Theodore Watson, Esq (Government Contract Attorney)

As a government contractor, your ability to collect prompt payment from the federal government is essential to your success.  The Federal Acquisition Regulation includes law that supports timely payment by the government.

As government contract attorneys, we sometimes have to represent contractors by assisting them in receiving prompt payment for unpaid invoices.

Prompt Payment

The Prompt Payment Act (PPA), as enacted by Congress requires the government to pay invoices by the required due date. As practical matter, the federal government usually pays invoices within 30 days. However, this does not always happen.

Conditions of Payment

If you don’t submit a proper invoice then, you will have a hard time demanding payment and interest.  Most contractors are now signed up with Wide Area Workflow. This process is designed to speed up payment of invoices. Invoices for progress payments  should be certified under FAR 52.232-5. Nevertheless, the government must notify you if you have submitted a defective invoice. 

Am I entitled to Interest?

The Prompt Payment Act does not allow interest if the government and the contractor do not agreement on the amount invoiced (disputed invoice). Also, contractors should be aware that if they are paid for work that does not conform to the contract requirements, then the government may be entitled to interest. 

Subcontractor Payments

The prime contractors on government projects are also supposed to pay subcontractors within 7 days after receiving payment from the government. Failure to do this will incur interest.

However, prime contractors are not required to pay a sub contractor for work that is not timely or accurately performed under the subcontract. Some government contract attorneys forget this point when dealing with prompt payment act issues, and focus solely on whether the government has paid the prime.

Subcontractors should be aware that complaining to the government will not solve the problem simply because the government has no privity of contract with subcontractors.  The basis for payment is the terms and conditions of the subcontract not the prime contract.

What can I do to ensure that the quality of work does not harm prompt payment?

As a matter of practice, you can keep in close communication with government contracting and quality assurance personnel. Written communication and project reports can reduce prompt payment act issues.

For information, feel free to contact our office or call us at 866-601-5518 for representation.

By: Theodore P. Watson, Government Contract Attorney and Consultant

After 911, access to the federal government has become very limited. Contractors now have to create new and innovative ways to market to the agency to sell their services and products. As many successful contractors know, building relationships with the government is one of the critical aspects of marketing to the government.

• There are over 80,000 agencies
• There is no bigger business than selling to government
• Marketing to the government takes time and is definitely not a simple task

There are no short cuts to acquiring government contracts. Many companies incorrectly believe that marketing to the federal government is done in the same manner as in the commercial sector. As a result, they spend thousands of dollars hiring employees with inflated resumes, going to events that don’t get results or simply not spending to the time to develop relationships with the agency decision-maker.

Analysis of Marketing to the Federal Government

Most companies will start the process in federal procurement as a subcontractor. This is especially true with construction contracts. However, given the push for more awards to small businesses, you can be successful with the right approach. For example, teaming arrangements.

As a product vendor, you should simultaneously start to acquire leverage in the commercial market. The government wants to know your performance in the commercial sector in order to weigh its risk when you first come to the federal marketplace.

• Building a reputation in the commercial sector is critical to your performance ratings in federal contracts
• Having your marketing staff keep statistical data on the success of your commercial efforts. This is an important piece when writing responses to solicitations and RFPs.

Know the Landscape of the Federal Market. Many companies quickly jump into the government contracting arena without knowing the ‘turf’. When our marking consultants assist clients with marketing to the federal government, we first gather data on the agency buying habits. This is critical.

• Understanding the government’s buying habits is key to a successful marketing campaign
• There are over 80,000 agencies. Scouting the market narrows your focus
• You must know which agency buys your product or service
• Knowing the market saves money and effort
• You must also know your competitors and who is also selling to the agency
• Market research and target specific agencies
• You should target emerging contractual vehicles ( service disabled, 8a, HUBZone and GSA)

Developing and Proving the Caliber of Your Service or Product is Critical. As a former government contracting official, I’ve seen many businesses present themselves both on paper and by in-person briefings. The results were sometimes damaging to the contractor.

Marketing to the government takes effort, skill and patience. You cannot simply think that procurement personnel are sold by sending them a one-page document that has your company name and address on it.  Nor does a simple brochure that tells them your product or service is the best thing on the earth sell them either.

