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Centre Law & Consulting

Mark your calendars to join Barbara Kinosky at the upcoming Section 809 Panel meeting on April 27 at 11:30am where she will be an invited featured speaker.

Section 809 Panel stakeholder meetings provide a forum for external experts in the defense acquisition community to provide input to representatives of the panel for consideration in the panel’s work. The Section 809 Panel is looking at reforming and streamlining acquisition regulations with a view toward improving the efficiency and effectiveness of the defense acquisition process and maintaining a defense technology advantage. The panel is charged with making recommendations for the amendment or repeal of such regulations that the panel considers necessary, as a result of such review, to:

  • Establish and administer appropriate buyer and seller relationships in the procurement system
  • Improve the functioning of the acquisition system
  • Ensure the continuing financial and ethical integrity of defense procurement programs
  • Protect the best interests of the Department of Defense
  • Eliminate any regulations that are unnecessary for the purposes described

All Section 809 Panel meetings are open to the general public and details are posted to the panel’s website.
 
Section 809 Panel logo
 

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Bid Protests: No Completed PPQs? No Contract. | Centre Law & Consulting in Tysons, VA
 
Last month, in Genesis Design and Development, Inc., B-414254 (Feb. 28, 2017), the Government Accountability Office (GAO) denied a protest challenging the rejection of a proposal where the contractor had failed to provide three past performance questionnaires (PPQs) completed by previous customers.

In its proposal, Genesis provided PPQs that provided customer contact information but which did not contain substantive responses from the previous customers. The company argued that it submitted PPQs containing information identifying its past clients and that it reasonably anticipated that the agency would seek the required information directly from its clients. Genesis also suggested that it can be difficult to obtain such information from its clients because they often are too busy to respond in the absence of an inquiry directly from the acquiring activity, and the company noted that, in previous cases, agencies had sought out such information.

The GAO was unmoved, holding that the RFP specifically required offerors to submit completed PPQs and that Genesis’s submission did not comply with the express requirements. Given that the RFP also provided that failure to supply required documentation – including PPQs – could result in a proposal’s elimination from consideration, the agency’s rejection of Genesis’s proposal was reasonable.

While PPQs can often place offerors in the uncomfortable position of needing to rely on prior COs who are under no obligation to respond or respond in a timely manner, the Genesis decision makes clear that failure to submit completed PPQs can preclude consideration for contract award.

About the Author:

David Warner | Centre Law & Consulting David Warner
Partner

David Warner is a seasoned legal counselor with extensive experience in the resolution and litigation of complex employment and business disputes. His practice is focused on the government contractor, nonprofit, and hospitality industries. David leads Centre’s audit, investigation, and litigation practices.

 

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VA National Acquisition Center Issues Updated Small Business Subcontracting Plan Template | Centre Law & Consulting in Tysons, VA
 
Large business prime contractors holding Federal Supply Schedule (FSS) contracts issued by the Department of Veterans Affairs (VA) National Acquisition Center (NAC) may want to take note.

Updated Small Business Subcontracting Plan Template
The VA NAC posted an updated Small Business Subcontracting Plan Template to its website in February 2017. This latest version of the template is dated January 26, 2017.

VA NAC also updated its VA FSS Subcontracting Plan Training presentation in January 2017, providing detailed information on how to complete the new VA FSS Subcontracting Plan Template. Current VA NAC contract holders should ensure their new and ensuing subcontracting plans are submitted to the VA NAC for approval no later than 30 calendar days prior to expiration of their current plans.

It should be noted VA does not accept or recognize digital or electronic signatures at this time. It requires the email submission of subcontracting plans contain a scanned wet signature.

VA NAC continues to step-up enforcement of timely submissions. Delinquent submissions of subcontracting plans and Electronic Subcontracting Reporting System (eSRS) data can result in negative Contractor Performance Assessment Reporting System (CPARS) assessments, issuance of Cure Notices, or other contract enforcement actions which could jeopardize continued performance under the contract.

Small Business Size Standards Changed
Federal small business size standards changed significantly effective February 26, 2016, for North American Industry Classification System (NAICS) Codes covering manufacturing (NAICS Sectors 31-33). For example, perhaps one of the most common NAICS Codes used in VA procurements, NAICS 339112, Medical and Surgical Supplies Manufacturing, increased from 500 to 1,000 employees.

Therefore, contract holders should check to see if their size status has changed. Some “large” businesses are now classified as “small” under the new size standards, and small businesses are not required to submit subcontracting plans. If your size status has changed from large to small, contact your contracting officer to determine if a small business subcontracting plan is still required. A subcontracting plan is required until the contracting officer advises it is no longer required.

What Can You Do Next?
Centre provides turn-key Small Business Subcontracting Plan support to large business VA FSS Contractors using best practices to develop commercial subcontracting plans and administer their small business subcontracting program. This includes conducting formal surveys to ascertain size and socioeconomic procurement preference program status of suppliers and subcontractors, eSRS submissions, and preparation of justifications for achievement shortfalls against negotiated small business and socioeconomic procurement preference program category goals.

Contact Wayne Simpson to find out more, get started with your supplier survey, or determine the best next steps for your company.

About the Author:

Wayne Simpson | Centre Law & Consulting Wayne Simpson
Consultant

Wayne Simpson is a seasoned former Federal executive and acquisition professional who is also a highly-motivated and demonstrative small business advocate, with nearly 38 years of Federal Civilian Service with the U.S. Department of Veterans Affairs (VA), and its predecessor organization, the Veterans Administration.

 

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Small Business and Working With Similarly Situated Entities | Centre Law & Consulting in Tysons, VA
 
If you are like me and work for a small business, you have been patiently waiting for the FAR Council to implement the Small Business Administration’s final rule from June 2016 that made major changes to the way performance requirements apply to small business in set-aide contracts.

For those who don’t know, this change allows for a prime small business, WOSB, SDVOSB, EDWOSB, 8A, or a HUBZone company to subcontract in service contracts to similarly situated firms and not count towards the 50% subcontracted work amount that typically cannot be exceeded. For example, if you win a WOSB set-aside contract and want to subcontract to another WOSB, the work the second firm does would not count towards the 50% subcontract amount limit. As you can imagine, this a huge boon to small businesses and provides great flexibility to compete on larger contracts.

As of March 22, 2017, the Defense Acquisition Regulatory Council (DARC) agreed to draft an interim FAR rule. Remember, this change isn’t automatically included in your current contracts. Under FAR 1.108(d)(3), the Contracting Officer (CO) “may, at their discretion, include changes in any existing contract with appropriate consideration.” Therefore, if you want to get credit for your subcontractor’s work to meet your set-aside requirements, make sure you petition your CO to update your contract with the new FAR rule when it is eventually implemented.

Find more information concerning this rule change in the Federal Register.
 
About the Author

Colin Johnson | Centre Law & Consulting in Tysons VA Colin Johnson
Contracts Manager

Colin Johnson is a Contracts Manager who focuses on business development and federal contracts management. His expertise is in preparing quotes and responses for both government and commercial entities for training and legal support services.

 

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Bid Protests: Incumbent Protests Failure of Navy to Release Incumbent’s Proprietary Data | Centre Law & Consulting in Tysons, VA
 
Just when you think you have heard it all, along comes the preaward protest of Fluor Federal Solutions, LLC, B-414223, March 29, 2017.

Fluor alleged that the Department of the Navy, Naval Facilities Engineering Command, solicitation was ambiguous. Fluor claimed that that offerors could not meaningfully price their proposals because of the ambiguous requirement it contained and that proposals received could not be meaningfully compared and evaluated. The interesting quirk was that Fluor was the incumbent, and they wanted to “level the playing field” so that all offerors were bidding to the same requirement and leaving no ambiguity. Fluor’s method of doing so was to have the Navy release Fluor’s proprietary data, after it waived its rights in the data.

The Government Accountability Office (GAO) dismissed this ground of protest. They held that the protester failed to establish that it is an interested party to challenge the lack of data. This is legal speak for saying that Fluor cannot protest on behalf of other potential bidders. Fluor was not prejudiced by the failure of other offerors to see the Fluor proprietary data.

It’s an interesting twist on a protest.
 
About the Author

Barbara Kinosky Barbara Kinosky
Managing Partner

Barbara Kinosky has more than twenty-five years of experience in all aspects of federal government contracting and is a nationally known expert on GSA and VA Schedules and the Service Contract Act. She has a proven track record of solving complex issues for clients by providing strategic and business savvy advice. Barbara was named a top attorney for federal contracting by Smart CEO magazine in 2010, 2012, and 2015.

