SBA Regulatory and Compliance Update June 17, 2014 National 8(a) Association Summer Conference Presented by: Robert K. Tompkins, Holland & Knight Melanie Roller, C2 North Copyright © 2014 Holland & Knight LLP All Rights Reserved I. General Regulatory Update New Regulations Significant New SBA Final Rules in the last 12 months i. June 2013 – Implementation of the Small Business and Jobs Act “Integrity Provisions” principally through the addition of 13 CFR 121.108. ii. July 2013 – Small Business Subcontracting iii. October 2013 – MAC contracting iv. June 2014 – Correction to 125.6 omission in MAC rule Pending Rules – June 12, Interim Final Rule with Inflation Adjustment to Monetary Based Size Standards • Effective July 14, 2014 • Comments due August 11, 2014 Anticipated Rule-makings Anticipated Rule-makings (from 2010 JOBS Act and 2013 NDAA) i. Size Standard Reviews, Sectors 31 and 33 due out soon. ii. Mentor-Protégé Changes iii. Limitation on Subcontracting Revisions SBA Guidance/SOP Updates – Revisions to SOPs – SF 1450 and other items (see next slides) – Guidance on Business Development and Shared Administrative Services II. Administrative and Personnel Changes New SBA 1450 Form New 8(a) Contract Activity Reporting Form • There is a new SBA 1450 form available on SBA’s website. However it is not available on BDMIS yet. –http://www.sba.gov/content/sba-form-1450-8aannual-update • New attachment to Form 1450 (Attachment C) requires reporting on 8(a) contracts including selfperformance percentages and subcontractors New System to Replace BDMIS: OneTrack CMS • OneTrack CMS (Certification Management System) may complete user testing in Fall 2014. Possible training for SBA in early 2015 with user implementation later in the year. • New system to be more user friendly and will integrate with SAM, requiring only one user ID/password to access all databases. • OneTrack will allow you to see where your company is in the review process. • Will be able to upload documents to accompany the application. • OneTrack CMS will have information on mentor-protégé program and all the required checklists. SBA Personnel Changes In Washington: • Bob Watkins will be serving as SBA Acting Administrator and replaces Darryl Hairston, who recently retired. Related to Alaska: • SBA Alaska District now has dedicated legal counsel which should speed up future submittals processing. • SBA Alaska District also has one newly assigned BOS. III. Enforcement and Oversight Changes and Trends DPCE Document Requests • The Division of Program and Certification Eligibility was established under Section 7(j) of the Small Business Act. • DPCE is conducting initial and continuing eligibility reviews of 8(a) program participants in coordination with annual reviews. • DPCE has requested all SBA district offices obtain and provide documentation on each active 8(a) participant. • You may receive your request via e-mail from your BOS. Enforcement and Oversight – SBA OIG activity (see data next slide) – Broader enforcement trends – various components working together (SBA and other agency OIG or investigative arms (i.e. Army CID) – Emerging issues • Use of administrative reviews in conjunction with other enforcement actions ENFORCEMENT: STATISTICS TELL THE STORY SUMMARY OF SBA-RELATED CRIMINAL ACTIONS AND SUSPENSION/DEBARMENT ACTIVITY BY FISCAL YEAR Indictments From OIG Cases Convictions From OIG Cases Suspensions/ Debarments Recommended to the SBA SBA Proposed Debarments SBA Final Debarments FY 2013 64 51 65 34 16 FY 2012 59 52 45 21 14 FY 2011 69 47 41 18 16 FY 2010 81 41 31 24 16 14 IV. Case Law – GAO and OHA cases CASE LAW DEVELOPMENTS OHA – – – Cases involving protest rights and timing. (NAICS Code appeals; post-proposal information) Cases involving re-certification of size on long-term and MAC contracts. Ostensible subcontractor cases: factors to consider: what are the “primary and vital” aspects of the work? Whose employees provide project management? Is the subcontractor the incumbent?; What are the capabilities of the prime? GAO – – – – – Rule of Two Cases. Timing of protest. Adams & Associates, B-409685, April 22, 2014. Past Performance & Experience. Unduly restrictive evaluation criteria. Iyabak Construction, LLC, B-409169, February 6, 2014 8(a) set-asides. “New” Requirements under 8(a). HRCI-MPSC PASS, LLC, B408919, January 8, 2014, see also Alpa Technologies, B-408762.2, Feb. 12, 2014 Timing of 8(a) JV approval. BGI-Fiore JV, LLC, B-409520, May 29, 2014 Consolidation – low bar for government. American Toner & Ink, B-409528.7, June 9, 2014. Best Practices/Recommendations • Understand and address issues raised in the new and upcoming regulations • Take an integrated view toward your interactions with the government (SBA, contracting agencies, etc.) • Enhance your compliance programs and training – Ensure your internal controls on determining size, affiliation and certifications are sufficient and well-documented – Right-size your training • Be aware of the enforcement environment – Take care in filings and representations to the Government – Alert your staff to be on the lookout for atypical inquiries Contact Information C2 North, LLC Melanie Roller 4141 B Street, Suite 201 Anchorage, AK 99503 907.569.9122 T 603.388.0793 eFAX mroller@c2north.com www.c2north.com Contact Information • • • • • • • Robert K. Tompkins Partner Holland & Knight, LLP 800 17th Street, NW, Suite 1100 Washington, DC 20006 (202) 469-5111 (direct dial) Robert.Tompkins@hklaw.com