Government Contracts

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

On July 14, 2016, the U.S. Equal Employment Opportunity Commission (EEOC) issued a revised version of its proposal to expand pay data collection from federal contractors and other employers with more than 100 workers. The revised proposal pushes back the date of the first required employer report to allow for the use of W-2 wage and salary reports.

The EEOC initially published its proposed rule in late January. The proposed rule expands the information certain employers must report to the federal government on an EEO-1 report. The EEOC’s proposal would add data on pay ranges and hours worked to the information currently collected.

The EEOC considered and adopted specific suggestions made by commenters during the initial 60-day comment period that ended earlier this year. For example, the EEOC moved the due date for the EEO-1 survey from September 30, 2017 to March 31, 2018, to simplify employer reporting by allowing employers to use existing W-2 pay reports, which are calculated based on a calendar year. In addition, the EEOC agreed to give employers the choice of reporting either a 40-hour week for full-time exempt and 20-hour week for part-time exempt workers, or in the alternative, providing an annual report for such employees. This change is in response to employer concerns for the non-standard weekly hours for this category of workers. The updated rule comes with a fresh, 30-day comment period that runs until August 15, 2016.Continue Reading EEOC Issues Revised Equal Pay Data 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

I offered insights for an article outlining ways that the United Kingdom’s exit from the European Union could affect the Washington, D.C. region. My comments are specific to how the transition could impact government contracting and benefit the defense trade.

The full article, “6 Ways Brexit Could Impact Washington Business,” was published by…

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 Department of Energy (DOE) has proposed an amendment to the Department of Energy Acquisition Regulation (DEAR) that, among other changes, clarifies that FAR Subpart 22.12, Nondisplacement of Qualified Workers Under Service Contracts, and the associated Department of Labor regulations, applies to subcontracts under DOE’s management and operating (M&O) contracts. M&O contractors and their subcontractors need to be aware of these changes, particularly the impact on the requirement to hire service employees working on incumbent contracts set forth in contract clause FAR 52.222-17.

FAR Subpart 22.12 implements Executive Order 13495 (January 30, 2009), and requires a successor contractor and its subcontractors to offer “service employees,” as defined by the Service Contract Act, under the predecessor contract (of the same or similar services at the same location) and whose employment will be terminated as a result of the successor contract award, a right of first refusal of employment under the new contract. Employment openings are generally prohibited until such right of refusal has been provided, meaning an incoming contractor will have limited opportunity to staff its current employees on the contract. Importantly, each bona fide express offer of employment must have a stated time limit of not less than 10 days for an employee response, a time period that successor contractors should account for when determining how long it will take to transition the contract. The contract clause, FAR 52.222-17, has to be flowed down to service subcontracts over the simplified acquisition threshold, typically $150,000. The requirements of FAR Subpart 22.12 do not apply to service contracts performed entirely outside the United States. 77 Fed. Reg. 75768 (Dec. 21, 2012).Continue Reading DEAR Department of Energy M&O Contractors: The FAR Nondisplacement of Qualified Workers Requirements Apply To You, Too

Bid protests are a ubiquitous part of government contracting, basically considered part of the normal procurement process. While bid protests can be filed at either the procuring agency level or at the U.S. Court of Federal Claims, the majority of bid protests are filed with the Government Accountability Office (GAO). Recently, on April 15, 2016, GAO released a proposed rule that will make several significant changes to their bid protest process. These proposed changes clarify some elements of the process, while at the same time raise several questions about how these new rules will affect protesters moving forward.
Continue Reading GAO Proposes Significant Changes to its Bid Protest Process

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

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