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GAO: Sole-Source Bridge Contracts are Acceptable after Corrective Action

Generally, agencies are required to maximize competition for procurements. But there are exceptions to this rule, such as for simplified acquisitions. Another exception is for sole source bridge contracts awarded between the end of an incumbent contract and the start of a new contract. A recent GAO case explains the rationale for why a sole-source award is usually acceptable in that situation. In Trailboss Enterprises, Inc., B-415970.2, (Comp. Gen. May 7, 2018), Trailboss protested the terms of a solicitation for Air Force flight training services. Trailboss also protested the award of a sole-source contract to PKL Services, Inc. for training services during the time between the expiration of the incumbent contract and the award of the new contract. Trailboss had filed an earlier protest for the same procurement, in response to which the Air Force took corrective action. During the corrective action, the Air Force indicated via synopsis it would award a sole-source contract to PKL for 3 months with a 2-month option to ensure continuity of services when the incumbent contract expired. Trailboss protested this sole-source bridge contract. Trailboss argued that the bridge contract was “improper because it was based on a lack of advanced planning.” GAO denied this protest ground. GAO noted that the Competition in Contracting Act requires use of full and open competition. But there is an exception when “the supplies or services required by an agency are available from only one responsible source, and no other type of supplies or services will satisfy agency requirements.” For follow-on (or “bridge”) contracts, In order to make use of this exception, the agency must provide a reasonable justification and approval with facts and rationale to support the sole-source procurement. Here, the Air Force noted that the flight training services were needed after expiration of the incumbent contract. The Air Force contacted three other potential offerors to see if they could meet the sole-source requirement. The results of this survey were that it would take 30-45 days to transition over, with an additional 14 days for employee clearance and badging requirements. There would also be heightened costs for transition to the new contractor. Based on the transition time and added costs, the Air Force determined that only the incumbent PKL could meet the requirements for the bridge contracts, stating that “[d]ue to the highly specialized services required under this contract, discontinued use would result in substantial duplication of cost to the government that is not expected to be recovered through competition and will result in unacceptable delays in fulfilling the agency’s requirements.” Trailboss argued that the sole-source was the result of failure in advance planning, which is not a proper justification for a sole-source award. But GAO held that “an agency’s procurement planning need not be error-free or successful” and “an immediate need for services that arises as a result of an agency’s implementation of corrective action in response to a protest does not constitute a lack of advance planning.”  Because the corrective action created the need for a sole-source contract, it was not a result of bad planning. After a corrective action, a short-term sole-source bridge contract to the incumbent will very likely be acceptable and difficult to successfully challenge at GAO.
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Koprince Law LLC

Koprince Law LLC

 

VA Will Use SBA SDVOSB Eligibility Rules Starting October 1, 2018

The VA will begin using the SBA’s eligibility rules to verify SDVOSBs and VOSBs beginning October 1, 2018. In a final rule published today in the Federal Register, the VA confirms that the SBA’s eligibility requirements will apply beginning next week–but in my eyes, one very important question remains unanswered. As regular SmallGovCon readers know, the differences between the government’s two SDVOSB programs have caused major headaches for veterans.  Because the two sets of regulations have different eligibility requirements, a company may be an eligible SDVOSB under one set of rules, but not the other. In 2016, Congress addressed the problem.  As part of the 2017 NDAA, Congress directed the VA to verify SDVOSBs and VOSBs using the SBA’s regulatory definitions regarding small business status, ownership, and control.  Congress told the SBA and VA to work together to develop joint regulations governing SDVOSB and VOSB eligibility.  The VA published a proposed rule earlier this year to eliminate its separate SDVOSB and VOSB eligibility requirements. Now the VA has issued a final rule, set to take effect in just one week on October 1.  The final rule broadly reiterates that the VA is eliminating its separate SDVOSB and VOSB eligibility requirements because “regulations relating to and clarifying ownership and control are no longer the responsibility of VA.”  Instead, in verifying SDVOSBs and VOSBs, the VA will use the SBA’s eligibility rules set forth in 13 C.F.R. part 125. The VA’s final rule answers a few questions from the public about the change.  Among the VA’s answers: Despite a common misconception, this final rule does not move the verification process from the VA to the SBA.  The final rule states, “[a]lthough the authority to issue regulations setting forth the ownership and control criteria for SDVOSBs and VOSBs now rests with the Administrator of the SBA, the [VA] is still charged with verifying that each applicant complies with those regulatory provisions prior to granting verified status and including the applicant in the VA list of verified firms.” The “VA and SBA will treat joint ventures the same way,” applying the SBA’s regulatory criteria.  This is important because the VA currently does not treat joint ventures the same way as the SBA.  Although the VA largely defers to the SBA’s joint venture rules, the VA has been requiring SDVOSB joint ventures to demonstrate that the SDVOSB managing venturer will receive at least 51% of the joint venture’s profits.  This conflicts with the SBA’s current regulation, which allows the SDVOSB managing venturer to receive as little as 40% of the joint venture’s profits, depending on how the joint venturers split work. Persons “found guilty of, or found to be involved in criminally related matters or debarment proceedings” will be immediately removed from the VetBiz database.  Additionally, owing outstanding taxes and unresolved debts to “governmental entities outside of the Federal government” may be disqualifying, but won’t lead to an automatic cancellation. As you may recall, the SBA proposed to revise its own SDVOSB regulations earlier this year.  These proposed rules, when finalized, would apply to both the VA and SBA. The VA’s final rule indicates that the SBA’s final rule also will take effect on October 1.  “VA and the SBA believe a single date on which all of the changes go into effect is the most effective path for implementation,” the VA writes.  As I sit here today on September 24, I haven’t seen the SBA’s final rule yet, but I assume it will be published any moment.  We’ll blog about it on SmallGovCon when that happens. By consolidating the eligibility requirements for SDVOSBs and VOSBs, the SBA and VA will eliminate a lot of confusion.  In that sense, these changes are good news.  But I’m concerned about one important item that wasn’t raised in the VA’s response–that is, what happens to currently verified companies who no longer meet the eligibility requirements?  In other words, what happens to companies that were verified under the VA’s “old” rules, but won’t qualify as SDVOSBs under the SBA’s “new” rules? Remember, many companies were verified as SDVOSBs and VOSBs based on the VA’s eligibility requirements, which (until October 1) aren’t identical to the SBA’s.  Perhaps most notably, the VA has long permitted companies to use reasonable “right of first refusal” provisions in their corporate governing documents.  The SBA, on the other hand, has deemed such provisions impermissible–a position that a federal judge called “draconian and perverse,” but nonetheless within the SBA’s broad discretion. As I read the SBA’s proposed rules, anyway, the SBA hasn’t changed its position on this issue.  And while it sounds wonky, it’s actually very important: right of first refusal provisions are commonplace in operating agreements, bylaws, and shareholders’ agreements prepared by good corporate counsel.  It’s a virtual certainty that hundreds, if not thousands, of verified SDVOSBs and VOSBs have such provisions in their governing documents. Are these companies now vulnerable to protest?  Will the VA CVE propose them all for cancellation?  Are they somehow grandfathered in?  (I highly doubt that, but I suppose you never know).  It’s a very important question and I hope one that the SBA and VA will answer soon. My colleagues and I will keep you posted.
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Koprince Law LLC