 

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Centre Law & Consulting

Centre Law & Consulting (Centre), a leading provider of training and acquisition services for government agencies, is pleased to announce the award of a contract with the Nuclear Regulatory Commission (NRC) for NRC Acquisition Workforce Training.

Under the contract, Centre will develop and deliver a structured training program which standardizes the education, training, and experience requirements for NRC acquisition professionals, while improving workforce competencies and performance. The instruction provided will include all levels of COR and acquisition courses related to FAC-C & FAC-COR certifications. Courses will be conducted at the NRC’s Professional Development Center and virtually across the United States.

The contract covers a base period of one year with two option years.

“It is an honor to be selected by the NRC as their new training provider, and we are excited to provide our expertise in developing integrated learning solutions for acquisition and procurement personnel,” said Barbara Kinosky, Esq., Managing Partner of Centre. “We look forward to delivering innovative curriculum and content that will strengthen the NRC workforce to align with the NRC’s performance goals.”

Jeffrey Keen, Director of Federal Contracts and Training at Centre Law & Consulting, will serve as Program Manager. He will be the primary point of contact with the NRC and with Hemsley Fraser, a subcontractor that will assist Centre with extensive course customization.

“Our training team is committed to helping the NRC improve the operational knowledge of its staff and we are dedicated to ensuring they receive the best possible support for their training initiatives. We look forward to customizing an education program that will elevate the performance of their employees,” Keen said.

Centre has a long history of working with a variety of government agencies, but this contract marks the first time it will partner with the NRC. Centre was selected based on its experience in creating custom courseware, for its history of providing DAU-approved courses, and for its day-to-day experience in advising government personnel on acquisition and procurement matters.

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Tune in tonight, Wednesday April 19, at 8:00pm and 11:00pm to the Government Matters show on NewsChannel 8 in the Washington DC area to see a segment featuring Centre Law & Consulting. Wayne Simpson, Consultant with Centre, appears on the show for an interview about the Department of Veterans Affairs’ efforts to reduce the administrative burdens on SDVOSBs and VOSBs.

Government Matters is the only television newscast focused on the business of government. Host Francis Rose recaps the top federal headlines and conducts thought-provoking interviews on tech, security, defense, workforce, and industry issues. Since its launch in August of 2013, Government Matters has hosted some of the top minds in the federal community, including guests from the White House, Congress, Fortune 500 companies, journalism, and the non-profit sector.

NewsChanne 8 Washington DC Logo
 

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Spring Cleaning for Your GSA Schedule | Centre Law & Consulting in Tysons, VA
 
As spring approaches, it’s the time of year when we are all busy dusting off and cleaning up around the house, but do not forget to spruce up your General Services Administration (GSA) Schedule contract as well.

Below are key items to consider when spring cleaning your GSA Schedule:

Authorized Negotiators/Digital Certificates: Have you reviewed the authorized negotiators on your GSA Schedule recently? If any authorized negotiators need to be removed or added, this can be completed via an administrative modification. Has it been two years since your received your digital certificate or did you get a new computer recently? It is important to check that your digital certificate is still valid and is on your current computer. Without a digital certificate, an authorized negotiator will not be able to access the eMod system. If the information on your digital certificate does not match what is listed in the authorized negotiator table in eMod, you will need to complete an administrative modification to make the updates. NOTE: Digital Certificates are only valid for two years.

Administrative Contract Data: Ensure that the Contract Administrator, phone and fax number, e-mail address, website, and physical address are up-to-date on your contract. GSA will use this information to communicate with you, so you do not want to miss out on important updates.

Pricing – Commercial Price List: Have you issued a new commercial price list and need to increase your prices? It is time to complete an Economic Price Adjustment (EPA) modification in accordance with 552.216-70.

Pricing – Market Rates: Have your completed your annual EPA modification in accordance with I-FSS-969(b)(2)? If not, it is time to review the Bureau of Labor Statistics (BLS) website to find the market indicator applicable to your contract and request an EPA modification.

Additions: Do you have new products or services that you want to add to your GSA Schedule? If you have sold these new products or services, it is time to submit an addition modification to include these new products and/or services on your Schedule.

Deletions: Are there any products or services that you no longer offer? It is time to complete a deletion modification to remove these products or services from your schedule. If you have products, have you verified the Country of Origin (COO) for them lately? If the COO has changed to a non-Trade Agreement Act compliant country, you must submit a deletion modification to remove those products immediately.

Terms & Conditions: Have your reviewed your terms and conditions within the last year? It is important to evaluate your Basis of Award (BOA) and Commercial Sales Practices (CSP) annually to determine if there have been any changes. Reviewing this information annually will help prepare you for your Option Renewal. If anything has changed in regards to your BOA or CSP, it’s time to complete a term and condition modification.

GSA Advantage! Price List: Is your GSA Advantage! price list up-to-date? Ensure that your price list has been updated per the last modification awarded under your GSA Schedule. If you have not updated your price list in two years, you will receive a notice from GSA that will require action within 90 days or your price list will be removed from GSA Advantage.

Mass Modifications: Have you checked to ensure that all mass modifications have been accepted? Click here to verify their status. If you have long outstanding mass modifications, it is possible that your PIN has expired. You will need to reach out to your Administrative Contracting Officer (ACO) to obtain a new PIN.

Small Business Reports: If you are a large business, ensure that all of your subcontracting reports are submitted. Below are the reporting deadlines for both Individual Small Business Subcontracting Plans and Commercial Small Business Subcontracting Plans.

Calendar Period Report Due Date Due
10/01 – 03/31 ISR (Individual Plan) 04/30
04/01 – 09/30 ISR (Individual Plan) 10/30
10/01 – 09/30 SSR (Commercial Plan) 10/30

 
IFF Reports: Are all of your Industrial Funding Fee (IFF) reports complete? Reports and IFF remittance must be completed within 30 calendar days following the completion of each reporting quarter. Even if you had zero sales during the reporting period, you are still required to complete your reports.

Before completing any modifications to clean up your GSA Schedule, review the modifications instructions applicable to your schedule to ensure that you submit all required documentation. If you need assistance updating your contract, reach out to our GSA consulting team.

GSA Schedule Spring Cleaning Checklist free download | Centre Law & Consulting in Tysons, VA
Download Now

 
About the Author:

Julia Coon | Centre Law & Consulting in Tysons VA Julia Coon
Consultant

Julia Coon is GSA and VA Contract Consultant at Centre Law & Consulting. Julia works with the GSA/VA team in preparing new schedule proposals and post-award contract administration. She has experience in producing schedule renewal packages, various modification packages, small business subcontracting plans, and updates to GSA pricelists.

 

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Bid Protests: Protester’s Costs for Filing Bid Protest Denied Even Where Agency Does Not Dispute a Meritorious Protest | Centre Law & Consulting in Tysons, VA
 
In a recent GAO decision, Boise Cascade Wood Products, LLC, B-413987.2 (Apr. 3, 2017), the GAO denied a small business’ request for reimbursement of the costs of filing and pursing a bid protest where the protester argued that the agency unduly delayed taking corrective action in the face of a clearly meritorious protest.

In this matter, the protester pursued a protest against the Forest Service, which involved both a timber sale and a procurement of services. Specifically, the Forest Service issued a solicitation for a forest stewardship contract, which typically also involves the sale of timber or forest products and the performance of certain services. What gives this decision its interesting twist is that the Forest Service’s implementing regulations provide that when the value of timber removed through the contract exceeds the total value of the services, it shall be considered a contract for the sale of property.

As a general matter, sales by a federal agency are not procurements of property or services and are not within the GAO’s bid protest jurisdiction. However, the GAO will consider protests concerning sales by a federal agency if that agency has agreed in writing to have protests decided by the GAO; the Forest Service has expressly agreed to this, creating a non-statutory agreement with the GAO.

In this case, as the value of the timber significantly exceeded the value of the services, the agency determined to solicit the contract as a timber sale. As such, the GAO found that the cost reimbursement request was precluded by its regulations, which establish that it will not recommend the payment of protest costs in connection with non-statutory protests.

About the Author:

Heather Mims | Centre Law & Consulting in Tysons VA 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.

 

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Government Shutdown Deadline Looms While GSA Takes It on the Chin Over TDR Program | Centre Law & Consulting in Tysons, VA
 

Trump Administration Begins Government Shutdown Preparations

Negotiators are hard at work behind the scenes this week trying to reach a budget agreement that will keep government agencies open, but the Trump administration has begun preparing for a shutdown that could begin on April 29, barring any congressional action.

Representatives on both sides of the aisle are hopeful about reaching an agreement that would fund all agencies through the end of the fiscal year in September, but the Trump Administration could stand firm on its funding priorities, which would make an agreement more difficult.

