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  1. Please check out the new release from my friend, federal contracting expert Michael LeJeune. Bestselling author and GovCon expert, Michael LeJeune is releasing his new book, “I’m New to Government Contracting – Where Should I Start?” on March 26th. Michael’s new book has all that a growing federal contractor needs to get started on a path to success. I was especially struck by the emphasis on avoiding shortcuts. As a GovCon attorney, we sometimes hear about get-rich-quick schemes involving federal contractors. Michael puts those to bed. For instance, you have to read his takedown of the middleman strategy if you have heard about that online. But he also provides time-tested strategies for getting into government contracting and for growing your business. As one example, there is a nice overview of how to do an evaluation of your business and examine how your processes will translate to government contracting. The book also has great explanations and concrete checklists for things like 9 core marketing tools and 7 key ways to build your pipeline. Register here to get a special 60% discount link on the day of launch: https://mailchi.mp/f3520f7e9b0a/5snc8wdmhp. The post Michael Lejeune’s New Book Now Available! first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  2. As we often tell people, language in a teaming agreement is important for a federal contract. But so is complying with the terms of a solicitation. A recent GAO decision hinged on a very specific portion of the language in a teaming agreement that was required as part of a solicitation. Because the contractor did not include the required language in a teaming agreement, it lost out on an award. In Global Patent Solutions, LLC, B-421602.2 (Feb. 23, 2024), GAO looked at a solicitation from the Patent and Trademark Office (PTO or USPTO) for professional services to assist the PTO in reviewing international patent applications. Protester Global Patent Solutions, LLC (GPS), challenged award under the solicitation to CPA Global, Inc. (CPAG). The protest argued that CPAG was not evaluated properly under Factor 4, Small Business Participation. Here, the solicitation required large business offerors to submit a small business subcontracting plan, and provided that an offeror’s plan “shall comply with all elements of FAR Subpart 19.704 (Subcontracting Plan Requirements) and FAR Clause 52.219-9 (Small Business Subcontracting Plan).” In particular, there was a requirement that “[t]he extent of small business participation shall equal or exceed the minimum requirement” of at least 10 percent with a goal of reaching at least 25 percent. In addition, “[t]o receive credit under this factor, an enforceable teaming agreement must be in place with one or more small businesses (unless the Prime Offeror is a small business) and a copy of each signed agreement shall be included with the Offeror’s proposal as an attachment.” Finally, an “Enforceable agreement” was defined as one “signed by both parties committing to a teaming arrangement if the contract is received and identifying the percentage of the total contract to be subcontracted.” As far as the evaluation, small business subcontracting plan would “be evaluated to the extent the Offeror complies with all elements of FAR Subpart 19.704 . . . and FAR Clause 52.219-9″ and proposals would “be evaluated to ensure it meets or exceeds the Government’s minimum requirement that at least ten percent (10 [percent]) of the annual order value be directed to small business for each of the five ordering periods,” and that the teaming agreements would “be reviewed to ensure compliance.” The small business teaming agreement for CPAG stated that the small business “Partner will accept and perform a subcontract for the services for up to [DELETED] [percent] of awarded volumes.” In reviewing this language, the agency initially determined that the subcontractor teaming agreements submitted by CPAG “do not specify any percentages of work to be contracted.” The evaluation team also noted that it was “impossible for the USPTO to evaluate exactly how much is guaranteed to go to small business” and “CPAG’s proposal also neglected to state what the percentages were as a portion of the subcontract value as required by FAR 52.219-9.” That FAR provision, FAR 52.219-9, in part states that a subcontracting plan should express small business subcontracting goals “as a percentage of total planned subcontracting dollars.” Ultimately, the agency weighed the missing information in the teaming agreement against the historical performance by the awardee when it comes to small business subcontracting and concluded that “CPAG’s flaws” in the small business participation “area were mostly procedural and not substantive.” GAO disagreed. GAO ultimately found that the agency did not follow its own solicitation rules: Specifically, under the small business participation factor, the solicitation established a material requirement that a minimum of 10 percent of the annual order value be subcontracted to small businesses. RFP §§ L‑M at 12. The solicitation was clear and unambiguous that, for an offeror to receive credit under this factor, it must submit “enforceable teaming agreements” that were signed by both parties and identified “the percentage of the total contract to be subcontracted.” In the evaluation record, all statements by the USPTO found “CPAG’s teaming agreements and the firm’s overall subcontracting plan to be lacking.” This included the contract specialist, who found that the agreements “do not specify any percentages of work to be contracted[.]” Similarly, the TET stated that CPAG’s teaming agreements failed to include “firm commitments with guaranteed minimum percentage[s] as specified in the [solicitation][.]” Finally the SSA found that the teaming agreements “did not represent a guaranteed amount of work to be subcontracted.” GAO concluded that “the evaluators’ and SSA’s conclusions were inconsistent with the solicitation’s material requirement for offerors to demonstrate through the use of enforceable teaming agreements that a minimum of 10 percent of the annual order value would be subcontracted to small businesses.” The agency tried to get a little sneaky in its argument, saying that the solicitation requirement for “the percentage of the total contract to be subcontracted” could mean any range of percentages, rather than a specific number. Again, GAO didn’t buy it–“the percentage” meant a specific percentage, not a range. GAO sustained the protest because USPTO did not follow its own solicitation requirements in evaluating a teaming agreement. But the take home message for contractors is that, if a solicitation asks for a specific number, even if it is in a teaming agreement, the contractor should include a specific number, or risk losing an award. Need legal assistance with a government contracting matter? Email us or give us a call at 785-200-8919. Looking for the latest government contracting legal news? Sign up here for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook. The post GAO: Small Business Teaming Agreement Must Follow Solicitation Guidelines first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  3. If you are a government contractor, odds are you have faced a situation where some aspect of the contract you were performing changed outside of your control, or you ran into something that neither you nor the government expected. As a result, your work requirements likely changed, and with that, your costs likely changed as well. When this happens, there are multiple paths to getting reimbursements for those new costs, and one of the most common ones is a request for equitable adjustment. Today, we’re going to explore when you should submit a request for equitable adjustment as opposed to the other routes. What is a request for equitable adjustment? Curiously, as much as it is referenced in the FAR, there is no set definition for “request for equitable adjustment” in the FAR. That said, the appellate court has taken a stab at it: “It is a remedy payable only when unforeseen or unintended circumstances, such as government modification of the contract, differing site conditions, defective or late-delivered government property or issuance of a stop work order, cause an increase in contract performance costs.” Reflectone, Inc. v. Dalton, 60 F.3d 1572, 1577 (Fed. Cir. 1995). Basically, a request for equitable adjustment is when you ask the government to reimburse you for some unexpected occurrence or issue that has increased your work costs. You are asking the government to make you whole for something that was outside your control. An adjustment made for equitable reasons, so to speak. A request for equitable adjustment is not the same as a formal cost claim. This is a crucial distinction. There is a specific procedure, located in FAR 52.233-1, to submitting a formal cost claim that requires the contracting officer to respond and that starts the path towards filing an appeal with a board of contract appeals or the Court of Federal Claims (COFC). A request for equitable adjustment does not set those mechanisms (or their corresponding deadlines) into motion. When you submit a request for equitable adjustment, there is no requirement that the contracting officer will respond, nor does a denial of the request allow you to take the matter to the board of contract appeals or COFC. So, with that said, you may ask why even consider filing a request for equitable adjustment at all? There are often good reasons to go that route. You have a cordial relationship with the agency. Just because the contracting officer isn’t required to respond to a request for equitable adjustment does not mean a contracting officer won’t respond. For every example of a bad relationship between a contractor and the contracting agency, there are many examples of good relationships. In our experience, it is rare for a contracting officer to not respond to a request for equitable adjustment, even where the relationship isn’t that great. The more informal nature of a request for equitable adjustment, as opposed to a formal cost claim, can be an advantage for the contractor. It comes across as less adversarial (think of the difference between “Could you please” and “I demand”) and so can help preserve a good relationship (or even help mend a strained one) while still getting the whole cost issue sorted. Many contractors go for a request for equitable adjustment before resorting to a formal cost claim for this reason: Why make things any more difficult than they need to be if the contracting agency is on good terms with them? You want to test the waters of your cost claim. When you file a formal cost claim, as noted earlier, it sets into motion a formal process in which the contracting officer must make a decision on the claim. When the contracting officer makes a decision on the claim, that is the contracting officer’s final decision. If you do not like the decision, you then have 90 days to take the matter to a board of contract appeals or 1 year to take it to COFC. If you try taking it to a board of contract appeals after 90 days have passed or to COFC over a year later, you will be too late. These two clocks start ticking from the moment you receive the contracting officer’s final decision. You are, essentially, locked in. On the other hand, if you make a request for equitable adjustment and the contracting officer denies your request for equitable adjustment, no clock starts on bringing the claim to the board of contract appeals or COFC. You can decide to start the formal claim process then by filing a formal cost claim, or you can even just make another request for equitable adjustment. (Keep in mind you should make your initial request for equitable adjustment or at least assert the right to increased payment within 30 days of whatever caused your costs to increase (FAR 52.243-4) and that you must file the request before the contract is closed out). As such, a request for equitable adjustment can let you test the waters of your cost claim and see if there are any major issues with it without starting the formal process. Attorney fees are potentially recoverable with requests for equitable adjustment, unlike claims. Requests for equitable adjustment are considered negotiations rather than litigation, and under