• You must know the agency’s problem and be able to let them know you can fix it
• Quick delivery and turnaround time is an essential element of selling a product
• The government demands quality and innovative ways to solve problems
• Your reputation is also critical when marketing to the federal government

Marketing to the government is not easy but the return can make it worth your while. As mentioned earlier, there are no get-rich schemes to acquiring government contracts. As federal marketing consultants, our firm focuses on developing solid marketing materials that talk about:

• Solving the agency’s problems
• Quality and reputation
• Cost-effectiveness
• Additional value concerns to the government
• Who you are and what you have done
• Showing that you know Industry and any future developments

Marketing materials that contain anything else will not be taken seriously. The government simply wants to know “what do you bring to the table and how can you solve its problems?”

Using Corporate Ad Agencies Does Not Help

Using a corporate ad agency to market to the federal government does not help. As mentioned before, building relationships with the agency calls for a different skill set that normally required in the commercial market place. Although one or two of the marketing companies may have a track record, the others tend not to grasp the procurement rules and regulations.

GSA Schedules – Good or Bad?

As government contract attorneys and marketing consultants, we often advise our clients to never fall for the old saying “get a GSA schedule and just wait for the phones to ring.” Marketing to the government just doesn’t magically get you millions. About 3-5% of GSA contractors control most of government dollars.

To successfully capture dollars on a GSA schedule you must also:

• Understand whether the government buys your service or product on GSA schedule
• The geography of what agencies and where are your targeted market agencies
• Remember that getting on GSA schedule should only be part of your entire marketing strategy and not the end

Should Branding and name recognition be the forefront when marketing to the government? Shockingly, the answer is a big “NO.” Except for computers, where DELL controls the government market, the government wants to know the bottom line; can you solve their problem AND what do you bring to the table?

• Commercial branding  does not guaranty you government contracts
• You simply should not market to the government in the same fashion as in the commercial sector – this is the biggest and most expensive mistake made by new federal contractors.

Trade Shows

Many small companies cannot afford to attend trade shows. The question is whether they are really effective when marketing to the federal government. A few points should be made:

• Tradeshows eat up big bucks
• Don’t expect miracles to happen at an event
• You must strategically select which trade shows to attend
• When picked carefully, trade shows bring great success for government contract marketing
• Prepare you materials to send a particular message (You can solve an agency problem or to demonstrate the benefit of your product)
• Go to smaller trade shows where decision makers tend to be
• Segment the market and focus and sizing up opportunities

Hiring Your Marketing Team

Many government contractors seek to hire former government personnel in hope of landing big contracts. Yes, it looks good on paper but hiring the wrong person can also be disastrous. Watson & Associates, LLC have former contracting offices and small business personnel on staff. However, our consulting strategy is based on a more focused approach instead of hope and guess work.

• Never believe that the only way to market is to hire a person in Washington, D.C. This guarantees you nothing.
• Learning  the market and learning to build relationships can be done from anywhere in the country
• Watch for spam e-mails professing to get government contracts

Searching for capable teaming partners can be very effective

As government contract and marketing consultants, we often advise our clients to seek out capable teaming partners. It is no big secret that small companies lose out on opportunities that may be too large for one company to handle. Thus, the only capable contractor would be the larger businesses.

In fact, larger businesses are seeking teaming arrangements with select small business such as service disabled veterans and 8a companies.

• Get advice on selecting a teaming partner
• You can now ,market you teaming partner’s capability along with your own

Key Marketing Tips

• Trade Shows (when carefully selected) can bring big dividends
• Following up on contacts from trade shows is the biggest mistake made
• Remember that building relationships is the key to success
• People ( the government is comprised of people) like to buy from people they meet face to face
• Marketing to the government is based on problem solving and desire to serve
• Do not hire commercial marketing companies that guaranty results
• If you are going to retain a government contract consultant, then ensure that they understand the rules and the market
• Government contract marketing must focus on how the government sees your company ; whether you can solve its problems; who you are and what have you done
• Get the right marketing consultants on board
• Know how to demonstrate your product or service; highlight the benefits or value to the government
• Your marketing strategy must be consistent

If you are seeking competent government contract consultants, feel free to contact Watson & Associates, LLC at 720.941.7200

By: Theodore Watson

Who are government subcontractors?

Under FAR 44.101. Generally a subcontractor is a supplier, distributor, vendor or firm that furnishes supplies or services to the prime contractor or another subcontractor (tier). The more unique limitation of this definition usually comes under the Miller Act ( 40.U.S.C.A. § 270a. )

Does the agency have to approve a subcontractor?

An government contracting agency does not normally have to consent to subcontracts for firm-fixed-price contracts. However cost-type contracts will require consent if the contract price is over a certain dollar value.

Construction government contracts in excess of $2,00.00 is covered under the Davis-Bacon Act, which requires the contractor to pay employees the prevailing wage in that region for work done. As a general rule, government contracts in excess of $500,000.00 ($1,000,000.00 for construction) require the prime contractor to submit a subcontracting plan allowing reasonable consideration for offers to small businesses.