Perhaps one of the biggest issues is “The Wall.” Trump has asked for an extra $33 billion to go toward the U.S.-Mexico border wall with increased immigration enforcement. Democrats seem to have no issue with shutting down the government if the spending bill includes this funding, and Republicans appear to not want to risk calling their bluff, indicating “they would deal with the administration’s supplemental request separately from the regular appropriations bill,” according to Government Executive.

There will of course be give and take, deal-making and trading going on behind the scenes. I guess we’ll have to wait and see how things shake out on April 29.

Read the full story on Government Executive.

DOJ and GSA Work to Build New Government-Wide FOIA Portal

Coming soon to a computer near you: a single streamlined website where you can submit Freedom of Information Act requests to any agency.

Well, that’s at least what the Department of Justice (DOJ) and General Services Administration (GSA) are working to achieve as they collaborate together on a new national portal. The DOJ has actually been working towards a single portal since 2010 when it introduced FOIA.gov and began working with GSA on small improvements to the site back in 2014. This new partnership hopes to introduce a new singular portal.

You are encouraged to provide input about your FOIA experiences as the agencies work through the development process. Send an email with your comments to National.FOIAPortal@usdoj.gov by April 28.

Read the full story on the Nextgov website.

Trump Signs EO to Bolster “Buy American” Laws

President Trump signed a new Executive Order (EO) that focuses on buying American products. Under the EO, agencies must complete a full review of their procurement procedures to assess their compliance with “Buy American” laws. A report of their findings is due to the Secretary of Commerce and Office of Management and Budget (OMB) within 150 days. A final report will go to the President within 220 days along with recommendations for how to better implement Buy American laws.

Read the full story on the White House website.

Hard Knocks for GSA’s Transactional Data Reporting Program

The General Services Administration (GSA) has been taking a lot of hits recently on their new Transactional Data Reporting (TDR) program. Harsh criticism has been coming from all directions, and government contracting consultants have strongly advised their clients not to take part in it.

If you’re unfamiliar with TDR, it’s a program that allows contractors to provide data about transactions made through their Schedule contracts in exchange for not having to follow the Price Reduction Clause (PRC) and the Commercial Services Practices (CSP) provision. Contractors have been rallying for years to change the PRC. While they were happy to see GSA making changes, the concern over TDR has continued to grow since it was unveiled.

You’ve got to give credit to the GSA Deputy Commissioner of the Federal Acquisition Service, Kevin Youel Page, though. Instead of staying silent and steadfast, he’s ready to hear contractors’ concerns and take action to address the issues. The TDR program management office even set up an email address where anyone can send in questions or concerns.

Meanwhile, some within the industry are already debating the long-term viability of the TDR program. So far, GSA has only announced a three-year pilot and no public support has come from the Trump administration.

Read the full story on Federal News Radio’s website.
 
About the Author

Barbara Kinosky Barbara Kinosky
Managing Partner

Barbara Kinosky has more than twenty-five years of experience in all aspects of federal government contracting and is a nationally known expert on GSA and VA Schedules and the Service Contract Act. She has a proven track record of solving complex issues for clients by providing strategic and business savvy advice. Barbara was named a top attorney for federal contracting by Smart CEO magazine in 2010, 2012, and 2015.

 

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Bid Protest: “Professional Compensation” Sinks Contract Award | Centre Law & Consulting in Tysons, VA
 
Last week, the Government Accountability Office (GAO) released the public version of its decision sustaining the protest of contractor A-P-T Research, Inc. with respect to a procurement with the National Aeronautics and Space Administration (NASA) for various support services. In addition to a potential impaired objectivity organizational conflict of interest, the protest was sustained because the awardee’s proposed professional compensation was at the low end of the experience and compensation scales used for evaluation. With that, the contemporaneous record lacked a reasoned basis for finding the professional compensation and related costs to be acceptable or realistic.

Because a cost-reimbursement contract’s cost is driven in significant measure by labor costs, the procuring agency is required to evaluate each offeror’s direct labor rates to ensure that they are realistic. The purpose of a review of compensation for professional employees under the provision at FAR § 52.222-46 is to determine whether offerors will obtain and keep the quality of professional services needed for adequate contract performance and to evaluate whether offerors understand the nature of the work to be performed. As the FAR provision states, the “professional compensation proposed will be considered in terms of its impact upon recruiting and retention, its realism, and its consistency with a total plan for compensation.” Further supporting information including “data, such as recognized national and regional compensation surveys and studies of professional, public, and private organizations, used in establishing the total compensation structure” are to be provided.

In brief, the Agency sustained the protest because “the record contains no meaningful explanation of how [NASA] concluded that [the awardee] would be able to retain” the proposed incumbent employees at the compensation offered, which would result in significant pay decreases. Rather, the record contained only general statements that concerns regarding compensation had been addressed via discussions.

Notably, the Agency did not express a view on the argument that FAR § 52.222-46 requires a direct comparison of proposed compensation and actual incumbent compensation rates. However, it is clear that under-cutting on professional salaries can be a dangerous gambit.

About the Author:

David Warner | Centre Law & Consulting David Warner
Partner

David Warner is a seasoned legal counselor with extensive experience in the resolution and litigation of complex employment and business disputes. His practice is focused on the government contractor, nonprofit, and hospitality industries. David leads Centre’s audit, investigation, and litigation practices.

 

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Executive Order for More Accountability at Department of Veterans Affairs | Centre Law & Consulting in Tysons, VA
 
The Department of Veterans Affairs (VA) has come under intense scrutiny from Congress, Veterans, and taxpayers in recent years in large part due to its patient wait time scandal. The first bills to pass the U.S. House of Representatives in the current 115th Congress included The Ensuring VA Employee Accountability Act. The Congress.gov website has numerous current bills pending pertaining to VA accountability, and there was no shortage of proposed accountability legislation in the 114th Congress.

Now the President has weighed in as well. On April 27, 2017, President Trump traveled across Lafayette Park from the White House to the VA Central Office to sign Executive Order (EO) 13793, “Improving Accountability and Whistleblower Protection at the Department of Veterans Affairs.”

The intent of the EO is to improve accountability and whistleblower protection at VA. It directs the Secretary of Veterans Affairs to establish an Office of Accountability and Whistleblower Protection and to appoint a special assistant to serve as the office’s Executive Director.

This new office must be established within 45 days of the EO (therefore, by June 11, 2017), and VA must provide funding and administrative support “consistent with applicable law and subject to the availability of appropriations.”

The VA Office of Accountability and Whistleblower Protection shall advise and assist the Secretary in using, as appropriate, all available authorities to discipline or terminate a VA manager or employee who has violated the public’s trust and failed to carry out his or her duties on behalf Veterans and to recruit, reward, and retain high-performing employees.

In addition, the office will identify statutory barriers to the Secretary’s authority to discipline or terminate any employee who has jeopardized the health, safety, or well-being of a Veteran, reporting such barriers to the Secretary for consideration as to the need for legislative changes.

Finally, the VA Office of Accountability and Whistleblower Protection is charged with the responsibility to work closely with VA components to ensure swift and effective resolution of Veterans complaints of wrongdoing at VA, ensure adequate investigation and correction of wrongdoing at VA, and protect employees who lawfully disclose wrongdoing from retaliation.

The EO does provide the Secretary with some flexibility in establishing the VA Office of Accountability and Whistleblower Protection. The Secretary may consider whether some or all of the functions are currently performed by an existing VA office, component, or program and to determine if certain administrative capabilities necessary to operate the office are redundant. Additionally, the Secretary may consider whether combining VA’s Office of Accountability and Whistleblower Protection with another VA office, component, or program may improve VA’s efficiency, effectiveness, or accountability.

A copy of EO 13793 was published in the Tuesday, May 2, 2017, edition of the Federal Register.

About the Author:

Wayne Simpson | Centre Law & Consulting Wayne Simpson
Consultant

Wayne Simpson is a seasoned former Federal executive and acquisition professional who is also a highly-motivated and demonstrative small business advocate, with nearly 38 years of Federal Civilian Service with the U.S. Department of Veterans Affairs (VA), and its predecessor organization, the Veterans Administration.

 

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Federal Circuit Reverses $80,000 Fee Award in Bid Protest | Centre Law & Consulting in Tysons, VA
 
In a recent ruling, the Federal Circuit in Dellew Corporation v. United States reversed a legal fees award to a contractor because the agency had taken corrective action on the bid protest before it was decided in court on the merits.