Koprince Law LLC

 

A Pre-Award Protest Probably Isn’t the Place to Raise Suspicions of Wage Violations

Let’s suppose you’re a contractor that provides services to the federal government. Typically, your contract will require you to pay your employees the prevailing wage rates promulgated under the Service Contract Act. What if you suspect that, under previous contracts, your competitors failed to pay their employees the mandated prevailing rates? Can you use a pre-award bid protest to obligate a procuring agency to police possible ongoing non-compliance through solicitation provisions? If you say yes, perhaps you should keep reading. In Crosstown Courier Service, Inc., B-416261 (July 19, 2018), GAO encountered a protester with this concern. There, the VA was looking for commercial transportation services on a fixed-price basis. The solicitation was subject to the SCA. Consequently, the solicitation required offerors to comply with the relevant SCA wage determinations and make certain certifications regarding their SCA-exempt employees. But it did not require a breakdown of costs by labor category. The protester, motivated by real or perceived abuses by other contractors, challenged the solicitation’s terms in two salient ways. First, it argued that the solicitation was defective because it did not require a breakdown of the offerors’ labor costs. And second, the solicitation did not provide for a price realism evaluation. Breakdown of Labor Costs The protester believed that the VA has a “long history” of awarding similar contracts to companies with low pricing–pricing that must have been, in the protester’s view, insufficient to cover SCA wage rates. Thus, the protester argued that the solicitation should require a labor costs breakdown. With this added detail, argued the protester, VA could evaluate each offeror’s proposal with an eye to whether an offeror was, in fact, capable of paying the required SCA wages. In essence, (and perhaps you can sympathize) the protester wanted to ensure that its pricing–which it believed factored in the full impact of SCA wages–was not undercut by offeror who might be less concerned with SCA compliance. GAO batted down the protester’s argument. For one, the protester did not present any evidence substantiating its claim that VA had previously awarded contracts to companies who did not pay the appropriate SCA wages. But more to the point, GAO said that protester misapprehended pricing in the fixed-price context. GAO explained that “[t]here is nothing inherently objectionable about low pricing, or even below-cost pricing, in fixed-price contracts, because the risk and responsibility for contract costs is on the contractor.” So, barring terms in the solicitation saying otherwise, an offer for a fixed-price contract isn’t invalid simply because the offeror won’t be able to cover its costs (including SCA wages) with the revenue generated from the specific procurement–as long as the proper wages are paid during contract performance. In other words, a contractor may calculate to lose money on a government contract, and submit a below-cost bid on a fixed-price contract, even where the contract is covered by the SCA. Of course, the cost breakdown urged by the protester might give the VA greater confidence that an offeror has considered the required costs associated with the procurement. But because” the agency’s approach in this case–advising vendors of the requirements and requiring relevant certifications–is not inconsistent with law or regulation, or otherwise unreasonable,” GAO denied this protest ground. Price Realism The protester’s second protest ground essentially repackaged the first.  It went like this: because the solicitation failed to provide for a price realism evaluation, the VA would not be able to assess the likelihood of contract compliance (including the payment of SCA wages). In other words, a price realism evaluation was necessary in order to root out offers that, if accepted, would not provide the revenue necessary for the contractor to pay its employees compliant wages. GAO was unconvinced. After noting that agencies have broad discretion when selecting evaluation criteria, GAO noted that “the protester [had] not identified any laws or regulations, which would compel the agency to incorporate a price realism evaluation.” What is more, GAO explained, citing FAR 15.404-1(d)(3), that “a price realism evaluation is not required for fixed-price contracts” but an agency can still use it in “exceptional cases.” In addition, GAO found that “other than the protester’s vague representations concerning prior unrealistic quotes or proposals, the protester has not identified any facts that would suggest that the agency erred in failing to include a price realism evaluation in the [solicitation].” Because the protester presented no error made by the VA, GAO denied this ground too. We can probably all sympathize with a contractor who makes an offer on a fixed-price contract only to be undercut but a lower price–especially one that, in all probability, won’t cover the winning contractor’s costs. In such cases, one might suspect that the winning offeror won’t comply with applicable laws, like the SCA, or may be angling for an equitable adjustment in the midst of contract performance. Here, the protester wasn’t wrong to think that added scrutiny of offerors’ prices may have been beneficial in the evaluation process, but agencies have broad discretion when it comes to drafting solicitations. Regardless of whether it would have been a good idea for the VA to more closely evaluate offerors’ prices, the GAO said that the VA wasn’t required to do so. If you do suspect that a competitor is not, or will not, pay required wages under the SCA (or the Davis-Bacon Act), you might consider raising the issue with a contracting officer or the Department of Labor. But when the solicitation calls for a fixed-price contract, and the solicitation terms don’t include a price realism analysis, raising the issue in the context of a pre-award protest is likely a dead end.
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Koprince Law LLC

Koprince Law LLC

 

SmallGovCon Week in Review: September 17-21, 2018

It’s time for the best part of the week: the SmallGovCon Week in Review! In this week’s edition, the Deputy Secretary of Defense discusses the importance of cybersecurity in DoD procurements, a California company was ordered to pay back wages under the Service Contract Act, upcoming changes to startup contracts with the Air Force, and much more. Have a great weekend! DoD releases new cybersecurity strategy. [Fedscoop] California company to pay back wages after they violated federal contract provisions of the SCA. [dol.gov] The world’s richest person weighs in on commercial technology acquisitions. [Fedscoop] Air Force will soon announce a series of “Startup Days” involving startup companies in Air Force acquisition by awarding contracts in less than 24 hours. [defensenews.com] Public and private officials met to discuss how to use innovation from protecting critical assets to reforming acquisition methods. [washingtontechnology.com] In the new fiscal year, agencies will have access to automated contact center technologies and services through the General Services Administration’s IT Schedule 70. [nextgov.com] A father and son are sentenced to prison and ordered to pay over $1 million in restitution for fraudulently winning government contracts. [justice.gov]
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Koprince Law LLC

Koprince Law LLC

 

SmallGovCon Welcomes Haley Claxton!

