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Todd Overman

Todd Overman is the chair of the firm’s Government Contracts practice and Managing Partner of the Washington, D.C. office.  He has over twenty years of experience advising companies on the unique aspects of doing business with the federal government. Over the last decade, he has advised on more than 50 transactions involving the purchase or sale of a government contractor.

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On Friday, July 22, 2016, the Small Business Administration (SBA) released a Final Rule (Final Rule) establishing a government-wide mentor-protégé program for all small business concerns, designed to increase opportunities in the federal market place and improve development for small businesses. This expansion implements the authority Congress gave SBA in the 2013 National Defense Authorization Act to create mentor-protégé programs for Service-Disabled Veteran Owned Small Businesses (SDVOSB), HUBZone small businesses, women-owned small businesses (WOSB), and small businesses.

    The new program, which enables these categories of small businesses to benefit from the SBA-approved mentor-protégé arrangements previously only available to certified 8(a) small disadvantaged businesses, goes into effect on August 24, 2016, and will be implemented with the help of a newly formed unit within the SBA Office of Business Development devoted solely to processing and reviewing mentor-protégé applications and agreements. Instead of creating four new and separate programs covering each of the small business contracting programs (i.e., small business, SDVOSB, WOSB, and HUBZone), SBA chose to create a single program for all small business concerns modeled after the existing 8(a) Business Development (BD) mentor-protégé program, which will continue to operate as a separate program. Alongside these regulations, the Final Rule revises guidelines for joint venture agreements between a mentor and a protégé.

Opening the mentor-protégé program to new categories of small businesses creates significant opportunities for both large and small businesses. Because of the expected avalanche of applications from companies wishing to participate in this program, an overview of which is provided below, businesses that anticipate submitting applications for approval of mentor-protégé agreements should do so as soon as possible after the program goes into effect.Continue Reading Mentor-Protégé Expansion Creates Opportunities for all Government Contractors Large and Small

We recently authored an article outlining the provisions and ramifications of the General Services Administration’s (GSA) final rule governing transactional data reporting, released on June 23, 2016.  As the most significant change to the GSA Federal Supply Schedules (FSS) program in the last two decades, the new rule requires each vendor subject to the provisions to electronically submit monthly reports that provide 11 transactional data elements and replaces the current requirements relating to Commercial Sales Practices (CSP) disclosures and the Price Reduction Clause (PRC). While many remain skeptical of the benefits of the new rule, the GSA believes the transactional data clause will reduce the administrative burden on contractors, promote competition and transparency, and benefit small businesses that often lack the necessary resources to devote to business intelligence and development.
Continue Reading Update: GSA Requests Comments on Releasing Data Obtained through the New Transactional Data Reporting Rule

In another example of the government’s efforts to root out fraud in government procurement programs, on July 5, U.S. District Judge Reggie B. Walton sentenced Virginia businessman, Tarsem Singh, to 15 months in prison followed by three years of supervised release for conspiracy to commit major fraud on the United States. In December of 2015, Singh pleaded guilty to executing a scheme to defraud the Small Business Administration (SBA) and the General Services Administration (GSA) through fraudulent procurement of more than $8.5 million in federal government contracts through SBA’s 8(a) program. Created to help small, disadvantaged businesses engage in federal procurement, the 8(a) program requires that qualifying businesses are at least 51% owned and controlled by a socially and economically disadvantaged U.S. citizen.

From 2000 to 2009, Singh was the vice president of “Company A,” a construction company specializing in renovating and altering buildings. From 2000 through 2009, Company A was certified under the 8(a) program and lawfully received approximately $23 million in contracts from the GSA. The real trouble began in 2009, when Company A graduated from the 8(a) program and, on the same day, entered into a Mentor-Protégé Agreement with “Company B.” With monetary support and guidance from Company A, Company B was certified under the 8(a) program and was ultimately awarded 26 federal contracts under the program. According to the government’s calculations and Judge Walton’s Memorandum Opinion, the contracts awarded to Company B totaled more than $8.5 million.Continue Reading Business Owner Sentenced to 15 Months for Defrauding SBA’s 8(a) Program Through Use of “Shell” Company to Receive 8(a) Contracts

On June 23, 2016, the General Services Administration (GSA) released a final rule that will result in the most significant change to the GSA Federal Supply Schedules (FSS) program in the last two decades. 81 FR 41103 (New Rule). The New Rule introduces a transactional data reporting element to the FSS program, effectively replacing the current requirements relating to Commercial Sales Practices (CSP) disclosures and the Price Reduction Clause (PRC).

Under current FSS regulations, contractors are required to submit CSP disclosures with their initial offer for a FSS contract, which includes a broad disclosure of discounts the contractor offers to commercial customers for similar products and services. The CSP disclosures are used to identify a “tracking customer,” which consists of a customer or category of customers that will be tracked to identify pricing discounts to GSA customers. The PRC requires the contractor to monitor its ongoing commercial sales to ensure that the government receives the same price reductions given to the “tracking customer.” Through the New Rule, GSA is replacing the CSP disclosures and PRC requirements with a different method of award monitoring: transactional data reporting.Continue Reading Major Changes to GSA’s Federal Supply Schedules Program

Today, one week following the Supreme Court’s unanimous decision requiring the U.S. Department of Veterans Affairs (VA) to set-aside contracts and Federal Supply Schedule (FSS) orders for eligible veteran-owned businesses under the Rule of Two, the Senate Committee on Small Business and Entrepreneurship held a hearing on how the decision will affect VA procurement going forward. Chairman David Vitter (R-LA) orchestrated the two-panel hearing alongside Senator Jeanne Shaheen (D-NH). Chairman Vitter made clear that the Senate wanted to understand how the Kingdomware decision will affect veteran-owned businesses and how to ensure that the VA is implementing the statute’s proper interpretation.

