2019 NDAA - Funding for PTACs

The President signed the 2019 NDAA (National Defense Authorization Act) named for Senator John McCain yesterday. So this week we will be covering just a few of the provisions included in the legislation - those that might be of interest to Government contractors (and prospective Government contractors). Yesterday we discussed the prohibition against contracting officers arbitrarily withholding consent to subcontract just because they didn't like the price or the estimated cost. Today we want to take a look at a provision that has potential benefit for small businesses - enhanced PTAC (Procurement Technical Assistance Centers).

The House version of the 2019 NDAA contained a provision that would authorize PTACs to form an association to pursue "matters of common concern" (whatever that entails) and would direct DoD to recognize a PTAC association with a membership of the majority of PTACs and to fund the program. The Senate version had no such provision. In compromise committee, the House version prevailed.

The idea of PTACs is to offer no-cost procurement advise to small businesses looking to enter the Government market. The 94 PTACs across the US operate mostly autonomously and the heavy handed administration by DLA (Defense Logistics Agency) as to how PTACs can spend their Government funds has discouraged the Centers from coming together to share best practices and to otherwise improve their operations.

That's about to change. Section 859 of the 2019 NDAA authorizes DoD to pay costs relating to meetings of PTACs to discuss best practices for the improvement of the operations and for membership dues for any association of such centers, training fees and associated travel for training.

How much will these PTACs be funded for such purposes? We don't know yet. The legislation authorizes an amount determined appropriate by the Director so we'll have to wait and see.

If you are a small business and haven't taken advantage of the services available through your local PTAC, find them here and make an appointment.

2019 NDAA - More Funding for PTACs

The House yesterday passed its version of the 2019 National Defense Authorization Act (NDAA). The Senate is working on its version which is expected to easily pass. Then the bills are off to a joint committee to reconcile or resolve the differences.

Over the past few days, we have been writing about some of the procurement related provisions in the House version. We'll continue that today and for a few more days until we've covered the major procurement provisions. Today we will discuss funding of the Procurement Technical Assistance Centers (PTACs).

The Procurement Technical Assistance program was established to expand the number of businesses capable of participating in Government contracts. It is administered by DLA (Defense Logistics Agency) Office of Small Business in cooperation with states, local governments and nonprofit organizations.

Under the program, Procurement Technical Assistance Centeres (PTACs) help businesses pursue and perform under contracts with the Department of Defense, other federal agencies, state and local governments and with government prime contracts. The services provided by PTACs are free and include registration in SAM (System for Award Management), identification of contract opportunities, help in understanding requirements and in preparing and submitting bids.

Section 859 of the House version of the fiscal year 2019 NDAA would provide PTACs additional resources necessary to conduct greater outreach and provide expanded support to small businesses. It would increase the topline budget for the PTAC program to $50 million. It would increase the funding caps for PTACs operating on a statewide, less than statewide, and eligible tribal locations to $1 million, $750,000, and $450,000 thousand respectively, substantial increases in all categories.

Section 859 would also adjust the percentage of Federal funding for PTACs to 75 percent from 65 percent, and would adjust the community contribution to 25 percent from 35 percent.

For firms unfamiliar with the PTAC program, click here to find your local PTAC. Every state is covered.

Proposed Legislation to Notify Small Businesses of Free Procurement Assistance

Senators Gary Peters (D-MI) and Susan Collins (R-ME) have introduced legislation to help protect small businesses from falling victim to fraud when they register to procure federal contracts. The "Procurement Fraud Prevention Act" would require small businesses to be notified that free assistance is available for help in procuring government contracts through federal programs. Free assistance is available through the various Procurement Technical Assistance Centers (PTACs) the Small Business Administration (SBA) and other organizations.

Many business owners are unaware that these resources exist and fall victim to scams that mislead them into paying high sums of money for contract procurement assistance. Procurement Technical Assistance Centers (PTACs) provide local, in-person counseling and training services for small business owners. They are designed to provide technical assistance to buisnesses that want to sell products and services to federal, state, or local governments. The Procurement Technical Assistance Program is administered by the Defense Logistics Agency.

PTACs can help determine whether a particular small business is ready for government contract, help register them in the proper places (e.g. SAM or System for Award Management). They can help determine eligibility for small business certifications such as woman owned, disadvantaged, veteran-owned and HUBZone. The PTACs also have the resources to search prior contracts to see what kind of contracts have been awarded to similar business.

You can find your local PTAC from SBA's Website. There are also specialized PTAC such as Native American PTACs who focus on businesses owned by native Americans.

Whether this bill passes or not, businesses interested in selling to the Government should make a point of visiting their local PTAC. Can't hurt, its free.

Get an SBA Size Determination - Avoid Serious Penalties

The U.S. Small Business Administration (SBA) issued a new rule that will now limit the liability from fraud penalties for individuals or firms that misrepresent business concerns as being small for purposes of Federal procurement opportunities if they acted in good faith reliance upon small business status advisory opinions received from Small Business Development Centers (SBDCs) or Procurement Technical Assistance Centers (PTACs). The rule also established the criteria small business status advisory opinions must meet in order to be deemed adequate and specify the review process for such opinions.

This limitation on liability will only affect those firms that incorrectly claim status as small business concerns after obtaining small business status advisory opinions from SBDCs (administered by the SBA) or PTACs (administered by DoD). In Fiscal Year 2014, SBA determined that approximately 137 firms had represented themselves as being small for purposes of federal procurement opportunities were not small. Most of these cases however did not involve fraud, but instead were the result of errors or misunderstandings of the size regulations.

With regard to the small business status advisory opinion provision of the new rule, neither SBDCs nor PTACs are required to provide such opinions and it is not know how many SBDCs and PTACs will elect to provide such services, particularly given that no additional funding will be awarded to them to cover the cost of these services. Moreover, the SBA has no idea how much demand there will be for such services from those SBDCs and PTACs that offer them.

A small business status advisory opinion is a written opinion issued by either a SBDC or a PTAC which concludes that a firm is entitled to represent itself as a small business concern for purposes of federal government procurement opportunities. An SBDC or PTAC must sumit a copy of each small business status advisory opinion it issues to the the SBA. The opinion must

1. provide a written analysis explaining the reasoning underlying the SBDC or PTAC's determination that the covered concern (along with its affiliates) either does or does not exceed the size standards. This analysis must be signed by an SBDC or PTAC business counselor or similarly qualified individual.
2. include a copy of an SBA Form 355
3. include copies of the evidence (such as payroll records, timesheets, federal income tax returns, etc.) provided by the covered concern to the SBDC or PTAC clearly documenting its annual receipts and/or number of employees as those terms are defined by the SBA.

The SBA will decide within 10 days whether to accept or reject the opinion. Once that opinion is received, a concern may rely upon that determination for purposes of responding to Federal procurement opportunities from the date it is issued until the concern undergoes a significant change in its ownership, management, or other factors bearing on its status as a small business concern. 

This will not foreclose on interested parties protesting a competitor's size. Even holding such an opinion, a firm's size may still be protested by interested parties in connection with a specific procurement.