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SmallGovCon has covered the SBA’s assumption of control over certification of Service-Disabled Veteran Owned Small Businesses (“SDVOSB”) and Veteran Owned Small Businesses (“VOSB”) since it was first announced well over a year ago. Now, we are coming close to one of the final deadlines associated with SBA taking over these certification processes. It is hard to believe that it is already the end of the calendar year once again. But time flies when you are having federal contracting fun! With the end of 2023 comes a crucial deadline for certain veteran businesses to keep in mind–the date for self-certification to go away.
As we discussed during the SBA’s SDVOSB certification rules rollout, self-certification of SDVOSBs was an item that SBA planned to get rid of. In the final rules and in follow up guidance, SBA stated that self-certified SDVOSB contractors would be given a one-year grace period to submit their certification application to the SBA. During that period, SDVOSBs could still self-certify as an SDVOSB. However, after that one-year grace period, SDVOSB self-certification would be eliminated. (That being said, SBA did indicate in its final rule that SDVOSB self-certification would be allowed for subcontracting purposes and goaling credit, for another five more years).
As you likely know, SBA assumed control of SDVOSB certification on January 1, 2023. So, that one year grace period is coming to an end very soon. As SBA states on its site, there is “one-year grace period for self-certified SDVOSBs until January 1, 2024.” Meaning the grace period’s last day is December 31, 2023, only a few short weeks away.
SDVOSB contractors who are self-certified were given the one-year grace period to file an application for SDVOSB certification. Consequently, a self-certified SDVOSB that sends in its application for SDVOSB certification to SBA prior to January 1, 2024, “will maintain their eligibility through the expiration of the grace period until SBA issues a final eligibility decision.” Meaning, a SDVOSB could self-certify through 2023 to compete for most SDVOSB set-asides (note, though, that VA does not recognized SDVOSB self-certification), but that ability will end on December 31, 2023. Therefore, if you are a self-certified SDVOSB, you have only a few weeks (as of the date of this blog) to get your application in to the SBA. Applications must be sent to the SBA through the SBA’s VetCert portal. If a self-certified SDVOSB contractor misses that deadline, it will find itself no longer SDVOSB certified and standing in line with other new applicants to regain SDVOSB status. In fact the SBA states “Self-certified SDVOSBs are encouraged to submit an application in advance to ensure the certification process is complete by January 1, 2024.”
While every application is different, SBA will generally look for the same things. We highlighted many of these in our back to basics post on SDVOSBs and VOSBs. But it basically boils down to two major things: 1) ownership; and 2) control. In general, the SBA will want to make sure service-disabled veteran(s) directly and unconditionally own the majority of the business. The SBA will also want to make sure service-disabled veteran(s) control the business. Control is typically shown through control of the day-to-day affairs and long-term strategic decision-making of the applicant business. Self-certified SDVSOBs applying to SBA will need to keep these things in mind when preparing their applications. The SBA has provided a FAQ, email (email@example.com), and toll free line (M-F, 8am-6pm ET, 800-862-8088), for any assistance they can provide. Of course, if you find yourself in the situation of needing to apply for SDVOSB certification, it may be a good idea to reach out to a federal contracting lawyer for input, to see if you meet the certification requirement, because there are many nuances to the eligibility requirements SBA places on contractors for the SDVOSB program.
Questions about this blog? Email us at firstname.lastname@example.org. Need legal assistance? Give us a call at 785-200-8919.Reminder: 2023 SDVOSB Deadline Looming first appeared on SmallGovCon - Government Contracts Law Blog.
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That was how Virginia O'Hanlon began her letter to the Editor of The Sun in 1897. The Editor's response to Virginia is the most read editorial that was ever written That is not exactly what this entry is about. However, four years ago I did some research on Virginia and found the room where Virginia wrote her letter. You can read about it in the brief entry shown below.