Subcontracting Clauses

Prime contracts generally contain clauses that will be included in the subcontract. The Federal Acquisition Regulation (FAR) has approximately 36 or more contract requirements that “flow down” to subcontractors. It is critical that contractors ( prime or subcontractors) have attorneys that can explain, negotiate or comply with these sweeping clauses.

Subcontractor Claims

There is a general consensus that there is no privity of contract between the government and a subcontractor (See Merritt v. U.S., 267 U.S. 338.) The fact that the government may approve a subcontractor does not substitute the privity of contract analysis.  In other words, subcontractors cannot sue the government directly absent an express or implied contract between the government and the subcontractor ; as well  as the prime contractor. A typical situation could be when the government instructs the subcontractor on the project to do something (change) and assures the subcontractor that the contract will be modified.

To be more exact, the United States Supreme Court  has held that a subcontractor who was not paid by the prime on a federal project cannot sue the government directly by asserting an equitable lien of funds held by the government. (See 525 U.S. 255).

Regarding claims against a prime contractor for nonpayment or breach of contract, the terms of the subcontract generally control and should be litigated in the appropriate state or federal court (Federal Miller Act Claims are generally brought a federal district court where the project is performed).

Having a strong subcontract to protect your legal interests is paramount to both and prime subcontractors in federal contracts. If you are involved in this process, you must seek help from an experienced government contract law attorney.

For more information, contact us online or call 720.941.7200

By: Theodore P. Watson, Esq

As the economy weakens, many commercial businesses are revisiting business initiatives to generate more revenues. Some companies have thought about doing business with the federal government but browse pass up the idea simply because they have no government contract training, have heard horror stories about federal contracts, or some other reason.

The truth is that the government awarded more and more contracts during late ’08 and early ’09. The businesses that were already performing federal procurement contracts are now seeking ways to improve and strengthen their position in the federal market place. This should be a clear indicator that revenues and government markets are alive and well.

Service Disabled Veteran Owned Small Business Contracts

New federal contractors are well aware the forecasted awards for service-disabled veterans are on the rise.  In fact, many veterans are now incorporating small business to take advantage of the new focus on veteran companies. However, one must be very careful. Although there are increased serviced disabled veteran-owned businesses, a vast majority is awarded to veterans with in-place teaming arrangements and joint ventures. This can be problematic in that larger businesses are purposely seeking out disabled veteran business for the purpose of generating revenues from the newly focused small businesses. This practice is heavily scrutinized due to the possibility of control.

This type of arrangement is fertile ground for SBA size protests under the affiliations rules. Simply having a teaming or joint venture agreement in place will not suffice. Government contractors, especially the prime, must know what challenges they fact. Seeking out a well-rounded government contracts lawyer that understands the small business programs and FAR rules is key to your success.

What is The Overall Benefit of Doing Business With the Federal Government in 2012?

As mentioned above, the economy is questionable currently. Congress and budget funds for planned federal projects. Considering federal contracts creates a balance between commercial competition and establishing a steadier stream, of revenue for your business.

There is no dispute that the federal government purchases substantial amounts of services and supplies from the commercial marketplace.

Don’t Small Businesses Have To Compete Among the Larger Businesses?

The politically correct answer is generally NO. However, developing strategies that include a large business with a vast amount of past performance can be the way to go, if you don’t have much past performance in the industry.

Arguably, the federal government takes a firmer stance for small business government contract award, than most state agencies.  Our government contract consultants typically advise new clients to seriously consider going after federal contracts before state contracts. The rationale behind this thought is twofold. First, the federal government has more capital to budget for government contracts; second, to be qualified to business with the government is substantially easier than state agencies. For example, state agencies typically require application fees and a tall order of paperwork.

On the other hand, the federal government simply requires you to register on CCR and ORCA.

What are Chances of Landing a Government Contract?

Our government contract attorneys and consultants get this question almost every day. The answer is quite simple. If you are seriously considering going after large dollar contracts, it should be part of you business plan to budget for consulting services from firms that thoroughly understand the federal procurement process.

More specifically, looking for qualified teaming partners, knowing how to respond to Requests for Proposals are key aspects of increasing the probability of a federal contract award. You simply cannot market to the federal government in the same fashion as you do in the commercial sector. You must know how “to play the game” when doing business with the federal government. Nevertheless, federal contracting  is a very lucrative business.

Are You Limited To Performing Federal Government Contracts in Your State?