I am very pleased to announce that Haley Claxton has joined our team of attorney-authors here at SmallGovCon.  Haley is an associate attorney with Koprince Law LLC, where her practice focuses on federal government contracts law. Haley is a recent graduate of the University of Kansas Law School, and has served as a law clerk to the Library of Congress Office of the General Counsel in Washington, DC.  Check out Haley’s full biography to learn more about our newest author, and don’t miss her first SmallGovCon post on new rules recently implemented at the Civilian Board of Contract Appeals.
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Koprince Law LLC

Koprince Law LLC

 

Federal Circuit Reinforces Government Preference for Commercial Items

By Heather Mims, On September 13, 2018, the United States Court of Appeals for the Federal Circuit ruled that the Army acted arbitrarily and capriciously when it failed to buy commercially available products whenever possible or, in terms of the statute at issue, to the maximum extent practicable. This litigation began when Palantir USG, Inc. filed a pre-award bid protest in the Court of Federal Claims (although Palantir previously filed a pre-award bid protest with the GAO, which was denied). Palantir’s protest challenged the Army’s solicitation to develop and integrate the Army’s Distributed Common Ground System (DCGS-A2), which is the Army’s primary system for processing and disseminating multi-sensor intelligence and weather information. Palantir argued that the Army violated a federal statute (the Federal Acquisition Streamlining Act or “FASA”) by failing to determine whether its needs could be met by commercial items before issuing the solicitation. Generally, FASA ” requires that federal agencies, to the maximum extent practicable, procure commercially available technology to meet their needs. Specifically, Palantir argued that its flagship software product could satisfy the Army’s requirements. In finding that the Army failed to determine whether its needs could be met by a commercially available product, the Court found that the Army was, or should have been, aware of Palantir’s data management platform. Thus, the Court found, the Army acted arbitrarily and capriciously in failing to fully evaluate commercial options. As such, prior to issuing the solicitation at issue, the Army’s conclusion to exclude commercial items from consideration was not rational and was not in accordance with the applicable law, which required an agency to use its market research to determine whether there are available commercial items that: (A) meet the agency’s requirements; (B) could be modified to meet the agency’s requirements; or (C) could meet the agency’s requirements if those requirements were modified to a reasonable extent. While this was a pre-award protest, the Court did not go so far as to recommend that the Army choose Palantir as the awardee. Rather, the Court simply required the Army to satisfy the requirements of FASA and determine whether its needs could rationally be met by a commercially available product, which it has thus far failed to do.   About the Author: Heather Mims
Associate Attorney
Heather Mims is an associate attorney at Centre Law & Consulting. Her practice is primarily focused on government contracts law, employment law, and litigation. Heather graduated magna cum laude from the George Mason School of Law where she was the Senior Research Editor for the Law Review and a Writing Fellow.   The post Federal Circuit Reinforces Government Preference for Commercial Items appeared first on Centre Law & Consulting.
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Centre Law & Consulting

Centre Law & Consulting

 

Court of Federal Claims Rejects Unsupported Decision to Cancel Solicitation

An agency ordinarily enjoys very broad discretion in its procurement-related decisions. This includes whether an agency will award a contract or, instead, cancel a procurement. Broad as this discretion is, however, an agency does not have carte blanche to cancel a procurement on a whim. As a recent Court of Federal Claims decision shows, an agency must support its decision with sufficient information, lest the cancellation decision itself be successfully protested. The factual and procedural histories in FMS Investment Corporation v. United States, No. 18-862C et al. (Fed. Cl. Sept. 14, 2018) are tortured. But for purposes of this post, it’s sufficient to say that in 2015, the Department of Education issued a solicitation for student loan collection services. After an initial award, some twenty-two companies protested at GAO. In response, the agency decided to take a voluntary corrective action. In response, one of the protesters reasserted its protest at the Court of Federal Claims. In response to the COFC protest, DoE again decided to take corrective action. It terminated the awarded contracts, issued a revised solicitation, and then made two new awards. In January 2018, twenty disappointed offerors again filed bid protests relating to these awards. In March 2018, DoE again cancelled its solicitation. Doing so, it announced a new “vision” to utilize “enhanced servicers” to administer student debt. As a result of this new vision, DoE said that it no longer needed the services of private collection agencies (like the protesters). It therefore asked the Court to dismiss the bid protests filed by those agencies. Unsurprisingly, these agencies challenged DoE’s decision to cancel the solicitation, arguing that it was arbitrary and capricious. Reviewing the “scant” administrative record (totaling only 33 pages) provided by the agency in support of its cancellation decision, the Court agreed that DoE’s proposed cancellation was arbitrary. Doing so, it noted that the decision itself was largely unsupported by any reasoned analysis. The Court found that the record “is missing critical information about the enhanced servicer program,” including a plan or timeline for implementing that program, an overview of what its request for proposals might look like under that program, a source (or anticipated amount) of funding, or even estimates of the defaulted loan volumes and loan processing capacity. According to the Court, DoE’s decision to cancel the solicitation and instead transition to enhanced servicers is “a significant policy change.” Its underlying documentation for that change, however, was nearly non-existent. DoE “needs to provide a ‘reasoned analysis’ for the policy change.” The record presented by DoE failed to provide this analysis, so the Court found the proposed cancellation arbitrary. Although FMS Investment shows that an agency must support a cancellation decision with adequate justification, it might ultimately be for naught. That is, although the Court set aside the solicitation cancellation, the opinion did not permanently prohibit DoE from pressing ahead with its planned action. Quite the opposite: the Court noted that “[r]esurrecting the solicitation . . . will not prevent [the Department] from continuing to develop its enhanced servicer program.” As I read it, therefore, the Court simply found that the “scant” record did not adequately support the cancellation; it did not, however, prohibit DoE from continuing to develop the record and then pressing ahead with its planned cancellation at a later date. In any event, FMS is important because it shows that an agency’s conduct in even the most fundamental procurement decisions isn’t necessarily free from review. In some instances, an agency’s decision to cancel a solicitation in response to a protest might be so unsupported or illogical so as to be arbitrary.
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Koprince Law LLC

Koprince Law LLC

 

New Rule Changes Bring CBCA Procedures Into the Efiling Age

On August 17, 2018, the Civilian Board of Contract Appeals (CBCA) issued new procedural rules which go into effect Monday, September 17, 2018. The substantial overhaul of the former rules intends bring the CBCA into the 21st century by emphasizing, adding, and clarifying rules about electronic filing. Efiling is now common practice in many, if not most, federal courts, saving claimants and appellants both time and money. Electronic filings, or “efilings” are defined by the CBCA as any “documents submitted through the Board’s email system.” Along with more specific file size and format requirements for efilings, perhaps most importantly, the new rules change the CBCA filing deadline from 4:30 PM Eastern Time, in accordance with the Board’s regular business hours, to midnight Eastern Time. The new midnight deadline brings the CBCA into conformity with many other federal courts, including the U.S. Court of Federal Claims and is good news for those of us looking for a few more minutes to file. In addition to amending the filing deadline, CBCA’s new rules also now allow appellants to file their “appeal files” “in an electronic storage medium (e.g., hard disk or solid state drive, compact disc (CD), or digital versatile disc (DVD)), labeled with the docket number, case name, and range of exhibit numbers,” though appellants must still receive Board permission to submit an appeal file or supplement by email. In contrast with the old rule that only allowed for hardcopy filing in “loose-leaf binders,” the CBCA’s new filing rules usher in more efficient and environmentally friendly filing procedures. While the new rules still permit paper filing, this method of filing is only allowed “by permission of the Board,” further promoting the use of filing by electronic means. Overall, the CBCA’s new rules provide appellants with a little more time to file and a lot more savings on office supplies, printing, and postage costs.
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Koprince Law LLC

Koprince Law LLC

 

