Weekly Update Newsletter

PilieroMazza’s Weekly Update is an e-mail sent on Fridays that recaps legislative and regulatory issues affecting businesses of all sizes. When government agencies propose significant changes to existing regulations or Congress passes legislation of special interest to the small business community, we follow-up the Weekly Update with an analysis of the proposed change and the likely impact on small business. 


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  • March 24, 2017

    SMALL BUSINESS ADMINISTRATION

    Small Business Investment Companies: Passive Business Expansion and Technical Clarifications
    The delayed effective date for SBA’s final rule on Passive Business Expansion and Technical Clarifications occurred on March 21, 2017, when SBA re-opened the rule for additional public comments. SBA requires additional time to consider this final rule and determine whether any further changes are required. This final rule will go into effect on May 20, 2017. 82 Fed. Reg. 14428

    GOVERNMENT CONTRACTS

    Homeland Security Acquisition Regulation (“HSAR”) - Extension of Comment Periods
    The Department of Homeland Security (“DHS”) has extended the commenting periods for the following three proposed rules published on January 19, 2017: (1) “Safeguarding of Controlled Unclassified Information;” (2) “Information Technology Security Awareness Training;” and “Privacy Training.”  Comments are due on, or before, April 19, 2017.  82 Fed. Reg. 14341

    OTHER NEWS

    “GAO: Defense Contracting Down, Civilian Agencies Steady Over 5 Years.” Federal Times, March 20, 2017. Retrieved from https://www.federaltimes.com
    Defense spending decreased by almost 31 percent between 2011 and 2015, while civilian obligations remained steady, according to an analysis of governmentwide contracting by the Government Accountability Office (“GAO”).  Looking at trends of the government’s discretionary spending over a five-year period (which included 2013’s sequestration), the GAO found procurement activity at military departments during fiscal 2015 — primarily the Air Force, Army and Navy — dropped from nearly $211 billion in services and $186 billion in goods to $144 billion in services and $129 billion in goods.  Meanwhile, the civilian agencies with the highest obligations on contracts during that same time period — led by the Departments of Health and Human Services, Homeland Security, Justice, State, Commerce, and Transportation, as well as the U.S. Agency for International Development, General Services Administration and National Aeronautics and Space Administration — spent around $136 billion on services and $40 billion in products for 2011 and $127 billion on services and $36 billion in products in 2015.

  • March 17, 2017

    SMALL BUSINESS ADMINISTRATION

    “SBA Administrator Honors Nation’s Top Small Businesses.”  Small Business Administration Press Release, March 16, 2017. Retrieved from https://www.sba.gov.
    Administrator Linda McMahon, the head of the U.S. Small Business Administration (“SBA”), announced today this year’s Small Business Person of the Year winners from the 50 states, the District of Columbia, Puerto Rico, Guam and the U.S. Virgin Islands. All of the winners have been invited to attend ceremonies in Washington, D.C on April 30 – May 1 where they will be honored with their individual award along with recognition of the three runners-up and the naming of the 2017 National Small Business Person of the Year. The winners can be found here.

    “SBA Announces National Small Business Week.”  Small Business Administration Press Release, March 13, 2017. Retrieved from https://www.sba.gov.
    SBA Administrator Linda McMahon announced that this year’s National Small Business Week will be held from April 30 – May 6, 2017. McMahon will start the week in Washington D.C., where she will recognize and award outstanding small business owners from around the country. She will then continue the week with small business events in New York City, Indianapolis, Dallas, and finish up in Fresno, California. Additionally, recognition and educational events throughout SBA’s 10 Regions and 68 Districts will be held throughout the week. More details can be found here.

    Small Business Committee Examines SBA’s 7(a) Loan Program
    On March 9, 2017, the House Small Business Committee’s Subcommittee on Investigations, Oversight and Regulations examined the successes of the SBA’s 7(a) loan program, as well as potential opportunities to strengthen and improve the program. The 7(a) loan program is the SBA’s most common loan program, which made 64,000 loans in FY2015, totaling $24.1 billion. The hearing was the first in a series of hearings and actions the Small Business Committee will be taking this year to reform and protect the popular program which helps entrepreneurs access crucial early capital.

    OTHER NEWS

    “Hogan: Sick-leave Bills ‘Dead on Arrival’.” The Washington Post, March 15, 2017. Retrieved from https://www.washingtonpost.com
    Maryland Governor Larry Hogan, a Republican, rejected both versions of paid-sick-leave legislation advancing through the General Assembly, apparently because they require businesses with as few as 15 employees to offer the benefit and do not give employers tax credits or other incentives to lessen the financial blow. The bill approved last week in the House would require employers to give seven paid sick-leave days a year. The version that will be voted on by the Senate would require five paid sick days a year. Companies with fewer than 15 employees would have to provide five days of unpaid sick leave. Governor Hogan is pushing a different sick-leave bill that would require businesses with 50 or more employees to provide five paid sick days a year and would offer tax incentives to small businesses that agree to do so. The Governor’s measure has not moved out of committee.

    “GAO Weighs in on the State of Federal Contracting.”  Government Executive, March 10, 2017. Retrieved from http://www.govexec.com.
    Contractors working with major federal agencies delivered $438 billion in products and services in FY 2015, a 24 percent decrease from FY 2011, according to a wide-ranging roundup from the Government Accountability Office (“GAO”). The 66-page report, titled “Contracting Data Analysis: Assessment of Government-wide Trends,” said the drop-off occurred mostly at the Defense Department, which saw contracting go down by 31 percent in that timeframe. Services contracts have now risen to 60 percent of total government obligations — 50 percent of Pentagon awards and 80 percent of those let by civilian agencies — over the past five years, GAO said. Such services as professional and management support to information technology needs were used most by the Air Force and Army, while the top civilian agencies procuring services (worth at least $10 billion) were the departments of Energy, Health and Human Services, Homeland Security, Veterans Affairs, and the National Aeronautics and Space Administration. The full report can be read here.

  • March 10, 2017

    OTHER NEWS

    “Senate Narrowly Passes Repeal of Obama Fair Pay, Safe Workplace Rule.”  Government Executive, March 6, 2017.  Retrieved from http://www.govexec.com.
    The Senate narrowly approved, by a vote of 49-48, a House-passed Congressional Review Act resolution of disapproval, overturning President Obama’s Fair Pay, Safe Workplaces Executive Order (“EO”) and handing a victory to contractors who had blasted the EO and the Department of Labor’s (“DOL”) rule to implement it as “blacklisting.”  The EO aimed to protect contractor employees from wage theft and unsafe working conditions by requiring employers bidding on federal contracts to disclose violations and alleged violations of 14 federal labor laws and similar state labor laws.  Many contractors resisted the EO as burdensome and a form of punishment for unproven violations.  The DOL’s guidance on the EO issued last August was subsequently blocked by a federal court.

    “Reversing Course, Pentagon Says It Fully Supports Restructuring of Its Acquisition Bureaucracy.”  Federal News Radio, March 7, 2017.  Retrieved from http://federalnewsradio.com.
    The Pentagon has submitted a report to Congress on how it plans to implement one of its largest organizational changes in decades:  the bifurcation of the current Department of Defense (“DOD”) Office of the Undersecretary of Defense for Acquisition, Technology and Logistics (“AT&L”) and the creation of a new Chief Management Officer position, as authorized by the National Defense Authorization Act for Fiscal Year 2017 (“2017 NDAA”).  The 2017 NDAA authorizes the splitting of AT&L into two separate Undersecretaries – one for research and engineering and one for acquisition and sustainment.  But the report – a two-page memo from Deputy Defense Secretary Robert Work – offers scant detail about where the DOD is headed with the reorganization.  Indeed, in the 2017 NDAA, Congress gave the DOD very little direction on the bureaucratic details of the reorganization, other than to say they wanted a new Undersecretary to focus on sharpening the military’s technological edge.  However, the DOD intends to take advantage of the flexibilities Congress provided for the establishment of these positions – although no final decisions have yet been made by the Defense Secretary.  A final report is expected from the DOD in August.

    “Agencies Could Learn a Thing or Two from DOD’s Approach to Buying Services.”  Federal News Radio, March 6, 2017.  Retrieved from http://federalnewsradio.com.
    Since 2012, the Pentagon has been effectively utilizing its services acquisition workshop (“SAW”), a four-day training, to procurements worth more than $1 billion.  Ken Brennan, the Deputy Director for Services Acquisition in the DOD’s Procurement and Acquisition Policy Office, said the success of this effort – that brings together all the stakeholders of an acquisition, from technology, to financial, to mission, to lawyers – is leading the DOD to consider lowering the threshold for requiring the use of SAWs.  The 2012 memo mandates using SAWs for services acquisition over $1 billion and encourages the military to use the process for any services acquisition worth more than $100 million.  The concept of SAW is starting to spread to other agencies as well.  Tiffany Hixson, the General Services Administration’s (“GSA”) Professional Services Category Executive in the Federal Acquisition Service, said at a conference that her office used a version of the SAW while developing the blanket purchase agreement for identity monitoring and data breach response services last year.  Hixson said GSA’s experience was so positive that she foresees the agency using a SAW for all future multiple award type contracts.

    “Lead Agencies Must Turn Category Management Small Business Strategies into Action.”  Federal News Radio, March 6, 2017.  Retrieved from http://federalnewsradio.com.
    The future of the Obama administration’s Category Management initiative remains unknown.  Several federal officials involved in Category Management have said they have received good feedback from Trump administration transition team and special advisers so far in the first few months of the transition and presidency.  But others, particularly in industry, say they are hearing major changes are on the way for this and several procurement initiatives of the prior administration.  One thing is certain no matter what happens to Category Management:  small businesses have a lot of anxiety about the future of federal procurement.  Steve Koprince, a procurement attorney working with small firms, and John Shoraka, the former Associate Administrator for Government Contracting and Business Development at the Small Business Administration during the Obama administration, both say the Office of Federal Procurement Policy and the GSA have struggled to clarify the role of small businesses in Category Management, and ongoing concerns by lawmakers add to what seems like an ever-growing anxiety for small firms they counsel.

  • March 3, 2017

    GOVERNMENT CONTRACTS

    Presidential Executive Order on Enforcing the Regulatory Reform Agenda
    This Executive Order instructs the head of each agency to designate an agency official as its Regulatory Reform Officer (“RRO”) within 60 days. Each agency RRO will oversee the implementation of regulatory reform initiatives and policies to ensure that agencies effectively carry out regulatory reforms including (1) offsetting the number and cost of new regulations; (2) regulatory planning and review; and (3) the termination of programs and activities that derive from or implement Executive Orders, guidance documents, policy memoranda, rule interpretations, and similar documents, or relevant portions thereof, that have been rescinded. The Executive Order can be read here.

    Purchases from Federal Prison Industries; Updated List of Federal Supply Classification (FSC) Codes to Be Completed 
    The Department of Defense (“DOD”) Office of Acquisition, Technology and Logistics, issued a memorandum providing an updated list of product categories for which the Federal Prison Industries’ (“FPI”) share of the DOD market is greater than five percent. This list is based on FY 2016 data from the Federal Procurement Data System. The product categories and the products within each of the identified product categories must be procured using competitive (or fair opportunity) procedures in accordance with Defense Federal Acquisition Regulation Supplement 208.602-70. Contracting officers shall consider a timely offer from FPI for any of the product categories on the list when conducting the competition. FPI must be included, even if the procurement would have been a small business set-aside in accordance with Federal Acquisition Regulation Part 19. The memorandum can be read here.

    SMALL BUSINESS ADMINISTRATION

    “SBA Administrator Linda McMahon Appoints Mary Anne Bradfield as Chief of Staff.”  Small Business Administration Press Release, February 27, 2017. Retrieved from https://www.sba.gov.
    Administrator Linda McMahon of the U.S. Small Business Administration (“SBA”) announced that Mary Anne Bradfield will serve as her new Chief of Staff. Bradfield brings experience in agency-level management, strategic budget development, public and congressional relations, and program implementation, as well as policy expertise in economic development and small business. These areas of competency directly correlate with her new role at SBA. Bradfield returns to SBA after serving in a senior program development role at ADS Corporation supporting the National Guard Bureau Joint Staff. Prior to that, she served as the Senior Advisor to the Chair and Agency Records Office at the U.S. Election Assistance Commission.