In initially awarding the fees and costs, the Court of Federal Claims found that comments it made during the hearing and prior to the Government taking corrective action materially altered the position of the parties so that the contractor qualified as a “prevailing party” under the Equal Access to Justice Act (EAJA), a requirement under the statute for the Court to award fees and costs. Specifically, the Court of Federal Claims focused on certain comments it made during the parties’ oral arguments. The Court stated that it provided “hints” about its views favorable to the contractor on the merits and told the parties that it had drafted an opinion. The Court of Federal Claims also repeatedly expressed its belief that corrective action would be appropriate.

As a result, the Government agreed to take corrective action and the bid protest was dismissed as moot. The contractor subsequently sought attorney fees and costs under the EAJA. In awarding nearly $80,000 in fees and costs, the Court of Federal Claims held that it, in making substantive comments during the oral argument regarding the merits of the case, the Court materially altered the relationship between the parties such that the contractor qualified as a prevailing party under the EAJA.

However, in reversing the fee award, the Federal Circuit held that the contractor was not a prevailing party as required by the EAJA because the Government voluntarily took the corrective action and the Court’s comments about the merits of the case made during the hearing did not constitute sufficient grounds to convey prevailing party status. Therefore, the Federal Circuit reversed the fee award of nearly $80,000.

About the Author:

Heather Mims | Centre Law & Consulting in Tysons VA 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.

 

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Ninth Circuit Rules Employer Can Pay Female Employee Less Than Male Based On Prior Salary | Centre Law & Consulting in Tysons, VA
 
The Ninth Circuit recently ruled in Rizo v. Yovino that a female’s prior salary can be a “factor other than sex,” thus justifying a pay disparity between comparable male and female employees for purposes of the Equal Pay Act.

The plaintiff was an employee of the public schools in Fresno County, California. Upon discovering that the County paid her less than her male counterparts for the same work, she brought an action against the County under the Equal Pay Act. The County conceded that it paid the plaintiff less than male employees but argued that the pay differential was based on the plaintiff’s prior salary.

Under the Equal Pay Act, there are four exceptions that permit a wage disparity; one of those exceptions is “a differential based on any other factor other than sex.”

In determining that prior salary alone can never qualify as a factor other than sex, the district court reasoned that “a pay structure based exclusively on prior wages is so inherently fraught with the risk…that it will perpetuate a discriminatory wage disparity between men and women that it cannot stand, even if motivated by a legitimate non-discriminatory business purpose.” In vacating the district court’s order, the Ninth Circuit held that an employer may base its pay differential on prior salary so long as its use effectuated some business policy and the employer reasonably used it in light of its stated purpose and other practices. The Ninth Circuit remanded the matter back to the district court to evaluate the employer’s business reasons in setting the salaries.

Therefore, in essence, the Ninth Circuit has held that an employer may perpetuate existing pay disparities so long as it is part of a company’s business policy. However, this case has the potential to go to the U.S. Supreme Court as other appeals courts have decided this issue differently.

About the Author:

Heather Mims | Centre Law & Consulting in Tysons VA 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.

 

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photo-finish-bid-decision-survives-protest | Centre Law & Consulting in Tysons, VA
 
In its May decision, the Government Accountability Office (GAO) denied a bid protest despite agreement that the contract award was all but a tossup.

After a three year phased acquisition competition between two contractors for the design of radio detection software used in the U.S. Air Force Special Operations Command aircraft, neither contractor had pulled far ahead of the other. The lack of distinction came even with a complicated and detailed evaluation. From the two factors considered, the Agency assigned ratings for the five different elements of two different sub-factors. All of this just to finish with identical ratings. Both contractors drew “moderate” concern for some of the incomplete portions of the designs, but ultimately the Source Selection Advisory Council (SSAC) leaned toward Northrop Grumman over BAE.

In preparing their recommendation, the SSAC admitted, “We do recognize that a different body of stakeholders with similar experience and knowledge could reach an entirely different recommendation based on the same data.”

As predicted, a different body did reach another conclusion. The Source Selection Authority (SSA) rejected the recommendation. While the SSA agreed the Northrop Grumman design was likely more advanced and impressive, it “does the warfighter no good until it can be integrated onto their aircraft.” The SSA cited less risk with completion of the BAE design and the small savings in cost for its decision to instead award BAE.

The GAO ruled the SSA’s preference, for one in the hand over two in the bush, was a justifiable reason to reject the SSAC’s recommendation.

Northrop Grumman focused a large portion of its protest explaining the perceived risks were very short term and therefore not a justifiable reason to discredit the benefits of their design acknowledged by the SSA and SSAC. The GAO refused to decide how the risk should have been evaluated, instead stating the SSA’s concern was not unreasonable and therefore the protest must be denied.

About the Author:

Tyler Freiberger Headshot | Centre Law & Consulting in Tysons, VA 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..

 

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100-days-administration.jpg
 
Say what one will about our still-new President (and I will), there appear to be very few among the chattering class who hold a “neutral” view about him. A little over 100 days into his administration and certain corners are already routinely beating the drum of impeachment. And the ink spilled over the Comey firing and recent reports concerning what was either a benign discussion of known intelligence information (from one perspective) or the revealing of “highly classified information” to his Russian puppet masters (from another) suggest that the fever pitch of commentary is not going to be lowering in volume any time soon.

Dumpster Fire, Constitutional Crisis, or Perhaps Just Business as Usual | Centre Law & Consulting in Tysons VA And yet, if one sets both ends of the partisan hyperbole aside, a funny thing appears to be happening on the way to the dumpster fire which is purportedly the Trump Administration – governance. For example, while conservatives may be chafed by having to accept Alexander Acosta in lieu of the more ideologue burger exec Andrew Puzder at the head of the Department of Labor, the much maligned “Fair Pay and Safe Workplaces Executive Order” is already history. Many expect that the even more maligned, revised and expanded EEO-1 form (requiring reporting of pay data) is likely to end up in the dust bin this summer. Similarly, the legislative wrangling around the Affordable Care Act continues apace as well.

On judicial appointments, seen by many as one of the signature issues of the campaign, Trump is also widely perceived as delivering on his promises. With the judicial filibuster having been “nuked” to clear the path for Neil Gorsuch to join the U.S. Supreme Court, Trump has been active in identifying slates of candidates for lower court benches. Last week, the White House announced Trump’s “third wave” of judicial appointments (following Gorsuch and the nomination of Judge Amul R. Thapar of Kentucky to serve as a Circuit Judge on the U.S. Court of Appeals for the Sixth Circuit). Notably, two of the ten nominees – Professor Amy Coney Barrett of Notre Dame University Law School and Justice Joan Larsen of the Michigan Supreme Court – are former law clerks of the late-Justice Antonin Scalia, and another – David Stras of the Minnesota Supreme Court – was a clerk for Justice Clarence Thomas. Of course, not everyone is pleased with the selections, but we do seem to have come a long way from thoughts of nominating his sister to the high court.

While I’m not one to believe that Trump (or his predecessor for that matter) is a master of three-dimensional political chess, which the rest of us rubes simply can’t comprehend, sometimes the allegedly oncoming dumpster fire or ill-conceived tweet looks an awful lot like “stray voltage.” Or, rather, business as usual in Washington, D.C.

About the Author:

David Warner | Centre Law & Consulting David Warner
Partner

David Warner is a seasoned legal counselor with extensive experience in the resolution and litigation of complex employment and business disputes. His practice is focused on the government contractor, nonprofit, and hospitality industries. David leads Centre’s audit, investigation, and litigation practices.

 

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Protest Denial Stresses Need of Detail in Proposal Methodologies | Centre Law & Consulting in Tysons, VA
 
A single weak link in a contractor’s proposal resulted in its highly praised proposal losing to one with fewer evaluated strengths.

Seeking mission support services in its work to counter improvised threats, such as IEDs and other homemade explosives, the Joint Improvised-Threat Defense Organization (JIDO) recently issued a task order for subject matter expertise. Its award drew a protest from Sev1Tech, Inc. challenging JIDO’s choice of Amyx, Inc. for the task order.

When evaluating the contractors’ proposals, JIDO stressed it was seeking a coherent discussion of how the offeror proposes to meet its requirements rather than a restatement of the requirements or a listing of what it proposes to do. The protesting contractor received heaps of praise for most of its methodologies, with the final evaluation resulting in Sev1Tech having nine strengths compared to Amyx’s six strengths. However, the lack of detail on just one technical requirement snowballed into a worry that the hypothetical flaw would negate all of Sev1Tech’s noted strengths.

JIDO decided Sev1Tech had only provided general statements regarding what it was proposing to do to satisfy a specific technical requirement. As a result, the agency found that it was unclear how the protester would satisfy the requirements of the solicitation and assigned a “significant weakness” to the element in its evaluation. Even with this weakness, Sev1Tech still retained more strengths in its proposal, but the agency feared the risk of a flaw in this single section would compromise the entire task order.

