Presented byFrancine Morris, Program Analyst

8(a) Business Development /Office of

Management and Technical Assistanceto

Department of Health & Human Services November 13, 2014

Training Outline8(a) BD Program Overview8(a) Offer LettersDeterminations of Eligibility8(a) and GSA SchedulesContract Modification vs a “New Requirement”Contract ModificationsContract Extensions/Bridge ContractsSole Source Requirements Above the ThresholdCompetitive Requirements Below the ThresholdRequests to Release Requirement From the 8(a) Program Cure NoticesContract Terminations

8(a) BD Program Over8(a)BD Program Objectives (Sec. 204 of Public Law 100-656)

“to promote the business development of small business concerns owned and controlled by socially and economically disadvantaged individuals…”

“to promote the competitive viability of such concerns…”

“to clarify and expand the program for procurement by the United States…”

In summary, a nine-year, 2 stage business development program, providing both developmental and contractual assistance to firms that are qualified for participation.

Program Overview Cont…SBA serves as the prime contractor on 8(a) Contracts.

Responsible for Ensuring Continued Program Eligibility of Program Participants

Review and Approve all 8(a) Joint Venture Agreements Prior to Contract Award

May Assist with Contract Negotiations Report and Provide copies of all Contract Awards,

Modifications, Exercised Options and Purchase Orders to SBA Shall Provide SBA with all Non-Classified Information in

Contract Files for On-Site Agency Reviews

Cannot Count Contract Award Dollars as 8(a) unless Requirement was formally Offered and Accepted by SBA

Preparing the Offering(1) A description of the work to be performed or items to be delivered, and a copy of the statement of work, if available. (2) The estimated period of performance. (3) The NAICS code that applies to the principal nature of the acquisition. (4) The anticipated dollar value of the requirement, including options, if any. (5) Any special restrictions or geographical limitations on the requirement (for construction, include the location of the work to be performed). (6) Any special capabilities or disciplines needed for contract performance. (7) The type of contract anticipated. (8) The acquisition history, if any, of the requirement, including the names and addresses of any small business contractors that have performed this requirement during the previous 24 months. (9) A statement that prior to the offering no solicitation for the specific acquisition has been issued as a small business, HUBZone, or service-disabled veteran-owned small business set-aside and that no other public communication (such as a notice through the Government wide point of entry (GPE)) has been made showing the contracting agency’s clear intention to set-aside the acquisition for small business, HUBZone small business, or service-disabled veteran-owned small business concerns.

Preparing the Offering(10) Identification of any particular 8(a) concern designated for consideration, including a brief justification, such as— (i) The 8(a) concern, through its own efforts, marketed the requirement and caused it to be reserved for the 8(a) Program; or (ii) The acquisition is a follow-on or renewal contract and the nominated concern is the incumbent. (11) Bonding requirements, if applicable. (12) Identification of all known 8(a) concerns, including HUBZone 8(a) concerns, that have expressed an interest in being considered for the specific requirement. (13) Identification of all SBA field offices that have asked for the acquisition for the 8(a) Program. (14) A request, if appropriate, that a requirement with an estimated contract value under the applicable competitive threshold be awarded as an 8(a) competitive contract (see 19.805-1(d)). (15) A request, if appropriate, that a requirement with a contract value over the applicable competitive threshold be awarded as a sole source contract (see 19.805-1(b)). (16) Any other pertinent and reasonably available data

Where to Send Offering Letters8(a) sole source requirements offered to a specific

Participant, to the SBA district office servicing the Participant.

8(a) competitive and open construction requirements, to the SBA district office serving the geographical area in which the work is to be performed;

Competitive 8(a) requirements and sole source open requirements other than construction, to the SBA district office serving the geographical area in which the procuring activity is located;

8(a) requirements to be performed overseas, SBA Headquarters;

8(a) Offer Letters (Sole Source)Requirements at/under $4M threshold

NAICS CodeStatement of WorkParticipant current & in compliance with 8(a)

ProgramFirm is small under the requested NAICS CodeSole Source Restrictions (Transitional Stage of

the 8(a) Program (Business Activity Target)No Sole Source contract awards after firm

graduates 5-working day Acceptance

Determinations of Eligibility CompetitiveSubmit to the firms servicing District Office with

the following information: Title the email as “Determination of Eligibility”Attach the Statement of Work including the anticipated dollar value of the requirement and the relevant NAICS Code in the SOW or body of the email.The Original closing date of the SolicitationIn the body of the email name the specific firm and its address

Determinations of Eligibility Competitive

The Offering letterThe Acceptance Letter If needed SBA may request a copy of the

solicitation

Basic Ordering AgreementsCan Be Awarded on a Sole Source Basis if estimated Value

Including all Options is Below the Competitive Threshold Each Task Order Requires a Separate Offer and Acceptance Each Task Order is Treated as a Separate Contract Aggregate of all Task Cannot Exceed Sole Source Threshold

SBA cannot not accept any task order under it if the cumulative value of all the tasks awarded under the BOA, including the order under consideration, would exceed the competitive threshold

If it anticipates that the total value of task or delivery orders to be awarded under a BOA will exceed the competitive threshold, the procuring activity must offer the BOA to SBA for competitive award.

