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Column: Top 5 Things Every Small Business Government Contractor Needs to Know about Size Protestsby Paul Hawkins, attorney, ReavesColey PLLCSize protests are not usually at the top of the laundry list of compliance concerns for small business government contractors. This is likely because typically a small business government contractor may be size protested (or may bring a size protest) only once, or a handful of times, over the life of their business. Importantly, however, failing to properly respond to a size protest can have an enormous impact. On the other hand, knowing when and how to file a size protest can be a key strategy in winning set-aside contracts. Below are five key takeaways on size protests: 1. High Stakes A negative size determination can be devastating for a small business government contractor. For example, if you are found to be specifically affiliated with another concern under a particular procurement, you are ineligible for award for that contract. As bad as that scenario is, it could be worse. If SBA finds your business to be generally affiliated with another concern, your business could lose its small business status. On the flip side, if you are notified you were the unsuccessful offeror on a set-aside procurement, but you fail to file a size protest in time (within only 5 days), you could allow a potentially ineligible competitor to keep a contract they were not eligible to win. 2. Tight Timelines An unsuccessful offeror only has five (5) business days to file a size protest with the Contracting Officer after first learning the identity of the prospective awardee. Procedurally, the Contracting Officer then must forward the size protest to the Small Business Administration, which then notifies the protested concern and directs it to respond to the size protest. If you are the protested concern, you generally have only three (3) business days to respond once SBA has notified you of the protest! SBA is encouraged, though not mandated, by its regulations to issue size determinations within fifteen (15) business days of receiving the size protest. Regardless of what side you find yourself on, you need to act quickly. 3. A Tool to Protect Awards If you unfortunately find yourself on the unsuccessful side of a set-aside contract award, you should immediately assess whether a size protest would be effective. While any size protest should be rooted in a good faith and truthful assertion of available facts and applicable legal arguments, unsuccessful offerors should understand that the size protest process can be an avenue to challenge a competitor’s award. Often, a size protest is filed along with a bid protest (a different type of procurement challenge most often filed with the Government Accountability Office that generally challenges the substantive decision behind the Agency’s award). These two protest avenues can work in complimentary ways to give a protester the best opportunity for a successful outcome. 4. Use of Publicly-Available Information Because you are unable to see your competitor’s proposal or have access to its proprietary information (such as tax returns and financial records), your size protest must be based on publicly-available information. This can include public databases reporting contract award data or websites such as LinkedIn, Manta, or even the awardee’s own website. A size protest must be specific and contain some basis for the allegations included in the protest. In other words, it is best practice to back up your size arguments with as many specific facts as possible. 5. Experienced assistance for Protests and Protest Defense While technically you can file or respond to a size protest without the assistance of an attorney, it is not advisable to do so. Often, size protest issues involve nuanced interpretations of the SBA’s small business size and affiliation regulations. Engaging an attorney familiar with these regulations not only will result in more effective protest filings but also in a higher likelihood of success in responding to protest allegations. An SBA size protest is not to be taken lightly. If the procurement is restricted for small businesses and you unfortunately find yourself in the position of being the unsuccessful offeror, it is important not just to consider the potential grounds for a bid protest but a possible size protest as well. Even more importantly, if you receive a size protest, you need to treat it like your entire business is on the line—because that could very well be the case. Knowing about the important (and incredibly short!) deadlines and understanding the basics of how size protests can be brought and defended against is important for every small business government contractor.
Paul Hawkins is an attorney with Reaves Coley PLLC. Contact him at paul.hawkins@reavescoley.com.
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