The protester insisted its technical rating was evaluated too low, given the numerous positive comments found in the evaluation, and that the awarded contractor’s evaluation was too high due to missing programs in its proposal.

The General Accountability Office denied the protest after finding JIDO’s demand for details formed a reasonable basis to assign the technical rating. It also ruled the missing programs were not required in the solicitation and, therefore, could not be considered a material term.

In sum, the decision should serve as a cautionary tale for providing not just what a contractor can perform, but exactly how it plans to do so.

About the Author:

Tyler Freiberger Headshot | Centre Law & Consulting in Tysons, VA 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.

 

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SBA Adopting the 2017 NAICS Size Standards-Centre Law and Consulting in Tysons Corner, VA

The U.S. Small Business Administration (SBA) is amending its small business size regulations to incorporate the NAICS revision for 2017.  The proposed rule was issued by the SBA on April 18th and is currently open for comments until June 19th.  The NAICS changes for 2017 include the creation of 21 new industries.  These new NAICS codes were created from combining, reclassifying, or splitting 29 existing industries.  The new NAICS codes have resulted in an increase to the size standards for six NAICS industries and a part of one industry, a decrease to size standards for two, and a change in the size standards from average annual receipts to number of employees for one.

When determining these size standards changes for NAICS codes, the SBA uses the following process:

  1. If the new NAICS code is comprised of a single NAICS 2012 industry, the same size standard is used.
  2. If a new NAICS code is a combination of two or more NAICS 2012 industries or parts of those industries and:
    • The industries all have the same size standard, the new NAICS will have the same size standard.
    • The industries all have the same size measure, but not the same size standard, the new NAICS will use the same size standard for the NAICS 2012 that most closely matches the economic activity or the highest size standard.
    • The industries have different size measures, SBA will use the NAICS 2012 industry that most closely matches the economic activity or the highest size standard amount NAICS 2012 industries. In this situation, the SBA coverts all size standards to single measure such as receipts or employees.

A few of the industries effected by this change include crude petroleum extraction, natural gas extraction, mining, major household appliance manufacturing, department stores, electronic shopping, and others. You can find the full list located at the Federal Register.

These changes are proposed to be adopted effective 10/1/17 or at the beginning of the fiscal year.

Get your comments in while you can!

About the Author

Colin Johnson | Centre Law & Consulting in Tysons VA Colin Johnson
Contracts Manager

Colin Johnson is a Contracts Manager who focuses on business development and federal contracts management. His expertise is in preparing quotes and responses for both government and commercial entities for training and legal support services.

 

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You are still at risk of Government oversight/review even if you fall below the threshold for the Contractor Purchasing System Review (CPSR).1 While, CPSR is a total business system review, there is a series of other Government activities that will look into your procurement business processes. Some of these other activities include; proposal analysis, interim payment reviews, incurred cost submissions, and compliance reviews with DFARS business system clauses.

Proposal analysis by the Government can include subcontracted effort, especially when cost analysis is performed. Your procurement procedures on solicitation, cost/price analysis, competition, flow down requirements, procurement file organization and others will form the basis for developing and documenting the information the Government will want to review. Does your current documented process produce adequate analysis and documentation to support your proposals?

Interim payment reviews start in with your Accounting Department’s invoice, but can quickly move to the Procurement Department for backup on subcontract billing terms, invoice review and approval, evidence of adequate funding, basis for indirect billing rates and subcontractor hours and timesheets. What do your post-award administration procedures say about administration of payments to subcontractors, and do your records support your due diligence when approving subcontractor invoices?

The annual incurred cost submission (ICS pronounced “ICE”) seems like a cost accounting exercise, but the Government auditors will find their way into procurement records! In addition to the due diligence of invoice review in the preceding paragraph, be prepared to provide closeout documentation that supports; successful completion of subcontracted work, proper subcontract final billing/payment, and deobligation of excess funds. Do you procurement procedures cover when and how these steps will be taken? Do you know where the documentation is located?

The DFARS clause 252.244-2001, Contractor Purchasing System Administration, isn’t just for the big guys. The DFARS clause will be included in all defense contracts containing FAR 52.244-2, Subcontracts. This FAR clause can be found in cost-reimbursement contracts and most other contracts exceeding the simplified acquisition threshold, currently $150,000. The one break you may get is DFARS 252.242-7005, Contractor Business Systems, (this is the one that requires withholds for “significant deficiencies”) only goes in your contract if you are subject to Cost Accounting Standards.2 The DFARS 252.244-2001 clause lists 24 system criteria, covering what Defense Contract Management Agency sees as 29 major purchasing areas. These areas cover everything from make or buyer decisions, funding authorization, solicitation, competition, cost/price analysis, small business, and all other points up through and including closeout!3 Are your company policies, procedures and records up to the task of proving you meet the requirements of this business system clause?

As you can see, just because you fall below the radar for a formal CPSR, you are not off the hook! You are still vulnerable for withholds, delayed payments, cost disallowance, and poor performance ratings effecting new awards. The best protection against these vulnerabilities is good procedures that adequately cover requirements, and a well trained staff that documents compliance with your procedures.

 

1 On October 7, 2016, DCMA executed a Class Deviation raising the CPSR threshold to $50M effective through December 31, 2017. The rationale is the current $25M threshold has not changed since 1996.

2 However, the Contracting Officer can still take measures to protect the Government’s interest if problems are thought to exist within your procurement system.

3 See DCMA CPSR Guidebook

 

About the Author

Jack Hott headshot | Centre Law & Consulting in Tysons, VA Jack Holt
Jack R. Hott has more than four decades of experience as a contracts professional in Government and the private sector.

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Recently, in the matter of SK Hart Properties LLC, the unsuccessful incumbent contractor for the General Services Administration’s office in Salt Lake City protested the Agency’s decision to use a “fixed tenant improvement allowance.” At its heart, the contractor submitted it does not need the full amount listed for improvements in the solicitation for the contract because its space is relatively prepared for the Agency to use as is. Because the incumbent contractor would not charge the Agency the full amount allowed to alter the space, assuming they will increased their bid price above the competitor, who had a lower base rate of rent but arguably needs closer to the full amount to meet the Agency’s needs.  The incumbent failed to win either the award or the protest, despite arguing the procurement artificially increased their bid price by requiring it to claim expenses they would not incur.

The GAO sided with the Agency who agreed the funds may not actually be spent, but that not including a fixed allowance would unjustly allow the incumbent to rely on improvements to their space previously paid for by the government. No mandate required the Agency to eliminate advantages held by the incumbent, but their decision to do so is permitted. This form of pricing also allowed the Agency to focus on the rental rate, without worrying if proposed improvement costs were correct.

The decision offers a unique example of the GAO attempting to foster competition under the Competition in Contracting Act, even if it results in increased costs to the government.

 

About the Author:

Tyler Freiberger Headshot | Centre Law & Consulting in Tysons, VA 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.

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Employees are expensive. It’s little surprise market forces incentivize companies to search for a way to get the same work out of people without paying for holidays, accommodating disabilities, and paying overtime, among countless other requirements. Imagine if you could save all this money within the law and avoid the risk of employment discrimination lawsuits. With all these savings your company could lower the price of your services/goods and edge out the competition. Figure out how to replace the lion’s share of your workforce as independent contractors and you could be living the dream, right?

Well, if your current company is currently staffed entirely by “independent contractors,” then madam/sir I am happy to meet with you to discuss both your unique staffing model and your likely immediate need for outside legal services.  Very rare is the government contractor that truly has “no employees” (though we’ve seen a few try).

That said, statistics show that there are currently an estimated 40 million independent contractors in America.  Clearly not everyone who takes money from you in exchange for a service should be called your employee. But where is the line between my contracting with a freelance plumber and a commercial company drawing billions in revenue from hundreds of thousands of its drivers? As we’ve discussed in prior blog posts, the government contracts industry is rife with the use (and abuse) of independent contractor status; and federal regulators have been tightening the screws on the use of the status.  This past year, arguably more than ever, the courts and legislators across the country are wrestling with the employee/independent contractor distinction with messy results.

Federal courts have increasingly grown skeptical of massive independent contractor agreements but don’t seem sure how to address it given the long precedent defining the relationship. One way is to decrease the incentives of an independent contractor relationship like the 1st Circuit recently did in Oliveira v. New Prime, Inc., restricting the use of mandatory arbitration agreements on independent contractors. In California, the court forced an extra $15 million out of Lyft in a settlement agreement designed to avoid the costly test of their independent contractor classification.