FAR 31.205-33, contract administration costs are allowable costs. This was the finding in Tip Top Const., Inc. v. Donahoe, 695 F.3d 1276, 1281 (Fed. Cir. 2012). Generally, costs in preparing requests for equitable adjustment are considered part of the negotiation process, and so are considered contract administration costs. That means that attorney and accounting fees incurred for preparing a request for equitable adjustment can be included in the request and in a later cost claim. Costs to prepare a formal claim, however, are considered litigation costs. Such costs are not allowable under FAR 31.205-33. So, this can be a great incentive to pursue a request for equitable adjustment instead of a formal cost claim, as there is the potential to get the costs of preparing that request. Summary There are many reasons why one might go with a request for equitable adjustment as opposed to a formal cost claim, but the above three are three of the most common reasons we see contractors go that route. It really will depend on the contractor’s situation on which route might be best for them. A request for equitable adjustment may be a great route in some cases, but not in others. We always recommend consulting with a government contracts attorney to discuss the potential options if you are unsure. Need legal assistance with a government contracting matter? Email us or give us a call at 785-200-8919. Looking for the latest government contracting legal news? Sign up here for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook. The post Why File: A Request For Equitable Adjustment first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  4. Hope you are having a good week readers, and enjoying some March Madness. While it looks like spring in our neck of the woods, in this part of the country the weather can change quickly. We joke around that we must always have every type of coat or jacket at the ready on any given day. Never a dull moment! Speaking of never a dull moment, the NCAA tournament has started and there certainly have been some great games in the first round! How’s your bracket doing? We hope you had a great week and are enjoying some nice spring weather as well as some exciting basketball. Here are some happenings from the federal government contracting world this week. Interesting updates include an update on OASIS+ timing and enhancing whistleblower protections for DoD contracts. Enjoy your weekend! Busted! Is your March Madness bracket breaking government ethics rules? GSA’s Tiffany Hixson Offers Advice for New Providers Breaking Into the GovCon World Supreme Court rules public officials cannot block critics on social media, even from personal accounts GAO Urges DOD to Implement Better Monitoring of Procurement Administrative Lead Time Data Contracting Brief: AI Funding Plans Spread Across Budget Request GSA Targets Summer for Initial OASIS+ Small Business Awards Senators Coons, Kennedy introduce bill to help small businesses compete for federal contracts Women’s History Month 2024: Celebrating a vital business force US Department of Labor Nearly $200K for Workers Underpaid by Massachusetts Subcontractor at Rhode Island Worksite Whistleblower Protections in Defense Contracts Aventura Technologies, Inc. Pleads Guilty to Wire Fraud and Illegal Importation for Reselling Chinese Goods as U.S.-Made Washington State Man Sentenced to Federal Prison for Marketing and Selling Low-Quality Ballistic Protective Equipment Produced in China to Dozens of Law Enforcement Agencies and the U.S. Military The post SmallGovCon Week in Review: March 18-22, 2024 first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  5. Have you ever wanted to learn more about the advantages of the SBA’s Mentor-Protégé program? Join Allisa Young, CT APEX – Procurement Specialist, along with the subject-matter experts from Koprince McCall Pottroff LLC to learn how the SBA Mentor-Protégé program can help leverage your business in regards to government contracting opportunities. We will discuss the eligibility criteria for both the “Mentors” & “Proteges”, along with information about how to apply. Stephanie Ellis, Attorney for Koprince McCall Pottroff LLC, will be on hand to answer questions for the Q&A session. Register here. The post Webinar Event! SBA’s Mentor-Protégé Program hosted by Connecticut APEX Accelerators, March 21, 2023, 11:00am EDT first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  6. Steven Koprince, Govology Legal Analyst and retired founder of Koprince McCall Pottroff will be presenting this webinar to help you understand the applicable rules and regulations in government contracts and the Federal Acquisition Regulation. These rules can be lengthy and complex–and contractors may also need to follow rules outside the FAR, such as those found in FAR supplements and the regulations of the U.S. Small Business Administration. Please join Steve as he walks you through the process. Register here. The post Govology Webinar: Navigating Government Regulations in Solicitations and Contracts, March 27, 2024, 1:00pm EDT first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  7. This post was written by our friend and colleague, Nick Bernardo, president of MyGovWatch, a bid notification and intelligence website offering a free trial to government contractors in more than 200 industries. Over the years, MyGovWatch has accumulated tens of thousands of buyer email addresses, from Federal government buyers in the DC Beltway all the way down to the tiniest school districts in the remote American hinterlands. In January, we decided to conduct our first-ever survey among buyers to create a dataset to help our users and the govcon community, at large, to better understand how buyers view certain aspects of the source selection process. (You can download a copy by visiting this page and filling out the form.) In broad strokes, the MyGovWatch survey was intended to shed light on the significance of name recognition and incumbency during source selection in absolute terms. Will buyers still pick you if they never heard of you before the bid process, or if you’re not an incumbent? To what extent should you let these drive bid/no bid decisions? For example, we asked buyers: How often are you involved in purchasing decisions where you had no awareness of the company selected until the bid process started? (The data around these questions may shock you!) This is the crux of the MyGovWatch survey, with fascinating data points that have already surprised a few who have accessed the full report as described below. (This post is intended as a primer, offering a sneak preview of sorts by providing data in a couple of key areas while letting people know how to get access to the full survey report in one of three ways.) For our purposes here, the MyGovWatch survey asked buyers two things designed to let them speak to the govcon community. These two questions encouraged respondents to give suppliers advice and to disclose areas of emergent and hard-to-fill needs for which it’s not always easy to find qualified suppliers. It’s important to note here the MyGovWatch survey respondents were not solely Federal buyers; they comprised of state and local folks also. The first of these questions was: What advice would you offer as a seasoned purchasing professional to companies that would like to do business with government agencies? The MyGovWatch survey asked this as an open-ended question by design, not wanting to limit what might come back. What came back was varied. When studied closely and after removing vague or ambiguous comments, the rest generally fell into seven categories, as follows. Understand the Procurement & RFX Process A clear majority of respondents (62.3%) gave simple advice: invest time in understanding the buyer’s procurement rules and the RFX process (where “RFX” can mean RFP, RFQ, ITB, etc.). Don’t simply show up for the bid process without any knowledge of how the process works or what rules the buyer must follow. More than anything else, buyer frustration with the supplier community around this idea appears to color much of how buyers perceive specific suppliers, invariably leading to lower evaluation scores within an RFX process if the buyer views the supplier’s understanding of procurement rules and processes as inadequate. This advice therefore tops the list of what buyers encourage suppliers to know more about to foster greater success. Bid on Relevant RFXs An astonishing 21% of respondents, or more than one in five, gave suppliers the straightforward advice of simply identifying and bidding on relevant RFX opportunities. They did this in various ways, mentioning identifying bids and knowing when and where bids are posted. One simply commented suppliers should, “register on all government platforms,” not realizing that suppliers would need to identify and monitor thousands of individual websites daily and weekly to do the job a platform like MyGovWatch does for users – sending relevant RFX opportunities to each user’s inbox daily. Network with Government Buyers A cohort of 11.5% of respondents gave suppliers the sage advice of networking with government buyers as a means of growth in govcon. This tried-and-true approach undoubtedly yields personal contact with buyers in way that fosters not only recognition of your company’s name in any resulting RFX process, but also the inside scoop on what pain points motivate buyers in a way that’s not always discernible in a statement of work. It’s no surprise many respondents mentioned this piece of advice; however, it may surprise some that respondents were nearly twice as likely to mention simply bidding on relevant RFXs than they were to mention traditional networking with decision makers, who often have neither the time nor the interest in networking with as many suppliers who would like to do the same if given the chance. Everything Else Between 1%-5% of respondents mentioned one or more of the following steps suppliers should take to experience greater success in govcon markets.  Price RFXs Competitively: Respondents pointed out suppliers should do more research around pricing for their products or services in govcon markets to have greater success. (Incidentally, you can obtain competitor and contract pricing information through open records requests after RFX awards, whether on your own or through tools available on MyGovWatch, to research pricing.)  Publish Good Marketing Materials: A gaggle of respondents said suppliers could have better success with better marketing materials, mentioning anything from websites to capability statements, from proposal documents to handouts, as an additional focus area.  Research Competitors: A bunch of respondents said suppliers should spend more time investigating who they are competing with (which can also be learned by completing open records requests for copies of RFX winning proposals as described above, mainly in state and local markets.)  