SmallGovCon Week in Review: September 10-14, 2018

Another week has flown by, which means that it’s time for the SmallGovCon Week in Review. In this week’s edition, we’ll take a look at Uncle Sam’s “cloud spending splurge,” a new GSA bid on a vendor verification system, frustrations with the VA’s verification process, the looming year-end spending binge, and more. Have a great weekend! Congress has reached a deal to avoid a shutdown . . . for now. [Bloomberg] Federal cloud spending hits a new high. [FedScoop] VA’s VOSB verification process is causing delays and frustration for hundreds of companies. [Stars and Stripes] Issues under the looming Kaspersky ban. [NextGov] GSA opened up bids to manage its vendor verification system. [NextGov] Leaders of Senate subcommittee on government contracting asks agencies for briefing on fiscal year-end spending. [FEDweek] Agency customers and industry partners push for GSA schedule modernization. [Federal News Radio] VA issues final rule amending and updating VA Acquisition Regulation (VAAR). [Federal Register]
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Koprince Law LLC

Koprince Law LLC

 

New Minimum Hourly Wage Rates Announced For Federal Contractors & Subcontractors

By Wayne Simpson, CFCM, CSCM New Hourly Rates Effective January 1, 2019 The U.S. Department of Labor’s Wage and Hour Division announced the new applicable minimum wage rates for workers performing work on or in connection with Federal contracts covered by Executive Order (E.O.) 13658. The new rates, effective January 1, 2019, are $10.60 per hour for covered contracts, and $7.40 per hour for tipped employees. The announcement was published in the September 4, 2018, edition of the Federal Register.  E.O. 13568, signed February 12, 2014, raised the hourly minimum wage rate for workers performing work in connection with Federal contracts covered by the Service Contract Labor Standards to $10.10 per hour, beginning January 1, 2015.  The E.O. requires annual adjustments thereafter, as determined by the U.S. Secretary of Labor.  The Secretary’s determination also affects the minimum hourly cash wage for tipped employees performing work on or in connection with covered contracts. The Secretary is required to provide notice to the public of the new minimum wage rates at least 90 days before the rates take effect. E.O. 13568 is codified in Federal Acquisition Regulation (FAR) Subpart 22.19, Establishing a Minimum Wage for Contractors, and implemented in FAR Clause 52.222-55—Minimum Wages Under Executive Order 13658 (Dec 2015). Federal contractors should note FAR Clause 52.222-55 has a flow-down requirement for subcontracts (including purchase orders issued by the contractor) regardless of the dollar value of the subcontract or purchase order. FedBizAssist, a Centre Subcontractor, has flow-down clause subscriptions available for Federal prime and subcontractors seeking to increase their compliance and reduce risks associated with flow-down requirements.  Centre Clients and blog readers receive a 20% discount. Please enter promo code “CENTRE” at checkout to receive the discount. These one-year subscriptions are available at https://fedbizassist.com/shop Best wishes for every continued success in the Federal Marketplace!   About the Author: Wayne Simpson
Consultant
Wayne Simpson is retired from the U.S. Department of Veterans Affairs (VA) after 38 years of federal service. He served as the Executive Assistant to VA’s Deputy Assistant Secretary for Acquisition and Logistics where he was the primary staff advisor to the Deputy Assistant Secretary, who serves concurrently as VA’s Senior Procurement Executive and Debarring Official.           The post New Minimum Hourly Wage Rates Announced For Federal Contractors & Subcontractors appeared first on Centre Law & Consulting.
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Where Non-Price Ratings Identical, Agency Wasn’t Required to Choose Lower-Priced Offeror

In a best value competition, when two offerors receive identical adjectival scores on the non-price factors, one might assume that the procuring agency would be required to award the contract to the lower-priced offeror. Not so.  In a recent bid protest decision, the GAO held that where two offerors received identical scores on three non-price factors, the agency could still elect to award the contract to the higher-priced offeror. GAO’s decision in Valiant Government Services, LLC, B-416488 (Aug. 30, 2018) involved an Army Corps of Engineers task order solicitation for operations and maintenance services.  The solicitation called for proposals to be evaluated on a best value basis, considering price and three non-price factors (Experience, Technical Approach, and Past Performance). Only two offerors, Valiant Government Services, LLC and J&J Maintenance, Inc., submitted proposals.  After evaluating those proposals, the Corps assigned each offeror a “Very Relevant” score for Experience, an “Outstanding” score for Technical Approach, and a “Substantial Confidence” score for Past Performance.  Valiant’s price was about $300,000 lower–$43,551,418 versus $43,846,929 for J&J.  Nevertheless, the Corps determined that J&J offered the best value, and awarded the task order to J&J. Valiant filed a bid protest with GAO.  Among its allegations, Valiant argued that the Corps was required to award it the contract because Valiant’s non-price scores were identical to J&J’s, and Valiant was lower-priced. The GAO wrote that “[w]hen conducting a best-value tradeoff analysis . . . an agency may not simply rely on the assigned adjectival ratings to determine which proposal offers the best value because evaluation scores–whether they are numerical scores, colors, or adjectival ratings–are merely guides to intelligent decision-making and often reflect the disparate, subjective judgments of the evaluators.”  Therefore, “a tradeoff analysis should be based upon a qualitative comparison of the proposals consistent with the evaluation scheme.” In this case, although the two offerors received identical Past Performance and Experience scores, the underlying source selection documentation revealed that J&J had “superior past performance ratings” and “a greater percentage of exceptional ratings on all related task orders.”  Additionally, while the two companies received the same adjectival score for Technical Approach, the Corps “concluded that J&J’s approach was superior because it offered technically advanced management tools.”  Therefore, the Corps reasonably determined that J&J’s advantages were worth its higher price, “especially considering that the price differential was less than 1 percent of the total price of the contract.” The GAO dismissed a portion of Valiant’s protest and denied the remainder. When an agency assigns two companies the same adjectival scores for a best value solicitation’s non-price factors, the agency typically awards to the lower-priced offeror.  But, as Valiant Government Services demonstrates, the agency isn’t required to do so, if it has good reason to consider one offeror’s proposal superior despite the identical underlying scores.
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Koprince Law LLC

Koprince Law LLC

 