What caught my eye was the comment from Alan to my earlier entry. The comment was written in 2021 and I first noticed it tonight. Alan, thank you for the comment. It added a bit of cheer to my Christmas in 2023.
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Crowell & Moring’s “All Things Protest” podcast keeps you up to date on major trends in bid protest litigation, key developments in high-profile cases, and best practices in state and federal procurement. In this episode, host Christian Curran highlights a recent GAO decision with analysis on key personnel and discussions issues.
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In recent months, there have been a number of articles about an increase in venture capital interest in entities that do business with the federal government.
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Joint Proposal Calls for Amendment of the FAR to Support Environmental Concerns.
A joint proposal requesting to amend the current Federal Acquisition Regulation (FAR) to focus on the environment and sustainability and to implement a requirement for agencies to procure sustainable products and services to the maximum extent practicable was issued on August 3, 2023, by the Defense Department (DoD), General Services Administration (GSA), and National Aeronautics and Space Administration (NASA).
This proposal is on the heels of the Catalyzing Clean Energy Industries and Jobs through Federal Sustainability Executive Order (EO 14057). In this EO, President Biden challenged agencies to meet the following targets:
- Achieve 100 percent carbon pollution-free electricity by 2030, including 50 percent on a 24/7 basis.
- Reach 100 percent zero-emission vehicle acquisition by 2035, including 100 percent light-duty acquisitions by 2027.
- Achieve net-zero building emissions by 2045, including a 50 percent reduction by 2032.
- Reduce Scope 1 and 2 greenhouse gas emissions by 65 percent from 2008 levels by 2030.
- Establish targets to reduce energy and potable water use intensity by 2030.
- Reduce procurement emissions to net-zero by 2050.
- Have climate resilient infrastructure and operations.
- Develop a climate- and sustainability-focused workforce.
- Advance environmental justice and equity-focused operations.
- Accelerate progress through domestic and international partnerships.
More importantly to NITAAC, the EO also directs agencies to purchase sustainable products and services in accordance with relevant statutory requirements, and, to the maximum extent practicable, purchase sustainable products and services identified or recommended by the Environmental Protection Agency (EPA).
At NITAAC, protecting our environment is at the forefront of our procurement strategy. In fact, our environmental best practices have been lauded for four consecutive years by the Global Electronics Council, which owns and manages the EPEAT Purchaser Awards. The awards recognize excellence in sustainable procurement of EPEAT-registered products.
NITAAC is one of a few Government-Wide Acquisition Contracts (GWACs) to receive this global award and has been recognized for excellence in multiple categories, including computers, displays and servers.
Environmentally Responsible Spending
NITAAC takes considerable pride in doing our part to ensure the federal government has access to sustainable products. As agencies look to purchasing commodities, such as laptops and desktops, NITAAC can help. We are committed to providing EPEAT certified laptops, desktops, printers, monitors and servers to meet every federal agencies’ information technology (IT) needs.
With almost 4000 EPEAT certified products to choose from, the ordering process is as easy as the click of a button. To start your order, download a copy of the NextGen GSS Ordering Guide here, then click the log in to e-GOS button in the upper right hand corner of any NITAAC web page.
NITAAC not only offers the standard configurations of the GSS program, we also can handle more complex requirements through our CIO-CS Government-Wide Acquisition Contract for IT Commodities/Solutions. NITAAC offers training in use of our GWACs and is happy to provide customized training for any federal office or organization.
Together, we can achieve the President’s vision for a more sustainable future. We strongly believe it is not only our job to provide a first-class acquisition experience but to also do our part to create a healthier planet. To learn more about how NITAAC can help you meet your end of year laptop and desktop buying needs, and meet the President’s directive in EO 14057, visit https://nitaac.nih.gov/services/government-wide-strategic-solutions.