There is a huge debate among government contracting agencies on this topic. The politically correct answer is generally NO. Federal contracting is a federal program and not state. The facts show that government contractors from one state have been awarded government projects in totally new states.

Prudent government contract lawyers should look at the constitutionality of favoring in state companies versus out of state contractors with no compelling reason.

Many government agencies and SBA offices create policy that you can only apply for work within your particular state. This has yet to be seriously challenged. Other government RFP’s will state that bidders must posses a certain state license to bid on the particular federal contract. These strategies at some point will be challenged successfully.

While it is true that small businesses must use the SBA Office in their specific region, this is a far cry from saying that you must only look at contracts within that specific state.  If this were the intent of congress, then using substance over form, the Small Business Act would be geared at generating state revenues and not federal revenues to congress (i.e. federal taxes).

Is The 8a Program Going Away?

This is another highly debated subject. There has been one court decision that challenged the constitutionality of the SBA 8(a) program. This has created a floodgate of terror among small businesses nationwide.

The question that most legal scholars must ask is who is the challenger to the 8a program really challenging? The logical answer would be Congress since the C.F.Rs that govern the 8a program are federal statutes. The next question should be if there is a challenge against a federal statute, is the appropriate forum a lower district court OR the U.S. Supreme Court? This analysis has yet to hit the headlines.

It would appear that since has the authority to create laws for the general welfare of the public, that there can is and can be enough justification to show that the 8a program does not violate the constitution because there can be ample statistical evidence to show that small business close their doors with in nine years of opening. Since congress acquires substantial amount of revenues (taxes) from small businesses, it would appear prudent that economically and socially disadvantaged businesses (a qualification for 8a status) should be justified in getting preferential treatment in government contracts.

If the SBA 8a programis in essence unconstitutional, so too must the HUBZone business program, Service Disabled Veteran Small Business Programs etc.

Interested government contractors should read the U.S. Supreme Court’s opinion in Adarand v. Pena to get a better idea of what is going on. The heart of the decision was that congress must generate evidence to support the programs they institute.

If nothing else in the current economy, it is hard to argue that small business receive less business loans and are welcomed into the commercial market place as the larger companies. These factors go into the analysis for ‘social and economically disadvantaged.’

Is the 8a Program Only For Minorities?

There is no concrete rule that states you only can be a minority to claim 8a status. There is only a presumption that can be rebutted. For example if a minority applicant does not met the ‘net worth’ requirement for the 8a program, he simply cannot acquire the status.

Can a Caucasian contractor acquire the 8a status? The arguable answer would be yes, if he or she can provide evidence to the 8a guidelines.

What Can Business Do to Acquire Government Contract Training?

There are plenty of sources to acquire government contracts training. Depending on your budget, you can retain qualified consultants that truly understand the federal procurement system. Acquire training from a person or company that can advise you on your specific business and not just give general theories.

What Does the Government Contract For?

The government purchases just about anything sold in the commercial market. Most types of products and services are procured. A diligent government contract consultant would know how to do his or her homework to provide you with solid data on whether the government has bought, or intends to buy your product or services. It is only at this juncture that you should make a business decision to venture into government contracts.

Businesses in every state can consider doing business with the federal government including Colorado, Wyoming, New Mexico, Kansas and Nebraska, New York, Los Angeles, San Francisco, Chicago, Illinois, Michigan, Pennsylvania, Virginia, North Carolina, South Carolina, Arkansas, Denver, Colorado Springs, Utah, California, Oklahoma, Ohio, Maine, Florida, Texas, Nevada, Las Vegas, Georgia, Hawaii, Alaska, Washington D.C., West Virginia, Florida, Indiana, Washington, Mississippi, Tennessee, Miami, Virgin Islands, Rhode Island, Vermont, Wisconsin, Minnesota, Washington State, Missouri, Virgina, Delaware, Connecticut, Arizona, New Hampshire, Massachusetts, Montana.

For more information or questions about government contracts, contact us online or call Watson & Associates, LLC at 720.741.7200

Moving Into Government Contracts

By: Theodore P. Watson, Esq. Government Contract Attorney

As the economy becomes tougher, more and more businesses are seeking to venture into government contracts as a way of sustaining long-term income. This is a very lucrative business venture. However, contractors must also be aware of the federal procurement rules

If you are a new business, or even an existing business, becoming a contractor with the federal government is pretty easy. Unlike state government contracting programs, the federal government has a virtually free process. The Federal Acquisition Regulation (FAR) only requires a business to be registered at www.ccr.gov.