Take Advantage of Government Procurement Resources: A handful of respondents encouraged suppliers to take advantage of resources government agencies themselves offer to support supplier success. Notably, many Federal respondents mentioned APEX Accelerator resources, which are geared toward small businesses pursuing Federal buyers. The second open-ended question the MyGovWatch survey asked buyers was: What are any emerging or growing areas of need where it is difficult for purchasing professionals to identify and contract with qualified vendors? Many had nothing to offer related to this particular question and left it blank. However, among those who did answer, buyers overwhelmingly mentioned technology in its myriad forms, mainly citing ongoing needs for developers and software. One buyer wrote, “While it is not an emerging or growing area of need, we’re finding it to be increasingly more difficult to hire software specialists at competitive prices. Industry is starting to price out the government in a lot of software-related fields.” There were a number of other notable fields where government buyers feel they are underserved. To read about those, we encourage you to get access to the MyGovWatch survey report in full. How to Access the Full MyGovWatch Survey Report Interested govcon suppliers may obtain a copy of survey results in one of three ways. MyGovWatch Trial: Start a free, 14-day trial at MyGovWatch and request a copy via chat on the website post sign up. You can get a copy by visiting this location and filling out the form. (Current MyGovWatch users need only request a copy via chat or to support@mygovwatch.com to obtain one.) SmallGovCon: If you are a subscriber to the email newsletter at www.smallgovcon.com, forward a copy of a recent issue to support@mygovwatch.com and you will receive a copy by reply. RSM Federal Book Pre-Release: Sign up to hear about the release of Michael Lejeune’s upcoming book, which will feature a chapter exploring survey results to include critical analysis, at this location, then email us from the same address to support@mygovwatch.com with subject line GovCon Survey Results Request. Media requests for a copy of the survey results should go to media@mygovwatch.com. The post First Annual MyGovWatch Buyer Survey Results May Surprise You first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  8. Please join federal government contracts attorneys Nicole Pottroff & Greg Weber for this informative webinar on SBA certifications hosted by Catalyst Center for Business & Entrepreneurship. Participants will get an overview about the Small Business Certifications including: Woman Owned Small Business and Economically Disadvantaged Woman Owned Small Business 8(a) Business Development Program HUBZone (Historically Underutilized Business Zone) Service Disabled Veteran Owned Small Business We will discuss how to get certified, how long it may take, regulations, changes, updates, and tips and tricks on how to be prepared. Please Register here. The post Webinar! Small Business Certifications, March 20, 2024, 10:00-11:00 am CDT first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  9. Happy Friday and happy, early Saint Patrick’s Day. We hope you have some fun things planned for the weekend. Here, in Lawrence, Kansas, preparations are underway for the annual St. Patty’s Day parade. It seems the whole town comes out to celebrate and it’s a very fun and festive spectacle. I think more than anything, people are just ready to get outside to enjoy the warmer temperatures. Before you head into your weekend activities, here are a few articles on what’s happening in the federal government contracting world. Enjoy the weekend and don’t forget to wear green! Top Government Contracting Events for 2024 GovCon Index Snaps 4-Day Win Streak but Marks Another Winning Week Shreveport Man Convicted in Recent Trial Pleads Guilty to Additional Charge of Theft of Government Funds Biden administration requests $3B for federal AI application development, procurement and integration in 2025 budget Statement by GSA Administrator Robin Carnahan on the President’s Fiscal Year 2025 Budget Contract losses have defense contractors saying no to their biggest customer: the DOD Navy civilian worker, contractor indicted in alleged bribery scheme Argus Information & Advisory Services Agrees to Pay $37M to Settle Allegations that it Misused Data Obtained Under Government Contracts OMB Announces Pilot to Better Leverage Federal Acquisition to Strengthen America’s Critical Supply Chains Incurred cost submission best practices for government contractors Women-Owned Contracting Trends for 2024 Defense Contracts: Better Monitoring Could Improve DOD’s Management of Award Lead Times The post SmallGovCon Week in Review: March 11-15, 2024 first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  10. Contractors will often enter into mentor protégé relationships and joint ventures to leverage the experience and skills of multiple parties for various reasons. SBA regulations dictate how the capabilities, past performance, and experience of a mentor-protégé joint venture will be evaluated. But at the end of the day, what matters is, whether agencies will follow those regulations in their small business set-aside solicitations and evaluations thereunder. A recent GAO case addressed this issue, providing further guidance on the interplay of solicitation terms for experience evaluations and SBA’s rules for evaluating mentor-protégé joint ventures’ experience. SBA regulations dictate that when evaluating a joint venture’s experience, capabilities, and past performance, on a “contract set aside or reserved for small business,” the agency “must consider work done and qualifications held individually by each partner to the joint venture as well as any work done by the joint venture itself previously.” Additionally, an agency “may not require the protégé firm to individually meet the same evaluation or responsibility criteria as that required of other offerors generally.” The joint venture as a whole must “demonstrate the past performance, experience, business systems and certifications necessary to perform the contract.” Basically, if a mentor-protégé joint venture bids on a small business set-aside procurement, the agency must evaluate the members, as well as the joint venture as a whole. But, an agency can’t require the protégé member to meet the same requirements as other contractors. GAO in Akima Data Management, LLC; Absolute Strategic Technologies, LLC, B-420644.7, B-420544.8 (Comp. Gen. 2024) looked at terms under the Polaris small business pool solicitation. This is quite the well known procurement around federal contracting. So, unsurprisingly, there is some bid protest history with this procurement. In fact, the disputes in Akima revolve around agency action taken after a Court of Federal Claims (“COFC”) case. Prior to this case at GAO, the solicitation in Akima, was protested at the COFC for its terms related to submitted experience for a mentor and protégé, which stated: “a minimum of one Primary Relevant Experience Project or Emerging Technology Relevant Experience Project must be from the Protégé or the offering Mentor-Protégé Joint Venture,” and “[n]o more than three Primary Relevant Experience Projects may be provided by the Mentor.” The COFC found that these terms meant that the same evaluation criteria was was applied to all experience projects, regardless of whether the project is submitted by a protégé or not. As you recall, the SBA regulations state that the protégé will be separately evaluated from other offerors (or rather is not required to meet the same conditions as other offerors). Due to the COFC decision, the terms were updated. However, these updates were also protested, this time at GAO, bringing us to this current case, Akima. These terms protested at GAO still required a “minimum of one Relevant Experience Project” from the protégé or the mentor-protégé joint venture. However, the terms were also updated in response to COFC’s orders, to state this requirement could be met by “submitting ‘a Primary Relevant Experience Project’; ‘an Emergency Technology Relevant Experience Project’; or–new and specific to MJPVs–‘a Protégé Capabilities Relevant Experience Project'” to be evaluated on a pass/fail basis rather than on a scoring table that other offerors used. In connection with this change, effected offerors could revise portions of their proposal, including removing or replacing the projects impacted by the term change submitted by a protégé or by a mentor-protégé joint venture. If an effected proposal didn’t have one of these project experiences from a protégé or mentor-protégé joint venture, then offerors must submit a protégé capability experience project from the protégé or the mentor-protégé joint venture. Akima protested this update, stating that the solicitation should allow all offerors to update or substitute projects for experience. Absolute (the other protester), among other arguments, argued that the updated terms violated SBA regulations because it “unreasonably limits protégés from taking advantage of the experience of their MPJVs and precludes members of MPJVs from demonstrating past performance and experience to perform the contract ‘in the aggregate.'” GAO held that only mentor-protégé joint ventures were required to submit projects for protégés or mentor-protégé joint ventures, and the updates limit revisions to projects from the protégé or mentor-protégé joint venture. GAO also held that the updated terms do not violate SBA regulations because the regulations simply require agencies to “consider the work and qualifications of the individual members of the MPJV as well as the MPJV, itself, and provides that ‘partners to the joint venture in the aggregate must demonstrate the past performance, experience, business systems and certifications necessary to perform the contract.'” GAO interpreted the updated terms as providing mentor-protégé joint ventures with flexibility, through the ability to “replace any experience project from the protégé or the MPJV with one from the mentor or a subcontractor–while still providing details about the protégé’s capabilities.” Thus the terms meet the requirement to evaluate a mentor-protégé joint venture “based on the abilities of the joint venture and its members” as a whole. This case provides some great insight on: 1) the type of evaluation terms that GAO and other reviewers will see as acceptable related to mentor-protégé joint ventures; and 2) the advantages placed on mentor-protégé joint venture experience evaluations. Contractors bidding on a procurement through a mentor-protégé joint venture need to be on the look out for experience evaluation terms. If the solicitation’s terms place requirements on protégés that are the same as other offerors, or don’t consider the mentor-protégé team as a whole, then it may be seen as violating SBA rules. Additionally, mentor-protégé joint ventures (and really all contractors) should be careful to examine the effects of any corrective action or amendment to a solicitation, to ensure it meets regulatory expectations. Finally, this case serves as a great reminder to all contractors who are interested in, or are involved in the SBA’s mentor-protégé program, that the SBA’s regulations can provide significant experience advantages to joint ventures formed under SBA’s Mentor Protégé Program (such as permitting protégés to be held to different experience standards than other offerors). Need legal assistance with a government contracting matter? Email us or give us a call at 785-200-8919. Looking for the latest government contracting legal news? Sign up here for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook. The post GAO Says: SBA’s Rules for Mentor-Protégé Joint Venture Experience Evaluations May Limit Solicitation Terms first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  11. Happy Friday! March Madness is upon us! For you college basketball fans, it’s a great time of year. The upsets keep things exciting, even if they do bust everyone’s brackets. I guess that’s what makes March Madness so maddening and exciting–one can never predict the outcome. Listening to the news out of the federal government can sometimes feel like March Madness. So, before you start your weekend of studying those basketball stats, here are some things that happened in federal government contracting this week. These include updates on government spending bills, AI, and use of apprentices. Have a wonderful weekend. With FOIA backlogs on the rise, do agencies need direct-hire authority? SBA Administrator Guzman Announces 2024 National Small Business Week Award Winners VA Seeks Veteran-Owned Small Businesses to Provide Software Tool, Information Submission Support The New JADC2—Explaining CJADC2 & How Companies Are Meeting DOD’s Needs If you’re a budget numbers nerd, this is the week to watch FACT SHEET: President Biden Signs Executive Order: Scaling and Expanding the Use of Registered Apprenticeships in Industries and the Federal Government and Promoting Labor-Management Forums How the Federal Government Is Continuing AI Progress Post-Executive Order Committee on Small Business Holds Hearing Examining GAO Recommendations to Reduce Mismanagement at the SBA Additional Contractors Indicted for Rigging Bids and Defrauding the U.S. Military in South Korea Air Force Employee Indicted for Unlawful Disclosure of Classified National Defense Information House passes $460 billion package of spending bills. Senate expected to act before shutdown deadline White House presses agencies to use apprenticeships for skills-based hiring 5 Women-Owned Defense Contracting Companies That Are Crushing It The post SmallGovCon Week in Review: March 4-8, 2024 first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  