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Once again, the threat of a government shutdown looms over federal contractors and grantees. If Congress does not pass a continuing resolution or other funding legislation before midnight on Saturday, agencies will lack authorized appropriations to fund their operations. Although regrettable, the risk of a shutdown (or debt ceiling crisis) has been a fairly common occurrence over the last few years.
Here’s our guidance from prior potential funding shortfalls on how contractors can prepare to weather the storm of a government shutdown:
- Surviving a Government Shutdown
- Strategies for Sequestration
- The right to stop work due to inadequate funds
- Contractors get paid even if appropriations are exhausted
- Implications of the Debt Ceiling for Government Contractors
In short: (1) communicate with your contracting officer; (2) address near-term funding issues; (3) assess mitigation options (e.g., reassigning personnel); and (4) quantify and document your shutdown-related impacts. Contractors should also consult their applicable agencies’ government shutdown contingency plans.
While prior shutdowns have historically not lasted very long, the duration of shutdowns has been increasing. Until 1995, all prior government shutdowns lasted less than a week with most being one day or less. In 1995, the government shut down twice, once for 5 days and again for 21 days. The 2013 shutdown lasted 16 days. The most recent shutdown in 2018-2019 lasted 35 days but was only a partial shutdown—Congress had passed at least some funding legislation.
Although the current threatened shutdown looks increasingly likely, it is difficult to predict how long it may last. But the scope of the shutdown and the lack of any appropriations will hopefully prompt quick action in Congress to avoid a lengthy pause in government operations.
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Late last year, the United States Office of Management and Budget (OMB) published a memorandum, M-22-18, that required federal agencies to comply with the guidelines regarding ensuring the safety and integrity of third-party software on federal information technology systems. This memorandum applied to the use of firmware, operating systems, applications, cloud-based software and general software.
The memo requires federal agencies to comply with the National Institute of Standards and Technology (NIST) guidance, as detailed in President Biden’s cybersecurity Executive Order 14028, and stipulated that agencies “only use software provided by software producers who can attest to complying with the Government-specified secure software development practices, as described in the NIST Guidance.”
The memo instructed agencies to collect a standardized self-attestation form from all software contractors before deploying their products. Initially, each agency will identify the software and collect the self-attestations forms. The end goal is to create a government-wide central repository of all software-related information, to shore up any cybersecurity vulnerabilities.
I wanted to provide you with a brief update on where the NIH Information Technology Acquisition and Assessment Center (NITAAC) is in the self-attestation process and make you aware of some key dates that will impact your company.
NITAAC is working with the OMB to determine the formal agency posture on this matter. We also are working to finetune the process for our communications requirements, as it relates to collecting the self-attestation forms.
In the meantime, contractors should be aware of the following key dates:
- June 11, 2023: NITAAC deadline to collect self-attestation forms from critical software providers.
- September 14, 2023: NITAAC deadline to collect the forms from all software providers on the NITAAC networks.
- TBD: If needed, NITAAC will request a software bill of materials or other artifact(s) that demonstrate conformance with secure software development practices.
You will hear more from NITAAC as we get additional clarity, however, I wanted you to know you are not in this alone. I understand that this request presents several challenges on your end, in terms of staffing and the additional labor required to conduct and submit the self-attestations.
We face those same challenges at NITAAC. One of the biggest obstacles being faced on the federal level is that of time. The reality is that the government likely will not be able to produce and distribute the attestation forms in a timely manner. Unfortunately, if we cannot do so, this administrative burden will fall upon our contract holders, as you will then need to develop your own forms.
I can’t promise that this process will be smooth, as there are several variables at play, but what I can promise is that we will be as transparent as possible and will make it our business to provide you with timely and relevant updates.
I value our partnership and look forward to attesting the safety, integrity and security of all the software our contract holders provide to the federal government. This will become just one more example of the high-quality, best in class service agencies can expect from the NITAAC Contract Holders.
We will discuss this further on our next Contact Holders’ call.
