for employee-based size standards for industries that are not part of Sector 31-33, Sector 42 or Sector 44-45).  You may also mail comments to Khem R. Sharma, Chief, Office of Size Standards, 409 3rd St., SW, Mail Code 6530, Washington, DC  20416.

For size standards review, SBA takes into account the structural characteristics of individual industries, including average firm size, startup cost and entry barriers, the degree of competition, and small business share of federal government contracting dollars.  This ensures that small business size definitions reflect current economic conditions and federal marketplace in those industries.

An SBA-issued White Paper entitled, “Size Standards Methodology,” which explains how SBA establishes, reviews and modifies its receipts-based and employee-based small business size standards, can be viewed at http://www.sba.gov/size.

For more information about SBA’s revisions to its small business size standards for various industry sectors, click on “What’s New with Size Standards” on SBA’s Web site at http://www.sba.gov/size.

Family relationship, revenues and subcontracts caused affiliation, says SBA

September 5, 2014 by

A small business was affiliated with companies owned by the business owner’s father and siblings, based on the family relationship and the companies’ ongoing history of doing business together.

In a recent size appeal decision, the SBA Office of Hearings and Appeals held that the small business had not successfully rebutted the regulatory presumption that companies owned by close family members are affiliated, because the small business had earned substantial revenues from the alleged affiliates, and intended to issue a subcontract to both affiliates with respect to the procurement at issue.

SBA OHA’s decision in Size Appeal of Industrial Support Service, LLC, SBA No. SIZ-5576 (2014) involved an Army Corps of Engineers solicitation seeking a contractor to provide certain repair work.  The solicitation was issued as a small business set-aside under NAICS code 238290 (Other Building Equipment Contractors).

Keep reading this article at: http://smallgovcon.com/sbaohadecisions/family-relationship-plus-revenues-subcontracts-caused-affiliation-says-sba-oha/

GSA to host multi-agency small business event in Warner Robins on Oct. 29th

September 1, 2014 by

The U.S. General Services Administration (GSA) Southeast Sunbelt Region, the Centers for Disease Control and Prevention (CDC), Department of Housing and Urban Development (HUD), Federal GSA logoEmergency Management Agency (FEMA), Dobbins Air Reserve Base, Warner Robins Air Logistics Complex (WRALC), and the Marine Corp Logistics Base Albany will host a Multi-Agency Small Business Industry Day on Wednesday, October 29, 2014, at the Museum of Aviation (Eagle Building) at Robins Air Force Base.

This event will provide small business concerns the opportunity to hear from the agencies’ Heads of Contracting Activity/Directors of Contracting. Small business concerns will also have the opportunity to receive valuable training from the Small Business Administration (SBA) and discuss forecast opportunities with the various federal agencies during match-making sessions.

There is no cost to attend this event but pre-registration is required; limited space is available. No onsite registration or walk-ins will be allowed. Two (2) contractor representatives max per company are allowed to register. Once maximum attendance capacity is reached, registration will be closed.

To pre-register for the event, go to www.gsa.gov/events.

The Museum of Aviation is handicapped accessible and offers limited FREE parking.

Date: Wednesday, October 29, 2014

Time: 9:00 AM – 4:00 PM

For additional information: Please contact Cindy Kirvin at: vog.asgnull@nivrik.ydnic or call (404) 331-9720.

University System of Georgia’s annual procurement expo scheduled for Oct. 24 in Macon

August 26, 2014 by

Mark your calendar.

The University System of Georgia’s annual procurement conference is scheduled to be held on Friday, Oct. 24, 2014.  This year’s event will be held on the campus of Middle Georgia State College in Macon, GA.

Registration and further details are not available at this time.  Keep watching the GTPAC website for further announcements.

USG Procurement Expo 2014

How many big contractors are actually posing as small businesses?

August 25, 2014 by

In the sixth of its annual studies, a small business advocacy group has again blasted the government for allegedly awarding contracts to major corporations when policy intends for them to go to legitimate small businesses. The Small Business Administration offered other possible explanations for the apparent discrepancies.

The Petaluma, Calif.-based American Small Business League’s new study of fiscal 2013 procurement data concluded that of the top 100 companies receiving the highest-valued small business federal contracts, “79 were large companies that exceeded the SBA’s small business size standards, five were anomalous and 16 were legitimate small businesses.”

The group’s annual studies also show that the number of top-100 contracting companies that are large firms has risen steadily, from 60 in fiscal 2009 to 84 in fiscal 2013.

The large corporations that received the contracts in question in fiscal 2013 included Lockheed Martin Corp., General Dynamics Corp., Boeing Co., General Electric, Oracle Corp., Apple Inc., Verizon, Bank of America Corp., Citigroup Inc., PepsiCo, Comcast Corp., Intel Corp., John Deere Co. and many more, said the league, which published brief company-by-company profiles.

Keep reading this article at: http://www.govexec.com/contracting/2014/08/how-many-big-contractors-are-actually-posing-small-businesses/91694