GSA 8(a)Contract

GSA STARS II GWAC – Offered and Accepted Competitive 8(a) requirementSole Source AuthoritySTARS II Ordering Guide

GSA Schedule Contracts

GSA Schedules are not 8(a) Contracts

GSA Schedule 8(a) Set-Aside Authority for Federal Supply Schedules - Rule Change November 2011 FAR Case 2011-024

Note…Sole Sourcing contracts on a GSA Federal Supply Schedule is prohibited. (Competitive Procedures)

GSA Schedule 8(a) Set-Aside procedure

You must offer the competitive to the 8(a) BD DOState that the requirement will be a GSA 8(a)

Schedule award. Only firms that are 8(a) and hold the GSA schedule

required is eligible to bid on the opportunity. Follow the GSA procedures for the competitive process

and award. Agency will receive 8(a) credit for the award. Cannot Count Contract Award Dollars as 8(a) unless

Requirement was formally Offered and Accepted by SBA

“New Requirement”determination

Contract Modification Req’d Info Name and address of the 8(a) firmDate the requirement offered to the 8(a) ProgramContract # and corresponding Buyer #Original estimated value of the contractContract current period of performanceValue contract dollars obligated & expended to

dateWill the dollar value proposed modification will

exceed original estimated value of the contractWhat event(s) caused need to increase the

estimated value of the contract or other modification

Sole Source Above Threshold

To The Servicing District Office ….First, the usual scope and contents for the Offer Letter wording, as it currently exists and in accord with 13CFR124.502(c), plus accompanied by the Statement of Work in a separate document. A thorough explanation of the procuring agency’s making this a Sole Source Award in the approximate amount proposed, rather than competitive (13CFR124.506(d)), including, but not limited to, that there is not a reasonable expectation that at least two eligible 8(a) Participants that will submit offers at a fair price (13CFR124.506(d)). Must be approved by AA/SBA.

[continued on next slide]

Sole Source Above Threshold

(continued)The procurement agency’s written commitment to continue to support the SBA 8(a) BD Program on a competitive basis, including the following data:i. The last two most recent fiscal years’ 8(a) contract

dollars that were awarded by the procuring agency to 8(a) Program Participants on a competitive basis;

ii. The current fiscal year’s forecast to award contracts to the 8(a) BD Program; and

iii. The result of any market research conducted by the procuring agency under the NAICS Code assigned to the proposed contract.

Competitive Requirements Below

the ThresholdTo The Servicing District Office….Agency’s Offer Letter, per 13CFR124.502(c);An explanation of the procuring agency’s determination that technical competitions are required or a large number of potential awardees exist [13CFR124.506(c)];Agency’s written commitment to continue to support the 8(a) BD Program on a non-competitive basis below the competitive threshold. This explanation must include: [continued on next slide]

Competitive Requirements Below

the Threshold (cont’d)i. The last two most recent fiscal years’ 8(a)

contract dollars that were awarded by the Procuring Activity to 8(a) BD Program Participants on a sole source basis;

ii. The current fiscal year’s forecast to award contracts to the 8(a) BD Program; and

iii. The result of any market research conducted by the Procuring Activity.

[continued on next slide for Competitive Requirements Below the Threshold]

Competitive Requirements Below

the Threshold (cont’d)Dynamic Small Business Search (DSBS) result of

8(a) firms performing under the NAICS Code assigned to the respective contract;

District Office’s recommended 8(a) BD Program Participant(s) from the DSBS listing that are qualified to perform the Statement of Work.

Package is forwarded to SBA Headquarters. Analyst will make recommendations to SBA AA/BD for his decision to approve or decline.

Request to Release From

The 8(a) Program (124.504(d)To The Servicing District Office….

Procuring agency’s official Request to Release on its Letterhead, signed by authorized person, to include:The procurement history;The NAICS Code assigned to the requirement;If the procurement was previously offered to SBA under the 8(a) BD Program: (1) SBA’s Acceptance Letter and (2) SBA’s Buyer Number;The result of any market research conducted by the Procuring Activity; [continued on next slide]

Request to Release From

The 8(a) ProgramThe Agency’s written commitment to continue to support the 8(a) BD Program. This explanation must include:

(1) the prior two years’ 8(a) contract dollars that were awarded by the Procuring Activity to 8(a) BD Program Participants; and

(2) the current fiscal year’s forecast to award contracts to the 8(a) BD Program.