The government generally advertises contracts over $2500,000. www.fbo.gov is the focal point for all government agencies to advertise government contracting requirements.

Q: Do I need a business plan or other documents to be a government contractor?

No. Government contracting, unlike most state programs is a relatively easy process you do not need a business plan or tax filings to become a federal contractor.

Q: After I register, what else do I need to do to become effective at government contracting?

After registration, the key is developing simple marketing material and a strong capability statement. You must be able to articulate to the government contracting officer what services or products you offer. Have a separate page with your NAICs codes. This series of six numbers spells out the industry for which you offer services or products.

Q. Can only small businesses perform government contracts?

No. However, the Small Business Act suggests that the government contracting agencies offer contracting opportunities to small businesses if there is reasonable expectation that two or more small businesses will submit an offer.

There are some industries where statistics show that large businesses can perform more effectively For example garbage services are generally open to large government contractors to bid. This is called “full and open competition.”

Q: What if I have no previous experience; can I become a government contractor?

Yes. Congress receives the majority of taxes from small business. Thus, it would be counter-intuitive for it to only require small businesses that have previous past performance to qualify to become a government contractor.

Government contracting law states that if a bidder submits a bid but has no past performance, the contracting officer shall give you a neutral rating. In other words, you cannot be given a negative rating.

Q: How do I overcome a lack of previous experience when bidding on government contracts?

Government contract law allows businesses to team with other companies and create joint ventures in order to perform government contracts. You should seek out qualified businesses that have the past performance, equipment or other resources that you can compliment each other on.

Q: Do I need to acquire professional consultants to become a government contractor?

This answer depends on your business goals, budget and contract initiatives. If you have a budget, it may be wise to secure a professional government contracting consultant that understands the process. For example our firm offers training for large corporations. However, we also consult with smaller businesses that don’t have large budgets but still need to be pointed in the right direction.

Do I need to hire an attorney if I choose to go into government contracting?

Government contract law has many winding rules. However, it is not necessary to hire a government contract attorney right away. As you learn the process for an experience federal consultant, you may want to retain outside counsel in order to have questions answered as they arise.

During public speaking engagements and government contract training seminars, our lawyers typically suggest that when you are awarded a government contract, you should at a minimum consult with an attorney to understand what contractual obligations you have to fulfill.

What are the chances of me getting a government contract?

Although nothing is guaranteed, you can increase your chances but having experienced government contracting persons on your team. There are numerous statistics that show first timers are awarded government contracts. The government contracting rules even allow for an emerging small business category. Here, the contracting officer can award projects at $25,000 or less without consideration of past performance. I would say that your chances (given that you have strong advisors) can range from 50-60% Knowing how to market to the government is the first priority. Learning how to be competitive and present your business to the agency is also paramount.

For instance, our team has actually assisted clients that have never been engaged in government contracts in awards. Therefore, it is not impossible to do. Knowing how the game is played is critical. Remember, a contractor should not market to the federal government in the same manner as in the commercial sector.

For additional questions feel free to contact our office at 720.941.7200 or visit our main government contracting website

Size Protests, Size Determinations, and SBA Appeals Lawyers

 Aggressively Protecting or Defending Small Businesses’  Rights in Affiliation Protests.

Size Standard Appeal Representation: Watson & Associates, LLC represents small businesses in a wide range of high-stakes size protest litigation nationwide, particularly matters that raise issues at about affiliation (Ostensible Subcontractor Rule), affiliation through ownership, identity of interests and other allegations of violating Size Standards. Small businesses get the benefit of obtaining cost-effective resolutions from attorneys that have been on the other side. Clients can feel comfortable with our skill when attacking mistakes made by government officials. Our government contracts law firm has extensive experience handling size protests before the Small Business Administration (SBA) or size protest appeals before SBAOHA.

Our clients include SBA 8a companies, service disabled veteran owned businesses and other socio-economic categories. Clients originate from various industry groups including information technology (IT), construction companies engaged in teaming agreements, aerospace, medical and more. Small businesses clients hire us to litigate and defend them in size protest and appealing adverse rulings from the SBA to Office of Hearing and Appeals.  The firm can help you with size protest decisions that stem  from varying perspectives to include:

• Affiliation through ownership
• Negative control
• Indirect ownership through third parties
• The present effect rule
• Common management
• Identity of interest (family members etc.)
• Common investments
• Ostensible Subcontractor Rule…and more

Zealous Advocacy and Litigation: When litigating or defending size protests, your rights are protected through creative legal and factual analysis and strategy coupled with zealous advocacy. Sometimes that means wining at the initial stages of the bid protest. Sometimes it means winning through motion practice. Sometimes it means litigating issues on appeal or negotiating a favorable settlement that avoids litigation risk and expense. Sometimes it means counseling on issues so that the client can avoid size protest litigation altogether. You can also benefit from the firm’s strong small business regulatory and public policy practices. Our multidisciplinary approach to government contracting enables us to draw on the technical experience of our size protest lawyers to develop creative defenses and pursue every avenue to resolve your’ problems. See recent case where Watson & Associates overturn SBA affiliation decision.