SBA OIG Recommends Improved Oversight of 8(a) Continuing Eligibility

Last year, we wrote about the SBA’s Office of Inspector General’s concerns with the SBA’s review of potential 8(a) participants’ eligibility. In this report, the OIG made three recommendations aimed at improving to verify applicants’ eligibility. Just last week, the OIG released a new report analyzing the 8(a) Program. This report picks up where the earlier report left off—it addressed several issues in the SBA’s evaluation of participants’ continuing eligibility. The results of this report are rather alarming: based on its review, the OIG identified almost $127 million in 8(a) set-aside awards to ineligible firms. Before diving into the OIG report, it’s important to remember that 8(a) participants not only have to meet initial eligibility criteria for admission into the Program, but they also have to meet continuing eligibility criteria to stay in the Program. These criteria not only include a $750,000 cap on the 8(a)’s disadvantaged owner’s net worth and a $6 million limit on his/her overall assets, but also a restriction on the amount of withdrawals an owner can make from the participant. A participant is subjected to annual eligibility reviews once admitted to the Program; if the firm fails to meet these criteria, it should be removed from the Program. SBA’s OIG analyzed the SBA’s oversight of 8(a) continuing eligibility, to determine whether it was doing enough to make sure that 8(a) participants met these continuing eligibility requirements. The OIG analyzed the continuing eligibility of twenty-five 8(a) participants—the 15 individually-owned 8(a) firms with the highest 8(a) set-aside contract dollars in 2016 (totaling some $461 million in set-aside awards) and 10 other firms about which the OIG had received complaints alleging continuing eligibility violations. The OIG’s investigation revealed a troubling truth: 20 of the 25 firms reviewed by the OIG did not meet the 8(a) Program’s continuing eligibility requirements and should have been removed from the Program. These firms were not removed, however, and “received $126.8 million in new 8(a) set-aside contract obligations in FY 2017 at the expense of eligible disadvantaged firms.” Based on its investigation, the OIG identified three issues that contributed to these improper awards. First, the OIG noted that the SBA did not consistently identify ineligible 8(a) firms. It noted that, in some cases, the SBA’s reviewers did not perform continuing eligibility reviews for the most high risk firms and, when reviews were conducted, did not detect indicators of ineligibility. As a result, ineligible firms were able to stay in the Program. Second, the SBA did not remove ineligible firms in a timely manner. When issues relating to eligibility were discovered, the SBA did not provide several firms with a Notice of Intent to Terminate or Graduate Early; for those that the SBA did notice its intent to terminate, it lacked sufficient follow-through to actually terminate. Problematically, the OIG noted that the SBA did not have an adequate system to track the removal of a firm or the resolution of eligibility issues once concerns with that firm were identified. Third, and perhaps most striking, was that the SBA did not address complaints about 8(a) firms that were forwarded from its OIG Hotline. Here, it’s important to remember that SBA’s regulations say that the SBA will review a firm’s eligibility “upon receipt of specific and credible information alleging that a Participant no longer meets the eligibility requirements for continued eligibility.” From a sample of 10 complaints, the OIG found that the SBA did not conduct any follow-up investigation. When the OIG reviewed these complaints, however, it found that all 10 firms failed to meet the continued eligibility criteria. From these findings, the OIG made 11 recommendations to improve the SBA’s oversight of 8(a) participants’ continued eligibility. These recommendations largely focus on the SBA’s internal processes for identifying and reviewing eligibility reviews. For example, the OIG recommended that the SBA “[d]evelop and implement a centralized process to track and document all adverse actions and voluntary withdrawals from the 8(a) program, from recommendation through resolution” and “[e]stablish and implement clear policies and procedures that include timelines for sending Notices of Intent to Terminate and to Graduate Early firms after eligibility issues are first identified.” The OIG further recommended that the SBA develop a system for tracking and resolving complaints that are received via the OIG’s Hotline. Moreover, the OIG recommended that the SBA evaluate the eligibility of specific 8(a) concerns (as referenced in the report) and, if necessary, remove them from the Program. *** In our practice, we often counsel prospective and admitted 8(a) participants about the Program’s nuanced eligibility criteria. The OIG’s recent report is revealing, as it shows that the SBA often struggles with issues of continuing eligibility, too. Going forward, we wouldn’t be surprised if the SBA more thoroughly scrutinizes 8(a) eligibility as a result of the OIG’s recent investigations. If you have any questions about your company’s 8(a) eligibility, please give us a call.
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Koprince Law LLC

Koprince Law LLC

 

Recent SBA OHA Decision Offers NAICS Code Appeal Guidance

As we’ve noted here on SmallGovCon, appealing the assignment of a NAICS code for a solicitation is often successful. But the time frame for doing so is short, and there are other procedural limitations. Given the short deadlines and procedural hurdles, are there any signals to help identify when a NAICS code appeal might be in order? Recently, SBA’s Office of Hearings and Appeals provided some guidelines in discussing the assignment of NAICS codes in the Computer Facilities Management Services, Research and Development, and Engineering Services codes. In Rollout Systems, LLC, SBA No. NAICS-5901 (2018), OHA reviewed a procurement by the Navy for a contractor to provide “full spectrum information technology (IT) engineering and management support services” for the Research, Development, Test and Evaluation (RDT&E) Infrastructure Division in the Navy’s Integrated Battlespace Simulation and Test Department at Naval Air Warfare Center Aircraft Division (NAWCAD). I will describe the decision in some detail because each part is helpful for analyzing a potential NAICS code appeal. The Solicitation The CO set the solicitation as restricted under NAICS code 541715, Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology). NAICS code 541715 normally has a size standard of 1,000 employees, but the RFP indicated that the procurement fit within the exception for Aircraft, Aircraft Engine and Engine Parts, which has a 1,500-employee size standard. The scope of the contract included the following areas: The solicitation included two sample tasks that offerors had to address. First, each had to “propose a secure method of transmitting [aircraft and weapon systems] data to various labs and facilities at NAWCAD,” along with “a long-term data storage, archival, index and retrieval solution.” Second, offerors had to “propose a solution discussing the types of communications networks, cyber security considerations, and data storage systems that would be required” to support a “high fidelity multi-ship battlespace simulation.” Arguments of the Parties The various ways the parties argued this appeal demonstrate how different parts of a solicitation can support various NAICS codes. Rollout Systems filed an appeal with the SBA Office of Hearings and Appeals challenging the assigned NAICS code, arguing that the correct NAICS code for this procurement wsa 541330, Engineering Services. NAICS code 541330 normally corresponds with a size standard of $15 million average annual receipts. Rollout Systems also noted that  that “there is no R&D work identified to be performed for this effort.” Further, “[n]one of the labor categories have R&D attributes specified in their descriptions or have responsibilities and education requirements that support R&D.” Instead, Appellant maintains, the contractor will perform information technology support services, specifically “the operation and maintenance of the RDT&E network (i.e. operation and maintenance of [NAWCAD’s] IT systems.” Although this procurement is “in support of an RDT&E organization,” the contractor will not itself be engaged in research and development. Another potential offeror, RMC, similarly argued that the appropriate NAICS code was 541330 but, in contrast to Rollout Systems, said the exception for Military and Aerospace Equipment and Military Weapons should apply with a $38.5 million size standard. NAICS code 541330 has three exceptions that utilize a size standard of $38.5 million. As support, it noted the sources sought proposed code 541330 with the Military Weapons exception. RMC maintained that “[t]here is no original research and experimental development” for this RFP and OHA has stated that a research and development NAICS code such as 541715 requires creating new processes. A third potential offeror, MIL Corp. argued that code 541715 was correct because this RFP included “research and development efforts” in certain task areas and for certain labor categories. The services here are an integral part of the Navy’s “research, and essential for the conduct of the research”, and the computer services are woven into the Navy’s research. The CO stated that NAICS code 541715 was correct because the NAICS Manual describes NAICS code 541715 as including “research and experimental development in . . . computers.” NAICS Manual The NAICS code manual provides descriptions for various NAICS code industries. NAICS code 541715. NAICS code 541715, Research and Development in the Physical, Engineering, and Life Sciences (except Nanotechnology and Biotechnology), covers: The NAICS Manual defines “research” as “original investigation undertaken on a systematic basis to gain new knowledge,” and “experimental development” as “the application of research findings or other scientific knowledge for the creation of new or significantly improved products or processes.” For NAICS code 541715, a footnote in the Size Standards table states that: 13 C.F.R. § 121.201, n.11(a). NAICS code 541330. NAICS code 541330, Engineering Services, in contrast covers: NAICS code 541513. Finally, NAICS code 541513, Computer Facilities Management Services, covers: How to Assign the Proper NAICS Code OHA reiterated the rule that “the CO must assign the NAICS code that best describes the principal purpose of the product or service being acquired in light of the industry descriptions in the NAICS Manual, the description in the solicitation, the relative value and importance of the components of the procurement making up the end item being procured, and the function of the goods or services being acquired. The key with this sort of fact-specific analysis is how OHA decides what is proper, and in this case OHA’s analysis is pretty straightforward (at least in my opinion). OHA decided that NAICS code 541715 was inappropriate because the solicitation did not call for research and development. Research and development means “creating new processes or products.” Reviewing the solicitation, it called for network administration; cyber security; data storage; and other information technology and computer-related technical support. Because the computer networks already existed, the contractor would not invent or create them. Interestingly, OHA noted that, because there were few labor categories with advanced research or educational requirements, this reinforced that the agency was not looking for research and development. In other words, research and development often requires advanced degrees. Further, under the NAICS code table notes, “computer programming,” “data processing,” and “engineering, operations, systems, or other nonphysical research” is excluded from the definition of “research and development.” OHA also held that in some cases, supporting research by an agency can make it into a research procurement. But this procurement was not in direct support of research because the particular division of the Air Force seeking services (RDT&E Infrastructure Division, with the “R” standing for Research) did not do research. Rather the RDT&E Infrastructure Division provided the “computer and communications infrastructure to support research and development conducted by the ‘RDT&E labs’ and ‘the RDT&E community.’” In order to fit this exception for supporting research efforts, the contractor must also perform work integral to the research. Here, the contractor would not be doing research and was not required to have experience in aircraft or weapons research; the contractor would supply the computer services to assist those doing the research. OHA succinctly rejected NAICS code 541330, Engineering Services, because so little of the required labor consisted of engineers. So what NAICS code did apply?  541513, Computer Facilities Management Services, with a size standard of $27.5 million. Oddly, none of the parties suggested this code, but that did not stop OHA from applying it. Here, the contractor would supply operation and maintenance of government-owned computer systems; that fits NAICS code 541513. Takeaways This case demonstrates that there are many ways to advocate for the appropriate NAICS code for services in this arena. Three potential NAICS codes or variants were put forth, and OHA chose a fourth, and the size standards ranged from $15 million to 1,500 employees. Second, the line between some of these NAICS codes are quite fuzzy. Finally, OHA seemed to take a broad approach to analyzing the appropriate NAICS code, meaning OHA looked at the overall work being done, without getting bogged down too much in individual parts of the Solicitation.
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Koprince Law LLC