Coast to coast, states are trying to get a handle on independent contractors too. New York’s recent “Freelance Isn’t Free Act” requires that all entities that engage a freelance worker for $800 or more in services execute a written agreement. Where Nevada is attempting to tackle the problem industry by industry rather than with general rules.  Not everyone wants to put breaks on the independent contractor train though. Alaska and Florida have more clearly defined boundaries in favor independent contracting status, though it may just add problems for employers still wrestling with federal regulations on the same issues.

Perhaps the most hopeful part of the confused situation, is this wide variation in responses. There will certainly continue to be growing pains as the legal standards develop, but the unique effects of these policies may offer a chance to evaluate which can keep independent contractor status alive and appropriately limited.

 

About the Author:

Tyler Freiberger Headshot | Centre Law & Consulting in Tysons, VA 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.

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Small Business Contracting Goals for “Manageable Spend”

On May 25, 2017, with only 128 days remaining in Fiscal Year 2017, the Secretary of Veterans Affairs issued VA’s Fiscal Year 2017 small business goals.  This is actually an improvement over when the Fiscal Year 2014 goals were issued with only 38 days remaining in the fiscal year.  Fiscal Year 2014 was the last time the Secretary of Veterans Affairs issued a Small Business Goaling Memorandum.

In response to a May 24, 2017, Freedom of Information Act request for VA’s Fiscal Year 2015, 2016, and 2017 Secretary of Veterans Affairs Goaling Memorandums, VA provided a copy of the Fiscal Year 2017 Secretary’s Goaling Memorandum, along with a no responsive records response for copies of the Fiscal Year 2015 and Fiscal Year 2016 Secretary’s Small Business Goaling Memorandums.  A no responsive records response can only mean the VA Secretary did not issue the annual goaling memorandum for those years.

VA’s Office of Small and Disadvantaged Business Utilization, an organizational element of the Office of the Secretary, is responsible for preparing and coordinating the Secretary’s annual small business goaling memorandum.  It appears this was not done for Fiscal Years 2015 and 2016.

The VA Secretary’s Fiscal Year 2017 Small Business Goaling Memorandum makes it official:  VA’s department-wide goals for Service-Disabled Veteran-Owned Small Business (SDVOSB) and Veteran-Owned Small Business (VOSB) remain at 10% and 12%, respectively.  These goals have been flatlined since Fiscal Year 2010, despite VA substantially exceeding the goals each year.

Interestingly, the VA Secretary’s Fiscal Year 2017 Small Business Goaling discusses a Fiscal Year 2016 piloted effort to concentrate on spend areas where active goals management is most likely to produce results.  VA identified “manageable spend” areas based on VA-funded contract actions, but excluded major health care contracts, large-dollar major construction actions, and mandatory domestic delivery service contracts under the Federal Strategic Sourcing Initiative.  Since no goaling memorandum was issued by the Secretary in Fiscal Year 2016, it is unlikely many people outside VA would have known of this change.

VA’s Fiscal Year 2017 Small Business Goals are established at the statutory level for Women-Owned Small Business (5%), Small Disadvantaged Business (5%), and HUBZone Small Business (3%).  VA’s Small Business goal was reduced from 32% last fiscal year, to 28.5% for Fiscal Year 2017.  The Secretary’s memorandum also establishes VA’s Fiscal 2017 subcontracting goals.

VA decreased its small business subcontracting goal from 17.5% to 17.0%, while increasing the goals for Service-Disabled Veteran-Owned Small Business and Veteran-Owned Small Business by 2%, from 5% and 3%, respectively, to 7% and 5% respectively.

About the Author:

Wayne Simpson | Centre Law & Consulting Wayne Simpson
Consultant

Wayne Simpson is a seasoned former Federal executive and acquisition professional who is also a highly-motivated and demonstrative small business advocate, with nearly 38 years of Federal Civilian Service with the U.S. Department of Veterans Affairs (VA), and its predecessor organization, the Veterans Administration.

 

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In a decision publicly released on May 30, 2017, Alphaport Inc. – Reconsideration, B-414086.3 (May 23, 2017), the GAO denied a request for reconsideration regarding a nearly $25 million contract. The GAO originally denied Alphaport, Inc.’s bid protest challenging the National Aeronautics and Space Administration’s (NASA) award of a contract to Banner Quality Management, Inc. for technical support services.

The solicitation was awarded as a single cost-plus-fixed-fee contract based on best value, focusing on three evaluation factors: technical capability, cost/price, and relevant experience and past performance. Regarding the cost factor, the solicitation stated that evidence of an approved accounting system would be required for award of the contract. Evidence of the approved accounting system would be shown by submitting four specific documents.

Alphaport initially challenged the award to Banner by alleging that the solicitation contained a material requirement to submit certain documentation to demonstrate the acceptability of the offeror’s accounting system. Despite NASA finding Banner’s accounting system acceptable, Banner only submitted three of the four required documents. Alphaport sought reconsideration after the GAO determined that the agency’s evaluation and selection decision were reasonable and consistent with the terms of the solicitation.

Specifically, Alphaport argued that the GAO erroneously concluded that the agency’s evaluation was reasonable because the adequacy of an accounting system is generally a matter of responsibility. In denying the request for reconsideration, the GAO reminded Alphaport that its decision already addressed its allegation that the agency waived a material requirement of the solicitation when it concluded that the solicitation’s material requirement was for an acceptable accounting system rather than specific documentation. Indeed, the GAO noted that Alphaport did not actually challenge the adequacy of Banner’s accounting system but only that the agency did not comply with a material RFP requirement. The GAO found no error of law and instead found that Alphaport merely disagreed with its determination.

 

About the Author:

Heather Mims | Centre Law & Consulting in Tysons VA 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.

 

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On May 17, 2017, the Department of Veterans Affairs (VA) published a proposed rule in the Federal Register to revise and streamline the VA Acquisition Regulation (VAAR).  Public comments are invited and must be submitted no later than July 17, 2017, to be considered in formulating the Final Rule.  Codified acquisition regulations may only be amended and revised through formal rulemaking under the Office of Federal Procurement Policy Act.  For ease of reference, information on how to submit comments appears at the end of this post.

Summary

VA is proposing to revise, streamline, and update its acquisition regulation, whereby all parts of the VAAR will be reviewed in phased increments to revise or remove any policy superseded by changes in the Federal Acquisition Regulation (FAR), to remove any procedural guidance internal to VA, and to incorporate any new regulations or policies.

According to VA, the proposed rule will correct inconsistencies, remove redundant and duplicative material covered by the FAR, deleted outdated material and information, and appropriately renumber VAAR text, clauses and provisions where required, to comport with the FAR format numbering and arrangement.  The Proposed Rule is intended to streamline the VAAR to implement and supplement the FAR only when required, and remove internal agency guidance in keeping with the FAR principles concerning agency acquisition regulations.

A VAAR Section-by-Section Synopsis of Changes Covered by the Proposed Rule is attached.

How to Submit Written Comments:

Written comments may be submitted through www.Regulations.gov; by mail or hand-delivery to Director, Regulation Policy and Management (00REG), Department of Veterans Affairs, 810 Vermont Avenue NW., Room 1068, Washington, DC 20420; or by fax to (202) 273-9026. Comments should indicate that they are submitted in response to “RIN 2900-AP50—Revise and Streamline VA Acquisition Regulation to Adhere to Federal Acquisition Regulation Principles (VAAR Case 2014-V001—parts 801, 802, 803, 812, 814, 822, and 852).” Copies of comments received will be available for public inspection in the Office of Regulation Policy and Management, Room 1068, between the hours of 8:00 a.m. and 4:30 p.m., Monday through Friday (except holidays). Please call (202) 461-4902 for an appointment. This is not a toll-free number. In addition, during the comment period, comments may be viewed online through the Federal Docket Management System (FDMS) at www.Regulations.gov.

VAAR Section-by-Section Synopsis of Changes Covered by the Proposed Rule:

VAAR Part 801 – Department of Veterans Affairs Acquisition Regulation System

  • Removes an information collection burden previously included in the VAAR based on an outdated practice of providing bid envelopes.

VAAR Part 802 – Definition of Words and Terms

  • Adds two new definitions to define key terms used within the revised VAAR Part 803, Improper Business Practices and Personal Conflicts of Interest, dealing with debarment and suspensions which will be applicable when referenced in the future in other VAAR Parts: Debarment and Suspension Committee; and Suspension and Debarring Official.

