However, the decision contains a number of useful lessons for former joint ventures that must be taken into account when entering an AIC, either under the ASMPP programme or 8 (a) or one of the SBA`s other specific joint venture opportunities. These regulatory requirements must be taken into account in each joint venture 8 (a), whether or not a company uses the SBA model. If you have received a similar type of information from your BOS about the use – or not – of the draft JV agreement, we would like to hear from you. Similarly, we will certainly share new knowledge and answers with you. However, it appears that the SBA is increasingly relying on status and size events to ensure that joint ventures are properly created. This means that 8 (a) participants may see an increase in the challenge after this proposed rule comes into force. 8 (a) Participants need to be more vigilant in preparing their joint venture agreements, as they do not have a second chance to correct errors. It should be noted that the proposed removal of the requirement to authorize 8 (a) joint venture agreements by the SBA applies only to joint ventures that apply for competitive premiums 8. Joint ventures that receive 8 (a) single source premiums should submit their joint enterprise agreement for approval prior to award. The proposed rule justifies this distinction by stating that 8a) exclusive source premiums do not allow for large protests and, in the absence of a size protest, the only possibility of ensuring that a joint venture complies with Rules 8a is to authorize the joint enterprise agreement before the contract is awarded.
The SBA estimates that the savings from removing this requirement will be approximately $59,500. There are currently approximately 4,500 8 (a) participants. About 10% of them are owned in a joint venture that was set up to charge a price of 8 a. The process of auditing joint venture agreements is very factual, and it has continued. However, the SBA estimates that an 8-year participant currently spends approximately three hours presenting a joint venture agreement to the SBA and answering questions from the SBA regarding the agreement (note that this is not the time to prepare the joint venture agreement only to submit to the SBA and answer SBA questions). If you apply this estimate to each joint venture of 8 (a), the result is a working hour of 1,350 hours. Multiplying this by the median salary plus benefits for accountants and accountants results in a savings of $59,500 for 8 (a) participants. Recently, some of our small entrepreneurs, managed by the SBA`s Washington Metropolitan Area district office, received notice from their Business Opportunity Specialist (“BOS”) that the agency`s submission for joint venture agreements would no longer be accepted. It is not clear whether this applies to all SBA district offices or perhaps only to that district office. We wanted to draw your attention to the fact that, in some SBA offices, the use of the Agency`s draft JV agreement may be unacceptable. However, beyond this issue of joint enterprise agreements alone, we would also like to draw your attention to the broader issue of the importance of being aware of what your district office believes or expressly wants with respect to certain documents, situations and transactions. This contribution is Part 4 of our report on the proposed changes to the SBA and will cover potential changes to the joint venture agreement approval process for contracts 8 (a) (here is Part 1, Part 2 and Part 3 of our coverage).