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Don’t Overlook the Seemingly Perfunctory in Your Proposal: CAGE Codes

As our readers well know, a good proposal for a federal government procurement is an exercise in persuasive writing. You muster your creative powers to convince the source selection authority that you offer the best product or service, that your price is competitive, and that your past performance is stellar. So you invest heavily in your proposal writers; you review your proposal repeatedly to polish and ensure that it compels; you agonize. But while the artistic portion of your proposal is, without dispute, extraordinarily important, don’t neglect the seemingly mundane–like CAGE codes. Get that wrong, and GAO just might sustain your competitor’s protest. In United Valve Co., B- B-416277 et al. (July 27, 2018), GAO considered a protest alleging that the Defense Logistics Agency made an improper award because, based on the submitted CAGE code, the awardee did not appear to be an approved source sanctioned by the solicitation. Under the RFP, the agency was looking for an indefinite quantity of helicopter damper assemblies for the UH-1 (I didn’t realize the U.S. still used this Vietnam-era helicopter . . . It must be a good piece of machinery!). The solicitation identified the dampers as critical source items and identified four approved sources, including the eventual awardee, Logistical Support, LLC. The solicitation also noted Logistical Support’s CAGE code as 55064 . In Logistical Support’s proposal, it listed its business address on Prairie Street in Chatsworth, California and identified itself as the manufacturer of part number listed in the solicitation. Yet, Logistical Support listed a different CAGE code (1HFE7) from the one listed by the agency in the solicitation (55064). Given this discrepancy, the agency contacted Logistical Support for clarification, asking: In response, Logistical Support responded that “both Cage codes belong to the same facility as stated in the SAM registration. If needed, the quote can be changed to the 55064 cage code.” Apparently, Logistical Support’s proposal was never changed to reflect CAGE code 55064. After due consideration of all proposals, Logistical Support was awarded the contract. A contending offeror was not convinced that Logistical Support was the same entity identified as an approved source in the solicitation–even though the approved source and Logistical Support maintained the same address. It filed a bid protest, arguing that the agency acted unreasonably in concluding that the approved source and Logistical Support were the same legal entity because each was identified by a different CAGE code. GAO was receptive to this argument. Citing its previous decisions, it observed that “ncertainty as to the identity of an offering entity renders an offer technically unacceptable.” As a factual matter, it found that Logistical Support’s proposal nowhere reflected the CAGE code associated with the solicitation’s approved sources. And while it acknowledged that the SAM registration showed the entities associated with CAGE code 55064 and 1HEF7 were both named Logistical Support, LLC and had the same address, each entity possessed a different CAGE code, DUNS number, DBA name, and activation date. Under these circumstances, GAO held that: In sustaining the protest, GAO recommended that the agency determine–and document–whether the awardee was qualified and eligible for award. And if not eligible, GAO recommended termination of the award for the government’s convenience and making the award to the protester. In addition, GAO also recommended that the agency reimburse the protester for its protest costs, including attorneys’ fees. The lesson here: don’t get dragged into a protest because you forgot to cross all t’s and dot all i’s. GAO will hone in on seemingly insignificant details, especially when they concern a contractor’s identity. Put simply, you need to sweat the humdrum details in your proposal.
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Koprince Law LLC

Koprince Law LLC

 

SmallGovCon Week in Review: September 3-7, 2018

Happy Friday, everybody! As always, we wanted to bring you a roundup of government contracting news. In this week’s edition of the SmallGovCon Week in Review, we’ll take a look at some potential updates to GSA contracts, reminders of the trouble that comes along with defrauding the government, and more. Have a great weekend! GSA to acquire new validation services for federal contractors and grantees. [FedScoop] GSA considering governmentwide contracting vehicle for services related to manned and unmanned systems. [Bloomberg Government] More talk of a government shutdown as the end of FY18 draws to a close. [Government Executive] GSA has issued a notice for comments regarding extension to an existing OMB clearance. [Federal Register] Trial ends for two brothers accused of conspiring to defraud the federal government. [East Bay Express] A Turkish man who owns a New Jersey defense contracting business charged in a scheme to fraudulently acquire lucrative contracts with DoD. [U.S. Department of Justice]
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Koprince Law LLC