    SMALL BUSINESS COMMITTEE

    “Small Business Committee Approves FY 2018 Views and Estimates.”  Small Business Committee Press Release, March 1, 2017. Retrieved from http://smallbusiness.house.gov.
    The House Small Business Committee (“HSBC”) unanimously approved its Views and Estimates for the FY 2018 budget. The Views and Estimates markup is an important step in the budget process in which house committees set the funding priorities for the federal agencies within their jurisdiction. The HSBC set the following priorities for the SBA: (1) increased transparency and accountability for capital access programs; (2) smarter investments in time-tested, proven entrepreneurial development programs; (3) dedication and focus in helping small businesses participate in the federal procurement marketplace; (4) improved SBA structure and management; and (5) regulatory reform and paperwork reduction. The Views and Estimates of the HSBC can be read here.

    OTHER NEWS

    “House Votes to Create New Requirements for Writing Regulations.”   The Hill, March 2, 2017. Retrieved from http://thehill.com.
    The House voted 246-176 to pass legislation aimed at increasing transparency in the regulatory process. The Regulatory Integrity Act (“RIA”), sponsored by Rep. Tim Walberg (R-MI), requires federal agencies to shed light on what happens behind the scenes when they are crafting new rules. Under the RIA, federal agencies would be required to publish online a list of regulations they are writing, a description of those rules, the status, and timeframe for when the agency started working on and expects to complete each rule. The legislation also prohibits federal agencies from advocating for their regulations and “appealing to the public” to support these proposed rules.

    “Category Management Continues Efforts to Get Better Deal for Federal Bucks.” NextGov, March 1, 2017. Retrieved from http://www.nextgov.com.
    The federal government’s Category Management program continues to use its immense buying power to drive down acquisition costs and deliver better values to taxpayers—even without knowing whether the Trump administration will support the effort. Category Management is a federal-wide initiative that hones in on a series of common spend areas, including IT, professional services, transportation and logistics services and others, and seeks ways to get a better deal for the government. At a Category Management conference, Lesley Field, the acting Administrator for Federal Procurement Policy for the Office Management and Budget, said Category Management principles have saved taxpayers $2 billion since 2012, with significantly more savings expected now that agencies “have built a solid foundation around category management.” In addition she said Category Managers have approved strategies for tackling their common spending areas, and common standards, including savings methodologies.

    “House Votes to Repeal Obama-era Workplace Protections.” The Hill, March 1, 2017. Retrieved from http://thehill.com.
    The House voted to repeal an Obama-era workplace regulation by the Department of Labor’s Occupational Safety and Health Administration (“OSHA”). OSHA has long required companies to report workplace injuries and illnesses, but in December 2016 the agency extended the time period during which companies can be penalized for failing to make these reports from six months to five years. The House voted 231 to 191 to roll back workplace protections under the Congressional Review Act.

    “Navy Officially Adopts GSA Reverse Auctions Acquisition Platform.” Federal Times, March 1, 2017. Retrieved from http://www.federaltimes.com.
    The Department of the Navy, looking for more efficiency in its acquisition process, has adopted the General Service Administration’s (“GSA”) Reverse Auctions eTool to increase savings on commonly purchased office products, equipment and services. Signing a memorandum of understanding on January 18, 2017, the two parties have extended a longstanding partnership for reverse auction procurements, where sellers compete to win business from agencies with prices decreasing as the competitive auction progresses. The eTool can be used to facilitate the request for and submission of quotes, offers or proposals for products, services and solutions through GSA Multiple Award Schedules and Blanket Purchase Agreements and Open Market (non-schedule) acquisitions. The Navy, including the Marine Corps, has worked closely with the GSA for more than three years as the Reverse Auctions platform has been enhanced, awarding over $22 million in reverse auction procurements with average savings of 7.82% over standard pricing.

  • February 24, 2017

    GOVERNMENT CONTRACTS

    Procedural Rules and Regulations
    The National Labor Relations Board (“NLRB”) amended its procedural rules and regulations to (1) reflect modern technology, such as E-Filing, and eliminate references to telegraphs, carbon copies, and the requirements for hard copy submissions and multiple copies; (2) use more plain language and eliminate legalistic terms such as “therefrom,” “thereupon,” “therein,” “herein,” and “said;” (3) reorganize the rules and add headings so that the subject matter is easier to find; (4) incorporate current practices that had not been included in the published rules, such as the NLRB’s Alternative Dispute Resolution Program; and (5) update and streamline procedural provisions of the FOIA regulations. The amendments also clarify the document filing system and service process made by the parties and the NLRB. They also promote the parties’ use of E-Filing, which will facilitate sharing documents with the public. These revisions are procedural rather than substantive. This rule takes effect on March 6, 2017. 82 Fed. Reg. 11748.

    Recognition of Tribal Organizations for Representation of VA Claimants; Delay of Effective Date
    On January 19, 2017, the Department of Veterans Affairs (“VA”) issued a final rule amending its regulations concerning recognition of certain national, state, and regional or local organizations for purposes of VA claims representation. Specifically, the rulemaking allows the Secretary of State (“Secretary”) to recognize tribal organizations in a similar manner as the Secretary recognizes state organizations. The final rule allows a tribal organization that is established and funded by one or more tribal governments to be recognized for the purpose of providing assistance on VA benefit claims. In addition, the rulemaking allows an employee of a tribal government to become accredited through a recognized state organization in a similar manner as a County Veterans’ Service Officer may become accredited through a recognized state organization. This action delays the effective date of the final rule from February 21, 2017, until March 21, 2017. 82 Fed. Reg. 11151.

    VA Veteran-Owned Small Business Verification Guidelines
    This document implements a portion of the Veterans Benefits, Health Care, and Information Technology Act of 2006, which requires the VA to verify ownership and control of veteran-owned small businesses (“VOSB”), including service-disabled veteran-owned small businesses (“SDVOSB”) in order for these firms to participate in VA acquisition set-asides for SDVOSB/VOSBs. This interim final rule contains a minor revision to require re-verification of SDVOSB/VOSB status only every three years rather than biennially. The purpose of this change is to reduce the administrative burden on SDVOSB/VOSBs regarding participation in VA acquisitions set asides for these types of firms. This interim final rule became effective on February 21, 2017. Comments on the interim final rule are due on or before April 24, 2017. 82 Fed. Reg. 11154.

    OTHER NEWS

    “User Experience, Cloud Migration on To-Do List for SBA CIO.”  Federal News Radio, February 23, 2017. Retrieved from http://federalnewsradio.com.
    Speaking at a February 22, 2017 summit, U.S. Small Business Administration (“SBA”) Chief Information Officer Maria Roat said she is working on modernizing the agency and addressing management challenges. SBA stood up a digital service team about a year ago, with a focus on updating the agency’s website. Roat said she wants to develop a consistent look and feel across SBA’s website, so that users get a “unifying experience” when they visit the site. In that same vein, Roat said she is also looking at the applications running across SBA’s systems, and how they are talking to each other. “We do have separate systems right now, for tracking whether somebody’s interfacing with Program A, Program B, Program C, Program D,” Roat said. “There’s different customer information in all of those right now. Being able to look across all of those so that we understand it’s the same customer but they’re using multiple programs; we don’t have a good handle on the identity management piece. We are working on that.”

    “GSA Gives the ‘Dump DUNS’ Movement More Hope.”  Federal News Radio, February 21, 2017. Retrieved from http://federalnewsradio.com.
    The General Services Administration (“GSA”) released a request for information on February 10, 2017, asking vendors for details on other possible options than using the Dun & Bradstreet (“D&B”) Data Universal Numbering System (“DUNS”) for uniquely identifying federal government contractors across 39 federal agencies. By 2018, the GSA will have paid D&B more than $131 million over the last eight years for access and use of DUNS. The Federal Acquisition Regulatory Council issued a proposed rule in November 2015 and then a final rule in September 2016 removing any references to DUNS and establishes definitions of “unique entity identifier,” and “electronic funds transfer indicator.”  GSA’s 18F team is developing an identification code that would temporarily help agencies move from the nine-digit DUNS number to another standard

  • February 10, 2017

    SMALL BUSINESS ADMINISTRATION

    Civil Monetary Penalties Inflation Adjustments
    The Small Business Administration has issued an interim final rule amending its regulations to adjust for inflation the amount of certain civil monetary penalties that are within the jurisdiction of the agency. These adjustments comply with the requirement in the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, to make annual adjustments to the penalties. This rule is effective February 9, 2017. Comments are due on, or before, April 10, 2017. 82 Fed. Reg. 9967.

    OTHER NEWS

    “VA ‘Confident We’re Going to Commercial’ for EHR, Scheduling Fixes .” Federal News Radio, February 7, 2017. Retrieved from http://federalnewsradio.com.
    The Government Accountability Office said millions of dollars and years of faulty pilots and heated congressional hearings have failed to produce more modern, interoperable IT systems at the Veterans Affairs Department (“VA”). VA’s focus is on five major IT systems and nearly all of them have experienced delays, cost overruns, and changes in planning, and those moving parts have been difficult to track. But VA insists that the past 18 months have been instrumental in turning that perception around. “We lacked a coherent strategy,” Rob Thomas, VA’s acting assistant secretary and chief information officer, told the House Veterans Affairs Committee during a February 7, 2017 hearing. “We lacked the right processes and procedures. For the past 18 months, we have been going through an incredible transformation. … That transformation is happening. Now we need to get on with it, which is what we aim to do.”

    “Senate Panel Unanimously Approves VA Secretary Nominee .”  The Hill, February 7, 2017. Retrieved from http://thehill.com.
    The Senate Veterans Affairs Committee unanimously approved David Shulkin to be the next VA secretary. The committee voted to send Shulkin to the full Senate for what is expected to be an easy confirmation vote, given that he has received praise from Republicans, Democrats, and veterans alike. Shulkin, who has been the VA’s undersecretary of health since 2015, flatly pledged not to privatize the VA, while promising change despite being an Obama administration holdover.

    “GSA Seeks Proposals for Huge Governmentwide Charge Card Contract.”  Government Executive, February 3, 2017. Retrieved from http://www.govexec.com.
    The General Services Administration (“GSA”) is seeking proposals for a massive new contract it will award this summer for its governmentwide charge card payment program. The GSA recently issued a request for proposals (“RFP”) for its SmartPay 3 (“SP3”), the next iteration of a nearly 20-year-old program that provides the government with purchase, travel, fleet, and integrated payment solutions. The contract runs through November 28, 2021, with a potential extension to 2031. The current contract for GSA SmartPay 2 expires on November 29, 2018. GSA SmartPay is the world’s largest commercial payment program, providing services to 560 federal agencies and other organizations while supporting more than three million accounts. The estimate total value for the SP3 contract is $700 billion, according to the RFP.

  • February 3, 2017

    GOVERNMENT CONTRACTS

    Presidential Executive Order on Reducing Regulation and Controlling Regulatory Costs
    On January 30, 2017, President Trump issued an executive order requiring for every one new federal regulation issued, at least two prior regulations be identified for elimination, and that the cost of planned regulations be prudently managed and controlled through a budgeting process.  In addition, for fiscal year 2017, the heads of all agencies are directed that the total incremental cost of all new regulations, including repealed regulations, to be finalized in 2017 cannot be greater than zero, unless otherwise required by law or consistent with advice provided in writing by the Director of the Office of Management and Budget (“OMB”).  The executive order can be read here.

    The 2017 Adjustment of the Penalty for Violation of Notice Posting Requirements
    In accordance with the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (“FCPIA”), which further amended the FCPIA Act of 1990, this final rule adjusts for inflation the civil monetary penalty for violation of the notice-posting requirements in Title VII of the Civil Rights Act of 1964, the Americans with Disabilities Act, and the Genetic Information Non-Discrimination Act.  This final rule is effective March 2, 2017.  82 Fed. Reg. 8807.

    OTHER NEWS

    “House Votes to Repeal Obama ‘Blacklisting’ Rule.”  The Hill, February 2, 2017.  Retrieved from http://thehill.com.
    The House of Representatives voted 236-187 for a resolution under the Congressional Review Act (“CRA”) that would block a rule that requires companies to report any labor law violation or alleged violation they’ve had in the last three years when bidding on federal contracts over $500,000.  The resolution now heads to the Senate, where it is expected to pass.  CRA resolutions cannot be filibustered.

    “Shulkin Promises Employee Accountability, VA Choice Redesign If Confirmed.”  Federal News Radio, February 2, 2017.  Retrieved from http://federalnewsradio.com.
    Dr. David Shulkin, President Trump’s pick to lead the Veterans Affairs Department (“VA”), assured senators at his nomination hearing that with his confirmation and leadership, he wouldn’t just be “more of the same.”  “There is no doubt that if confirmed as secretary, I will seek major reform and a transformation to the VA,” Shulkin said during his nomination hearing before the Senate Veterans Affairs Committee.  “There will be far greater accountability, dramatically improved access, responsiveness and expanded care options, but the Department of Veterans Affairs will not be privatized under my watch.”  Committee Chairman Johnny Isakson (R-GA) said he sees an easy path to Senate confirmation for Shulkin and hopes he could take the helm as the leader of the government’s second-largest agency by the end of next week.