12. It is no doubt that the SBA’s 8(a) Business Development Program is a first-class program: there is a reason that some of us around here tend to say that it is one of the most important of federal government contracting programs. And in the past year, there has been a flurry of activity surrounding the 8(a) Program. For the most part, this uptick in activity has had to do with the requirement that all applicants prove they are socially disadvantaged in light of the the Ultima decision that we’ve discussed on the blog. As you may know, applicants must also prove that they are economically disadvantaged, though the requirements to qualify as such are a little more objective. But then there is the requirement that the applicant firm must be able to prove that it has the potential for success. Today we take a closer look at the potential for success requirement’s two year business revenue rule, and delve into whether there is any way around it. Potential for Success: A Mile High View If you are new here, I’ve included a short primer on potential for success to bring you up to speed. You can also go here to read more in-depth about it. SBA requires that 8(a) Program applicants demonstrate “reasonable prospects for success in competing in the private sector if admitted to the 8(a) BD program,” which is reasonable in light of the additional benefits 8(a) Program participants receive. Benefits like business development assistance and priority on many federal contracting opportunities. Makes sense, right? The SBA wants to make sure your business has a chance at making it before it will let you take advantage of the 8(a) Program benefits for up to nine years. Therefore, by looking at a number of criteria, the SBA evaluates the applicant’s potential for success. And, because this is arguably the most important of SBA’s socioeconomic programs, the program that every federal contractor wants a piece of, that isn’t always an easy thing to do. Two Years in Business Rule Turning to the two-years in business rule, it requires the applicant to demonstrate that it has “been in business in its primary industry classification for at least two full years immediately prior to the date of its 8(a) BD application[.]” To demonstrate this, the applicant must submit its income tax returns for the prior five tax years (if possible), two of which must show “operating revenues in the primary industry in which the applicant is seeking 8(a) BD certification.” Essentially, SBA is looking at whether you have been in business for at least two years, in your primary NAICS code identified on your 8(a) application, and whether you have generated revenues in that amount of time for that NAICS code. Two years in business is relatively easy to demonstrate, but the NAICS code and revenue requirements have potential to cause problems. You want to make sure that your primary NAICS code identified on your tax returns matches your primary industry identified in your 8(a) application, as experience has shown is it far easier to have it correct from the get-go than to have to field any number of questions from SBA reviewers about why the two don’t match up. Additionally, revenue is straight forward: there either was revenue in those two years or there was not. Does this mean that not having revenue in those two years is an automatic disqualification? Will you be denied if your NAICs codes don’t match? Will applicants that have been in business less than two years be immediately denied? Is there a minimum amount of revenue? The answer to those questions is every attorney’s favorite response: it depends. Waiver There is a waiver for the two-years in business rule, but it’s not very often that such a waiver is granted. It is entirely understandable that a business that is eligible for the 8(a) Program in every other way would want to get into the program without waiting the two years. But the bar to get over to be granted a waiver is very high and contains five separate conditions, each of which must be met to qualify. Those conditions are: (i) The individual or individuals upon whom eligibility is based have substantial business management experience; (ii) The applicant has demonstrated technical experience to carry out its business plan with a substantial likelihood for success if admitted to the 8(a) BD program; (iii) The applicant has adequate capital to sustain its operations and carry out its business plan as a Participant; (iv) The applicant has a record of successful performance on contracts from governmental or nongovernmental sources in its primary industry category; and (v) The applicant has, or can demonstrate its ability to timely obtain, the personnel, facilities, equipment, and any other requirements needed to perform contracts as a Participant. Seems easy, right? Not so fast. This waiver doesn’t allow the applicant to just check off each of the boxes. Instead, it must be able to provide evidence that it meets the requirements. That means evidence of current and completed “governmental and nongovernmental” contracts (including letters of reference or past performance reports) to establish its history of successful contract performance. Information demonstrating performance of work in the industry in which it is seeking 8(a) certification. Bank statements. Letters of recommendation. Documents showing availability of capital. Generally, the more documentation you have that can account for each of the five requirements, the better your chances of receiving a waiver. That said, SBA doesn’t hand out such waivers all willy-nilly. It can be incredibly difficult to have a waiver request granted. Unfortunately, denial of an 8(a) applicant because of a lack of potential for success is not a denial reason that can be appealed per 13 C.F.R. § 124.206. This means there is little information publicly available due to a lack of decisions that often come from appeals, which is where we would look to determine the finer details of waivers, such as what is “adequate capital to sustain its operations” and what amount of experience is considered “demonstrated technical experience to carry out its business plan,” are unknown. And SBA doesn’t release numbers on how many waivers it grants. But SBA officials have said that granting waivers is something that SBA does only in rare circumstances. * * * Moral of the story: requesting a waiver of the two year business revenue rule can be a valid path towards 8(a) Program participation if you are able to meet the five requirements for a waiver and have plenty of evidence to back it up, but it is by no means an easy one. Regardless, it might be worth a try. After all, the worst that can happen is a denial and, although you cannot appeal on account of potential for success, you can always re-apply 90 days later. Need legal assistance with applying to or navigating the SBA’s 8(a) Program or another government contracting legal matter? Email us or give us a call at 785-200-8919. Looking for the latest government contracting legal news? Sign up for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook. The post 8(a) Program’s Two Years in Business Rule: Requirement or Suggestion? first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  13. Back in 2021, GAO came down with a clear decision on whether Department of Defense (DoD) agencies could require a joint venture (JV) to have its own facility clearance level (FCL) if its component members held the required FCL themselves. Infopoint LLC, B-419856 (Aug. 27, 2021). That decision was “no,” and it was based on a very strong foundation: The 2020 National Defense Authorization Act (2020 NDAA), an act of Congress, contained a provision, Section 1629, expressly forbidding DoD agencies from doing such. We in fact did a blog post on this GAO decision and litigated this very matter. Despite this, in October 2023, the DoD quietly released a memorandum describing how they think they can still require JVs to have their own FCL. Today, we look at this memorandum to see what DoD is saying. The 2020 NDAA and InfoPoint Back in 2019, when Congress passed the 2020 NDAA, it contained a provision specifically prohibiting the DoD from requiring a JV to have its own FCL if its component members held the FCL required for the solicitation: “TERMINATION OF REQUIREMENT FOR DEPARTMENT OF DEFENSE FACILITY ACCESS CLEARANCES FOR JOINT VENTURES COMPOSED OF PREVIOUSLY-CLEARED ENTITIES. A clearance for access to a Department of Defense installation or facility may not be required for a joint venture if that joint venture is composed entirely of entities that are currently cleared for access to such installation or facility.” On top of this, SBA amended 13 C.F.R. § 121.103, the regulation governing affiliation rules, to include the following: “A joint venture may be awarded a contract requiring a facility security clearance where either the joint venture itself or the individual partner(s) to the joint venture that will perform the necessary security work has (have) a facility security clearance.” Despite this fairly straightforward language, many DoD procurements continued to include a requirement that a JV hold its own FCL even if the component members of the JV held that FCL. This was in spite of the fact that a JV is really just the JV members working together: If the JV members each have the requisite FCL, that would mean that all those working as part of the JV meet the FCL requirement. It took a few GAO protests, led by the Infopoint protest, to put an end to this. In InfoPoint, GAO observed that “section 1629 of the NDAA specifically states, and the plain meaning of the statute leads us to conclude, that it unambiguously prohibits DOD from requiring that a joint venture hold a facility clearance if the members of the joint venture hold the required facility clearances.” It further noted that 13 C.F.R. § 121.103 was “consistent with the 2020 NDAA,” and that “the relevant inquiry is whether the joint venture itself, or the individual partners that make up the joint venture, hold a facility security clearance.” October 2023 DoD Memorandum Despite the holding in InfoPoint, in October 2023, DoD issued a memorandum stating it was going to allow its agencies to require for a given contract that joint ventures hold their own or entity eligibility determinations or EEDs (the term the memo uses for FCLs, we’re going to stick to FCL), regardless of whether their members have their own FCL or not. The memorandum starts off by noting it is needed “in light of the recent Small Business Administration (SBA) rule (Oct. 16, 2020), which addresses JVs under the SBA’s programs, and a subsequent Government Accountability Office (GAO) decision (Aug. 27, 2021) that interpreted the SBA rule without addressing NISP requirements and 32 CFR 2004 or how the two interconnect, thus adding to the confusion.” It appears that DoD is referring to a requirement in 32 C.F.R. § 2004.32 stating: “The CSA must ensure that all entities needing access to classified information as part of a legitimate U.S. or foreign government requirement have or receive a favorable eligibility determination before accessing classified information.” DoD thinks that JVs don’t have to have this clearance when they bid, only by the time they begin performance. Furthermore, DoD recognizes one exception to its requirement: “[I]f the JV is established by contract (not a separate legal entity), is unpopulated (no employees of the joint venture itself will be performing work connected with classified information), or other similar situations, and thus will not be involved with or otherwise influencing performance on the security work accessing the classified information,” then it does not need its own FCL. However, a joint venture that is formed as a separate legal entity (which, in our experience, is most joint ventures), will need its own FCL by the time it begins performance. Adding to the confusion, DoD stated: “A JV formed as a separate legal entity may be awarded a classified contract and may hold an EED in its own right, although as with any U.S. legal entity, it is not required to hold an EED in order to be awarded the classified contract.” Similarly, DoD recognizes that a “prime JV offeror cannot be required to already hold an EED in order to submit an offer on a classified contract.” To summarize its view, DoD finishes: As envisioned by the