By Kelly DiGrado
Interested in forming a joint venture to chase an 8(a) opportunity? Remember to give the SBA advanced notice of your intent, execute your joint venture agreement prior to proposal submission and prepare the necessary supporting documentation for your joint venture application well in advance of the anticipated contract award date.
In order for a joint venture to be awarded an 8(a) contract, the joint venture agreement must be executed prior to proposal submission. Additionally, the joint venture parties must prepare and submit a joint venture application to the SBA, which generally must be submitted to the SBA for its review and approval at least 20 days before contract award. SBA will not typically review at a joint venture application until the procuring agency has confirmed that an award to the joint venture is imminent.
The joint venture agreement must be prepared in accordance with the SBA’s regulations at 13 C.F.R. § 124.513. Every SBA district office seems to have different requirements as to the format of the joint venture agreement, itself. Some district offices prefer that parties stick to certain joint venture agreement templates; others do not object to the format as long as it tracks the SBA’s regulations.
There is also variation among the SBA’s district offices as to what supporting documentation is required for the joint venture application package. Most district offices require the parties to include their executed joint venture agreement, which includes the resume of the project manager and the joint venture’s staffing plan, as well as any accompanying operating/organizational documents, as applicable.
In addition to the joint venture agreement and any accompanying operating/organizational documents as applicable, more and more district offices are now requiring the parties to supply a substantial amount of supporting documentation in the application package including their:
- respective tax returns,
- financial statements,
- capability statements;
- a description/history of each of the companies in the joint venture;
- a description of the project;
- information regarding the non-8(a) firm’s relevant experience,
- professional licenses,
- previous joint ventures;
- information regarding the effect of the contract award on the 8(a) firm’s cash flow, personnel, equipment and facilities;
- documentation regarding the joint venture’s bank account and capital contributions; information regarding the employees that will be working on the contract, including the hiring procedures, certain certifications; and
- SBA Forms 355 and 1623.
A handful of district offices, on the other hand, prefer only to see the joint venture agreement itself. Given the variation as to what each SBA district office requires, it is important to contact the 8(a) firm’s district office well in advance of the anticipated contract award date so the parties can ensure that they have assembled all required documentation in a timely fashion. Too often, we have seen companies miss out on contract opportunities either because they have used the wrong joint venture agreement template format, or have not assembled the correct or complete paperwork in time for the SBA to review the joint venture application. In our experience, federal agencies do not like to wait weeks and weeks for the SBA to review and approve a joint venture application.
In sum, the first step for companies interested in forming a joint venture for an 8(a) opportunity is for the 8(a) company to contact its Business Opportunity Specialist (“BOS”). The 8(a) company should ask its BOS whether it prefers a certain format for joint venture agreements and what documentation it requires to process a joint venture application.
About the Author: Kelly DiGrado is an associate in PilieroMazza’s Government Contracts Group. Ms. DiGrado also works with the Business and Corporate Law Group and can be reached at [email protected].