    “Top Federal IT Contracts to Watch for in 2017.”  Nextgov, January 31, 2017.  Retrieved from http://www.nextgov.com.
    This year will offer more contracting opportunities valued at far less than the number of contracts that went out to bid in 2016.  Data from Deltek, an information solutions provider for government contractors, suggests industry will be able to compete on approximately 1,400 federal IT opportunities this year valued at approximately $100 billion.  The VA will be among the most active agencies in 2017, with a request for proposal (“RFP”) on its $64 billion community care network for professional services, and the upcoming release of an RFP for a follow-on to its commodity enterprise contract.  The scorecard approach that the General Services Administration successfully used in creating Alliant 2 has also caught the attention of the U.S. Air Force, which is planning to release an RFP this year for its Small Business Enterprise Application Solutions.  This will be a follow-on to the Air Force’s Network Centric Solutions-2 small business companion contract, awarded in 2012 with an original ceiling of $960 million.  Deltek analysts estimate the amount for the new RFP will be the same as the original contract.  The Defense Information Systems Agency (“DISA”)—the IT arm of the Defense Department—is expected to release an RFP, worth an estimated $7.5 billion, for its Systems Engineering Technology Innovation contract, which will provide support to the Pentagon’s IT systems. It’s a kind of companion contract to the $17.5 billion Encore III contract that DISA tweaked and released last year after bid protests.

    “Senate Panel Approves McMahon to Lead Small Business Administration.”  The Hill, January 31, 2017.  Retrieved from http://thehill.com.
    The Senate Small Business and Entrepreneurship Committee voted to approve former World Wrestling Entertainment head Linda McMahon to lead the Small Business Administration.  The vote was 18-1, with the only “no” vote coming from Sen. Cory Booker (D-NJ).  The nomination now heads to the full Senate for a final vote.

    “Trump Orders Review of Military Readiness, Boosting Defense Funds in 2017.”  Federal News Radio, January 27, 2017.  Retrieved from http://federalnewsradio.com.
    On January 20, 2017, President Trump signed a memorandum ordering the Pentagon to launch a 30-day examination of a broad set of measures of military readiness, from maintenance to munitions and infrastructure to manning and training.  The Department of Defense (“DOD”) will work with the OMB to draw up an emergency supplemental 2017 budget request.  The funds would be used to pay for any immediate readiness gaps that the Pentagon review identifies, and the order also tells OMB and DOD to use the results of the readiness review as a basis for defense budgets in 2018 and beyond. The memorandum can be read here.

  • January 27, 2017

    GOVERNMENT CONTRACTS

    Executive Order Expediting Environmental Reviews and Approvals for High Priority Infrastructure Projects
    On January 24, 2017, President Trump issued an executive order for agencies to streamline and expedite environmental reviews and approvals for all infrastructure projects, including projects that are high priority, such as improving the U.S. electric grid, telecommunications systems, and repairing and upgrading critical port facilities, airports, pipelines, bridges and highways.  The executive order also directs the White House Council on Environmental Quality to decide within 30 days whether an infrastructure project qualifies as a “high priority” infrastructure project.  The executive order can be read here.

    Presidential Memorandum Streamlining Permitting and Reducing Regulatory Burdens for Domestic Manufacturing
    On January 24, 2017, President Trump signed a memorandum directing executive departments and agencies to support the expansion of manufacturing in the United States through expedited reviews of, and approvals for, proposals to construct or expand manufacturing facilities and through reductions in regulatory burdens affecting domestic manufacturing.  The memorandum instructs the Secretary of Commerce to conduct outreach to stakeholders concerning the impact of federal regulations on domestic manufacturing and to solicit comments from the public within 60 days.  Furthermore, the memorandum directs the Secretary of Commerce to submit a report to the President setting forth a plan to streamline federal permitting processes for domestic manufacturing and to reduce regulatory burdens affecting domestic manufacturers within 60 days of the completion of the public comment period.  The memorandum can be read here.

    Presidential Memorandum Regarding Construction of American Pipelines
    On January 24, 2017, President Trump signed a memorandum to develop a plan under which all new pipelines, as well as retrofitted, repaired, or expanded pipelines, inside the borders of the United States—including portions of pipelines—use materials and equipment produced in the United States.  The Secretary of Commerce is directed to submit the plan to the President within 180 days.  The memorandum can be read here.

    SMALL BUSINESS ADMINISTRATION

    Small Business Investment Companies: Passive Business Expansion and Technical Clarifications
    On December 28, 2016, the Small Business Administration (“SBA”) published a final rule to expand permitted investments in passive businesses and provide further clarification with regard to investments in such businesses for the Small Business Investment Program, with an effective date of January 27, 2017.  In the meantime, a memorandum dated January 20, 2017 from the Assistant to the President and Chief of Staff, entitled “Regulatory Freeze Pending Review,” calls for agencies to temporarily postpone the effective date of rules not yet effective and to invite new public comment.  In light of this development, SBA is delaying the effective date of this rule until March 21, 2017, and is inviting additional public comment on the final rule.  Any timely public comments received will be considered and any changes to the final rule will be published in the Federal Register.  Comments are due by February 19, 2017.  82 Fed. Reg. 8499.

    OTHER NEWS

    “President Appoints Philip A. Miscimarra NLRB Acting Chairman.”  National Labor Relations Board Press Release, January 26, 2017.  Retrieved from https://www.nlrb.gov.
    President Trump has named Board Member Philip A. Miscimarra Acting Chairman of the National Labor Relations Board.  Miscimarra has served as a Board Member since August 7, 2013.  He was nominated by President Obama on April 9, 2013, and he was approved unanimously by the Senate Committee on Health, Education, Labor and Pensions on May 22, 2013.  He was confirmed by the Senate on July 30, 2013, and his current term expires on December 16, 2017.

    “OMB Nominee Mulvaney Open to Expanding Hiring Freeze to Contractors.”  Federal News Radio, January 25, 2017.  Retrieved from http://federalnewsradio.com.
    The Program Assessment Rating Tool ("PART") is coming back.  The Digital Accountability and Transparency (“DATA”) Act—a 2014 law requiring agencies to improve how they collect and make spending information accessible—needs more attention and the hiring freeze may end up applying to contractors, too.  Those are some of the management high points Rep. Mick Mulvaney (R-SC) offered up during his two-committee marathon nomination hearings to be the next director of the Office of Management and Budget.  Mulvaney testified before the Senate Budget Committee in the morning and then before the Senate Homeland Security and Governmental Affairs Committee in the afternoon.  Mulvaney said he would help identify waste, fraud and abuse across agencies by bringing back the PART tool, or an updated version of the measurement initiative, first used during President George W. Bush’s administration.  Mulvaney also said during both hearings that the key to improving spending is through better data.  All of these efforts are tied together through the Act.  Agencies have until May 2017 to get their financial data online in a standardized form, and many are struggling toward that deadline.
     
    “WWE’s McMahon Still Standing after Positive Confirmation Hearing for SBA Role.” Federal News Radio, January 24, 2017.  Retrieved from http://federalnewsradio.com.
    According to Federal News Radio, an advocate for the underdog is what small businesses can expect if Linda McMahon is confirmed as the SBA’s new leader.  During her appearance before the Senate Committee on Small Business and Entrepreneurship, McMahon pledged her support to level the playing field for women, service-disabled veterans and minority small business owners looking to contract with the federal government.  McMahon said if confirmed, she would also make it a point to delve into the Office of Advocacy, an independent body within SBA, charged with helping guide small businesses through agency policies, and making sure their voice is heard.  The hearing was less than two hours, with only one round of questions.  Committee Chairman James Risch (R-ID) said the hope was to have her back for a committee vote next week, and McMahon was even introduced to the committee by former Senate race rivals, Sens. Richard Blumenthal (D-CT) and Chris Murphy (D-CT)

  • January 20, 2017

    GOVERNMENT CONTRACTS

    Recognition of Tribal Organizations for Representation of VA Claimants
    The Department of Veterans Affairs (“VA”) is amending its regulations concerning recognition of certain national, state, and regional or local organizations for purposes of VA claims representation.  Specifically, this final rule allows the Secretary to recognize Tribal organizations in a similar manner as the Secretary recognizes state organizations.  The final rule allows a Tribal organization that is established and funded by one or more Tribal governments to be recognized for the purpose of providing assistance on VA benefit claims.  In addition, the final rule allows an employee of a Tribal government to become accredited through a recognized state organization in a similar manner as a County Veterans' Service Officer may become accredited through a recognized state organization.  The effect of this action is to address the needs of Native American populations which are geographically isolated from existing recognized Veterans Service Organizations (“VSOs”) or which may not be utilizing other recognized VSOs due to cultural barriers or lack of familiarity with those organizations.  This rule will take effect on February 21, 2017.  82 Fed. Reg. 6265.

    Federal Acquisition Regulation: Sustainable Acquisition
    The Department of Defense, General Services Administration, and National Aeronautics and Space Administration are proposing to amend the Federal Acquisition Regulation to implement Executive Order 13693, Planning for Federal Sustainability in the Next Decade, and the biobased product acquisition provisions of the Agricultural Act of 2014 (also known as the 2014 Farm Bill).  The changes made in this proposed rule continue the improvements made by the government to lead by example in protecting the health of our environment by purchasing sustainable products and services.  This rule promotes the acquisition of sustainable products, services, and construction methods in order to reduce energy and water consumption, reliance on natural resources, and enhance pollution prevention, within the government.  While the anticipated costs associated with this rule are not quantified in dollar amounts, the Councils anticipate that any such impact will be outweighed by the expected benefits of this rule.  Comments are due on, or before, March 20, 2017.  82 Fed. Reg. 5490.

    Department of Labor Federal Civil Penalties Inflation Adjustment Act Annual Adjustments for 2017
    The U.S. Department of Labor (“DOL”) is publishing this final rule to adjust for inflation the civil monetary penalties assessed or enforced in its regulations, pursuant to the Federal Civil Penalties Inflation Adjustment Act of 1990 as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (“Inflation Adjustment Act.”)  The Inflation Adjustment Act requires the DOL to annually adjust its civil money penalty levels for inflation no later than January 15.  The Inflation Adjustment Act provides that agencies shall adjust civil monetary penalties notwithstanding Section 553 of the Administrative Procedure Act.  Additionally, the Inflation Adjustment Act provides a cost of living formula for adjustment of the civil penalties.  Accordingly, this final rule sets forth the DOL's 2017 annual adjustments for inflation to its civil monetary penalties.  This final rule went into effect on January 13, 2017.  82 Fed. Reg. 5373.

    Office of Federal Procurement Policy Memorandum: “Service Contract Inventories.” 
    The Office of Federal Procurement Policy released a memorandum, addressed to Jason Chaffetz (R-UT), Chairman of the Committee on Oversight and Government Reform, providing a summary of agency activities for the Fiscal Year 2015 reporting period based on information provided by covered agencies.  Agencies annually develop inventories and analyze the data so that their managers can better understand by function how contracted services are being used, and if the mix of federal employees and contractors for a given program is effectively balanced.  Agencies prepare their inventories using a standard format and data sequence set for in the Office of Management and Budget guidance that has been updated periodically through “Alerts” to the acquisition workforce that highlight best practices, including recommendations made by the Government Accountability Office to improve the quality of reporting.  The memorandum can be read here.

    SMALL BUSINESS COMMITTEE

    “Chabot Announces Committee Leadership for 115th Congress.”  Small Business Committee Press Release, January 17, 2017.  Retrieved from http://smallbusiness.house.gov.
    House Small Business Committee Chairman Steve Chabot (R-OH) announced the Committee’s leadership team for the 115th Congress.  Included in the new leadership team are Representatives Trent Kelly (R-MS), who will chair the Subcommittee on Investigations, Oversight and Regulations, and Steve Knight (R-CA), who will chair the Subcommittee on Contracting and Workforce.

    OTHER NEWS

    “In Final Speech, DOD Acquisition Chief Knocks Congressional Reforms as Unhelpful.”  Federal News Radio, January 18, 2017.  Retrieved from http://federalnewsradio.com.
    Frank Kendall, the Undersecretary of Defense for Acquisition, Technology and Logistics, used his final public remarks as Pentagon acquisition chief to argue that the Department of Defense has made significant, demonstrable progress in improving outcomes from its procurement system, and that if Congress wants to help, it should largely stay out of the way.  Among the data points Kendall wishes would receive more attention: cost growth in major weapons systems is now at a 30-year low, an achievement he said was driven by sound internal management practices like tightly-controlled affordability caps and “should cost” management, not by legislative mandates. 
     