VAAR Part 803 – Improper Business Practices and Personal Conflicts of Interest

  • Proposes clarifying language regarding the prohibition of contracts from making reference in their commercial advertising regarding VA contracts to avoid implying the government approves or endorses the contractor’s products, services, or commercial line of endeavor.
  • Proposes removal and reserves for future use, VAAR Subpart 803.1, Safeguards, and VAAR Section 803.101, Standards of Conduct, since it contains procedural guidance and a delegation of authority internal to VA and will be in the VA Acquisition Manual (VAAM).
  • The Proposed Rule removes Section 803.101-3, Department Regulations, since it contains information on standards of conduct and financial disclosure for VA employees and is internal procedural guidance internal to VA and will be in the VAAM.
  • VA’s Proposed Rule will remove Section 803.104, Procurement Integrity, and Section 803.104-7, Violations or possible violations, since they contain procedural guidance and a delegation of authority is internal to VA and will be in the VAAM.
  • In Subpart 803.2, Contractor Gratuities to Government Personnel, VA proposes to update its policy governing improper business practices and personal conflicts of interests to make VA’s policies clear, to provide notice of due process rights and to establish who in VA determines whether or not a violation of the Gratuities clause has occurred and what procedures are followed when the Suspension and Debarring Official (SDO) makes that decision.
  • In Section 803.204, VA’s Proposed Rule removes portions of Section 803.204, Treatment of violations, which contain procedural guidance and a delegation of authority internal to VA and will be moved to the VAAM. To ensure VA contractors are apprised of their rights, VA proposes to revise Section 803.204 to add the responsibility of the SDO for determining whether or not a violation of the Gratuities clauses has occurred and what action will be taken, as well as a paragraph stating that when the SDO determines a violation has occurred and debarment is being considered, the SDO shall follow the requirements at VAAR 809.406-3.
  • In Subpart 803.3, Reports of Suspected Antitrust Violations, VA proposes to remove Section 803.303, Reporting suspected antitrust violations, since it contains guidance to VA employees internal to VA and will be moved to the VAAM.
  • In Subpart 803.4, Contingent Fees, VA’s Proposed Rule removes and reserves the entire subpart and to remove the underlying Section 803.405, Misrepresentations or Violations of the Covenant Against Contingent Fees, since it contains guidance to VA employees internal to VA and will be moved to the VAAM.
  • In Subpart 803.5, Other Improper Business Practices, VA proposes to remove Section 803.502, Subcontractor Kickbacks, since it provides direction to VA employees and is internal VA and will be moved to the VAAM.
  • In Section 803.570, Commercial advertising, VA’s Proposed Rule revises the language of Subsection 803.570-1, Policy, to clarify the intent to prohibit advertising which implies a Government endorsement of the contractor’s products or services.
  • In Subpart 803.6, Contracts with Government Employees or Organizations Owned or Controlled by Them, VA is proposing to remove and reserve the entire subpart and to remove the underlying Section 803.602, Exceptions, since it delegates authority to authorize an exception to the policy in FAR 3.601. This delegation will be moved to the VAAM.
  • In Subpart 803.7, Voiding and Rescinding Contracts, VA proposes to remove and reserve the entire subpart and to remove the underlying sections. VA further proposes to remove Section 803.703, Authority, since it is a delegation of authority, internal to VA, moving the delegation to the VAAM.  VA also proposes to remove Section 803.705, Procedures, as it duplicates FAR 3.705.  A short paragraph directing VA Heads of Contracting Activities to follow the procedures of FAR 3.705 was added to the VAAM.
  • In Subpart 803.8, Limitation on the Payment of Funds to Influence Federal Transactions, VA’s Proposed Rule removes and reserves the entire subpart and to remove the underlying sections. VA also propose to remove Section 803.804, Policy, and Section 803.806, Processing Suspected Violations, all internal VA procedural guidance being moved to the VAAM.
  • VA further proposes to add Subpart 803.11, Preventing Personal Conflicts of Interest for Contractor Employees Performing Acquisition Functions. This implements part of FAR Clause 52.203-16, Preventing Personal Conflicts of Interest, by requiring the signing of a Non-Disclosure Agreement by certain contractor covered employees performing acquisition functions closely associated with inherently governmental functions in order to prohibit disclosure of non-public information accessed through performance on a Government contract. This will also each contractor and subcontractor at any tier whose employees perform acquisition functions closely associated with inherently governmental functions to obtain the signed non-disclosure forms from each covered employee.
  • The Proposed Rule also removes and reserves subpart 803.70, Contractor Responsibility to Avoid Improper Business Practices, and to remove its underlying Section 803.7000, Display of the VA Hotline Poster and its prescription at section 803.7001, Contract clause, because it is unnecessary and duplicates FAR coverage. FAR 52.203-14, Display of Hotline Poster(s), as prescribed at FAR 3.1004(b), which provides adequate coverage for VA. VA internal procedures regarding fill-in information for the clause will be covered in the VAAM.

VAAR Part 812 – Acquisition of Commercial Items

  • VAAR Section 812.301, paragraph (b)(13), VA proposes to change the name of provision at VAAR 852.214-74 to Marking of Bid Samples to better reflect the requirement of the provision.

VAAR Part 814 – Sealed Bidding

  • VA proposes to delete VAAR Subpart 814.1, Sealed Bidding, in its entirety. The Proposed Rule also deletes Sections 814.104, Types of Contracts, and Section 814.104-70, Fixed-Price Contracts with Escalation, as unnecessary since both simply require compliance with FAR 16.303-1 through 16.203-4.  Ergo, no additional VAAR text is required.
  • VA also proposes to revise Section 814.201(a)-(f) by removing paragraphs (a)-(b) since they deal with numbering of Invitations for Bids (IFBs) and consist of internal agency procedures more properly covered in Subpart 804-16 of the VAAM.
  • The Proposed Rule adds a new Subsection, 814.201-2, Part I—The Schedule, to explain how award will be made on summary bids and bids on groups of items to ensure this is clear to the public.
  • In Subsection 814.201-6, Solicitation Provisions, VA proposes to remove as unnecessary paragraph (a), which addresses bid envelopes, since labeling of bids is a customary and usual commercial practice, and the use of the Optional Form (OF) 17, which is optional, and is no longer a standard practice.
  • The Proposed Rule proposes to redesignate paragraph (b) as (a) and to revise item (1) to prescribe new Provision 852.214-71, Restrictions on Alternate Item(s); item (2) to clarify the conditions for including the VAAR Provision 852.214-72, Alternate Items; and item (3) to prescribe the VAAR Provision 852.214-73, Alternate Packaging and Packing, when bids will be allowed based on different packaging and packing. VA also proposes to redesignate paragraph (c) as (b) and to add a prescription for VAAR Provision 852.214-74, Marking of Bid Samples.
  • The Proposed Rule adds Section 814.202, General rules for solicitation of bids and Subsection 814.202-4, Bid samples, requiring samples to be from the manufacturer providing supplies or services under the contract. This ensures the products that are actually proposed and would be delivered under the contract, if awarded, are the products submitted for evaluation.  Paragraph (g), requires bid samples be retained for the period of contract performance or until settlement of any claim the Government may have against the contractor.  Retention is intended for inspection purposes under FAR 14.202-4(g)(4).
  • The Proposed Rule deletes Section 814.203, Methods of Soliciting Bids, and Subsection 814.203-1, Transmittal to Prospective Bidders, as the practice specified of furnishing a bid envelope or sealed bid label is out of date with existing practices.
  • VA proposes to delete Section 814.204, Records of Invitations for Bids and Records of Bids, as it contains instructions internal to VA and will be moved to the VAAM.
  • The Proposed Rule also deletes Section 814.208, Amendment of Invitation for Bids as out-of-date with existing practices regarding sending amendments.
  • In Subpart 814.3, Submission of Bids, VA proposes to delete Section 814.301, Responsiveness of Bids, since there is no authority to refer the question of timeliness to the U.S. Government Accountability Office (GAO) except in the context of a protest.
  • The Proposed Rule also deletes Section 814.302, Bid submission, as duplicative of FAR 14.302(a) and therefore unnecessary.
  • VA proposes to revise Section 814.304, Submission, Modification, and Withdrawal of Bids, to delete internal procedures, to stipulate a limited time period for a late bidder to submit evidence of timeliness, and to renumber this paragraph (f) accordingly to comport with FAR and VAAR numbering conventions.
  • In subpart 814.4, Opening of Bids and Award of Contract, VA proposes to delete the entire subpart because the information is either redundant to the FAR and is adequately covered there or it is comprised of agency internal procedures to be incorporated into the VAAM, as noted specifically below.
  • VA proposes to delete Section 814.401, Receipt and Safeguarding of Bids, because coverage in the VAAR is unnecessary as the FAR adequately covers.
  • The Proposed Rule also deletes Sections 814.402, Opening of Bids; 814.403, Recording of Bids; 814.404, Rejection of Bids; 814.404-1, Cancellation of Invitations After Opening; 814.404-2, Rejection of Individual Bids; 814.407, Mistakes in Bids; 814.407-3, Other Mistakes Disclosed Before Award; and, 814.407-4, Mistakes After Award, as these are VA internal procedures and will be incorporated into the VAAM.
  • VA also proposes to delete Section 814.404-70, Questions Involving the Responsiveness of a Bid, as there is no authority to refer questions of bid responsiveness to the GAO other than in the context of a protest, and, the overall responsibility for this determination rests with the contracting officer. Coverage in FAR 14.301, Responsiveness of Bids, is adequate and no further VAAR coverage is required.
  • The Proposed Rule deletes Sections 814.408, Award, and 814.408-70, Award When Only One Bid is Received, because coverage in the VAAR is unnecessary as it is adequately covered by FAR 14.408-1(b).
  • VA proposes to delete Section 814.408-71, Recommendation for Award (Construction) as these procedures are no longer in use within VA’s Office of Construction and Facilities Management.
  • VA’s Proposed Rule also deletes Section 814.409, Information to Bidders, as unnecessary since the requirement not to disclose is contained in FAR part 3 and need not be duplicated in the VAAR.

