Homeland Security Capital Corporation (OTCBB: HOMS), an international provider of specialized technology-based radiological, nuclear, environmental, disaster relief and security solutions to government and commercial customers, announced that its subsidiary, Safety and Ecology Corporation (SEC), has received a protest on an active project in Oak Ridge, Tennessee. The protest, made by the unsuccessful bidder for the project, is disputing SEC’s business size under the rules of the Small Business Administration (SBA).
As previously announced, SEC was awarded the U.S. Department of Energy’s (DOE) Oak Ridge Office task order for complex environmental cleanup operations at the Oak Ridge National Laboratory as a part of the American Recovery and Reinvestment Act. The contract pursuant to which this initial task order was issued is valued at $16.6 million, and includes options that, if exercised, could increase the total value of the contract to approximately $50 million. SEC continues to actively perform work on this critical project despite the protest.
The SBA’s ruling states that SEC is “other than small for the captioned size standard” by finding that SEC is affiliated with its mentor protégé, American Radiation Services, Inc (ARS), and, therefore, ARS’s headcount should be included in SEC’s headcount. SEC became an approved mentor to ARS under the auspices of the SBA’s Mentor-Protégé Program. The relationship has been beneficial to ARS, and also serves as a successful example of the spirit behind the establishment of the program. The purpose of the Mentor-Protégé Program is to enhance the development of the protégé and to encourage approved mentors to provide various forms of assistance to eligible 8(a) participants to ensure contracting opportunity experience and overall financial viability.
“It is our strongly held position that the SBA determination is incorrect and, as such, SEC is appealing the determination to the SBA’s Office of Hearings and Appeals within the time prescribed by regulation,” said Christopher Leichtweis, President of Homeland Security Capital Corporation and CEO of SEC. “We think that the SBA determination is wrong and harmful to the Mentor-Protégé Program as a whole and will have a chilling effect on other similar mentor-protégé relationships.”