SBA is finally looking into the disconnect between its Joint Venture (JV) rules and Agency Facility Security Clearance requirements. Many of you may have run into this problem. Your JV is is the “prime offeror” and the agency’s solicitation requires the prime to have a facility security clearance. Your JV (being a separate legal entity) is “unpopulated” and cannot qualify for a facility security clearance since the clearance is dependent upon the personnel who will be monitoring/administering the security requirements. Technically, you fail to meet the solicitation requirement and a decision by GAO (ProTech Services USA, LLC , File: B-417484, Date: July 19, 2019) agreed with the agency on this point. (The decision involved SBA because the protester claimed that the determination was one of “responsibility” rather than a material requirement of the solicitation.) However, each of the members that make up the JV do have facility security clearances. To remedy this problem, SBA has asked for comments on how best to remedy this problem in its proposed rule regarding merging the 8(a) and All Small Mentor Protégé Programs (https://www.govinfo.gov/content/pkg/FR-2019-11-08/pdf/2019-23141.pdf). The SBA recommends that either the JV itself or the “lead” venturer could hold the required clearance. If you are a small business “protégé” in the SBA’s Mentor-Protégé Program, this may not be much help since you are the lead venture and may not have the required clearance. However, the SBA added that if “security” is ancillary to the principal purpose of the procurement, the non-lead partner, e.g. the Mentor, could possess such a clearance and satisfy the requirement. If you want to weigh in on this issue with SBA, you have until January 17, 2020. For any questions on Joint Ventures or Mentor-Protégé Programs, please give us a call at 732-380-7739.