The first panel featured Thomas J. Leney, the Executive Director for the VA, and John A. Shoraka, an Associate Administrator of Government Contracting and Business Development for the U.S. Small Business Administration (SBA). Speaking on behalf of the VA, Leney stated that the VA is committed to implementing the Supreme Court’s decision and has already started its review of current procurements. According to Leney, to enforce the decision, the VA is working on creating formal rules and new policy guidelines to regulate how veteran-owned businesses are considered under the Rule of Two. The Supreme Court clarified that the Rule of Two requires setting aside contracts for every competitive VA acquisition, including FSS orders, when two or more eligible veteran-owned concerns will submit offers and an award can be made at a fair and reasonable price. While his remarks emphasized the VA’s approach moving forward, Leney struggled to respond to Senator Vitter’s inquiry into why the VA has spent years improperly applying the Rule of Two to veteran-owned small businesses. While the VA was unable to set a hard cutoff date for when it can assure that all awards will comply with the guidelines of the decision, Senator Vitter set a July 15, 2016, deadline for the VA to issue an update to the Committee to demonstrate their improved procurement methods. According to the chairman, a delay in implementing the Rule of Two would be equivalent to resisting the decision of the Supreme Court – even a three month delay would be unwarranted.Continue Reading Senate Hearing: Ramifications of the Supreme Court’s Kingdomware Decision

In a unanimous decision issued today, the U.S. Supreme Court held that the U.S. Department of Veterans Affairs (VA) is required to set-aside contracts for every competitive acquisition, including Federal Supply Schedule (FSS) orders, when two or more eligible veteran-owned concerns will submit offers and an award can be made at a fair and reasonable price.  This ruling effectively increases the number of contracts (whether standalone or FSS orders) that will be set aside exclusively for veteran-owned small businesses (VOSBs) and service disabled veteran-owned small businesses (SDVOSBs) because the VA is statutorily prohibited from competitively awarding contracts to non-VOSB concerns when that requirement can be met.

In 2006, Congress passed the Veterans Benefits, Health Care, and Information Technology Act (VA Act), which established requirements for the VA to meet VOSB contracting goals.  38 U.S.C. §§ 8127-28 (2006).  The “Rule of Two,” at Section 8127(d), requires the VA to set aside competitive contracts for VOSBs if the contracting officer has a reasonable expectation that two or more VOSBs will submit offers and that the award can be made at a fair and reasonable price.

Since 2011, the U.S. Government Accountability Office (GAO) has consistently held that the VA is statutorily required to apply the Rule of Two to any competitive acquisition.  However, as the GAO issues “recommendations,” the VA has publicly disagreed with and declined to follow the GAO’s interpretation of the VA Act.  Accordingly, the GAO notified Congress of the VA’s declination to follow GAO recommendations.Continue Reading SCOTUS Says: Veterans Affairs Must Prefer Veterans

I offered insights for an article outlining the May 11 proposed rule on recruitment fees and recent guidance on implementation of anti-trafficking compliance programs. The new guidance was issued to clarify a 2012 executive order on human trafficking, which “‘[u]ntil two weeks ago, there really wasn’t any guidance on how to navigate any of this.'”…

On May 11, 2016, the Defense Security Service (DSS) released a new guide on mitigating and managing affiliate operations for entities bound by a Foreign Ownership, Control, or Influence (FOCI) mitigation agreement. The guide, titled Navigating the Affiliated Operations Plan: A Guide for Industry, outlines how companies can identify whether they are engaging in affiliated operations, submit an Affiliated Operations Plan (AOP), and ensure that they are properly mitigating potential risks. In compiling an AOP, a company is expected to describe all operations and services it intends to share with affiliates, as well as the potential risks of the collaboration and how those risks will be mitigated. The guide emphasizes that, unless there are special circumstances, an AOP must be provided before a company can start leveraging any affiliated operations.
Continue Reading DSS Releases New Guide to Help Cleared Contractors Meet Requirements of FOCI Mitigation Agreements

The SBA is proposing to change the SBIR and STTR Policy Directives in a series of clarifying amendments that provide a new layer of certainty regarding the future of SBIR contractors’ data rights and potential Phase III awards.

SBIR contractors are currently entitled to an “SBIR/STTR protection period” of four years (five years for DoD SBIR contracts) from the last deliverable during which the awardee retains the rights in data. This protection period is extended upon each subsequent related award, which can leave the contractor and the government (and potential acquiring entities) unsure of the actual length of the protection period. To provide clarity around the time period, SBA is proposing an SBIR/STTR protection period of 12 years without extensions. This is a suggested minimum, and agencies would have the discretion to adopt a longer period. Under a proposed fixed period, the value of a SBIR contractor’s data is more readily determined without an ever-changing timeframe of data rights.Continue Reading How Will Proposed Changes to SBIR Rules Impact Valuation of SBIR Contractors?

From the Bass, Berry & Sims Blog Network
From the Bass, Berry & Sims Blog Network

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