Request Made to Federal Court for Additional Restrictions on the 8(a) Program

    In our previous advisories, we have discussed how the U.S. Small Business Administration (SBA) released directives on subsequent actions for existing 8(a) Participants and fresh applicants to the 8(a) Program. This came after the U.S. District Court for the Eastern District of Tennessee prohibited the SBA on July 19 from applying a rebuttable presumption of social disadvantage in running the 8(a) program. The court called for further briefings regarding additional equitable relief and SBA’s adherence to the injunction.

    On Sept. 15, Ultima petitioned the Court to impose an additional injunction temporarily preventing the SBA from awarding, finalizing, altering, or exercising options on any contracts through the 8(a) program to 8(a) participants who gained from the rebuttable presumption.

    Ultima, referencing a popular webinar delivered by a senior SBA attorney, claims that the SBA is now incorrectly applying a less stringent narrative review process. This process allegedly eases the burden only for those who received the presumption while not providing any information about whether non-minorities receive the same accelerated treatment. Ultima contends that this supposed lenient pathway is incompatible with the Court’s injunction, as it would allow 8(a) businesses to continue benefiting from a previously granted rebuttable presumption.

    Beyond seeking a temporary injunction on the SBA’s interim “narrative” process, Ultima is requesting that the Court either mandate all social narratives to be public or appoint a “monitor” to supervise the SBA’s approval process for compliance with the Court’s directives. Ultima also urges the Court to direct the SBA to disclose how many narratives of social disadvantage have been approved and rejected since the July 19 order.

    The Government’s rebuttal to Ultima’s brief is expected by Sept. 29, with the final briefing due by Oct. 6. We cannot predict the Court’s decision but anticipate a swift ruling on Ultima’s request for a temporary stop on the SBA’s narrative reviews. A ruling favoring Ultima would likely compel the SBA to either swiftly appeal to the Sixth Circuit or reconsider its execution of the 8(a) Program and other disadvantaged contracting programs.

    Our team at CFO Enrollment will continue tracking these developments and provide updates following each additional briefing and the Court’s decisions. We remain committed to supporting 8(a) Participants and applicants as necessary.

    #GovAccountingCompliance #FARandCAS #GovernmentContracting #AuditPreparedness

    #SBA8a #8a #Assumption #GSA


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