The U.S. Small Business Administration (“SBA”) recently announced that the federal government exceeded its small business contracting goal by awarding $132.9 billion dollars in federal contracts – 26.5% of the government’s total procurement spending – to small businesses last fiscal year, with at least an additional $90.7 billion in subcontracts.  The SBA recently released statistics in its FY 2019 Small Business Procurement Scorecard, available here and here.  Also notable in these reports: (a) for only the second time ever the government met the 5% woman-owned small business goal; (b) the government met the service-disabled veteran-owned small business goal (3%, awarded 4.39%); and (c) the government also met the small disadvantaged business goal (5%, awarded 10.2%).  The government did not, however, meet the 3% HUBZone goal, coming in at 2.28%.  That said, small business contracting was up across all categories.  Here we provide a summary of the SBA’s findings, noting some of the potential opportunities available for small business contractors, while also highlighting some of the risks inherent in doing business with the U.S. government.
Continue Reading Government Small Business Contracting Continues to Increase: Creating Opportunities and Potential Pitfalls

Volume VII—Investing in Small Businesses

Numerous government contracts programs support small businesses.  There are prime contracts set aside for various categories of small business entities.  Agencies have small business contracting goals and take them very seriously.  Prime contractors often are incentivized, through evaluation factors, to propose significant small business participation.  They can also face liquidated damages for failing to make good faith efforts to comply with their small business subcontracting plans.  These programs promote economic growth by incentivizing investment in small business entities.

The primary obstacle to investing in small businesses, from a government contracts perspective, is that it is quite easy to lose small business size status as the result of a corporate transaction.  The difficulties arise from the doctrine of “affiliation.”


Continue Reading What You Need to Know About Mergers and Acquisitions Involving Government Contractors and Their Suppliers

By David Gallacher

Nearly three years ago, on September 27, 2010, the President signed into law the Small Business Jobs Act of 2010 (“Jobs Act”), which directed the Small Business Administration (“SBA”) to implement a variety of small business size and integrity requirements. As noted in our prior blog posting discussing many of these requirements, many of these provisions posed a significant threat to government contractors – both large and small businesses alike. On October 7, 2011, the SBA published its blueprint for implementing the statutory requirements. See 76 Fed. Reg. 52313 (the “Proposed Rule”). The Proposed Rule contained language that many industry participants and observers found alarming, particularly the requirements that:


Continue Reading Threats and Vulnerabilities – What Every Contractor Should Know About The SBA’s New “Presumed Loss” and “Deemed Certification” Rules

By W. Bruce Shirk & Kerry O’Neill

On February 11, 2011, the Small Business Administration issued final regulations addressing an array of issues relating to the agency’s programs, including the size standards applicable to nonmanufacturers or dealers, the elimination of the vexing use of both SIC and NAICS codes for size standards and adoption of the latter as the sole criteria for use in the standards, and the 8(a) mentor-protégé program. 76 Fed. Reg. 8222 (Feb. 11, 2011).
 


Continue Reading Small Business Savvy? Senate Bill Would Undercut New SBA Regulations

By Townsend L. Bourne

The U.S. Small Business Administration (“SBA”) issued a proposed rule on March 16, 2011 that increases the small business size standards for 35 industries and one sub-industry in North American Industry Classification System (“NAICS”) Sector 54, Professional, Scientific and Technical Services and one industry in NAICS Sector 81, Other Services. The proposed rule is one of several rules to be proposed by the SBA that will examine and potentially change the small business size standards for industries grouped by NAICS Sector. The SBA undertook this effort following passage of the Small Business Jobs Act of 2010, implemented on September 27, 2010, and Executive Order 13563, signed by President Obama on January 18, 2011, which calls for agencies to undertake a review of possible ineffective or outdated rules and, if necessary, update and streamline their rules to better meet regulatory objectives.
 


Continue Reading Objects In SBA’s Mirror Are Smaller Than They Appear: A Summary Of SBA’s Proposed Rule To Increase Small Business Size Standards