    “GAO Ruling Lets GSA Buy the USDA Steak, Not the Mystery Meat.”  Federal News Radio, January 17, 2017.  Retrieved from http://federalnewsradio.com
    The General Services Administration (“GSA”) may have just put the first nail in the coffin that eventually will bury the widespread use of “lowest-price, technically acceptable” contracts for services.  The Government Accountability Office’s decision to deny four protests of GSA’s Alliant 2 contracts for IT services could end up being a landmark ruling that is that first nail.  “This decision changes the paradigm of how the government has traditionally conducted price/cost analysis.  It provides the precedent for innovation across the government during the source selection process,” said John Cavadias, the senior contracting officer for GSA’s Alliant 2 Government Wide Acquisition Contract (“GWAC”) Procurement Contracting Office.  “This could also result in a significant time savings (shorter procurement lead times), as it already has with programs in GSA.” These were the last four protests stopping Alliant 2 from heading into the home stretch.  The 10-year $50 billion unrestricted and $15 billion small business versions of the multiple-award GWAC vehicle can now move closer to award of up to 60 vendors.

  • January 16, 2017

    GOVERNMENT CONTRACTS

    Federal Acquisition Regulation; Federal Acquisition Circular 2006-95
    This Federal Acquisition Circular provides a summary presentation of final rules issued by the Department of Defense (“DOD”), the General Services Administration (“GSA”) and National Aeronautics and Space Administration and agreed to by the Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council. The Small Entity Compliance Guide for these final rules can be found here.

    Item I – Uniform Use of Line Items (FAR Case 2013-014)
    This final rule amends the Federal Acquisition Regulation (“FAR”) to establish standards for the uniform use of line items in Federal procurement. These standards are designed to improve the accuracy, traceability, and usability of procurement data. The implementation of these standards will facilitate the identification and traceability of spending from appropriation through expenditure, supporting automated collection of information using key identifiers. The implementation date for FAR 4.1002 through 4.1008 will be October 1, 2019. The requirements in the rule have the potential to impact any entity, small or large, that does business with the Federal Government because the proposed rule would apply to purchases of items, including commercial items and commercially available off-the-shelf items, and purchases under the simplified acquisition threshold. Any small business that contracts with a Federal agency could be impacted to at least some extent. This final rule takes effect on January 13, 2017. 82 Fed. Reg. 4709.

    Item II – Acquisition Threshold for Special Emergency Procurement Authority (FAR Case 2016-004)
    This final rule amends the FAR by increasing the simplified acquisition threshold (“SAT”) for special emergency procurement authority from $300,000 to $750,000 within the United States, and from $1 million to $1.5 million outside the United States, for acquisitions of supplies or services that, as determined by the head of the agency, are to be used to support a contingency operation or to facilitate defense against or recovery from nuclear, biological, chemical, or radiological attack. This change implements Section 816 of the National Defense Authorization Act (“NDAA”) for Fiscal Year 2016 (Pub. L. 114-92). This rule provides contracting officers with more flexibility when contracting in support of contingency operations. This final rule takes effect on January 13, 2017. 82 Fed. Reg. 4716.

    Item III – Contractor Employee Internal Confidentiality Agreements or Statements (FAR Case 2015-012)
    This final rule revises the FAR to implement section 743 of Division E, Title VII, of the Consolidated and Further Continuing Appropriations Act of 2015 (Pub. L. 113-235) and successor provisions in subsequent appropriations acts. Section 743 prohibits the use of funds appropriated or otherwise made available by Division E or any other act for a contract with an entity that requires employees and subcontractors of such entity to sign internal confidentiality agreements or statements prohibiting or otherwise restricting such employees or subcontractors from lawfully reporting waste, fraud, or abuse, to a designated investigative or law enforcement representative of a Federal department or agency authorized to receive such information (e.g., agency office of the Inspector General). This final rule takes effect on January 19, 2017. 82 Fed. Reg. 4717.

    Item IV – Contracts under the Small Business Administration 8(a) Program (FAR Case 2012-022) 
    This final rule amends the FAR to implement clarifications made by the Small Business Administration (“SBA”) in its final rule, which were published in the Federal Register at 76 Fed. Reg. 8222 on February 11, 2011. This final rule clarifies in the FAR the procedures and requirements used when contracting under the 8(a) program. Clarifications include the evaluation, offering, and acceptance process, procedures for acquiring SBA's consent to procure an 8(a) requirement outside the 8(a) program, and the impact of exiting the 8(a) program in terms of the firm's ability to receive future 8(a) requirements and its current contractual commitments. This final rule takes effect on January 13, 2017. 82 Fed. Reg. 4724.

    Item V – Prohibition on Reimbursement for Congressional Investigations and Inquiries (FAR Case 2015-016)
    This rule amends the FAR to implement section 857 of the Carl Levin and Howard P. ‘Buck’ McKeon NDAA for Fiscal Year 2015. Section 857 imposes additional requirements relative to the allowability of costs incurred by a contractor in connection with a congressional investigation or inquiry. Contracting officers need to be aware of these new restrictions on certain costs, which cannot be charged under contracts. Although small businesses subject to FAR part 31 will need to maintain accounting records, this rule does not place any new requirements on small entities. This final rule takes effect on January 13, 2017. 82 Fed. Reg. 4732.

    General Services Administration Acquisition Regulation (GSAR); Fair Opportunity Complaints on GSA Contracts
    The GSA is issuing a final rule amending the General Services Administration Acquisition Regulation part 552, Solicitation Provisions and Contract Clauses at 552.216-74 Task and Delivery Orders. The final rule clarifies (1) that the jurisdiction and responsibility to review and resolve fair opportunity complaints placed against GSA multiple-award contracts lies with the ordering-agency task and delivery order Ombudsman; (2) requires the ordering agency to include contact information for their task and delivery order Ombudsman when placing task or delivery orders against GSA multiple-award contracts; and (3) requires the contractor to provide a copy of its complaint to the GSA Procurement Ombudsman for informational purposes, at the same time the contractor files its complaint to the ordering agency for action. This final rule took effect on January 9, 2017. 82 Fed. Reg. 2249.

    Updating Regulations Issued Under the Fair Labor Standards Act, Service Contract Act, Davis-Bacon and Related Acts, Contract Work Hours and Safety Standards Act, the Family and Medical Leave Act, Employee Polygraph Protection Act, and the Migrant and Seasonal Agricultural Worker Protection Act
    This final rule by the Department of Labor (“DOL”) revises regulations issued pursuant to the Fair Labor Standards Act of 1938, the Davis-Bacon and Related Acts, the Service Contract Act, Contract Work Hours and Safety Standards Act, Family and Medical Leave Act (“FMLA”), Employee Polygraph Protection Act, and the Migrant and Seasonal Agricultural Worker Protection Act that include reference to the “Employment Standards Administration” (“ESA”) at the DOL. The ESA was eliminated as part of agency reorganization in 2009 and its authorities and responsibilities were devolved into its constituent components, including the Wage and Hour Division (“WHD”). This action deletes reference to the ESA in the regulations administered by WHD. Additionally, this action updates Office of Management and Budget (“OMB”) control numbers associated with information collections in the appropriate regulations. WHD was assigned new control numbers by OMB and this action updates those references in the regulations to the current corresponding OMB control number. Further, this action updates cross-references that were not revised in the FMLA final rule published February 25, 2015. This final rule took effect on January 9, 2017. 82. Fed. Reg. 2221.

    Extension of Policy to Provide Accelerated Payment to Small Businesses and Small Business Subcontractors
    This memorandum further extends to December 31, 2017 the temporary policy requiring agencies to accelerate payments to all prime contractors in order for them to provide prompt payment to their small business subcontractors, and modifies the reporting instructions. Beginning with the October 1, 2016 through December 31, 2016 quarterly reporting period, agencies should provide three-month reports to the OMB on (1) the agency’s progress in making accelerated payments to all prime contractors, to the full extent permitted by law, pursuant to the temporary, transitional policy established by OMB Memorandum M-12-16 and designed to expedite contractor payments to small business subcontractors; (2) the agency’s progress in making accelerated payments to small business prime contractors, to the full extent permitted by law, pursuant to the policy established by OMB Memorandum M-11-32; and (3) the progress of any other steps that the agency has undertaken to ensure that small business contractors and small business subcontractors are paid in a prompt manner. The memorandum can be found here.

    National Industrial Security Program
    The Information Security Oversight Office of the National Archives and Records Administration has proposed to revise the National Industrial Security Program (“NISP”) Directive. The NISP safeguards classified information the Federal Government or foreign governments release to contractors, licensees, grantees, and certificate holders. This proposed rule adds provisions incorporating executive branch insider threat policy and minimum standards, identifies the Office of the Director of National Intelligence and the Department of Homeland Security as new cognizant security agencies (“CSA”), and adds responsibilities for all CSAs and non-CSA departments and agencies (to reflect oversight functions that are already detailed for private sector entities in the National Industrial Security Program Operating Manual (“NISPOM”)). The proposed revisions also make other administrative changes to be consistent with recent revisions to the NISPOM and with updated regulatory language and styles. Comments are due on, or before, February 10, 2017. 82 Fed. Reg. 3219.


    SMALL BUSINESS COMMITTEE

    “House Passes Small Business Regulatory Reform Measure.”  
    The U.S. House of Representatives has passed Small Business Committee Chairman Steve Chabot’s (R-OH) measure to force federal regulators to craft smarter, less burdensome regulations that take into consideration their direct and reasonably foreseeable indirect economic effects, especially on small businesses. Chabot’s bill, introduced last week as the Small Business Regulatory Flexibility Improvements Act of 2017, passed the House as Title III of H.R. 5, the Regulatory Accountability Act. The Bill can be found here.

    “Chabot Backs House Move to Protect Small Biz from FCC Internet Takeover.”  
    House Small Business Committee Chairman Steve Chabot hailed House passage of H.R. 288, the Small Business Broadband Deployment Act. This legislation exempts small businesses from burdensome new Internet regulations imposed by President Obama’s Federal Communications Commission (“FCC”) for five years. The measure also increases the number of small businesses that can use the exemption from the FCC’s “Open Internet Order,” commonly known as “net neutrality.”

    “HALOS Act Wins Bipartisan Support, Advances to U.S. Senate.”  
    The U.S. House has passed Small Business Committee Chairman Chabot’s bipartisan legislation to help startup companies access early capital. H.R. 79, the Helping Angels Lead Our Startups Act, was passed by a vote of 344 to 73. The bill, which now moves to the U.S. Senate for consideration, builds on a provision of the 2012 JOBS Act by allowing angel investor groups established by local governments, non-profits, universities and other organizations to host events designed to let entrepreneurs showcase their work and connect with potential backers.

    OTHER NEWS

    “Chaffetz’s New Bill Targets Feds, Contractor Tax Debts.”  Federal Times, January 11, 2017. Retrieved from http://www.federaltimes.com.
    Rep. Jason Chaffetz (R-UT) plans to tackle more than $1 billion in unpaid taxes by federal civilian employees with a “mix of the sweet and bitter.”  The House Oversight and Government Reform Committee chairman’s new bill—H.R. 396, the Tax Accountability Act—would address delinquent tax bills by contractors by requiring contractors and “individuals applying for federal employment” to certify their tax status when applying for work. If the contractor or grant applicant has a heavy delinquent tax debt, they wouldn’t be eligible for the contract and could face suspension or debarment. The Utah congressman noted stark debts from the contracting community, which he said owed more than $7 billion in back taxes spread across more than 63,000 defense, agency and GSA contractors. A text of this bill has not yet been published.

    “House Continues Pursuit of Regulatory Roll-Back Bills.” Government Executive, January 6, 2017. Retrieved from http://www.govexec.com
    Maintaining their push to take authority away from regulatory agencies, House Republicans on January 5, 2017, passed a long-sought bill that would require both chambers in Congress to approve any major new rule within 70 legislative days for it to take effect. The Regulations from the Executive in Need of Scrutiny Act (H.R. 26), a bill pursued for several years and re-introduced in the first week of the 115th Congress by Rep. Doug Collins (R-GA) would apply to rules deemed to impose $100 million or more in economic impact. Prospects for quick passage in the Senate are problematic, judging by past resistance and the greater need for bipartisanship.