Koprince Law LLC

 

DOL Releases New Opinion Letters Expanding FLSA Exemptions

By Tyler Freiberger, Following a nine-year gap, in January 2018 the Department of Labor (DOL) again began releasing voluntary opinion letters in response to common or unique questions. The initial batch of released letters only reinstated opinions from 2009 that had been withdrawn for “further consideration.” So the two letters released in April of this year, and the four released last week, are the first original works of the Trump administration’s DOL’s policies. I’ll warn you now, none of the opinion letters are exactly shocking, but they do give some indication of which way the wind is blowing. In general, the recent letters clarify some lesser used exemptions to the Fair Labor Standards Act (FLSA) and favor employers. Of the six opinions issued since April five clarify that an employee would be exempt from the FLSA or not compensated for an activity. The fact patterns these letters respond to are very limited. Still, each letter leaves breadcrumbs employers may follow in the future. The only letter arguably in favor of employees really just tries to put travel for non-traditional work schedules into context. No surprise in DOL assertion that travel time during the normal workday, for work, is compensable. Interestingly, the agency drew from an opinion letter half a century old to state “the employer and employee (or the employee’s representatives) may negotiate and agree to a reasonable amount of time or timeframe in which travel outside of employees’ home communities is compensable.” Citing WHD Opinion Letter (March 17, 1964). While this is only in the context of employees permanently working on the road, it is still an important win for employers, whom ideally could simply contract out exactly what hours are compensable and those that are not. The other letters are less far reaching, but in the aggregate show a trend toward chipping away at employer obligations.  First, hourly employees choosing to participate in voluntary health screenings, fairs, or other wellness activities, during or outside working hours, are not entitled to pay if the employer receives no direct financial benefit. Next, employees taking frequent breaks for medical reasons under the Family and Medical Leave Act (FMLA) are only entitled to the same amount of paid breaks as their co-workers. The DOL also clarified two uncommon overtime exceptions apply to some modern businesses, mobile credit card reader salespersons, and food servers at high-end movie theaters. Lastly, the agency clarified the line between a volunteer and an employee. While the letters do not have legal authority in a civil claim, they do indicate what activity the DOL will be hunting for in audits or investigations.   About the Author: Tyler Freiberger
Associate Attorney
Tyler Freiberger is an associate attorney at Centre Law & Consulting primarily focusing on employment law and litigation. He has successfully litigated employment issues before the EEOC, MSPB, local counties human rights commissions, the United States D.C. District Court, Maryland District Court, and the Eastern District of Virginia.       The post DOL Releases New Opinion Letters Expanding FLSA Exemptions appeared first on Centre Law & Consulting.
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GAO: Protest Sustained Where Agency Improperly Applied Adjectival Ratings

Recently, GAO sustained a bid protest where the ratings assigned to the unsuccessful offeror’s proposal did not conform to the definitions identified within the Solicitation. For those of you frequent the blog, you may recall earlier this year when we blogged on GAO’s decision in Immersion Consulting, LLC, B-415155 et al. (Dec. 4, 2017) where the Source Selection Authority had unilaterally revised the Source Selection Evaluation Board’s evaluation prior to making an award decision. GAO sustained the protest and instructed the agency to reevaluate proposals. This same procurement was subject to another round of protests following the agency’s reevaluation. We covered part of the GAO’s decision to sustain the second protest due to pervasive issues with the awardee’s staffing proposal in a recent blog post. This, however, was only one basis for GAO’s decision. As discussed in this post, GAO also sustained the protest due to issues with the agency’s application of the adjectival ratings. As more fully discussed in the earlier post, Immersion Consulting involved a procurement of program management support services by the Department of Defense’s Defense Human Resources Activity. Proposals were to be evaluated on three factors: technical, past performance, and price. Technical approach was the most important factor, followed by past performance, then price. The Solicitation explained that the agency intended to use adjectival ratings to evaluate proposals. The Solicitation provided definitions for each of the adjectival ratings. As relevant here, an adjectival rating of “Acceptable” was defined as follows:

Koprince Law LLC

Koprince Law LLC

Can Agencies Rely on CBP Rulings in Enforcing the Trade Agreements Act?

A new ruling says that Federal agencies can’t always rely on country-of-origin rulings by Customs and Border Protection (CBP) when applying the Trade Agreements Act to their contracts. The case dealt with an acquisition of Hepatitis B pill by the Department of Veterans Affairs (VA). The difficulty in parsing the regulations suggests that they need revision, if not a complete rewrite.     Read the full article at PetrilloPowell.com.

Joseph Petrillo

Joseph Petrillo

 

DoD Increases Micro-Purchase Threshold to $10,000, Effective Immediately

The Department of Defense has issued a class deviation raising the micro-purchase threshold to $10,000, effective immediately. The increase implements Section 821 of the 2019 National Defense Authorization Act, which was signed into law last month. The memo explains that there are a few exceptions to the standard $10,000 threshold.  The class deviation “does not change the micro-purchase threshold exceptions of $2,000 for acquisitions of construction subject to [the Davis-Bacon Act] and $2,500 for acquisitions of services subject to [the Service Contract Act].”  Definitions of these more limited authorities remain “as is” under FAR 2.101.  The memo also sets forth instances, such as contingency operations, where the micro-purchase threshold may be as high as $30,000. Kudos to the DoD for moving so quickly to implement the new statutory authority.  No doubt many Contracting Officers will be grateful.
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Koprince Law LLC

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5 Things You Should Know: Size Protests and Appeals