SBA, all work involving classified information under the SBA programs covered by 13 CFR 121.103 will be performed by one or both of the individual partners to the JV and by their employees, not by the JV entity itself. Under the NISP, a NISP CSA will assess the business structure of the legal entity awarded the classified contract to determine the entity’s eligibility for an (FCL) or an appropriate exclusion from classified information under NISP rules at 32 CFR 2004.32(a)(1). The SBA rule does not change this. However, if the legal entity awarded the classified contract is an unpopulated JV formed pursuant to this SBA regulation, the NISP CSA will exclude the JV from access to classified information (rather than determining its eligibility for access) unless the JV’s structure or potential influence, access, or control over the classified information/contract indicates it must also have an (FCL). Thoughts It appears that DoD is arguably saying that it is going to allow its agencies to require separate legal entity JVs to have their own FCL since the SBA rule in 13 C.F.R. § 121.103 doesn’t conflict with such a requirement, and their own regulations require such. (DoD could certainly be clearer in describing its policy). DoD appears correct that 13 C.F.R. § 121.103 only is concerned with requirements that the JV have its own FCL at award and is silent on whether the JV can be required to have its own FCL at start of performance. However, while we understand DoD’s interest in security here, we feel there’s a major problem in its analysis. InfoPoint was not solely based on 13 C.F.R. § 121.103. In fact, it was primarily based on the 2020 NDAA, which is a federal statute. That statute, which then trumps any conflicting federal regulation, plainly states: “A clearance for access to a Department of Defense installation or facility may not be required for a joint venture if that joint venture is composed entirely of entities that are currently cleared for access to such installation or facility.” While it might be arguable that the DoD’s reading of 32 C.F.R. § 2004.32 does not conflict with the SBA’s regulations, that doesn’t change or resolve the issue that it appears to directly conflict with a federal statute. The language in the NDAA does not distinguish between award or performance. We admit that we are a bit confused by DoD’s insistence on maintaining this requirement where the JV is already entirely made up of entities that have the required FCL. What does requiring the JV to have its own FCL in such an instance do to further security? All involved already have the required clearance. This was the issue with the old system that InfoPoint did away with. One thing contractors can consider is that if you make a JV that doesn’t involve a separate legal entity (until now, this has not been the norm, but it may arise more in light of this), the FCL requirement won’t be applied. As for challenging this position, it appears a protest of this to GAO or COFC for a given procurement wouldn’t work, as the requirement only that the JV must hold the FCL by the time performance starts. That means it isn’t technically a requirement to bid on a procurement, so it isn’t suitable for protesting. That said, there are routes to challenge agency actions during a contract itself. This would go to a Contract Disputes Act matter, and it may be worth considering if getting the FCL by the time of award appears prohibitive. Again, while we get DoD’s interest in security, we are hopeful that DoD may consider revisiting this plan to prevent needless issues down the road. If this is not what DoD intended, then it needs to amend or reissue its guidance to make it clearer how small business joint ventures can comply. There’s no real need for it to play Dr. Frankenstein here. Need legal assistance with a government contracting matter? Email us or give us a call at 785-200-8919. Looking for the latest government contracting legal news? Sign up here for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook. The post Playing Dr. Frankenstein: DoD Memo Tries to Revive Joint Venture Facility Clearance Requirements first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  14. A NAICS code appeal can be a powerful tool for altering the competitive landscape of a bid by changing what size of business is allowed to submit a bid and thereby either increasing or decreasing the potential competitor pool. This post explores some of the important reasons for considering filing a NAICS code appeal. While NAICS codes appeals are not that common, they have a fairly high rate of success. What is a NAICS Code? A NAICS code is a six-digit code that is assigned to various categories of industries under the North American Industry Classification System (NAICS), a standard used in classifying business establishments. The North America part in the name, means these codes are also used in Mexico and Canada, meaning revisions to the codes have to get approval of all three countries. The codes are assigned by the US Census Bureau for “business establishments for the purpose of collecting, analyzing, and publishing statistical data related to the U.S. business economy.” The NAICS manual lays out the system for assigning NAICS codes. The manual has convenient search form to use to look up the descriptions for each code. For our purposes, it’s important that the SBA assigns a different size standard to each NAICS code based on dollar number of receipts or number of employees. SBA publishes a table of all the size standards. Here’s an example. NAICS code 541511 is for Custom Computer Programming Services and has a size standard of $34 million per year. The NAICS manual describes this code as follows: “This U.S. industry comprises establishments primarily engaged in writing, modifying, testing, and supporting software to meet the needs of a particular customer.” So, if an agency assigns 541511 to a solicitation, then only contractors whose average receipts are under $34 million per year can bid on the procurement. 1. The Solicitation Description of Work Does Not Match the NAICS Code Description A contracting officer must assign the proper NAICS code based on what best describes the principal purpose of the product or service being acquired in light of the industry descriptions in the NAICS Manual and the description in the solicitation. The key to having a good NAICS appeal is to show that, based on clear examples from the solicitation’s scope of work and level of effort, the NAICS code assigned doesn’t match the main purpose of what the agency is purchasing. Look at the majority of work under the solicitation, as well as past examples of similar work (or possibly even the incumbent work) being procured under a different NAICS code. In one example we blogged about, a solicitation at the time of its posting was assigned NAICS code 561311, Employment Placement Agencies, which carried a $30 Million size standard. In the NAICS manual examples of businesses under that code may include employment registries, babysitting bureaus, and employment agencies. The work, as described, called for at least 8 supervisory medical support assistants, and over 150 full-time employees. These employees would conduct general administrative functions, perform a variety of technical support that will help the work of medical staff, cover general administrative staff on leave, and help cover vacancies, among other duties. The protester argued that the RFQ calls for “100% administrative services” and that there is no requirement for the agency to “purchase the suppliers of the administrative services.” Consequently, the protester proposed that NAICS 56110, Office Administrative Services, would be a better fit for this RFQ. The NAICS manual provides examples of businesses under that code such as, administrative management services, management services, managing offices of physicians and surgeons, and medical office management services. SBA agreed and sustained the appeal. 2. The Largest Dollar Amounts in the Solicitation Do Not Correspond to the Chosen NAICS Code The NAICS code must match 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. Say that 90% of the dollar value of a contract is for work under a contract that does not match the NAICS code. Based on those dollar amounts, it appears the government may have used the incorrect NAICS code. That would be a good candidate for a potential NAICS code challenge. 3. The NAICS code size standard doesn’t allow you to bid. The NAICS code is based on the type of work performed. But it has an important impact on the size of businesses that can bid on a solicitation. Going back to our earlier example, say that a solicitation had a NAICS code 541511 for Custom Computer Programming Services and has a size standard of $34 million per year. If your company has average receipts of $10 million per year, it would be competing with companies potentially more than three times as big. In that situation, it might make sense to consider a NAICS code appeal, if there was a reasonable basis for one. 4. The Agency Recently Updated the NAICS Code in a Solicitation These appeals must be filed within 10 calendar days after issuance of the solicitation or amendment to the solicitation affecting the NAICS code. This, of course, differs from the ordinary rule for protesting a defect in a solicitation. At the GAO and Court of Federal Claims, protests of other solicitation defects ordinarily are timely if filed before the due date for initial proposals. So, if you see that a solicitation was recently amended to change the NAICS code, you may want to examine why the agency changed it. Otherwise, however, you must challenge the NAICS code within 10 days of the initial issuance of a solicitation. Many appeals are dismissed for being untimely. Counting just those NAICS code appeals decided on the merits, about 45% were granted, per a GAO report. * * * These are reasons why your small business might consider a NAICS code appeal. A NAICS code appeal can be a powerful way to change the competitive nature of a procurement. But you must act fast and have a logical basis for suggesting the agency’s chosen NAICS code does not fit. If both of those are true, a NAICS code appeal can be a good bet. Questions about this post? Need help filing or responding to a size protest of your own? Or need additional government contracting legal assistance? Email us. Looking for the latest government contracting legal news? Sign up for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook. The post Why File: A NAICS Code Appeal first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  15. Hello, blog readers and happy Friday. Can you believe it’s already March? In just a few short weeks, spring will (finally) be here! We hope that you’re gearing up for a nice weekend. But before you punch out, let’s take a look at the-week that was. In this edition of the Week in Review, Congress passed a short term spending measure to avoid another government shutdown and a report was released citing that federal employee whistleblower complaints have dropped, and Congress is trying to improve small business contracting methods. You can read more about this and other federal government contracting news in the articles below. Have a great weekend! Federal Acquisition Regulation: Certification of Service-Disabled Veteran-Owned Small Businesses Congress approves short-term extension to avoid shutdown, buy more time for final spending agreement Sen. Ernst hopeful about fixes to small business contracting Federal employee whistleblower complaints to OSC fall by nearly half over 5 years US Government Preparing 3 Key Space Contracts for Launch GovCon Expert Payam Pourkhomami Ventures Into the New Era of DOD Cybersecurity With the Proposed CMMC 2.0 Rule (Part One) DOD, GSA & NASA Release Interim Rule on SDVOSB Certification Advice for contractors when the government really, really could shut down DOD Fraud Risk Management: Enhanced Data Analytics Can Help Manage Fraud Risks DoD calls for more contracting flexibilities in 2025 NDAA Class Deviation—Prohibition on Required Disclosure of Information Relating toGreenhouse Gas Emissions SBA Announces Statutory Increases for Surety Bond Guarantee Program How emerging technologies are changing government contracting The post SmallGovCon Week in Review: Feb 26-March 1, 2024 