VAAR Part 822 – Application of Labor Laws to Government Acquisitions

  • In Subpart 822.3, Contract Work Hours and Safety Standards Act, VA proposes revisions to Section 822.304, Variations, Tolerances, and Exemptions, to use plain language to state the conditions which must be met to permit use of the variation to Contract Work Hours and Safety Standards (the statute) (historically known as the Contract Work Hours and Safety Standards Act), granted by the Secretary of Labor regarding the payment of overtime under contracts for nursing home care for Veterans.
  • VA also proposes revisions to Section 822.305, Contract Clause, to change the title of the Cause at VAAR 852.222-70 to Contract Work Hours and Safety Standards—Nursing Home Care for Veterans, in order to reflect the way the FAR refers to the historical titles based on the Positive Law codification.
  • In Subpart 822.4, Labor Standards for Contracts Involving Construction, VA’s proposed revisions will remove and reserve Subpart 822.4, Labor Standards for Contracts Involving Construction, since this subpart contains procedural guidance on the types of labor standards involved in construction contracting, internal to VA and more appropriate for inclusion in the VAAM.
  • The Proposed Rule also removes the underlying Section 822.406, Administration and Enforcement and Subsection 822.406-11, Contract Terminations, which falls under this subpart since it contains procedural guidance and will be moved to the VAAM.

VAAR Part 852 – Solicitation Provisions and Contract Clauses

  • VA’s Proposed Rule revises VAAR Clause 852.203-70, Commercial Advertising, to use plain language, remove gender-specific wording, and to clarify the intent to prohibit advertising which implies a Government endorsement of the contractor’s products or services.
  • The Proposed Rule removes VAAR Clause 852.203-71, Display of Department of Veterans Affairs Hotline Poster, because VA will instead use FAR Clause 52.203-14, Display of Hotline Poster(s), as prescribed at FAR 3.1004. The FAR clause permits insertion of fill-in language to identify an agency’s hotline poster and VA will include language in its internal agency procedures detailing the requirement to insert the information regarding its agency specific hotline poster.
  • The Proposed Rule also removes VAAR Provision 852.214-70, Caution to Bidders—Bid Envelopes, because the practices described within the provision are obsolete with the advent of posting on the Government-wide point of entry (GPE) via the Federal Business Opportunities (govor FBO.gov) Web page or via a linked interface off of FBO.gov.   VA no longer issues Bid Envelopes or OF 17, Sealed Bid Label, described in the provision, when electronically posting IFBs, thus making the provision obsolete and unnecessary.
  • VA’s Proposed Rule also revises the individual prescription references for the following clauses based on the restructuring of 814.201-6: 214-71, Restrictions on Alternate Item(s); 852.214-72, Alternate Item(s); and 852.214-73, Alternate Packaging and Packing.  The Proposed Rule further revises the title, text and prescription language of VAAR Provision 852.214-74 which now reads, Bid Samples, to Marking of Bid Samples to describe better what the provision is about and to distinguish it from a FAR provision called “Bid Samples.”  VA uses plain language to describe the principal purpose, which is to ensure bidder’s packages including bid samples are clearly marked and identified with the words Bid Samples, as well as complete lettering/numbering and description of the related bid item(s), the number of the IFB, and the name of the bidder submitting the bid samples.
  • VA’s Proposed Rule also removes language stating the preparation and transportation of the bid sample must be prepaid by the bidder as this language is unnecessary because FAR Clause 52.214-20, Bid Samples, already contains language covering the bidder’s responsibilities in this regard. Further, the prescription language for VAAR Provision at 814.201-6(b) which was renumbered to comport with FAR and VAAR numbering and arrangement will also be revised.
  • Lastly, VA’s Proposed Rule revises VAAR Clause 852.222-70, Contract Work-Hours and Safety Standards Act—Nursing Home Care Contract Supplement, to change the title to Contract Work Hours and Safety Standards—Nursing Home Care for Veterans, to better reflect the substance and coverage of the clause and to align the name of the clause with the revised current reference in lieu of the historical title of the act. This revision will also clarify the clause has flow-down requirements and applies to subcontractors at any tier when the stated conditions in the VAAR clause are met.

The Proposed Rule may be viewed in its entirety in the Federal Register by clicking here.

 

About the Author:

Wayne Simpson | Centre Law & Consulting Wayne Simpson
Consultant

Wayne Simpson is a seasoned former Federal executive and acquisition professional who is also a highly-motivated and demonstrative small business advocate, with nearly 38 years of Federal Civilian Service with the U.S. Department of Veterans Affairs (VA), and its predecessor organization, the Veterans Administration.

 

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Centre Law & Consulting

On April 18, 2017, the U.S. Small Business Administration (SBA) published a proposed rule in the Federal Register to amend its regulations to adopt and incorporate the U.S Office of Management and Budget’s (OMB) North American Industry Classification System (NAICS) revisions for 2017, identified as “NAICS 2017.”  SBA proposes to adopt the updated table of size standards effective October 1, 2017, to coincide with beginning of the government’s next fiscal year.

NAICS 2017 creates 21 new industries by reclassifying, combining or splitting 29 existing industries under changes made in “NAICS 2012.”

SBA’s proposed size standards for the 21 new industries have resulted in an increase in size standards for six NAICS 2012 industries and part of one, a decrease to size standards for two, a change in the size standards measure from average gross annual receipts to average number of employees for one industry.  There are no changes for 20 industries and part of one.

SBA included six tables in its proposed rule showing the changes, which occur in the following NAICS Sectors:  21, Mining; 33, Manufacturing; 45, Retail Trade; 51, Information; 53, Real Estate and Rental Leasing; 54, Professional, Scientific, and Technical Services; and 72, Accommodation and Food Services.  We recommend consulting these tables if your business is engaged in one of these NAICS Sectors to determine if your business is impacted by the changes.

A note to large business prime contractors with Small Business Subcontracting Plans:  These changes could also impact the size status of your suppliers and subcontractors which may impact your ability to meet your Small Business Subcontracting Goals.

Why are NAICS Codes Important to Federal Contractors?

NAICS classifies business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the U.S. economy.  NAICS Industry Codes define establishments based on the activities in which they are primarily engaged.

NAICS Codes are important in the conduct of U.S. Government procurements, as a NAICS Code is assigned to each procurement by the procuring contracting officer.  NAICS Codes have a size standard assigned by SBA which will determine whether a business is small or other than small (large) business in response to a government procurement.  Companies may be a small business under one NAICS Code, and other than small (large) business under another.  Click here to view SBA’s Size Standards Table, updated February 26, 2016.

The corresponding size standard to a NAICS Code assigned by the contracting officer to a government procurement is especially important when the procurement is conducted using a set-aside for small business, as it will determine a company’s eligibility to participate under a small business set-aside.

More Information on NAICS Codes

Visit the U.S Census Bureau’s North American Industry Classification System website where you can use their useful tool to search NAICS by key word, sector, or NAICS Code:

https://www.census.gov/eos/www/naics/

 

About the Author:

Wayne Simpson | Centre Law & Consulting Wayne Simpson
Consultant

Wayne Simpson is a seasoned former Federal executive and acquisition professional who is also a highly-motivated and demonstrative small business advocate, with nearly 38 years of Federal Civilian Service with the U.S. Department of Veterans Affairs (VA), and its predecessor organization, the Veterans Administration.

 

The post “NAICS 2017” Revisions appeared first on Centre Law & Consulting.


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