  • January 6, 2017

    GOVERNMENT CONTRACTS

    Memorandum: Implementation of Defense Federal Acquisition Regulation Supplement Final Rule 2016-D002, Enhancing Effectiveness of Independent Research and Development
    On January 4, 2017, the Under Secretary of Defense for Acquisition, Technology and Logistics released a memorandum to implement the class deviation the Department of Defense (“DOD”) issued on December 1, 2016 for its final rule amending the Defense Federal Acquisition Regulation Supplement. This class deviation alleviates the requirement that the technical interchanges between “major” defense contractors and a technical or operational DOD government employee occur before costs are generated for IR&D projects initiated in a contractor’s Fiscal Year 2017 so as to afford contractors a phase-in period to develop processes and procedures. The memorandum can be found here.

    General Services Administration Acquisition Regulation; Update Contract Reporting Responsibilities
    The General Services Administration (“GSA”) is amending the General Services Administration Acquisition Regulation (“GSAR”) to remove section 504.604 regarding the internal processes for reporting and reviewing the accuracy of contract actions reported in the Federal Procurement Data System. The internal GSA procedures were incorrectly published in the GSAR. The internal GSA procedures will be established as a non-regulatory section in the General Services Acquisition Manual and communicated to the GSA acquisition workforce through a GSA internal policy letter. This final rule became effective on January 3, 2017.  82 Fed. Reg. 46.

    GAO’s FY 2016 Bid Protest Statistics
    The U.S. Government Accountability Office has released its Bid Protest Annual Report to Congress for Fiscal Year 2016. The report can be found here

    Memorandum: “Myth-busting 3” Further Improving Industry Communication with Effective Debriefings
    On January 5, 2017, the Office of Federal Procurement Policy (“OFPP”) issued a memorandum outlining best practices for strengthening productive interactions between the federal government and industry through the effective use of debriefings. To broaden the adoption of best practices and maximize the value of debriefings, the OFPP recommends that agencies consider establishing or adopting a debriefing guide, if they do not already have one in place. In addition, agencies are encouraged to review and address in their guidance the “myths” and misconceptions as described in an Appendix the OFPP has provided in this memorandum. The Appendix discusses frequently referenced issues by both industry and government, differentiates myth from fact, and provides additional information, including existing best practices, to help agencies facilitate effective and efficient debriefings. Agencies are encouraged to post their debriefing guidance, training tools, and debriefing reference materials by March 1, 2017. Agencies are further encouraged to share relevant debriefing instructions with current and potential industry partners, including those new to federal procurement. The memorandum can be found here.


    SMALL BUSINESS COMMITTEE

    “Small Business Regulatory Flexibility Improvements Act Introduced on Day 1 of New Congress.” House Small Business Committee, January 3, 2017. Retrieved from http://smallbusiness.house.gov.

    On January 3, 2017, House Small Business Committee Chairman Steve Chabot (R-OH) introduced House Resolution 33, the Small Business Regulatory Flexibility Improvements Act of 2017. This bill forces federal regulators to craft smarter, less burdensome regulations that take into consideration their direct and reasonably foreseeable indirect economic effects, especially on small businesses. The bill strengthens and clarifies the Regulatory Flexibility Act of 1980, closing loopholes to get around the good-government intentions of the original legislation by requiring more detailed analysis of proposed regulations, providing greater opportunity for small business input, and ensuring agencies regularly review regulations already on the books for their economic impact on small businesses. The text of the bill has not yet been published. 


    OTHER NEWS

    “To Keep Winning Federal Contracts, Small Businesses Say They Have to Spend More.” Government Executive, January 5, 2017. Retrieved from http://www.govexec.com.

    According to the latest annual survey from the American Express OPEN for Government Contracting initiative, small businesses reported a 72 percent increase in time and money devoted to winning a share of the government’s $90 billion procurement budget. Completed last year and released last month, the survey found that on average small businesses spent $148,124 in time and money to bid for federal work.  In the area of set-asides, the survey found that minority contractors in fiscal 2015 invested $152,969. By contrast, women-owned contractors continue to spend less time and money seeking federal contracts, investing $107,774 on average in 2015 versus $170,621 invested by men-owned firms. 62 percent of active contractors agreed with the statement that “It’s getting harder to win contracts because there are more bidders for each opportunity,” and 60 percent agreed that “It’s getting harder to win contracts because there are fewer bidding opportunities due to contract bundling.”

    “CYBERCOM Setting Up New Acquisition Office for Rapid Procurement Funds.” Federal News Radio, January 3, 2017. Retrieved from http://federalnewsradio.com.

    The U.S. Cyber Command (“CYBERCOM”) is looking for a command acquisition executive to oversee an annual $75 million budget through 2021 authorized by the 2016 National Defense Authorization Act (“NDAA”) to rapidly deliver cyber operations particular equipment, capabilities and services. The executive will provide oversight for program management, contracting support, logistics support, legal advice and guidance. In addition, the 2017 NDAA elevates CYBERCOM to a full combatant command.

    “DOD Report Shows Big Savings from ‘Should Cost’ Policy.” Federal News Radio, January 2, 2017. Retrieved from http://federalnewsradio.com.

    Frank Kendall, the Defense Undersecretary for Acquisition, Technology and Logistics, stated in a November 3, 2016 report to Congress the major benefits of its Better Buying Power acquisition reforms, including lower contracts costs, reduced cost overruns, and arrested cost growth on major programs with the “should cost” initiative. The policy asks managers to set program cost targets below independent cost estimates.  It then asks the heads of programs to manage with the intent to achieve those cost goals. The report stated ‘should cost’ “techniques are driving significant efficiencies into the acquisition system from the bottom up by enabling individuals to creatively identify new ways to save money.”

  • December 30, 2016

    GOVERNMENT CONTRACTS

    Submission for Office of Management and Budget Review; Payment of Subcontractors
    On January 20, 2016, the Department of Defense, Government Accountability Office, and National Aeronautic and Space Administration proposed a rule to amend the Federal Acquisition Regulation (“FAR”) Case 2014-004, Payment of Subcontractors, requiring contractors to notify the contracting officer in writing if the contractor pays a reduced price to a small business subcontractor, or if the subcontractor’s payment to a small business contractor is more than 90 days past due in accordance with the Small Business Administration’s (“SBA”) final rule implementing section 1334 of the Small Business Jobs Act of 2010.  Two comments were received on the information collection stating that the FAR Council (1) underestimated the implementation burden on commercial item and COTS item contractors; (2) underestimated the reporting time of only two hours per respondent; and (3) seeks additional information about the burden on contractors before a determination is made to apply the payment of subcontractor requirements to commercial item acquisitions since the Small Business Jobs Act of 2010 does not specifically require that the subcontractor payment clause apply to commercial contracts.  Since this is a new rule without an empirical frame of reference, the public reporting burden is reviewed every three years and can be adjusted as necessary.  Public comments are invited on (1) whether this collection of information is necessary for the proper performance of functions of the FAR and whether it will have a practical utility; (2) whether the public burden estimate of this collection of information is accurate, and based on valid assumptions and methodology; (3) ways to enhance the quality, utility, and clarity of the information to be collected; and (4) ways in which to minimize the burden of the collection of information on those who are to respond, through the use of appropriate technological collection techniques or other forms of information technology.  Comments are due on, or before, January 26, 2017.  81 Fed. Reg. 95141.

    Equal Employment Opportunity Commission: Availability of Records
    The Equal Employment Opportunity Commission proposes to revise its Freedom of Information Act (“FOIA”) regulations in order to implement the substantive and procedural changes to the FOIA identified in the FOIA Improvement Act of 2016 (“Act”) and update two district offices’ addresses and the Office of Legal Counsel's fax number.  In order to assist agencies and encourage consistency in FOIA practices across the government, the Department of Justice, Office of Information Policy (“OIP”), created a FOIA template for agencies to use as agencies publish and update their regulations.  The template, which is located here, provides sample regulation language.  The proposed language contained in these revised FOIA regulations utilizes the language provided in the Act or contained in OIP's template.  This interim final rule is effective on December 29, 2016.  Comments are due on, or before, January 30, 2017.  81 Fed. Reg. 95869.

    Office of Personnel Management: Access to Federal Employees Health Benefits for Employees of Certain Indian Tribal Employers
    The Office of Personnel Management is issuing a final rule to extend coverage, rights, and benefits under the Federal Employees Health Benefits (“FEHB”) Program to certain employees of certain Indian Tribal employers.  Section 10221 of the Patient Protection and Affordable Care Act incorporated, amended, and enacted section 409 of the Indian Health Care Improvement Act (“IHCIA”).  Under section 409 of the IHCIA, an Indian Tribe or Tribal organization carrying out programs under the Indian Self-Determination and Education Assistance Act, or an urban Indian organization carrying out programs under Title V of IHCIA, is entitled to purchase coverage, rights, and benefits under the FEHB Program for their employees.  Tribal employers and Tribal employees will be responsible for the full cost of benefits, plus an administrative fee.  The final rule is effective February 27, 2017. 81 Fed. Reg. 95397.

    SMALL BUSINESS ADMINISTRATION

    Announcement of InnovateHER: Innovating for Women Business Challenge 2017
    The SBA is conducting the third year of the InnovateHER: Innovating for Women Challenge (“the Challenge”), pursuant to the America Competes Act, for entrepreneurs to create a product or service that has a measurable impact on the lives of women and families, the potential for commercialization, and fills a need in the marketplace.  The Challenge launched on December 29, 2016.  The initial round of the Challenge will take the form of local competitions that will be run across the country beginning December 29, 2016, and ending no later than April 29, 2017.  The host organizations running the local competitions must select and submit one winner from each local competition to SBA, along with a nomination package, no later than May 12, 2017.  SBA will then select up to ten finalists.  The top three winners will be announced no later than July 27, 2017, following a live pitch competition.  81 Fed. Reg. 96157.

    Announcement of the Aspire Challenge - An Agency Prize Competition
    The Aspire Challenge is a prize competition conducted under the America Competes Act.  The objective of the prizes is to spur the development and provision of innovative entrepreneurial development and access to capital resources for formerly incarcerated individuals or those who are non-violent ex-offenders.  Through the design and delivery of intensive entrepreneurial education and increased access to micro-loans, the Aspire Challenge will serve as a catalyst to leverage business formation as a tool for economic mobility and self-employment for the formerly incarcerated.  This competition is designed to award prizes to entrepreneurial support organizations that propose innovative and sustainable solutions to equipping the formerly incarcerated with the education and technical assistance they need to start and grow a business.  The submission period for entries will begin on December 29, 2016 and close on February 13, 2017.  SBA anticipates that winners will be announced no later than March 14, 2017.  81 Fed. Reg. 96155.

    Small Business Investment Companies: Passive Business Expansion and Technical Clarifications
    The SBA is revising the regulations for the Small Business Investment Company (“SBIC”) program to expand permitted investments in passive businesses and provide further clarification with regard to investments in such businesses.  SBICs are generally prohibited from investing in passive businesses under the Small Business Investment Act of 1958, as amended.  SBIC program regulations provide for two exceptions that allow an SBIC to structure an investment utilizing a passive small business as a pass-through.  The first exception provides conditions under which an SBIC may structure an investment through up to two levels of passive entities to make an investment in a non-passive business that is a subsidiary of the passive business directly financed by the SBIC.  The second exception, prior to this final rule, enabled a partnership SBIC, with SBA's prior approval, to provide financing to a small business through a passive, wholly-owned C corporation (commonly known as a blocker corporation), but only if a direct financing would cause the SBIC's investors to incur Unrelated Business Taxable Income.  This final rule clarifies several aspects of the first exception and in the second exception eliminates the prior approval requirement and expands the purposes for which a blocker corporation may be formed.  The final rule also adds new reporting and other requirements for passive investments to help protect SBA's financial interests, ensures adequate oversight, and makes minor technical amendments.  Finally, this rule makes a conforming change to the regulations regarding the amount of leverage available to SBICs under common control.  This change is necessary for consistency with the Consolidated Appropriations Act, 2016, which increased the maximum amount of such leverage to $350 million.  The final rule is effective January 27, 2017. 81 Fed. Reg. 95419.

