Unlocking Opportunities: Joint Ventures and the GSA Multiple Award Schedule

At a Glance:

• The main takeaway: GSA expanded the Startup Springboard Program and introduced formal procedures for Joint Venture (JV) offerors under the Multiple Award Schedule (MAS).
• The impact on your business: The terms negotiated in the JV contract can also impact the individual partner’s MAS contracts and create unexpected compliance risks.
• Next steps: Understand unique considerations and strategies for JVs and their member companies to negotiate a JV MAS contract that maximizes effectiveness while minimizing compliance risks.

The Full Story:

The General Services Administration (GSA) created the Startup Springboard Program (the Springboard) to make companies with less than two years of corporate experience eligible for a GSA Multiple Award Schedule (MAS) contract. Designed to give the government access to the most cutting-edge products and services, the Springboard allows offerors to substitute alternate financial and past performance information for traditional offer requirements. Initially, only Information Technology category offers were eligible for the Springboard. However, in May 2022, GSA expanded the program to all MAS large categories.

Historically, GSA’s requirement for two years of corporate experience made it virtually impossible for a joint venture (JV) to submit a successful MAS offer. The creation and expansion of the Startup Springboard presented an opportunity for joint ventures (JV) to obtain a MAS contract without violating the “two-year rule.” In May 2023, GSA introduced formal procedures for Joint Venture offerors under solicitation refresh #16. The new guidelines resulted in an influx of offers from JVs.

Under the new procedures, JV partners can hold their own MAS contract and up to three additional JV MAS contracts with different partners. To avoid anti-competitive practices and price tampering, JV partners are prohibited from submitting competing bids for MAS task orders and/or Blanket Purchase Agreements (BPAs) using their individual contract and one or more JV contracts to which they are a party.

New Offer Requirements:

Submitting a JV offer under the new guidelines can be complex. The solicitation outlines specific instructions for JV offerors in SCP-FSS-001 Instructions Applicable to All Offerors. In many ways, preparing a JV offer is like doing three offers in one. If the JV still needs to gain corporate experience or past performance in its own name, the offer must include experience from the JV members instead. Similarly, financial documentation is required from the JV and all partners. In a Mentor-Protégé or socioeconomic JV, there are certain requirements, such as Past Performance and Relevant Project Experience, where at least one reference must be provided from the protégé or socioeconomic partner. JV offerors must also submit a Joint Venture Attachment that outlines requirements only applicable to JVs and includes ownership or control representations and certifications.

The pricing proposal is where a JV offer diverges most from a traditional MAS offer. Even though a JV is its own entity, JV offerors must identify which JV partner provides each proposed product or service in the Price Proposal Template (PPT) and GSA Price List. Any supporting price documentation must come from the identified JV partner. The products and services cannot be shared among the JV partners upon award. When determining which partner products or services to propose, Mentor-Protégé JVs need to consider SBA regulations (13 CFR 125.8) requiring the protégé firm to perform at least 40% of the work completed by the JV entity.

Because each JV partner identifies products and services, Commercial Sales Practices (CSP) disclosures for the JV and each JV partner are also required on offers not covered by Transactional Data Reporting (TDR). Coordinating accurate pricing disclosures among multiple entities is critical for preventing complicated compliance requirements for everyone involved.  

JV Contracts Awarded Prior to Refresh #16:

If your JV was awarded a MAS contract before to the new guidance, you must submit a modification request conforming to the new procedures in your contract. Impacted JVs must submit the Joint Venture Attachment and identify the JV partner providing each product or service. Due to the new guidance, this modification will require each JV partner to submit updated CSP disclosures. GSA requires the conformance modification to be submitted before the MAS solicitation refresh scheduled for May 2024.

Impact to JV Partner Individual MAS Contracts:

A MAS JV contract is unique in its risk to the joint venture and its partner companies. The most significant risk for JVs and their partners is the Price Reductions Clause (PRC) and navigating multiple discount relationships. Managing the PRC is already complex for traditional MAS contractors. It is especially difficult for joint ventures because pricing offered by the JV itself or an individual JV member can trigger the PRC on the JV’s and/or a member company’s MAS contract. The potential interplay among multiple MAS contracts makes it critical to negotiate terms and conditions carefully. It may be necessary to modify the terms of the JV partners’ MAS contracts to protect all parties further.

Contractors need to understand the additional layers of risk when submitting a JV offer and managing a JV MAS contract. Contact Aprio to discuss strategies for JV MAS contracts to maximize effectiveness while minimizing compliance risks.

Related Resources:

Accounting for Mentor-Protégé Joint Ventures

GSA to Expand Startup Springboard to All MAS SINs

GSA Issues Multiple Award Schedule Solicitation Refresh 16: What It Means for Joint Ventures, Good and Bad