8a Joint Venture Rules

Violation of 8a Joint Venture Rules Leads To Bid Denial

In July, the Government Accountability Office (GAO) challenged Alutiiq-Banner Joint Venture, B-412952 et al. (July 15, 2016) for an 8(a) joint venture eligibility award where the joint venture had not sought after, or received, SBA’s approval for a joint venture agreement addendum.

With strict requirements, the SBA’s Business Development Program Regulations must be satisfied before entering into another joint venture with another entity for an 8(a) contract. As an example, the 8(a) joint venture agreement must include the specific purpose of the joint venture and seek required approval for any addendum as part of the 8(a) joint venture rules.

At the center of the issue, Alutiiq-Banner, a NASA 8(a) solicitation that sought to issue a single-award IDIQ contract for human resources and professional services. Instead in late March, CTRM-GAPSI JV, LLC was named the contract awardee. Alutiiq-Banner Joint Venture protested the award decision because the entity that submitted the proposal was different from the one receiving it. The company awarded did not exist until sometime in April when it created an official corporate registration.

After seeking the SBA’s input, GAO had to decide whether the awardee was a different entity than the SBA had approved. The SBA confirmed they were the same entities and as a result, the SBA said that it would rescind its approval of CGJV’s award eligibility, and recommended that the award be terminated. CGJV learned the hard way, by failing to get the proper approval may cost a joint venture the contract.

Do you have questions regarding 8(a)a joint venture rules? Contact KDuncan for advice!

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KDuncan & Company is dedicated to providing knowledge and support for small government contractors about concerns regarding government contracting. For questions on areas such as as cost proposals, accounting systems, DCAA compliance, and incurred cost audits, reach out to KDuncan & Company.

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