first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  16. The 2024 NDAA is directing quite a change in past performance evaluations for offerors in Department of Defense acquisitions. Historically, an offeror’s affiliate’s past performance is not automatically considered along with the offeror’s proposal, although an agency could consider it. The 2024 NDAA, though, has actually mandated a change within the DFARS that will up-end this long-held tenet for Department of Defense contracts. Some background is probably warranted before discussing the change that the 2024 NDAA will cause for DoD acquisitions. We here at SmallGovCon discuss size and affiliation quite often (keep in mind that “affiliation” for federal contracting is different than “affiliation” in private industry). Of course, we highly recommend you read our blogs on affiliation to learn more, but for purposes of this discussion, what matters most is that in federal contracting, affiliates are deemed to be commonly controlled, and their sizes are combined. Based on that foundation of affiliation, many contractors logically think, “well my affiliate is seen by the SBA as under common control and part of my size, so agencies should consider my affiliate’s past performance along with mine as well.” Unfortunately for those under that impression, it is wrong (for now). Agencies must consider joint venture partner experience, and past performance of a small business teaming partner if it meets the factors under those rules. The FAR has also stated that an agency “should” consider the “past performance information regarding predecessor companies, key personnel who have relevant experience, or subcontractors that will perform major or critical aspects.” Noticeably absent from all of these is any sort of requirement or consideration of an offeror’s affiliates. Thus, under current rules, a business could be affiliated with a company due to sharing of resources, ownership, management, or other reasons that could directly impact performance, but the agency does not have to look at any of that. An affiliate could have the best past performance possible for a procurement, which could boost an offeror’s performance, but it would all be for naught. This can be frustrating for many contractors who (understandably) think these types of affiliate situations should boost their proposal. Well, this will soon be changing for Department of Defense procurements. The 2024 NDAA states in section 865: Not later than July 1, 2024, the Secretary of Defense shall amend section 215.305 of the Defense Federal Acquisition Supplement (or any successor regulation) to require that when small business concerns bid on Department of Defense contracts, the past performance evaluation and source selection processes shall consider, if relevant, the past performance information of affiliate companies of the small business concerns. The 2024 NDAA was signed into law in late December 2023. Consequently, this will mean that once the DFARS is updated in line with the NDAA (hopefully by July of this year), Department of Defense acquisitions (and only those for now), will take into account any relevant past performance information of affiliates of a small business offeror. This could provide many small businesses a new ability to leverage past performance that is technically not exactly their own. What is unclear from all this is how such a change will be interpreted for entity-owned 8(a) Program participants, such as those owned by Alaska Native Corporations or Native-American entities. As you may know, when determining the size of an entity-owned 8(a) company, SBA does not consider other entities with common ownership to be affiliates. So, under this change to the DFARS, it could be argued that entity-owned 8(a) Program companies cannot automatically utilize their possibly large network of affiliate resources for a proposal advantage in a DoD acquisition, absent a JV or teaming arrangement (although the FAR would allow it at the discretion of the evaluating agency). As of the time of this blog post, the subject DFARS provision has not been updated. The NDAA provides a deadline of July 1, 2024, to get such an update complete. Once that update occurs (hopefully by July 1), offerors should be prepared to adjust their DoD proposal approaches to reflect relevant past performance of affiliates, and/or take into account competitors’ affiliates. Make sure to come back and check the link to the specific DFARS above on this blog post through July 1, 2024, to know exactly when this change occurs, and be sure to reach out to your federal contracting attorneys with any questions on the FAR or DFARS. Questions about this post? Email us. Need legal assistance? Call us at 785-200-8919. Looking for the latest government contracting legal news? Sign up for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook. The post 2024 NDAA will Update DFARS to Require Evaluation of Small Business Affiliate Past Performance first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  17. Join our attorneys, Nicole Pottroff and John Holtz, on the latest edition of MyGovWatch, now on YouTube. This podcast, hosted by Nick Bernardo, covered a wide variety of current government contracting topics and answered all the right questions. From the migration of the Veteran Small Business Program from the VA to the SBA (and the first appeal reviewing SBA’s SDVOSB “grace period”)–to the most-recently updated size standards and the assignment of (the often incorrect) NAICS codes to federal contracts–all the way to SBA’s 8(a) Program and the effects of the recent federal court decision in Ultima –and everything in between. You can watch this informative video here. The post MyGovWatch YouTube Video Available Now! first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  18. Whether you are a small, medium or even a large contractor seeking to team with small businesses, this course will discuss the different regulations you must follow, the different small business programs set up by the SBA, the advantages and disadvantages of the JV & Mentor Protégé programs, plus other topics of interest. This live virtual event will be hosted by Larry Allen and Nicole Pottroff and Stephanie Ellis will be joining Larry for the afternoon session. We hope you will consider attending this informative event! Register here. The post 1 Day Virtual Event! The Essentials for Small Business Government Contracting, February 29, 2024 first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  19. Happy final Friday of February! Can you believe that next week is March already? I guess we can start preparing for St. Patrick’s Day because it will be here soon. I think folks are hoping that our spring like weather will hold and that winter is over. Of course, in Kansas, the weather can change on a dime so we won’t count on it! Here’s hoping the weather is nice wherever you are and have a great weekend. This week in federal government contracting news included reactions to proposed federal rules on cybersecurity for contractors, and an update on potential expanded whistleblower protections. U.S. Attorney Announces $25.5 Million Settlement With Durable Medical Equipment Supplier Lincare Inc. For Fraudulent Billing Practices Pentagon IG not impressed by effectiveness of DoD vendors’ award fees 4 lessons for tech startups expanding into government contracting DoD ready to start implementing multibillion dollar moving contract after solving latest tech hurdle Small and minority-owned businesses see more opportunity than ever Potomac man pleads guilty in federal contracting scheme Defense Innovation Board: Scaling Innovation Forward Contractors on edge because of Pentagon’s proposed buying rules SBA Announces Funding Competition to Organizations Providing Entrepreneurship Training to Women Veterans Oklahoma Man Pleads Guilty to Defrauding Government’s Online Auctions, Purchasing Vehicles and Jewelry for $1 Whistleblower protection legislation stalls amid congressional chaos House leaders announce new, bipartisan AI task force General Services Administration Acquisition Regulation; Updated Guidance for Non-Federal Entities Access to Federal Supply Schedules The post SmallGovCon Week in Review: February 19-23, 2024 first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  20. In Mckenna Brytan Indus. LLC, SBA No. VSBC-334, 2023 (Feb. 8, 2024), the U.S. Small Business Administration (SBA) Office of Hearings and Appeals (OHA) sustained the Service-Disabled Small Business (SDVOSB) status protest of BTNG Enterprises, LLC (BTNG). In its decision, OHA reiterated the two current regulatory options for calling yourself an “SDVOSB” concern: the first, is having your SDVOSB application officially approved by the SBA and your company listed in the SBA’s Veteran Small Business Certification Program (VetCert) data base; and the second, is having submitted your complete application to SBA through VetCert prior to December 31, 2023, and be currently waiting for approval or denial. Here, OHA was unable to conclude that BTNG had done either of those things–despite looking for evidence of eligibility from the SBA and from BTNG itself. McKenna Brytan is a significant protest. It is one of the first OHA decisions to discuss enforcement of SBA’s regulatory SDVOSB grace period that began January 1, 2024 (actually it appears it may be the first protest). McKenna Brytan concerned a Defense Logistics Agency (DLA) Request for Quotations (RFQ) for portable dehumidifiers, set aside for SDVOSBs under North American Industry Classification System (NAICS) code 333415, Air-Conditioning and Warm Air Heating Equipment and Commercial and Industrial Refrigeration Equipment Manufacturing. It had a corresponding size standard of 1,250 employees. The RFQ specifically stated: “[i]f no qualified SDVOSB offers are received, it is possible other small businesses can be considered.” And DLA announced the award to BTNG on December 6, 2023. In its proposal, BTNG offered a fixed unit price of $330 per unit and represented to DLA that it was a WOSB concern and an SDVOSB concern. McKenna Brytan filed a timely SDVOSB status protest of the awardee with DLA’s Contracting Officer for the RFQ. It alleged: its quotation should have been found superior to BTNG’s; and its quotation would more likely have been awarded if BTNG had not falsely claimed SDVOSB status. As required, the Contracting Officer forwarded the status protest on to OHA requesting: “a formal SDVOSB status determination be accomplished for BTNG.” Along with the referral letter, DLA also told OHA that BTNG was only the lowest quote among those representing SDVOSB status and “was not the lowest quote in relation to the quotes submitted by [non-SDVOSBs].” To investigate BTNG’s represented SDVOSB status and eligibility, OHA issued a Notice and Order for the Director of SBA’s Office of Government Contracting (D/GC) to submit a BTNG Case File to OHA. But after “a comprehensive search,” the D/GC told OHA there was no record of BTNG being SDVOSB certified by SBA–and in fact, no record of BTNG even applying for SDVOSB certification with SBA. So, without an SBA case file, OHA issued an Order to BTNG itself to prove its qualification as an SDVOSB, noting: “As the protested firm, BTNG has the burden of proving its eligibility as an SDVOSB by a preponderance of the evidence. 13 C.F.R. § 134.1010.” In perhaps one of the most interesting parts of this protest, BTNG’s response to the protest and OHA’s Order openly admitted that BTNG was not 51% owned nor fully controlled by one or more service-disabled veterans. Rather, in OHA’s words: BTNG maintains that it was selected for the instant award because it is a small business. BTNG asserts that it expects to “partner” with an SDVOSB through a post-award “teaming agreement”. BTNG concludes that “the [CO] awarded this contract with full authority and the protest is without merit.” OHA’s analysis of this protest rightfully began with an explanation of the relevant date for determining SDVOSB eligibility, noting, “In an SDVOSB status protest pertaining to a procurement, OHA determines the eligibility of the protested concern as of the date of its initial offer or response which includes price. 