    Small Business Mentor-Protégé Programs; Correction
    On October 19, 2016, the SBA issued a correction pertaining to 8(a) joint venture profits.  81 Fed. Reg. 71981.  As SBA explained, due to the change made to section 121.103(h), which eliminated the ability of a joint venture to be populated with individuals intended to perform contracts awarded to the joint venture, a conforming correction was needed to section 124.513(c), which references populated joint ventures.  Specifically, section 124.513(c)(4) provided that in the case of a populated separate legal entity joint venture, 8(a) participant(s) must receive profits from the joint venture commensurate with their ownership interests in the joint venture.  Because SBA eliminated populated joint ventures, that provision was superfluous and was deleted.  SBA's 8(a) joint venture rule now states that the 8(a) participant(s) in a joint venture must receive profits from the joint venture commensurate with the work performed by the 8(a) participant(s), 13 CFR 124.513(c)(4).  This change was necessary because under the mentor-protégé program, a protégé may perform as little as 40% of the total work performed by the joint venture in aggregate.  It would not make sense to require a firm to receive 51% of the profits for doing only 40% of the work.  The same language that SBA corrected in the 8(a) regulations is currently in place for joint ventures under all small mentor-protégé, Service-Disabled Veteran-Owned, Women-Owned and HUBZone small business programs.  SBA's intent was for profits to be commensurate with the work performed by each member of the joint venture.  These rules currently state that in the case of a separate legal entity, the firm must receive profits commensurate with their ownership interests in the joint venture, which is contrary to SBA's intent.  Consequently, SBA is correcting sections 125.8(b)(2)(iv), 125.18(b)(2)(iv), 126.616(c)(4) and 127.506(c)(4) to the make the rules consistent with 124.513(c)(4) and across all programs.  81 Fed. Reg. 94941.

  • December 23, 2016

    GOVERNMENT CONTRACTS

    Payment of Subcontractors
    The Department of Defense (“DOD”), General Services Administration (“GSA”), and National Aeronautics and Space Administration (‘NASA”), have issued a final rule amending the Federal Acquisition Regulation (“FAR”) to implement a section of the Small Business Jobs Act of 2010.  This statute requires contractors to notify the contracting officer, in writing, if the contractor pays a reduced price to a small business subcontractor or if the contractor's payment to a small business subcontractor is more than 90 days past due, 81 Fed. Reg. 93481.  This final rule is effective January 19, 2017.

    Privacy Training
    DOD, GSA, and NASA have issued a final rule amending the FAR to require that contractors, whose employees have access to a system of records or handle personally identifiable information, complete privacy training, 81 Fed. Reg. 93476.  This final rule is effective January 19, 2017.  

    DEPARTMENT OF DEFENSE

    Competition for Religious-Related Services Contracts 
    DOD is proposing to amend the Defense Federal Acquisition Regulation Supplement (“DFARS”) to implement a section of the National Defense Authorization Act that provides the competition requirements for religious-related services contracts on a U.S. military installation, 81 Fed. Reg. 93875.  Comments on the proposed rule are due on, or before, February 21, 2017. 

    Independent Research and Development Expenses 
    DOD is proposing to amend the DFARS to ensure that substantial future independent research and development expenses, as a means to reduce evaluated bid prices in competitive source selections, are evaluated in a uniform way during competitive source selections, 81 Fed. Reg. 93878.  Comments on the proposed rule are due on, or before, February 2, 2017. 

    Contract Financing 

    DOD has issued a final rule amending the DFARS by providing that contracting officers are not required to further justify a decision to provide customary contract financing, other than loan guarantees and advance payments identified in FAR part 32, for certain fixed-price contracts, 81 Fed. Reg. 93841.  The final rule became effective December 22, 2016. 

    SMALL BUSINESS ADMINISTRATION

    Small Business Size Standards for Manufacturing - Correction
    On January 26, 2016, SBA published a final rule implementing changes to the size standards for a number of industries in NAICS Sectors 31-33, Manufacturing (81 Fed. Reg. 4469).  As discussed in the preamble of the rule, SBA intended to amend paragraphs (a) and (b) of Footnote 5 to the table of size standards relating to NAICS 326211, Tire Manufacturing (except Retreading), by replacing the former Census classification codes 30111 and 30112 with the new Census Product Classification Codes 3262111 and 3262113.  However, the amended text inadvertently omitted the new Census Product Classification code 3262111. This action corrects that omission, but does not affect the 1,500-employee small business size standard for NAICS 326211, RIN: 324-AG50.

    OTHER NEWS

    “In 2017, Expect Fierce Competition For Defense IT Contracts.”  NextGov, December 21, 2016.  Retrieved from http://www.nextgov.com.
    According to research from big data and analytics firm Govini, $210 billion in DOD contracts are set to expire during the 2017 calendar year, and no market will be more competitive than that of IT services.  Govini projects an average of seven bids per expiring contract in 2017, meaning increased competition among vendors competing for an estimated $9 billion in expiring contracts, and an untold billions of more dollars in new ones.  Govini’s analysis takes into account President-elect Trump’s position on government contracting in general and states “[e]xpiring contracts will be seen as low-hanging fruit by the incoming Trump administration looking to begin implementing its agenda immediately.  Combined with the backdrop of leveraging purchasing power, procurement reform and eliminating fraud, waste and abuse, the defense industrial base faces much uncertainty in 2017.”

    “SBA and GSA, OFPP Not Seeing Eye-to-Eye on ‘Rule of Two’ Application.” Federal News Radio, December 19, 2016.  Retrieved from http://federalnewsradio.com.
    The Small Business Administration (“SBA”) is expanding the Supreme Court’s June 16 Kingdomware ruling, applying the “rule of two” to all task and delivery orders under the Simplified Acquisition Threshold (“SAT”) if the request for proposals comes under the General Services Administration’s (“GSA”) Schedule.  The “rule of two” states if an agency can find two or more qualified small businesses during market research of a contract under the SAT, it must set aside the solicitation.  While John Shoraka, SBA’s Associate Administrator for Government Contracting and Business Development, has argued “the language around 15J [of the Small Business Act] where contracts are defined as order and should follow the same procedures as contract in respect to the rule of two and set-asides,” industry experts, the GSA, and the Office of Federal Procurement Policy (“OFPP”) aren’t yet on board with the SBA.  Christoph Mlinarchik, a government contracts expert and owner of Christoph LLC said SBA’s ruling and recent memo are not in line with what Congress intended in the Small Business Jobs Act of 2010.  In an email to Federal News Radio, Mlinarchik said “Congress established that at the ordering level for multiple-award contracts, agencies have discretion to set aside orders and the ‘rule of two’ is not mandatory.”  The next question is whether the GSA and OFPP agree with SBA and move to change the Federal Acquisition Regulation, or push back.

  • December 16, 2016

    GOVERNMENT CONTRACTS

    Paid Sick Leave for Federal Contractors
    The Department of Defense (“DOD”), General Services Administration (“GSA”), and National Aeronautics and Space Administration (“NASA”) have issued an interim rule revising the Federal Acquisition Regulation (“FAR”) to implement Executive Order 13706 (the “E.O.”), Establishing Paid Sick Leave for Federal Contractors. The E.O. seeks to increase efficiency and cost savings in the work performed by parties who contract with the Federal Government by ensuring that employees on those contracts can earn up to 7 days or more of paid sick leave annually, including paid sick leave for family care. The E.O. directed the Department of Labor (“DOL”) to issue regulations by September 30, 2016, and for the FAR Council to issue regulations within 60 days of the DOL regulations. The Wage and Hour Division of DOL published a final rule in the Federal Register (81 Fed. Reg. 67598), on September 30, 2016, also entitled “Establishing Paid Sick Leave for Federal Contractors,” which added a new part 13 to title 29 Code of Federal Regulation.

    This interim rule applies to solicitations issued on, or after, January 1, 2017, and resultant contracts. Applicability of the clause at §52.222-62, Paid Sick Leave Under the E.O., to existing contracts is as follows: (1) Contracting officers shall include the clause in bilateral modifications extending the contract when such modifications are individually or cumulatively longer than six months; and (2) in accordance with FAR § 1.108(d)(3), contracting officers are strongly encouraged to include the clause in existing indefinite-delivery indefinite-quantity contracts, if the remaining ordering period extends at least six months and the amount of remaining work or number of orders expected is substantial, 81 Fed. Reg. 91627. This interim rule is effective January 1, 2017 and comments are due on, or before, February 14, 2017.

    Fair Pay and Safe Workplaces; Injunction 
    A final rule was published in the Federal Register on August 25, 2016, amending the FAR to implement the E.O. on Fair Pay and Safe Workplaces. Implementation of portions of the E.O. was preliminarily enjoined by an order issued by a Federal District Court on October 24, 2016. On October 25, 2016, the FAR Council (the “Council”) issued a memorandum to the Chief Acquisition Officers, Senior Procurement Executives, Defense Acquisition Regulations Council, and Civilian Agency Acquisition Council directing that all steps necessary be taken to ensure the enjoined sections, provisions, and clauses of the final rule are not implemented until such time as the injunction is terminated. The effective date of this final rule is December 16, 2016 and the date of applicability is October 24, 2016. 

    Introduction of Federal Acquisition Circular 2005-93
    Federal Acquisition Circular (“FAC”) 2005-93 and its companion document, the Small Entity Compliance Guide (“SECG”), summarizes the FAR rules agreed to by the Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council, 81 Fed. Reg. 91626.  

    LEGAL SERVICES CORPORATION

    Procedures for Disclosure of Information Under the Freedom of Information Act 
    The Legal Services Corporation (“LSC”) is revising its regulation on procedures for disclosure of information under the Freedom of Information Act (“FOIA”) to implement the statutorily required amendments in the FOIA Improvement Act of 2016. LSC is also making technical changes to improve the structure and clarity of its FOIA regulations, 81 Fed. Reg. 91037. The final rule is effective as of December 16, 2016. 

    SMALL BUSINESS ADMINISTRATION

    Small Business Investment Companies--Administrative Fees 
    The Small Business Administration (“SBA”) is proposing to increase the Small Business Investment Company (“SBIC”) licensing and examination fees. The Small Business Investment Act of 1958, as amended, allows SBA to collect licensing and examination fees to offset SBA’s costs associated with the administration of these two activities.  Current fees offset less than 40% of SBA’s administrative expenses related to these activities. This proposed rule would revise existing regulations to increase, over a five-year period, SBIC licensing and examination fees in order to annually recoup an estimated 70% of SBA administrative expenses related to these activities. After the five year period, the rule proposes annual increases of these fees based on inflation. To encourage investment into underserved areas, the proposed rule would establish certain examination fee discounts for SBICs that make significant low and moderate income investments, 81 Fed. Reg. 91050. Comments on the proposed rule are due on, or before, February 14, 2017.

    OTHER GOVERNMENT CONTRACTING NEWS

    “2016 Saw Large Uptick in Bid Protests Sustained by GAO.”  Federal News Radio, December 14, 2016.  Retrieved from http://federalnewsradio.com
    The GAO issued a report showing that in 2016, the GAO sided against federal agencies’ initial awarding of contracts and task orders in nearly 23% of the cases it decided. This was the highest rate of sustained protests since 2007 and up 11% from last year. The report indicated that the most common reasons for ruling in protestors’ favor were due to agencies reaching unreasonable conclusions about bidders’ technical capabilities, past performance or cost and price, or ‘flawed’ selection criteria. The annual report to Congress also notes that federal agencies complied with all the recommendations GAO made in connection with bid protests during 2016, the first time that has happened in the last five years.

    “Federal Contracting Experts Offer Advice, Encouragement to Women Small Business Owners.”  Federal News Radio, December 14, 2016.  Retrieved from http://federalnewsradio.com.
    At the ChallengeHER event held on December 14 by the SBA, small business advisers from the GSA, DOD and the SBA addressed women small business owners on best practices for securing federal government contracts. Earlier this year SBA released its annual report card on small business federal contracting and for the first time, the federal government reached its 5% women-owned small business (“WOSB”) contracting goal since the bar was set in 1996, spending $17.8 billion working with WOSBs.

    “New DIA Acquisition Process Invites Tech Firms to Show Their Stuff to Senior Leaders.”  Federal News Radio, December 14, 2016.  Retrieved from http://federalnewsradio.com.
    Over the past three years, the Defense Intelligence Agency (“DIA”) has been experimenting with a rapid technology acquisition project called “Needipedia” in which it publishes technology gaps it wants to fill, lets industry respond with short white papers, and then buys new capabilities in as little as a month. Now, companies will also get a chance to show off their products directly to DIA’s senior leadership in 30-minute online presentations. Robert Dixon, DIA’s special adviser for innovation, said it is the first of many such industry events the agency plans to host on a quarterly basis. So far this year, DIA has entered into contracts for pilot demonstrations to solve 18 separate technology gaps it advertised via the classified and unclassified version of its Needipedia web portals.
     
    “Inspector General Empowerment Act Clears Congress.”  Government Executive, December 12, 2016.  Retrieved from http://www.govexec.com.
    The Senate unanimously approved a House-passed bill to enhance the abilities of inspectors general to commandeer agency documents previously held due to privacy or other concerns. The Inspector General Empowerment Act (H.R. 6450), sponsored by Rep. Jason Chaffetz (R-UT), confirms that IGs “are entitled to full and prompt access to agency records, thereby eliminating any doubt whether agencies and whistleblowers are legally authorized to disclose potentially sensitive information to IGs” as noted in a statement from the Council of Inspectors General on Integrity and Efficiency. The bill can be found here.