To read the Executive Order, visit https://www.nist.gov/itl/executive-order-14028-improving-nations-cybersecurity. To learn more about the OMB Memo, visit https://www.whitehouse.gov/wp-content/uploads/2022/09/M-22-18.pdf.
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Consider the following exchange between two people:QuoteSpeaker 1 (asking Speaker 2): What type of car do you drive, foreign or domestic?
Speaker 2: I drive a red car.
Obviously, Speaker 2's answer is not responsive to Speaker 1's question. Speaker 1 wanted to know about a particular aspect of Speaker 2's car: its origin. Speaker 2 described a different aspect of his car: its color. While Speaker 2's statement about the color of his car may be true, it doesn't tell us anything about the origin of his car.
Easy enough, right? Ok, let's try another one. Consider the following exchange between two contract specialists:QuoteContract Specialist 1: Is Contract X a fixed-price or cost-reimbursement contract?
Contract Specialist 2: Contract X is an indefinite delivery contract.
Is Contract Specialist 2's answer responsive to Contract Specialist 1's question? No, the answer is no more responsive to the question than Speaker 2's answer was to the question of whether his car was foreign or domestic. Why? In this exchange, Contract Specialist 1 wanted to know about a particular aspect of Contract X: ts compensation arrangement. Contract Specialist 2 described a different aspect of Contract X: its delivery arrangement. While Contract Specialist 2's statement about the delivery arrangement of Contract X may be true, it doesn't tell us anything about the compensation arrangement of Contract X.
Make sense? If so, see if you can spot anything wrong with the following passage of an article on contract types that recently appeared in the December 2010 issue of Contract Management (see Government Contract Types: The U.S. Government?s Use of Different Contract Vehicles to Acquire Goods, Services, and Construction by Brian A. Darst and Mark K. Roberts):QuoteFAR Subparts 16.2 through 16.6 describe 11 different permissible contract vehicles. These vehicles can be subdivided into three different families:
- Fixed-price contracts,
- Cost-reimbursement contracts, and
- Other contract vehicles that can be used when the quantity of supplies or services cannot be determined at the time of award (i.e., indefinite delivery, time-and-materials (T&M), labor-hour (LH), and level-of-effort contracts) or where it is necessary for the contractor to begin performance before the terms and conditions of the contracts can be negotiated (i.e., letter contracts).
Do you see anything wrong? Notice that the first two "families" are categorized by compensation arrangement. However, the third family contains a mix of terms used to describe compensation arrangement (T&M/LH), delivery arrangement (indefinite delivery), the extent of contractor commitment (level-of-effort), and a unique term used to describe a contract that is not definitive (letter contract). The way this passage is written implies that an indefinite delivery contract, a level-of-effort contract, and a letter contract are necessarily different (belong to a different "family") from a fixed-price or cost reimbursement contract. However, an indefinite delivery contract or a level-of-effort contract will have a compensation arrangement. The compensation arrangement can be fixed-price, cost-reimbursement, T&M/LH, or some combination thereof. A letter contract may or may not have a compensation arrangement when it is issued. You could conceivably have a letter contract that had a cost-reimbursement compensation arrangement, an indefinite delivery arrangement, and that provided for level-of-effort orders. As such, the authors? categorization of contract types makes as much sense as categorizing cars into three families?foreign, domestic, and red.
Incentive Contracts? Not What You Think They Are
Consider the following simplified description of a compensation arrangement:QuoteThe buyer agrees to pay the seller $100,000 to provide a specified quantity of medical transcription services. If the accuracy of the transcriptions exceeds 99%, the buyer agrees to pay the seller an additional $5,000.
Does the preceding describe an incentive contract? Many would say yes, because the arrangement provides for an incentive--specifically, a performance incentive. However, that would be incorrect. Just because a contract contains an incentive does not mean that it is an incentive contract. FAR 16.202-1 contains the following statements in a description of firm-fixed-price contracts (similar statements pertaining to fixed-price contracts with economic price adjustment can be found at FAR 16.203-1.QuoteThe contracting officer may use a firm-fixed-price contract in conjunction with an award-fee incentive (see 16.404) and performance or delivery incentives (see 16.402-2 and 16.402-3) when the award fee or incentive is based solely on factors other than cost. The contract type remains firm-fixed-price when used with these incentives.