Plus, any additional supporting documentation.Address letter to SBA Servicing District Office

8(a) Contract Cure Notices

Whereas SBA is the Prime on all 8(a) Contracts, please include the SBA District Office that issued the respective Acceptance Letter on all of your agency’s issued 8(a) Contract Cure Notices.

The firm’s Business Opportunity Specialist (BOS) will contact the respective 8(a) firm’s owner to determine the issue and the resolution plan.

The BOS will participate with the 8(a) firm in the communication with your agency on this issue.

Terminations for Convenience

The SBA District Office that approved the Offer must also be informed of Terminations for Convenience, as well as the 8(a) firm from your agency.

The Servicing District office must be notified in the event the agency decides not to exercise an option on existing contract.

Terminations for Default

Whereas SBA is the Prime Contractor for all 8(a) Contracts, SBA must be informed commensurate with your agency informing the 8(a) firm contractor.

Inform SBA through the SBA District Office that approved the Offer. The BOS will contact the firm to determine a course of action.

Mentor Protégé ProgramThe purpose of the Mentor/Protégé program is

to enhance the capabilities of 8(a) participants and to improve their ability to successfully compete for federal government contracts

Mentors may provide the following forms of assistance to Protégés:a. Technical and management assistance;

b. Financial assistance, including equity investments and/or loans;c. Subcontracting support; andd. Assistance in performing prime contracts through

joint venture arrangements.

Mentor Protégé ProgramThe benefits of the Mentor/Protégé relationship include:

The two firms approved by SBA to be a Mentor and Protégé under 13 CFR 124.520 may joint venture as a small business for any government procurement, provided that the Protégé qualifies as small for the size standard corresponding to the NAICS code assigned to the procurement, and other relevant program requirements are met.

In order to assist the Protégé to raise capital, the Mentor may own an equity interest of up to 40 percent in the Protégé despite the more limited, general ownership restrictions on eligibility in 13 CFR 124.105(g) and (h). In the event the Mentor/Protégé relationship ends, the Mentor may retain its ownership percentage in the Protégé existing at the time the relationship ends to avoid any detrimental impact on capital.

Mentor Protégé Program

A determination of affiliation or control may not be found between a Protégé firm and its Mentor based solely on the Mentor/Protégé Agreement or any assistance provided pursuant to the Agreement.

A contract cannot be awarded to the Mentor and Protégé based simply on the Mentor/Protégé Agreement. In order for a Mentor to participate in an 8(a) contract as a prime with its Protégé, they must joint venture. The M/P Agreement must be approved before a joint venture can be submitted.

Joint Ventures13 CFR 121.103 The Program enables business concerns to carry

out no more than: three specific or limited-purpose business ventures for joint profit over a two year periodStarting from the date of the award of the first contract without

the partners to the joint venture being deemed affiliated for all purposes

Concerns are able to combineEfforts Skill KnowledgeMoneyProperty

Joint Ventures If approved by SBA, a Participant may enter into a joint

venture agreement with one or more other small business concerns, whether or not 8(a) Participants, for the purpose of performing one or more specific 8(a) contracts.

A joint venture agreement is permissible only where an 8(a) concern lacks the necessary capacity to perform the contract on its own, and the agreement is fair and equitable and will be of substantial benefit to the 8(a) concern.

However, where SBA concludes that an 8(a) concern brings very little to the joint venture relationship in terms of resources and expertise other than its 8(a) status, SBA will not approve the joint venture arrangement.

Populated and Unpopulated JVs

Populated Joint VentureThe entity is contains personnel performing

the requirements of the contract.The 8(a) participant must demonstrate what

it will gain from performance of the contract and

How such performance will assist its business development

Must Demonstrate control over the JV

Populated and Unpopulated JVs, cont’d…Unpopulated Joint VenturePopulated only with 1 or more administrative

personnelThe Project Manager is an employee of the 8(a)

Managing Venturer8(a) firm MUST perform at least 40% of the

work performed by the JVMust be more than administrative or

ministerial in order to gain substantive experience.

Joint VenturesPerformance of work. For any 8(a) contract, including those

between mentors and protégés authorized by 13 CFR §124.520, the joint venture must perform the applicable percentage of work required by FAR 52-219-14, and the 8(a) partner(s) to the joint venture must perform 40% of the work performed by the J/V.

SBA must approve a joint venture agreement prior to the award of an 8(a) contract on behalf of the joint venture.

Upon SBA’s Approval. Joint Venture Entity is listed in CCR Joint Venture Agreements limited to 3 Contracts over a 2 year

periodContract execution - Where SBA has approved a joint venture,

the procuring activity will execute an 8(a) contract in the name of the joint venture entity.

(Please include the name of the 8(a) Participants)

Questions?_________________________

Contact information for Presenters:Francine.Morris@sba.gov; 202-205-7204 __________________________________(http://www.sba.gov/category/navigation-

structure/8a-business-development-program)

Thank You!