    “The Unintended Consequences of Category Management’s Best-in-Class Approach?”  Federal News Radio, December 9, 2016.  Retrieved from http://federalnewsradio.com.
    This blog article explores some of the legal, policy and operational questions surrounding the best-in-class designation (BIC) contract solutions for mandatory use in the recent draft circular issued by the Office of Federal Procurement Policy regarding the implementation of Category Management. The draft circular can be found here.

    “NASA Proposes New Rule to Reward Good Contractors.”  Federal News Radio, December 9, 2016.  Retrieved from http://federalnewsradio.com.
    NASA has proposed a rule in which it will wants to give “award terms” or additional contract periods of performance to contractors whose sustained performance is deemed excellent. NASA said this will provide a non-monetary incentive for contractors to perform well, and create more stable business relationships for contractors and their employees.

    “House Clears Two Whistleblower Protection Bills to Send to Obama.” Government Executive, December 9, 2016.  Retrieved from http://www.govexec.com.
    On December 5, the House cleared a Senate-passed bill to extend and make permanent current whistleblower protections to nearly all federal government grantees, subgrantees, contractors and subcontractors. Under current law, whistleblower protections apply only to contractors, grant recipients, and subcontractors, but not to employees of subgrantees. The bill was sponsored by Senator Claire McCaskill (D-Mo.) who is the top Democrat on the Homeland Security and Governmental Affairs Committee. The bill can be found here.

  • December 9, 2016

    GOVERNMENT CONTRACTS

    Set-Asides under Multiple-Award Contracts
    The Department of Defense (“DOD”), General Services Administration (“GSA”), and National Aeronautics and Space Administration (“NASA”) are proposing to revise the Federal Acquisition Regulation (“FAR”) to implement regulatory changes made by the Small Business Administration (“SBA”) in its final rule (78 FR 61114), dated October 2, 2013, regarding the use of small business partial set-asides, reserves, and orders placed under multiple-award contracts. SBA's final rule implements the statutory requirements set forth at section 1331 of the Small Business Jobs Act of 2010 (15 U.S.C. § 644(r)), (“Jobs Act”).  Section 1331 of the Jobs Act, which is the focus of this rule, provided authority for three acquisition techniques to facilitate contracting with small businesses on multiple-award contracts: (1) setting aside part or parts of the requirement for small businesses; (2) reserving one or more contract awards for small business concerns under full and open multiple-award procurements; and (3) setting aside orders placed against multiple-award contracts, notwithstanding the fair opportunity requirements of 10 U.S.C. § 2304c(b) and 41 U.S.C. § 4106(c), 81 Fed. Reg. 88072.  Comments on this proposed rule are due by February 6, 2017.

    OTHER GOVERNMENT CONTRACTING NEWS

    “Trump Chooses Former WWE Exec McMahon for SBA.”  Federal News Radio, December 7, 2016.  Retrieved from http://federalnewsradio.com.
    President-elect Donald Trump selected wrestling executive Linda McMahon to his cabinet as leader of the Small Business Administration.  McMahon and her husband, Vince, founded and built World Wrestling Entertainment, Inc., now a publicly traded sports entertainment company.  In 2009, she stepped down as the company’s chief executive and earlier this year launched a joint venture, Women’s Leadership LIVE, which promotes opportunities for women in business and public service.

    “DC’s Expansive Family and Medical Leave Policy Advances.”  The Washington Post, December 7, 2016.  Retrieved from https://www.washingtonpost.com.
    D.C. City Council members voted to move forward with the Universal Paid Leave Act, one of the nation’s most generous laws guaranteeing family and medical leave, creating roughly $250 million a year in new taxes on local businesses to fund two months of paid time off for workers to care for newborn or adopted children.  The bill, which would apply to both full and part-time workers, also grants employees six weeks of paid leave to help ailing relatives and two weeks of personal sick leave per year.  The bill must undergo a final council vote on December 20 before moving to Mayor Muriel Bowser (D) for a signature or veto.

    “Senate Backs Down from Attempt to Restrain Bid Protests, But Wants More Data.”  Federal News Radio, December 5, 2016.  Retrieved from http://federalnewsradio.com.
    This year’s National Defense Authorization Act will give the Government Accountability Office (“GAO”) permanent jurisdiction to hear and decide bid protests of any task order worth more than $10 million.  The Senate also passed a stand alone bill that would grant the GAO permanent jurisdiction over civilian agency task orders, in addition to the GAO’s permanent authority to hear protests of task orders on Defense Department contract vehicles.  Congress moved to increase the threshold for the Defense Department task order protests to $25 million.

    “Chairmen Ask Why Agency Failed to Issue Required Reports Two Years in a Row.”  Small Business Committee Press Release, December 5, 2016.  Retrieved from http://smallbusiness.house.gov.
    In a letter to the Office of Management and Budget (“OMB”), House Small Business Committee Chairman Steve Chabot (R-OH) and House Oversight and Government Reform Committee Chairman Jason Chaffetz (R-UT) demanded answers on the failure of the OMB to submit required annual reports to Congress on the federal government’s efforts to reduce the paperwork burden on individuals and small businesses.  The letter can be read here.

  • December 2, 2016

    GOVERNMENT CONTRACTS

    FAR Amendment Proposal to Implement Section of NDAA 2016
    The Department of Defense (“DOD”), General Services Administration (“GSA”), and National Aeronautics and Space Administration (“NASA”) are proposing to amend the Federal Acquisition Regulation to implement a section of the National Defense Authorization Act for Fiscal Year 2016, which will clarify that agency acquisition personnel are permitted, and encouraged, to engage in responsible and constructive exchanges with industry, so long as those exchanges are consistent with existing law and regulation and do not promote an unfair competitive advantage to particular firms, 81 Fed. Reg. 85914.  Comments to this proposed rule are due by January 30, 2017.

    SMALL BUSINESS ADMINISTRATION

    SBA Issues Notice of Proposed Rulemaking for WBC Program
    The Small Business Administration (“SBA”) has issued a Notice of Proposed Rulemaking (“NPRM”) regarding the Women's Business Center (“WBC”) Program.  The NPRM is being issued in order to continue the consultative process with stakeholders to examine the proposed WBC regulations, and to codify policy and procedural changes that have been included in the Notice of Award, such as: (1) language on risk determination as required by limitations on carryovers; (2) who is considered key personnel; and (3) a reduction in the reporting requirements, 81 Fed. Reg. 83718.  Comments on the proposed rule are due by January 23, 2017. 

    OTHER GOVERNMENT CONTRACTING NEWS

    “Chabot to Chair Small Business Committee for 115th Congress.” Small Business Committee Press Release, December 2, 2016. Retrieved from https://smallbusiness.house.gov.
    Small Business Committee Chairman Steve Chabot (R-OH) was elected by his House peers to serve as Chairman of the Small Business Committee for the 115th Congress. 

    “In New ‘How-to’ Guide, Pentagon’s Innovation Outpost Urges Rest of DOD to Adopt Rapid Acquisition.” Federal News Radio, December 2, 2016. Retrieved from http://federalnewsradio.com.
    The Pentagon’s Defense Innovation Unit-Experimental (“DIUx”) published a 99 page “how to” guide for the DOD acquisition community. The guide details the legal and practical aspects of the contracting practices DIUx has used to award $36 million in a dozen small contracts in 60 days or less. The DIUx awards process, referred to as “commercial solutions opening,” sidesteps many of the procurement steps required by the Federal Acquisition Regulation, allowing the government to: (1) enter into direct negotiations with firms based on their proposals to solve particular technology problems, and (2) negotiate intellectual property rights. Congress authorized the DOD’s streamlined approach in last year’s defense authorization bill.  The DIUx has only used DOD’s new acquisition authorities to procure prototypes, but may soon start pursuing follow-on production contracts with firms.  The guide can be found here.

    “GSA Wants Transaction-Level Purchasing Data.” Government Executive, November 16, 2016. Retrieved from www.govexec.com.
    The General Services Administration’s Federal Acquisition Service has formalized a new rule, the Transactional Data Reporting rule, requiring vendors to report transaction-level data from orders on Federal Supply Schedule and government-wide acquisition contracts, as well as indefinite delivery, indefinite quantity agreements.  The new reporting requirement would replace the lengthy commercial sales practices and price reduction clause categories, helping category managers to refine their buying strategies and reorient contracting officers to focus on value instead of low price when evaluating contracting proposals.

  • November 18, 2016

    DEPARTMENT OF DEFENSE, GENERAL SERVICES ADMINISTRATION, AND NATIONAL AERONAUTICS AND SPACE ADMINISTRATION

    Clarification of Requirement for Justifications for 8(a) Sole Source Contracts
    The Department of Defense (“DOD”), General Services Administration (“GSA”), and National Aeronautics and Space Administration (“NASA”) have issued a proposed rule to amend the Federal Acquisition Regulation to clarify the guidance for sole-source 8(a) contract awards exceeding $22 million.  This proposed rule responds to the recommendations made by the Government Accountability Office (“GAO”) in its report, “Slow Start to Implementation of Justifications for 8(a) Sole-Source Contracts” (GAO-13-118).  The GAO report recommended that the Office of Federal Procurement Policy (“OFPP”), in consultation with the FAR Council, promulgate guidance to clarify the circumstances in which an 8(a) justification is required.  As recommended, OFPP and the FAR Council agree to amend the FAR with guidance that will: (1) clarify whether an 8(a) justification is required for 8(a) contracts that are subject to a pre-existing Competition in Contracting Act of 1984 class justification; (2) provide additional information on actions contracting officers should take to comply with the justification requirement when the contract value rises above or falls below $22 million between the Small Business Administration's acceptance of the contract for negotiation under the 8(a) Program and the contract award; and (3) clarify whether and under what circumstances a separate sole-source justification is necessary for out-of-scope modifications to 8(a) sole-source contracts.  The intent of the proposed rule is to further clarify the processes and procedures in the FAR to ensure uniform, consistent, and coherent guidance regarding the use of sole-source 8(a) justifications, 81 Fed. Reg. 80012.  Comments to the proposed rule are due by January 17, 2017.

    Federal Acquisition Regulation (“FAR”) Technical Amendments
    DOD, GSA, and NASA have issued technical amendments to the FAR in order to make editorial changes to sections 2.101, 7.105, 19.1506, 34.000, 34.005-2, 34.201, 34.203, 42.709, 52.234-2, 52.234-3, and 52.234-4. Included in these technical amendments are revisions to Part 19 Small Business Program, section 19.5106 Women-Owned Small Business Program sole source awards, to read as follows: (a) A contracting officer shall consider a contract award to an EDWOSB concern on a sole source basis (see 6.302-5(b)(7)) before considering small business set-asides (see 19.203 and subpart 19.5) provided none of the exclusions at 19.1504 apply and (1) The acquisition is assigned a NAICS code in which SBA has determined that WOSB concerns are underrepresented in federal procurement; (2) The contracting officer does not have a reasonable expectation that offers would be received from two or more EDWOSB concerns; and (3) the conditions in paragraph (c) of this section exist. (b) A contracting officer shall consider a contract award to a WOSB concern (including EDWOSB concerns) eligible under the WOSB Program on a sole source basis (see 6.302-5(b)(7)) before considering small business set-asides (see 19.203 and subpart 19.5) provided none of the exclusions at 19.1504 apply and (1) the acquisition is assigned a NAICS code in which SBA has determined that WOSB concerns are substantially underrepresented in federal procurement; (2) The contracting officer does not have a reasonable expectation that offers would be received from two or more WOSB concerns (including EDWOSB concerns); and (3) The conditions in paragraph (c) of this section exist. (c)(1) The anticipated award price of the contract, including options, will not exceed: (i) $6.5 million for a requirement within the NAICS codes for manufacturing; or (ii) $4 million for a requirement within any other NAICS codes. (2) The EDWOSB concern or WOSB concern has been determined to be a responsible contractor with respect to performance. (3) The award can be made at a fair and reasonable price. (d) The SBA has the right to appeal the contracting officer's decision not to make a sole source award to either an EDWOSB concern or WOSB concern eligible under the WOSB Program; 81 Fed. Reg. 83103.

