Following award of a small business set-aside to a joint venture, an unsuccessful offeror filed a size protest. The proteser alleged the awardee’s joint venture agreement was deficient. After the protest was filed, the awardee submitted a revised proposal with an addendum to its joint venture agreement. The addendum addressed issues raised in the size protest. In light of the addendum, the SBA Area Office denied the size protest. But OHA, reversed. The Area Office shouldn’t have considered an unsolicited addendum to the JV agreement submitted after award and a protest.
Size Appeal of Focus Revision Partners, RE: NWI&T Atkins SB JV, LLC, SBA No. SIZ-6188
Background
The Federal Emergency Management Agency (FEMA) issued an RFP for architect-engineering services. The procurement was set aside for small businesses. On September 15, 2021, after reviewing proposals, FEMA announced that NWI&T Atkins SB JV, LLC was the apparent awardee. NWI&T was an SBA-approved mentor-protégé JV between North Wind Infrastructure and Technology, LLC and its mentor, Atkins North America.
An unsuccessful offeror, Focus Revision Partners, filed a size protest on September 17, 2021. Focus alleged NWI&T’s joint venture agreement was deficient. Focus asserted the mentor, Atkins, would provide the responsible manager. Focus also contended Atkins would likely perform more than 60% of the contract.
A few days after the protest was filed, on September 24, NWI&T submitted a revised proposal to FEMA. The revised proposal included an addendum to the joint venture agreement. The addendum addressed many of the issues raised in Focus’s protest. The addendum stated the protégé, North Wind, would provide the responsible manager. The addendum also clarified that North Wind would perform more than 40% of the work.
The SBA Area Office denied Focus’s protest. The Area Office found NWIT’s joint venture agreement, supplemented with the addendum, complied with SBA’s regulations. Focus appealed to SBA’s Office of Hearings and Appeals.
Analysis
Focus argued the Area Office erred in considering the addendum to NWI&T’s JV agreement. FEMA never asked for the addendum, and Focus didn’t provide until after the award had been announced.
OHA agreed. As an initial matter, OHA noted the addendum was not signed. NWI&T’s joint venture agreement stated that any amendment to the agreement had be in writing and signed by both partners. Because the addendum was not signed, OHA doubted its validity.
Additionally, under SBA’s regulations, compliance with SBA’s joint venture requirements is determined as of the date of final proposal revisions. Here, NWI&T had submitted it final proposal revisions on September 10. FEMA announced the award on September 17. NWI&T then submitted the addendum on September 24, after the award announcement and after Focus filed a size protest. The Area Office should not have considered the unsolicited September 24 proposal revision. Permitting a challenged firm to amend its proposal after award and after a size protest would negate the entire size protest process.
OHA concluded by noting that even if addendum had been properly submitted, NWI&T’s joint venture agreement would have still been deficient. The addendum still didn’t comply with SBA’s joint venture requirements. In particular, it did not explain how the venture would source labor or perform the contract.
Focus is represented by Matthew T. Schoonover, Matthew P. Moriarty, John M. Mattox II, and Ian P. Patterson of Schoonover & Moriarty LLC. NWI&T is represented by Joshua A. Mullen and Julius H. Bodie of Womble Dickinson (US) LLP. Christopher R. Clarke appears on behalf of the Small Business Administration.
–Case summary by Craig LaChance, Senior Editor
