SBA Office of Hearings and Appeals (OHA) decision regarding the eligibility of an SDVOSB joint venture (JV) provides cautionary reminder: keep your JV agreements (JVA) up to date.
Though short, this Center for Verification and Evaluation (CVE) protest highlights a critical item for JV's––the JVA. Here, while the JVA was drafted before the procurement, OHA still found that it did not meet SBA's regulations as it was silent on the instant procurement.
For example, the JVA didn't "'[i]temiz[e] all major equipment, facilities, [. . .]'" nor did the JVA "'[s]pecify the responsibilities of the parties with regard to negotiation of the contract, source of labor, and contract performance'. 13 C.F.R. § 125.18(b)(2)(vi) and (vii)." In addition, OHA also found that the JVA did not comply with 13 C.F.R. § 125.18(b)(3), under which a JVA must provide that the SDVOSB partner(s) "must perform at least 40% of the work, and such work must consist of more than administrative or ministerial functions."
SBA's regulations are strictly construed and where a JVA fails to follow them, OHA will sustain the protest and find the SDVOSB JV ineligible for award.
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OHA Decision: https://bit.ly/2Jc8liy
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