I’m just back from El Paso, where I had a great time discussing small business size and affiliation issues at the Contract Opportunities Center. This presentation got me thinking: “Wouldn’t our loyal SmallGovCon readers want to know 5 Things about size protests and appeals?” “Of course they would!” I immediately answered my own internal monologue. “After all, who wouldn’t?” Here are 5 Things You Should Know about size protests and appeals: What is a size protest? As a refresher, an offeror has to be a small business under the NAICS code assigned to a solicitation set-aside for small businesses in order to qualify for the award. At the most basic, a size protest is a challenge to an awardee’s size. In essence, a protester argues that the contract awardee should not have been awarded the contract because it’s not a small business. Sometimes, protesters argue that the awardee on its own is just too large a business; most of the time, however, a size protest argues that an awardee is affiliated with one or more other companies and, together with its affiliates, the awardee exceeds the applicable size standard. If a size protest finds that the awardee is not a small business, it can lose the award. Who can challenge a company’s size? A size protest must relate to a specific procurement. In most instances, this means that a person can’t protest a company’s size just because that person thinks the company is a large business—the supposedly large business must first be named an awardee under a particular solicitation. There are generally three different persons who might file a size protest against a particular company: A disappointed offeror. If an offeror loses out on the award (for reasons unrelated to its own size), that company could challenge the awardee’s size. Protests by a disappointed offeror must be sent to the contracting officer within five days from the date the disappointed offeror receives notice of the award; the contracting officer will then forward the protest to the SBA for a decision. The contracting officer. If a contracting officer has reason to doubt the awardee’s size, she can ask the SBA for a size determination. Importantly, this request can be made at any time—meaning that, even a couple of years into performance, the SBA can ask for a size determination. The SBA itself. Like a contracting officer, the SBA can initiate its own size determination, at any time, if it has reason to doubt a company’s size. How are size protests decided? If a size protest is filed (and isn’t dismissed for untimeliness or some other reason), the SBA will immediately notify the awardee. The awardee must then submit a response to the size protest and provide a trove of documents with that response—including its articles of organization, bylaws, tax returns and financial statements for the preceding three fiscal years, and documents describing its relationship with any potential affiliates. This response (and supporting documentation) is usually due just a few days after the awardee is notified of the protest. After it receives this information, the SBA will evaluate it thoroughly. If needed, it will ask for a more detailed response or additional documents from the company being protested. Once all of the needed information is received, the SBA will evaluate it and make a size determination (either finding that the company is a small or large business under the applicable NAICS code) within a couple of weeks. Can I appeal an adverse size determination? Absolutely. Any party that is adversely affected by a size determination can appeal it to the SBA’s Office of Hearings and Appeals. If your company is named the awardee and is subsequently found by the SBA to be an ineligible large business, you can appeal this determination to the OHA. Conversely, if your company loses a size protest against a different awardee, you can also appeal that determination. I don’t have any empirical data, but it’s my impression that OHA appeals are oftentimes successful. Size determinations are intensely fact-specific, and the SBA’s regulations are quite nuanced. So if you think that a determination might have been in error, it could be worth appealing that determination to the OHA. What else should I know about size protests and appeals? Size protests are an important part of the procurement process, as they help make sure that small businesses get the benefit of set-asides. Used offensively, a protest might help take an award away from a competitor. But this is a double-edged sword: one of your competitors might try to take your award away, too. Size protests must be taken seriously. Size protests and appeals oftentimes involve complicated factual and legal questions. And failing to adequately respond to a protest, in fact, could be considered an admission that your company is not a small business. Given the stakes—potentially winning or losing an award, as the case may be—it makes sense to get help from counsel that are experienced in size protests and appeals. *** There you have it: 5 Things You Should Know about size protests and appeals. If you have any questions, please give me a call.
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Koprince Law LLC

Koprince Law LLC

 

SmallGovCon Week in Review: August 27-31, 2018

The Labor Day weekend is inching closer! Before you enjoy the unofficial end of summer, let’s take a look at the SmallGovCon Week in Review. This week’s edition includes suggestions for interacting with a Contracting Officer Representative, a proposed DFARs amendment, contractors behaving badly, and more. Have a great weekend! Suggestions for interacting with a Contracting Officer Representative [Clearance Jobs] A recent report shows large compensation gaps among federal government contractor CEOs and workers [USA Today] More OTAs and less LPTA part of the impending upheaval for contractors [Federal News Radio] A proposed amendment to the Defense Federal Acquisition Regulation Supplement would revise progress payments and performance-based payments policies for DoD contracts [Federal Register] Dan Snyder, deputy director of Government Contracts Research at Bloomberg Government, and Larry Allen, president of Allen Federal, share their thoughts on what to expect at the end of FY 2018 and the beginning of FY 2019 [Federal News Radio] A $13.7 million “rent-a-vet” scheme lands a business owner in jail [U.S. Department of Justice] The mastermind of a scheme to use disabled veterans to apply for military construction project found guilty [The State]
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OFCCP Issues New Policy Directives

By Wayne Simpson, CFCM, CSCM On August 10, 2018, the Office of Federal Contract Compliance Programs (OFCCP) issued two directives. OFCCP directives provide guidance to OFCCP staff, Federal contractors (and subcontractors) on enforcement and compliance policy or procedures. These directives do not change the laws and regulations governing OFCCP programs and do not establish any legally enforceable rights or obligations. These directives will remain in force in anticipation of an addition to the Department’s regulatory agenda followed by rulemaking informed by public comment. The first directive, No. 2018-03, involves Executive Order No. 11246, Section 204(c), religious exemption, and incorporates recent court decisions addressing the broad freedoms and anti-discrimination protections that must be afforded religion-exercising organizations and individuals under the United States Constitution and Federal Law. The directive contains a policy statement, stating “In line with the longstanding constitutional requirement that government must permit individuals and organizations, in all but the most narrow circumstances, to participate in a government program ‘without having to disavow [their] religious character,’ OFCCP staff are instructed to take these legal developments into account in all their relevant activities, including when providing compliance assistance, processing complaints, and enforcing requirements of E.O. 11246, OFCCP staff should bear in mind that: They cannot act in a manner that passes judgment upon or presupposes the illegitimacy of religious beliefs and practices and must proceed in a manner neutral toward and tolerant of religious beliefs. They cannot condition the availability of opportunities upon a recipient’s willingness to surrender his [or her] religiously impelled status.” A Federal regulation’s restriction on the activities of a for-profit closely held corporation must comply with the Religious Freedom Restoration Act. They must permit faith-based and community organizations, to the fullest opportunity permitted by law, to compete on a level playing field for Federal contracts.” They must respect the right of religious people and institutions to practice their faith without fear of discrimination or retaliation by the Federal Government. The second directive, No. 2018-04, directs a portion of future scheduling lists included focused reviews as to each of the three authorities OFCCP enforces: E.O. 11246; Section 503 of the Rehabilitation Act; and the Vietnam Era Veterans’ Readjustment Assistance Act of 1974, as amended. The directive contains the following OFCCP policy: OFCCP staff is directed to work towards ensuring that a portion of future scheduling lists, starting in Fiscal Year 2019, include focused reviews as to each of the three authorities that OFCCP enforces: the E.O., Section 503, and VEVRAA. As such, these focused reviews will be selected from the same neutral selection system used to identify and create OFCCP’s supply and service scheduling list. OFCCP staff is further directed to develop a standard protocol for conducting the focused reviews anticipated by this Directive and to make this information available publicly in its FAQs prior to the next scheduling list being issued. Finally, the OFCCP staff is directed to develop staff training and contractor education and compliance assistance to provide guidance as to the focused reviews anticipated by this Directive. [CLICK HERE TO SEE THE NEW OFCCP POLICY DIRECTIVES] About the Author: Wayne Simpson
Consultant
Wayne Simpson is retired from the U.S. Department of Veterans Affairs (VA) after 38 years of federal service. He served as the Executive Assistant to VA’s Deputy Assistant Secretary for Acquisition and Logistics where he was the primary staff advisor to the Deputy Assistant Secretary, who serves concurrently as VA’s Senior Procurement Executive and Debarring Official.   The post OFCCP Issues New Policy Directives appeared first on Centre Law & Consulting.
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