Survive SBA Size Protest Investigations: If your company recently lost competition for a federal small business set-aside contract, Theodore Watson & Associates’ government contract attorneys can help to file or defend a size protest on your behalf. The U.S. Small Business Administration (SBA) will investigate your company’s small business size status. Therefore, you want to avoid the deadly land mines that may weaken your case. Our law firm has successfully helped contractors to challenge or defend allegations of violating the Ostensible Subcontractor Rule. Therefore, we have the necessary experience and skill to help you. Our protest attorney will help you to:

• Properly respond to or file your size protest
• Aggressively fight for your rights
• Assess the reason for the size protest
• Ensure you have standing
• Draft and file the appropriate pleadings
• Support your position with case law
• Address common ownership challenges
• Prepare necessary exhibits
• Address the Ostensible Subcontractor Rule challenges

Violating the NAICs Size Standards Can be Devastating

Government contractors often join forces to compete for government contracts. This is often accomplished by using teaming agreements under FAR 9.6. Having a properly drafted teaming agreement by a federal procurement lawyer can minimize the risk a bid protest due to violating the NAICs size standards. Our law firm will review your documents for adequacy and legal sufficiency.

The result of an improperly-drafted teaming agreement could be that the SBA deems you “affiliated” with the other company under the Ostensible Subcontractor Rule. This is grounds for overturning the award.

As a small business, you must be aware of the Small Business Size Regulation and Methodology and Use of Size Standards for Government Procurement. In government contracting, a contracting officer analyzes a small business’ size by referring to 13 C.F.R. 121. However, you can be caught in a situation where you are teaming with another business (usually a large business) where instances of affiliation may be present. This is where a government contracts attorney that understands the NAICS size standard rules can help you.

Size Protests in General

Understanding the process is critical: When you bid on a government contract, the agency will generally accept the small business’ certification as being small. However, your size determination can be challenged in a bid protest to the contracting officer or to the SBA. When the SBA investigates your small business size, the contracting officer must accept the SBA determination as final. Protecting your rights is critical because you can end up waiving them on appeal. Having a size protest attorney may then allow you to appeal to the SBA Office of Hearing and Appeals (SBAOHA).

Size protest defense can become problematic when you wait until the appeal stage to hire an attorney. This is true simply because your initial response to the SBA can be already damaged. Always consider retaining a size protest attorney that is familiar with SBA NAICs Standards and the Ostensible Subcontractor Rule.

Who can File a Size Protest?

Not just anyone can file a bid protest. Having standing to file a Size bid protest is critical at the beginning stage. In order for you to file a small business size protest, you must show that you have standing. As a small business you should have submitted a proposal as a prime contractor and must not have been eliminated from the competition. In addition, government contractors should have some reasonable grounds to challenge the size standard. The bid protest lawyers at Theodore Watson & Associates can help you with this analysis.

The following parties can file an SBA size protest.

• Unsuccessful Offeror
• Contracting Officer
• SBA Government Contracting Area Office
• Other Interested Parties
• Other Government Officials

Size Appeals

You are facing short protest and appeal deadlines: The SBA area office makes initial size determinations within very tight time constraints (usually within 10 days of receiving a protest). Area office determinations may be appealed to the SBA Office of Hearing and Appeals at SBA headquarters in Washington, D.C. by any of the interested parties (there is no legal right to an appeal.)

An appeal for a size determination must begin by serving and filing an appeal petition in writing. The following lists the basic rules for appeals:

• If the appeal is for a size determination in procurement or pending government property sale, then the appeal petition must be served and filed within 15 calendar days after the size determination was made.
• If the appeal is for a size determination other than one in a pending procurement or pending government property sale, then the appeal petition must be served and filed within 30 calendar days after the size determination was made.
• An untimely appeal will be dismissed.

The SBA Office of Hearing and Appeals will do a standard review of the appeal, issue a decision containing the facts and the conclusion that was made based on the appeal, and notify in writing all parties involved. This is the final decision of the SBA. To understand your appeal rights, call our government contract attorneys for immediate help at 1-866-601-5518.