Further, FAR 16.402-1(a) states:QuoteMost incentive contracts include only cost incentives, which take the form of a profit or fee adjustment formula and are intended to motivate the contractor to effectively manage costs. No incentive contract may provide for other incentives without also providing a cost incentive (or constraint).
Thus, it's not enough for a contract to contain an incentive to be an incentive contract. It must contain a cost incentive (or constraint).
In the aforementioned Contract Management article, an endnote references FAR 37.601(3) and misinterprets this paragraph as--encouraging the use of incentive-type contracts where appropriate. Here's what FAR 37.601(3) actually says:QuotePerformance-based contracts for services shall include-
(3) Performance incentives where appropriate. When used, the performance incentives shall correspond to the performance standards set forth in the contract (see 16.402-2).
The authors have made the mistake of assuming that a contract that contained a performance incentive was necessarily an incentive contract. In fact, when acquiring services FAR 37.102(a)(2) states the following order of precedence:Quote(i) A firm-fixed price performance-based contract or task order.
(ii) A performance-based contract or task order that is not firm-fixed price.
(iii) A contract or task order that is not performance-based.
As shown above, a firm-fixed-price contract would take precedence over an incentive contract.
A Genuine Misunderstanding
In a discussion of additional contract types and agreements, the Contract Management article contained the following statement (which caused me to stop reading and start writing):QuoteT&M and LH contracts are varieties of indefinite-delivery contracts and provide procuring agencies with the flexibility to acquire recurring services or when the amount of the effort required to deliver an end-item is uncertain.
Huh? T&M/LH is a type of indefinite delivery contract? I'll let you readers ponder that one.
The article concludes with a plug for the authors-two-day course in, you guessed it, types of contracts. I will pass.
At the beginning of Fiscal Year 2008 John Krieger and John Pritchard, two professors at the Defense Systems Management College, Defense Acquisition University, were kicking around the topic of Acquisition Reform. They reflected on what Jim Nagle wrote in the Epilogue to A History of Government Contracting, "If someone were asked to devise a contracting system for the federal government, it is inconceivable that one reasonable person or a committee of reasonable people could come up with our current system. That system is the result of thousands of decisions made by thousands of individuals, both in and out of government. It reflects the collision and collaboration of special interests, the impact of innumerable scandals and successes, and the tensions imposed by conflicting ideologies and personalities."
They reflected that those thousands of decisions were like putting bandages on the acquisition, contracting and procurement processes. Every time a piece of legislation is passed to “fix” the acquisition process, it’s another bandage. Every time a change is made to the Federal Acquisition Regulation (FAR), it’s another bandage. Every time a change is made to the Defense Federal Acquisition Regulation Supplement (DFARS), it’s another bandage. Every time a procurement or contracting policy memorandum is issued, it’s another bandage.
They joked about that being a great visual aid for the classroom. (Remember classrooms, the places you went to learn before COVID-19?) And the joking became reality. They started with a golf ball, and added a bandage for each new law, executive order, regulation, guide handbook, etc. And it would grow, and grow, and grow. “Acquisition Reform and the Golf Ball” was born that day.
The story of the golf ball was chronicled each fiscal year, and reported in the National Contract Management Association’s Contract Management (CM) after the end of each fiscal year. That is each year up until the report on the results for Fiscal Year 2020, when CM declined the latest installment in the series. Although John and John sought publication elsewhere, there didn’t appear to be a good fit, which brings the latest iteration, “Acquisition Reform and the Golf Ball—A Baker’s Dozen,” to Wifcon.com. (See attachment.)
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