DOD, NASA, and GSA Release Proposed Rule Affecting Contracts Under SBA’s 8(a) Program

On Monday, February 3, 2014, DOD, NASA and GSA released a rule proposing several substantive changes to the Federal Acquisition Regulation (FAR) provisions governing the Small Business Administration’s (SBA) 8(a) Business Development program.  See 77 Fed. Reg. 6,135.  The 8(a) Business Development program assists small, disadvantaged companies break into the marketplace by setting aside small sole-source contracts for 8(a) participants and encouraging participants to form joint ventures and teams with other contractors in order to bid competitively on larger prime contracts.  Specifically, the rule proposes to add new FAR sections addressing issues such as protesting an 8(a) participant’s eligibility and size status, the procedures for requesting a formal size determination, and rules that apply to 8(a) participants that exit the program. With regard to the protest regulations that apply to 8(a) procurements, the proposed rule adds FAR Sections 19.813 and 19.814, which inform that an unsuccessful 8(a) offeror may not protest the size or eligibility of an awardee of an 8(a) sole-source contract.  Rather, unsuccessful offerors have recourse to request a formal size determination from SBA, which may lead to a determination of ineligibility by the SBA.  However, the size of an 8(a) awardee in a competitive procurement may be protested by an offeror provided that the protester was not eliminated for reasons unrelated to size. The proposed rule also creates FAR Section 19.816, which states that contractors that exit the 8(a) program will no longer be eligible to receive new 8(a) contracts.  Similarly, if an 8(a) participant is suspended, it will be ineligible until the contracting agency determines that it is in the Government’s best interest to end suspension and the SBA agrees with this determination.  The SBA may suspend a participant from the 8(a) program where there is information showing that the participant is not eligible or the participant’s conduct shows a lack of business integrity (e.g. submission of false statements in an 8(a) application). Companies may submit final comments on the proposed rule by April 4, 2014.  The proposed rule may be accessed here.

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