The Ostensible Subcontractor Rule

The silent weapon – be aware of the Ostensible Subcontractor Rule: Under 13 C.F.R. 121.103, a contractor and its ostensible subcontractor are treated as joint venturers, and therefore affiliates, for size determination purposes. An ostensible subcontractor is a subcontractor that performs primary and vital requirements of a contract, or of an order under a multiple award schedule contract, or a subcontractor upon which the prime contractor is unusually reliant.

All aspects of the relationship between the prime and subcontractor are considered, including, but not limited to, the terms of the proposal (such as contract management, technical responsibilities, and the percentage of subcontracted work), agreements between the prime and subcontractor (such as bonding assistance or the teaming agreement), and whether the subcontractor is the incumbent contractor and is ineligible to submit a proposal because it exceeds the applicable size standard for that solicitation. Given the fact that a lucrative contract is at stake, you should seriously consider retaining a government contract law firm that understands the law. Call Watson & Associates for immediate help at 1-866-601-5518.

Learn How to Avoid Costly Size Bid Protest Mistakes

As government contract bid protest lawyers, we often find that protestors sometimes make costly mistakes when filing a SBA size determination protest. The following are some key practices to avoid.

• Never file a size standard protest to GAO
• Never file a protest after 5 days of being aware of the size deficiency
• Never make general allegations without support
• Never file based upon “information and belief.” You should provide specific facts about the business in question

In determining the business’ size, the SBA counts the receipts, employees, or other measure of size of the concern whose size is at issue and all of its domestic and foreign affiliates, regardless of whether the affiliates are organized for profit. Ensure that you provide adequate responses and documents in the initial SBA investigation.

Exceptions to Affiliation

When filing a request for size determination, you or your bid protest lawyer should be aware that certain business concerns are exempt from affiliation rules. This includes:

•  Business concerns owned in whole or substantial part by investment companies licensed, or development companies qualifying, under the Small Business Investment Act of 1958, as amended, are not considered affiliates of such investment companies or development companies.
•  Business concerns owned and controlled by Indian Tribes, Alaska Native Corporations (ANCs) organized pursuant to the Alaska Native Claims Settlement Act, Native Hawaiian Organizations (NHOs), Community Development Corporations (CDCs), or wholly-owned entities of Indian Tribes, ANCs, NHOs, or CDCs are not considered affiliates of such entities.

NAICS Size Standard – Control & Affiliation

Control is the underlying target in this type of bid protest: Businesses and entities are affiliates of each other when one controls or has the power to control the other, or a third party or parties controls or has the power to control both. It does not matter whether control is exercised, so long as the power to control exists. The Small Business Administration (SBA) considers factors such as ownership, management, previous relationships with or ties to another business, and contractual relationships, in determining whether affiliation exists.

Control may be affirmative or negative: Negative control includes, but is not limited to, instances where a minority shareholder has the ability, under the business’ charter, by-laws, or shareholder’s agreement, to prevent a quorum or otherwise block action by the board of directors or shareholders.

NAICS Size Standard Affiliation may be found where an individual, concern, or entity exercises control indirectly through a third party.

In determining whether affiliation exists, the SBA will consider the totality of the circumstances, and may find affiliation even though no single factor is sufficient to constitute affiliation. At Watson & Associates LLC, our bid protest attorneys understand the slippery slope. Giving up a lucrative contract is usually devastating experience.

Nationwide Representation

Regardless of your state, our law firm can help. Our attorneys can represent you in a small business size protest in Denver, Washington D.C., Alabama, Alaska, Arizona, Arkansas, California, Colorado, Connecticut, Delaware, Florida, Georgia, Hawaii, Idaho, Illinois, Indiana, Iowa, Kansas, Kentucky, Louisiana, Maine, Maryland, Massachusetts, Michigan, Minnesota, Mississippi, Missouri, Montana, Nebraska, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, North Dakota, Ohio, Oklahoma, Oregon, Pennsylvania, Rhode Island, South Carolina, South Dakota, Tennessee, Texas, Utah, Vermont, Virginia, Washington, West Virginia, Wisconsin, Wyoming, and Virgin Islands. Cities include: San Diego, Dallas, Miami, Atlanta, Anchorage, San Francisco, Denver, Colorado Springs, Indianapolis, Austin, San Antonio, Philadelphia, Santa Clara, San Jose and Chicago.

Contact us for Immediate Help

If you need help bringing or defending an SBA NAICS size standard protest, contact online or call the Theodore Watson & Associates’ law firm at 866-601-5518.