13 C.F.R. § 134.1003(e)(1).” OHA therefore determined it would analyze BTNG’s eligibility as of the date it submitted its quotation to DLA. OHA then turned to the question of BTNG’s SDVOSB eligibility as of the date it submitted its proposal. Because there was no debate that BTNG was not a VetCert registered SDVOSB, OHA focused on SBA’s regulatory option for previously self-certified SDVOSBs to continue to self-certify if they qualify for SBA’s SDVOSB grace period. OHA said: SBA regulations generally permit that a concern may self-certify as an SDVOSB, so long as the concern submitted “a complete SDVOSB certification application to SBA on or before December 31, 2023”, until such time as “SBA declines or approves the concern’s application.” 13 C.F.R. § 128.401(a). OHA then said, although BTNG represented it was an SDVOSB in its quotation, OHA and SBA found no record of BTNG ever applying for SDVOSB certification before December 31, 2023. And as noted above, OHA even gave BTNG the chance to prove its eligibility regardless of this finding. But BTNG didn’t even argue that it was service-disabled veteran owned or run. If you’re familiar with the Veteran Certification Programs’ rules–both SBA’s and, previously, the Department of Veterans Affairs (VA) Center for Verification and Evaluation’s (CVE)–you likely know that two of the main requirements are: “To qualify as a SDVOSB, one or more service-disabled veterans must unconditionally and directly own at least 51 percent of the concern[,]” (13 C.F.R. § 128.202); and “To be an eligible SDVOSB, the management and daily business operations of the concern must be controlled by one or more service-disabled veterans . . . [which] means that one or more qualifying veterans controls both the long-term decision-making and the day-to-day operations of the Applicant or Participant.”13 C.F.R. § 128.203. But no worries if you are not familiar with the Veteran Certification Program or rules, you can read more about them here. So, because BTNG wasn’t officially SDVOSB certified, allowed to self-certify under the grace period, or even eligible under the SDVOSB rules, OHA found: BTNG’s self-certification as an SDVOSB thus was improper under 13 C.F.R. § 128.401(a). [And] BTNG has produced no evidence to substantiate its claimed SDVOSB status. Nor does BTNG even argue that it is at least 51% owned, and fully controlled, by one or more service-disabled veterans. Accordingly, BTNG has not carried its burden of proving that it is an SDVOSB. Finally, OHA briefly addressed BTNG’s argument that offerors on the RFQ were not required to be SDVOSBs. On that front, OHA said: It is true that the RFQ indicated that “[i]f no qualified SDVOSB offers are received, it is possible other small businesses can be considered.” BTNG, though, did represent itself as an SDVOSB in its quotation, and DLA evaluated BTNG’s quotation as if it had been submitted by an SDVOSB. Contrary to BTNG’s suggestions, then, BTNG’s status as an SDVOSB (or lack thereof) was directly relevant to the underlying procurement. As a result of BTNG’s misrepresentation of SDVOSB eligibility–deemed relevant to DLA’s selection of an awardee for the RFQ, as the RFQ gave clear priority to SDVOSBs over small business offerors–OHA sustained the protest. Questions about this post? Email us. Need legal assistance? Call us at 785-200-8919. Looking for the latest government contracting legal news? Sign up for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook. This post updates an earlier post on SmallGovCon. The post OHA Sustains Status Protest: Self-Proclaimed SDVOSB Awardee Not Certified by VetCert, Not Eligible For SBA’s Grace Period, And Not Veteran Owned or Controlled first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  21. As federal contracts attorneys, we often get questions about what happens in the event of an acquisition of a small business. Reporting requirements, whether before or after an acquisition, tend to vary from one type of small business socioeconomic program to another. And there are other considerations such as whether the small business in question is the one being acquired or the one acquiring another small business and the timing with regard to proposal submission, contract performance, task orders, and other variables. Taking those together, and it can be, well, confusing, to say the least. In the case of Forward Slope, Inc., SBA’s Office of Hearings and Appeals (OHA) took a look at some of these variables to determine how an acquisition can affect the size of a concern awarded a multiple award contract. Background In July 2021, the U.S. Department of the Navy awarded Forward Slope a place on the Seaport-NxG Multiple Award Contract (MAC). For those unfamiliar with Seaport-NxG, it is both a set of Indefinite Delivery Indefinite Quantity (IDIQ) MACs and the platform used by the Navy to solicit, award, and administer task orders under those IDIQ MACs. Once on the MAC, on November 29, 2022, Forward Slope, a self-certified small business, submitted its response to an RFQ for Seaport-NxG. Following Forward Slope’s response to the RFQ, the Navy made an award to Forward Slope on the 100% small business set aside task order. Following award, SBA’s Area Office received a protest regarding Forward Slope’s size, alleging that Forward Slope was an “other than small” business. This led to the Area Office issuing a size determination stating that Forward Slope was, in fact, other than small and therefore it was ineligible for award. How did this happen, if Forward Slope was small when it was awarded a place on the MAC? One word: acquisition. You see, sometime between when Forward Slope was awarded the MAC and when it submitted its offer for the task order, it was acquired by another entity . And 13 C.F.R. § 121.404(g)(2)(i) states: In the case of a merger, acquisition, or sale which results in a change in controlling interest under 13 C.F.R. §121.103, where contract novation is not required, the contractor must, within 30 days of the transaction becoming final, recertify its small business size status to the procuring agency, or inform the procuring agency that it is other than small. If the contractor is other than small, the agency can no longer count the options or orders issued pursuant to the contract, from that point forward, towards its small business goals. The agency and the contractor must immediately revise all applicable Federal contract databases to reflect the new size status. Therefore, according to 13 C.F.R. § 121.404(g)(2)(i), the Area Office determined Forward Slope was required to recertify its size status to the procuring agency or inform the procuring agency that it was other than small. Forward Slope did not, it was found to be other than small, and any subsequent options or orders would not count towards the Navy’s small business goals. Size Appeal Fast forward to July 2023, when Forward Slope filed the appeal at issue here. The underlying MAC stated that it would be competed on the following bases: unrestricted or set-aside for small businesses, service-disabled veteran-owned small businesses (SDVOSB), women-owned small businesses (WOSB), 8(a) participants, or HUBZone participants. In its appeal, Forward Slope asserted that offerors on task orders set-aside for SDVOSBs, WOSBs, 8(a), and HUBZones were required to qualify as small at the time of offer submission, as stated in the MAC. But there was no similar requirement included for small business set-asides, nor was there in the task order solicitation. Therefore, according to Forward Slope, it was not required to recertify its size following its acquisition by the other company. So, who was right? Forward Slope, but not for the reason they were arguing. It is a longstanding policy (as we discussed here) that a concern that certifies itself as small, at the time it submits its initial offer, remains small for the life of the contract per 13 C.F.R. 121.404(g). However, contracting officers are also permitted to request recertification of size, if desired, at the time of the task order offer. In that case, the size of the offeror at the time of the initial offer, including price for the task order, will be the size that applies. In this situation, the contracting officer never requested recertification. In fact, that was even affirmed by the contracting officer during the Area Office’s investigation. However, the Area Office incorrectly applied 13 C.F.R. § 121.404(g) when it determined that Forward Slope’s size was to be determined at the time of its submission in response to the RFQ for the task order. There was no requirement that offerors for small business set-asides recertify at task order bid submission—whether in the MAC or in the task order RFQ—and SBA policy does not require recertification to the procuring agency (here, the Navy) unless the contracting officer requests recertification. But wait, there’s more! The regulation clearly states that after a merger or acquisition that affects size, the contractor must recertify its size. So how can a contractor be required to recertify, but not have the new size, if other than small, apply to the rest of the contract? Well, there is a rule that both parties seemed to overlook. Way down in 13 C.F.R. § 121.404(g)(4), it states, [I]f the Multiple Award Contract was set-aside for small businesses, partially set-aside for small businesses, or reserved for small business, then in the case of a contract novation, or merger or acquisition where no novation is required, where the resulting contractor is now other than small, the agency cannot count any new or pending orders issued pursuant to the contract, from that point forward, towards its small business goals. The distinguishing point here, and the point that OHA’s decision turned on, was that the requirement to recertify as a result of a merger, sale, or acquisition, per 13 C.F.R. § 121.404(g)(2) is not the same as a contracting officer’s request for size recertification for a task order under a MAC, as discussed in 13 C.F.R. 121.404(g)(4). 13 C.F.R. § 121.404(g)(4) only requires recertification on a MAC when the contracting officer requests. Therefore, because SBA rules allow an awardee to count as small for the first five years following the initial offer for the MAC, Forward Slope was still considered small for award eligibility purposes. This meant that Forward Slope would be eligible for small business awards under the MAC for five years from initial offer. A very interesting—and important—distinction to keep in your back pocket. So, what have we learned? You can be eligible for small business task order awards on MACs, even when the agency cannot count the contract as one to a small business; and Task orders on MACs will continue to count as awards to small businesses following an acquisition, unless the contracting officer requests a recertification in relation to a task order under the MAC. Questions about this post? Email us. Needing legal assistance? Give us a call at 785-200-8919. Looking for the latest government contracting legal news? Sign up for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook. The post Shopping for a New Small Business: How Acquisitions Affect Size Status for Multiple-Award Contracts first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  22. Under 13 C.F.R. § 124.506, if an 8(a) contract price would exceed a certain threshold ($7 million for manufacturing contracts, $4.5 million for others), in most cases, the agency must compete the set-aside. 