Small Business Government Contracts

Are small Businesses Getting Their Fair Share of Government Contracts?

Unfortunately, they don’t. The real question is why not? There is some analysis to this unfortunate result. First, large projects appear to be out of the reach of small businesses – or so they think. Small business should attempt to seek out teaming partners to plan for the big projects ahead of time.

Contracting Officers and government contract officials frown on small businesses that attempt to bid on the larger projects. If you choose to bid on larger projects you may want to propose a possible staffing plan. This could increase your chances of getting a government contract.

Other concerns include the fact the many small businesses simply do not understand how to respond to government contract proposals or solicitations. Although this can be an expensive process, contractors actually spend more man-hours writing responses that would never put them in the competitive range to be considered for award.

If you are a small business and are serious about getting government contracts, then you also have to learn how the game is played. Our firm engages with many contractors across the United States that need help o be successful. Failure to take this simply leaves the large businesses to take advantage of the situation. Get help if you want to compete.

Asbestos is a fibrous material with high tensile strength and flexibility, widely used for its resistance to heat, chemicals and electricity. In the construction industry, asbestos is typically found in installed products such as pipe insulation, floor tiles, fire-resistant drywall and acoustical products.
Because of the many health and safety dangers associated with the inhalation of asbestos, the United States Occupational Safety and Health Administration (OSHA) has issued an “Asbestos Standard for the Construction Industry” regulation, which governs asbestos exposure for certain construction activities.

The Dangers of Asbestos
When a person inhales or ingests airborne asbestos particles, the particles can become embedded in the tissues of the digestive or respiratory systems. Exposure to asbestos can cause disabling or fatal diseases such as:

• Asbestosis: Scarring of lungs resulting in loss of lung function
• Mesothelioma: Cancer affecting the membranes lining the lungs and abdomen
• Lung cancer
• Gastrointestinal cancer

The symptoms associated with these diseases generally do not appear for 20 or more years after the initial exposure, and often progress to disability and death.

Asbestos in the Construction Industry
In order to avoid health risks, few products containing the fibrous material are currently installed in construction projects. Yet, due to its previously widespread use, asbestos exposure still occurs frequently during its removal, and in renovation and maintenance projects involving structures that contain asbestos. Governmental agencies estimate that 1.3 million employees in construction and general industry are exposed to significant levels of asbestos on the job. However, the greatest exposure to asbestos occurs during renovation or demolition projects, where asbestos must be removed.

OSHA’s “Asbestos Standard for the Construction Industry”
OSHA has issued regulations that govern a wide variety of construction workplace issues. Specifically related to asbestos exposure, OSHA has put into effect an “Asbestos Standard for the Construction Industry.” Among other measures, OSHA’s Standard regulates asbestos exposure for the following construction activities:

• Demolishing or salvaging structures where asbestos is present
• Removing or encapsulating asbestos-containing material (ACM)
• Constructing, altering, repairing, maintaining or renovating asbestos-containing structures or substrates
• Installing asbestos-containing products
• Cleaning up asbestos spills and emergencies
• Transporting, disposing, storing, containing and housekeeping involving asbestos or asbestos-containing products on a construction site

OSHA’s Standard sets a strict maximum exposure limit and establishes provisions that address the following requirements:

• Engineering controls and respirators
• Protective clothing
• Exposure monitoring
• Hygiene facilities and practices
• Warning signs and hazard communication
• Proper labeling and record-keeping
• Medical exams

Classification System Based on Work Class
The OSHA Standard utilizes a classification system for the regulation of asbestos construction work, distinguishing between four work classes. Depending on work class, employers must comply with a specific set of safety precautions to ensure that employees avoid exposure to asbestos fibers surpassing the permissible exposure limits. Further, employers must take adequate precautions if asbestos fibers are likely to be released during the performance of a particular job.

Class I workers are the most strictly regulated work class, due to the high risk nature of their job duties (which involves the removal of thermal system insulation and surfacing material containing greater than 1% asbestos).

State Regulation
In addition to the standards set by OSHA, states may also regulate work conducted near asbestos or the removal of asbestos materials. In fact, the Occupational Safety and Health Act of 1970 encourages states to develop and operate their own OSHA-approved job safety and health plans, which must adopt standards either identical to or as effective as the federal OSHA standards.

New York is one state that has instituted its own program regulating work conducted near asbestos and the removal of asbestos. New York’s program requires licensing of contractors, certification of all persons working on asbestos projects, filing of notifications for large asbestos projects, and pre-demolition surveys to identify the existence of asbestos-containing materials.