13 C.F.R. § 124.506(a)(5) is a provision meant to close up what otherwise would be a loophole in the rules. It states that “[a] proposed 8(a) requirement with an estimated value exceeding the applicable competitive threshold amount may not be divided into several separate procurement actions for lesser amounts in order to use 8(a) sole source procedures to award to a single contractor.” But this rule does not apply in all circumstances. In particular, it does not apply to bridge contracts. In Anika Systems, Inc., B-422187 (Feb. 1, 2024), the SEC (the federal one, not the football one), had a two-step acquisition plan for data management services. It would sole source the first part to 8(a) participant Peregrine Advisors Benefit, Inc. (Peregrine) and compete the second part, worth $43 million, for 8(a) participants to bid on. The first part in 2022 went through without issue. But the second part of the acquisition was protested by unsuccessful offerors, resulting in the SEC taking corrective action. The problem was that now, the 2022 contract to Peregrine was about to expire with no successor to take on the data management services. As such, the SEC offered a bridge contract worth $4.2 million to Peregrine to continue the work while the second part of the acquisition was carried out. Anika Systems, Inc. (Anika), one of the competitors for the second part of the acquisition protested this bridge contract. Anika had some good points to make on this. Most notably, Anika argued that this bridge contract was basically inseparable from the 2022 contract as both contracts involve provision of the exact same services, and that, combined, the requirements had a value that exceeded the 8(a) sole source dollar limit. The SEC countered that the bridge contract wasn’t an attempt to split its requirement into smaller procurements so it could sole source the work to Peregrine. It argued that the bridge contract was a different requirement since it was issued in light of the protests and corrective action for the second part of the acquisition. The SEC also stated that 13 C.F.R. § 124.506(a)(5) is not meant to stop bridge contract as bridge contracts are a stop-gap measure to be used until an actual competition can take place. The SBA (invited to the party by GAO because the matter involved SBA regulations and GAO usually listens to SBA when interpreting SBA rules) filed a brief and agreed with the SEC’s interpretation, noting that the regulation was really meant to stop agencies from using indefinite-delivery, indefinite-quantity (IDIQ) contracts to get around the threshold. It “implemented this regulation to prevent an agency from dividing an IDIQ contract into separate smaller contract actions to make award to a single firm without competition.” Per SBA, it was not meant to stop agencies from using emergency measures like bridge contracts. GAO sided with SBA and the SEC. It noted that back in 2000, it in fact had addressed this question and agreed with the government’s view of the matter in Champion Bus. Servs., Inc., B-283927 (Jan. 24, 2000). GAO agreed that “the regulation does not apply to bridge contracts because bridge contracts do not pose any threat to the aims sought to be protected by a competitive procurement.” Going further, it noted its decision in New Tech. Mgmt., Inc., B-287714.2 (Dec. 4, 2001). There it “concluded that the regulation only applied to the award of concurrent contracts.” In other words, the regulation prohibits agencies from taking a single contract for, say, 10 services that would have a value above the threshold, and dividing it out into five separate contracts with covering two services each and each smaller contract being below the threshold. Anika also made an argument that the SEC failed to consider the effect the bridge contract would have on the equitable distribution of 8(a) contracts. Under 13 C.F.R. § 124.503(g), “[a] procuring activity contracting officer must submit a new offering letter to SBA where he or she intends to award a follow-on repetitive contract as an 8(a) award.” The SEC had not done this. However, GAO also rejected this argument. 13 C.F.R. § 124.3 notes: “The determination of whether a particular requirement or contract is a follow-on includes consideration of whether the scope has changed significantly, requiring meaningful different types of work or different capabilities; whether the magnitude or value of the requirement has changed by at least 25 percent for equivalent periods of performance; and whether the end user of the requirement has changed. As a general guide, if the procurement satisfies at least one of these three conditions, it may be considered a new requirement.” The bridge contract only had a base period of one month and was worth only $4.2 million compared to the $43 million original competitive acquisition. As such, it was a new requirement, not a follow-on requirement, so the new offering letter requirement did not apply. Thoughts GAO’s analysis seems very reasonable concerning bridge contracts, which really aren’t planned ahead of time. After all, how can you divide a requirement after the fact? But we think this protest raises some important questions. What happens when an agency decides that instead of competing a five-year contract to 8(a) companies, it will just sole source five one-year contracts at the sole source dollar threshold to an 8(a) company? Assuming they do this while complying with 13 C.F.R. § 124.503(g) and receiving SBA approval, there’s still an argument to be made that the agency is splitting up a five-year contract into five separate one-year contracts to stay under the threshold limit. 13 C.F.R. § 124.506(a)(5) doesn’t specify that it only applies for concurrent procurements, it says that “[a] proposed requirement may not be divided into several separate procurement actions for lesser amounts in order to use 8(a) sole source procedures to award a single contractor.” In fact, couldn’t this have maybe applied to the 2022 Peregrine contract itself? The agency basically split the procurement into two parts, one large and one small, and sole sourced the small part. It was too late for a GAO protest on the matter, but it is interesting to think about. It seems the implication is that the procedures in 13 C.F.R. § 124.503(g) on repetitive contracts will serve to prevent such a situation, and to SBA’s credit, we think that would do a good job of it. But it still opens a potential door, and we think it is something where some clarification in the regulation language itself could be helpful. Questions about this post? Email us. Needing legal assistance? Give us a call at 785-200-8919. Looking for the latest government contracting legal news? Sign up for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook. The post A Bridge (Not) Too Far: Prohibition on Dividing up Contracts to get Under 8(a) Sole Source Dollar Limit Doesn’t Apply to Bridge Contracts first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  23. If you feel like prices for just about everything are going up, you’re not alone. I recently got my annual property tax bill, and the first thing I did (after recovering from a brief fainting spell) was to start Googling to find out how much I could get for one of my kidneys on the black market. I get the feeling that my county tax assessor would consider anything less than a double digit increase to be an embarrassing professional failure. In federal government contracting, however, a contractor may not have the same leeway to raise its prices. In a recent bid protest decision, the GAO held that when an agency sought to procure services using the Federal Supply Schedule, the agency could not agree to pay a price higher than the price set forth in the offeror’s underlying FSS contract. The GAO’s decision in Kauffman & Associates, Inc., B-421917.2, B-421917.3 (2024) involved a request for quotations issued by the Centers for Medicare and Medicaid Services seeking in-person and virtual training services. CMS issued the RFQ to five GSA Schedule vendors under the procedures of FAR Subpart 8.4, which governs FSS acquisitions. Two of the five vendors submitted quotations. After evaluating the quotations, CMS announced that the order would be awarded to Octane Public Relations. The other vendor, Kauffman and Associates, Inc., then filed a bid protest with the GAO, challenging various aspects of CMS’s evaluation. Among its challenges, Kauffman argued that the agency “failed to evaluate discrepancies between the awardee’s proposed pricing and its FSS pricing.” Kauffman pointed out that Octane’s proposed price for the Events Coordinator labor category exceeded Octane’s price for the same category in its underlying FSS contract. The GAO explained: [W]hile discounts to FSS prices are permissible, a vendor may not propose prices higher than their FSS prices, as the higher prices have not been determined to be fair and reasonable by the General Services Administration (GSA) and are therefore not FSS prices. . . Accordingly, issuing an order based on non-FSS pricing under an FSS acquisition would be improper. In this case, the GAO wrote, “[w]e find the agency’s determination that the awardee’s pricing was fair and reasonable to be flawed.” Because Octane proposed a price that was higher than its FSS price, “it would not be proper to issue the order to that vendor.” The GAO sustained the protest. Contractors often negotiate FSS prices that are higher than they expect to actually charge, knowing that agencies may expect discounts. Per GAO, that tried-and-true strategy is viable. But as the Kauffman and Associates, Inc. case shows, a contractor’s FSS prices may effectively be a ceiling. When bidding on an FSS order, proposing a price higher than the underlying FSS contract price may make it improper for the agency to award the order. Oh, one more thing: if you know someone who is looking for a lightly-used kidney, could you let me know? Asking for a friend. This article was originally published by Steven Koprince on LinkedIn and is reprinted with permission. Steve is the founder of Koprince McCall Pottroff LLC but has retired from the practice of law to focus on other endeavors. His views do not necessarily represent those of the firm or its attorneys. To read more of Steve’s current government contracting writing, follow him on LinkedIn and subscribe to his LinkedIn newsletter. Questions about this post? Email us. Need legal assistance? Call us at 785-200-8919. Looking for the latest government contracting legal news? Sign up here for our free monthly newsletter, and follow us on LinkedIn, Twitter and Facebook. The post Agency Could Not Accept Price Above Awardee’s FSS Price, GAO Says first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  24. Touted as a “game-changer” when it was first introduced in 2016, the U.S. Small Business Administration’s All Small Mentor-Protégé Program isn’t new anymore. Known now as simply the “SBA Mentor-Protégé Program, it is still extremely powerful for large and small contractors alike. In this webinar, Gregory Weber and I will explain the ins and out of the SBA Mentor-Protégé Program, covering the program’s eligibility requirements, its potent benefits (including the ability to form special Mentor-Protégé Joint Ventures), the application process, and common misconceptions and pitfalls. Target Audience: Small Businesses (SDVOSB, WOSB, HUBZone, 8(a), SDB) and large businesses interest in doing business with the federal government. Please join us and register here. And thanks to Earl King of the DC Department of Small and Local Business Development and Apex Accelerator for organizing this event. The post Free Webinar! The SBA Mentor-Protégé Program hosted by Washington DC APEX Accelerators, February 27, 10:30am -12:30 PM EST first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
  25. Hello, blog readers. We want to say that our hearts are with the people of Kansas City. Our thoughts and prayers go out to the victims and families of those impacted during the the Super Bowl celebration in Kansas City. We also salute the first responders who acted so quickly. Our stories from federal contracting news this week included continued delays for CIO-SP4 and a new initiative on carbon-free electricity. GSA & DOD Seek Input on Upcoming Government Procurement of Carbon Pollution-Free Electricity Biden administration preps potential largest ever federal carbon-free electricity purchase How government contractors can harness artificial intelligence FACT SHEET: Biden-⁠Harris Administration Releases Annual Agency Equity Action Plans to Further Advance Racial Equity and Support for Underserved Communities Through the Federal Government How acquisition hinders national security VA sexual harassment investigation recommends firing, recouping bonuses from supervisors NITAAC seeking another 6-month extension for CIO-SP3 GE Aerospace Resolves Alleged Gender-based Hiring Discrimination, Pays $443K in Back Wages to Affected Job Applicants After Compliance Review Defense Federal Acquisition Regulation Supplement: DFARS Buy American Act Requirements (DFARS Case 2022-D019) General Services Administration Acquisition Regulation; Removing Small Disadvantaged Business Program Requirements To Align With the FAR The post SmallGovCon Week in Review: February 12-16, 2024 first appeared on SmallGovCon - Government Contracts Law Blog.View the full article
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