    OTHER GOVERNMENT CONTRACTING NEWS

    “GAO: Agencies need more access to databases to stop improper payments.” Federal News Radio, Nov. 15, 2016. Retrieved from http://federalnewsradio.com.  
    The system developed by the Treasury Department and the Office of Management and Budget to reduce improper payments doesn’t give agencies full access to the databases required to determine whether improper payments were actually made.  The GAO said the Do Not Pay Working system offers only partial or no access to three of the six databases required by the Improper Payments Elimination and Recovery Improvement Act of 2012.

    “GSA working on changes to FAR, new legislation to help agencies buy cloud.” Federal News Radio, Nov. 16, 2016. Retrieved from http://federalnewsradio.com.
    The GSA is working on a series of new changes to the Federal Acquisition Regulation (FAR) and a potential legislative proposal to help agencies buy cloud computing services as a “utility.”  Richard Blake, senior technologist for the Integrated Technology Service at GSA’s Federal Acquisition Service seemly defined the idea of cloud computing as a “utility” stating that “Cloud is not IT…Cloud is a service that happens to deliver IT, so it’s IT as a service.”  Some may find this confusing given that the creation and upkeep of a cloud computing platform involves significant traditional IT services, often to an unknown extent.  Regardless, the GSA is hoping to receive support from the Office of Management and Budget and attach the proposed legislation to the National Defense Authorization Act for Senate approval.  The GSA is also contemplating changes to the FAR to create a new contracting type to include cloud services instead of a “time and materials” purchase model contracting officers currently use.

    “Chabot, Velazquez Challenge OMB on Procurement Policy.” House Committee on Small Business Press Release, Nov. 10, 2016. Retrieved from http://smallbusiness.house.gov.
    In a comment letter sent to the Office of Federal Procurement Policy (“OFPP”), House Small Business Committee Chairman Steve Chabot (R-OH) and Ranking Member Nydia M. Velazquez (D-NY) criticized the implementation of Category Management procurement policy for negatively impacting small businesses, Comment Letter.

    “DOL Persuader Rule Permanently Blocked By Texas Judge.” Law360, Nov. 16, 2016. 
    U.S Northern District of Texas Court Judge Samuel R. Cummings permanently blocked the U.S. Department of Labor from enforcing a new rule which would have expanded employers’ disclosure requirements for consultants and attorneys hired to fight unionization.

    “GSA to launch cloud based contract writing system.” Federal Times, Nov. 16, 2016. Retrieved from http://www.federaltimes.com.
    GSA is launching a new cloud-based, shared-service contract writing and administration system anticipated to be available by the third quarter of fiscal 2017.  The CAP Contract Writing System-as-a-Service (CWSS) will guide contracting and program offices through the contract process from planning and requisition creation to solicitation publishing, award, and closeout.  CWSS will follow a workflow process methodology, providing real-time notifications of both work in progress and metrics as actions progress through lifecycle states, all while GSA handles security accreditation, ongoing operations, and maintenance.

  • November 14, 2016

    DEPARTMENT OF DEFENSE

    Revised Interim Implementation of Government-wide Guidance for Grants and Cooperative Agreements

    The DOD has issued a notice of proposed rulemaking (“NPRM”), the first in a sequence of six NPRMs, which collectively establish, for DOD grants and cooperative agreements, an updated interim implementation of government-wide guidance on administrative requirements, cost principles, and audit requirements for federal awards.  This NPRM removes a part of the DOD Grant and Agreement Regulations (“DODGARs”) and replaces it with a new DODGARs part containing a revised interim implementation of the guidance and establishes seven subchapters within DOD's chapter of the Grants and Agreements title of the Code of Federal Regulations.  The purpose of this NPRM is to provide an organizing framework for the DODGARs to make it easier for users of the regulations to locate the content that they need, 81 Fed. Reg. 78356.  Comments are due by February 6, 2017.

    OFFICE OF MANAGEMENT AND BUDGET

    Correction to Memorandum for the Preliminary Injunction on Implementation of Fair Pay and Safe Workplaces Executive Order 13673
    The FAR Council issued a corrected copy of the October 25, 2016 memorandum addressing the court order to enjoin certain coverage in the final FAR rule implementing the Fair Pay and Safe Workplaces Executive Order 13673. There was a typographical error in the third enumerated step regarding procedures that should not be implemented. The correct FAR cites are 22.2004-2, 22.2004-3, and 22.2004-4. The corrected copy reflects the proper FAR cites, Corrected October 25, 2016 Memorandum.

    OTHER GOVERNMENT CONTRACTING NEWS

    GSA’s Making It Easier Initiative Enters Second Phase. Federal Times, Oct. 24, 2016.  Retrieved from http://www.federaltimes.com.

    The GSA implemented the second phase of the Making it Easier initiative to attract new companies, including small businesses, into government acquisitions and streamline the procurement process for current vendors on GSA’s Acquisition Gateway. The GSA will also begin the Multiple Award Schedule Modification Improvement process.

  • November 4, 2016

    DEPARTMENT OF DEFENSE

    Withholding of Unclassified Technical Data and Technology from Public Disclosure
    The Department of Defense (“DOD”) Office of the Under Secretary of Defense for Acquisition, Technology, and Logistics has proposed a rule that establishes policy, assigns responsibilities, and prescribes procedures for the dissemination and withholding of certain unclassified technical data and technology subject to the International Traffic in Arms Regulations and Export Administration Regulations.  It applies to DOD components, their contractors and grantees, and is meant to control the transfer of technical data and technology contributing to the military potential of any country or countries, groups, or individuals that could prove detrimental to U.S. national security or critical interests, 81 Fed. Reg. 75352.  Comments to the proposed rule are due by December 30, 2016.

    OTHER GOVERNMENT CONTRACTING NEWS

    “‘Substantial progress’ in SBA goaling report accuracy: OIG.” Set-Aside Alert, Nov. 4, 2016:
    The SBA has collaborated with other agencies on data quality issues and improved digital tools and support to procurement personnel, helping improve the accuracy of its annual small business goaling report. A previous OIG report for fiscal 2014 found the SBA may have awarded more than $400 million in small business contracts to ineligible firms and $1.5 billion that may have incorrectly been credited to 8(a) small businesses. The OIG also encouraged the SBA to pursue litigation against small business federal contractors in cases involving small-dollar frauds.

    “Judge dismisses ASBL lawsuit.” Set-Aside Alert, Nov. 4, 2016: 1.
    Federal District Judge Vince Chhabria dismissed a lawsuit alleging that the SBA, by overstating its goal achievement, was defrauding small businesses out of federal contracts. The judge stated in his decision that "Congress enacted a statute requiring the SBA to provide information about the participation of small businesses in federal contracting. If the SBA is giving Congress bad information, then Congress can do something about it, either in an oversight or legislative capacity," according to the ASBL release. Mr. Chapman said the ASBL will be appealing its case to the 9th Circuit Court of Appeals.

    “Small Business Administration urges IRS to rethink estate tax rules.” The Hill, Nov. 1, 2016. Retrieved from http://thehill.com 
    The SBA’s Office of Advocacy submitted a letter to the Internal Revenue Service concerning a proposed rule to eliminate valuation discounts for generational transfers of businesses. Some congress members, including Senator Marco Rubio (R-Fla.) and Rep. Warren Davidson (R-Ohio), with the support of the U.S. Chamber of Commerce, have sponsored bills to stop the implementation of the rule, 81 Fed. Reg. 51413

    “OFCCP Names New Acting Director, to Begin Nov. 7.” Federal Contracts Report, Nov. 2016: 433-456.
    The Office of Federal Contract Compliance Programs has named Thomas M. Dowd as the agency’s acting director.  Mr. Dowd will serve until the new president appoints a labor secretary, who will then name a permanent director. 

     

  • October 28, 2016

    OTHER GOVERNMENT CONTRACTING NEWS

    “Texas court places temporary halt on Fair Pay rule.” Federal News Radio. October 26, 2016.

    The Eastern District Court of Texas placed a preliminary injunction on Fair Pay and Safe Workplaces rule that was supposed to take effect October 25. The court adopted most of the arguments set forth by the Associated Builder and Contractors in the initial lawsuit filed on October 7, including that the rule violated federal contractors’ First Amendment and due process rights by “compelling federal contractors to report and defend against non-final agency allegations of labor law violations without being entitled to a hearing at which to contest such allegations.” In addition, the plaintiffs believe the “rule creates additional costs and regulatory burdens that will discourage qualified firms, particularly small businesses, from pursuing federal contracts, […] will drive up costs to taxpayers [and] cause litigation and delays that will disrupt the federal procurement process for critical goods and services purchased by the government.” The full court order can be read here.

    “Reconsider Racial Element of SBA Program, Contractor Tells Court.” Federal Contracts Report. October 2016: 409-432. 

    A contractor, Rothe Development Inc, petitioned the D.C. Circuit Court to reconsider its decision upholding the constitutionality of the SBA’s 8(a) Program. The D.C. Circuit found that Section 8(a) of the Small Business Act lacks a racial classification and should be subject to a rational basis standard of review, not strict scrutiny. Rothe disagrees, saying the 8(a) Program provisions presumes “socially disadvantaged” refers to certain racial groups, encouraging and pressuring the set-aside of contracts based on race.

  • October 21, 2016

    SMALL BUSINESS ADMINISTRATION

    Small Business Mentor-Protégé Programs - Corrections
    The SBA has issued technical corrections to its final rule published in the Federal Register on July 25, 2016 (81 FR 48557), amending its regulations to establish a new government-wide mentor-protégé program for all small business concerns, consistent with SBA's mentor-protégé program for participants in SBA's 8(a) Business Development Program.  The rule, which went into effect August 24, 2016, also made several additional changes to current size, 8(a), Office of Hearings and Appeals, and HUBZone regulations, concerning among other things, ownership and control, changes in primary industry, economic disadvantage of a Native Hawaiian Organization, standards of review, and interested party status for some appeals.  The technical corrections to the final rule include correcting citations, eliminating a paragraph that conflicts with a new provision added by that final rule, and making conforming amendments, 81 Fed. Reg. 71981.  This rule became effective October 19, 2016.

    DEPARTMENT OF LABOR

    Report of Construction Contractor’s Wage Rates Information Collection Comments Request
    The Department of Labor (DOL) is soliciting comments concerning a proposed extension of the information collection request (ICR) titled, ‘‘Report of Construction Contractor’s Wage Rates.’’  This comment request is part of continuing DOL efforts to reduce paperwork and respondent burden in accordance with the Paperwork Reduction Act of 1995 (PRA), 44 U.S.C. 3501 et seq.  The review focuses mainly on (i) whether proposed wage determination information collection to determine prevailing local wages under the Davis Beacon Act is necessary for the proper performance of the functions of the agency, including whether the information will have practical utility, and to (ii) evaluate the accuracy of the agency’s estimate of the burden of the proposed collection of information, including the validity of the methodology and assumptions used, 81 Fed. Reg. 71767.  Comments are due by December 19, 2016.

    OTHER GOVERNMENT CONTRACTING NEWS

    “DOL Defends Contractor Regulation.” Politico Morning Shift.  October 21, 2016. 
    On Thursday, the DOL urged a Texas judge not to grant business groups a preliminary injunction against the final Fair Pay and Safe Workplace regulations set to phase-in October 25 and requiring companies to disclose labor law violations committed during the previous three years whenever they bid on a federal contract.  The DOL argued that (i) the regulations were within the executive branch's authority, (ii) the business groups failed to "point to any provision in the [regulations] that is in direct conflict with any federal labor law," and (iii) the plaintiffs' claim that the rules' disclosure requirements "compelled speech" and therefore violated the First Amendment.

    “Vitter Tells Obama To Delay Overtime Rule.” Politico Morning Shift.  October 21, 2016.
    In a letter, Senator David Vitter, Chairman of the Senate Committee on Small Business and Entrepreneurship, urged Labor Secretary Tom Perez to delay implementing the DOL’s final rule set to take effect December 1, 2016, warning it would hurt small businesses.  The final rule doubles (to $47,476) the salary threshold under which virtually all workers are guaranteed time-and-a-half pay if they work more than 40 hours in a given week. Read the letter here.

  • October 14, 2016
    GOVERNMENT CONTRACTS

    Implementing Category Management for Common Goods and Services
    The Office of Federal Procurement Policy (“OFPP”) in the Office of Management and Budget (“OMB”) has proposed the issuance of a new OMB Circular, Implementing Category Management for Common Goods and Services, to codify category management, a strategic practice where Federal contracting for common goods and services is managed by categories of spending across the Government and supported by teams of experts.  The Circular establishes key principles, and strategies and policies, roles and responsibilities, and metrics to measure success, 81 Fed. Reg. 69860.  Comments are due on, or before, November 7, 2016. 

    Procurement of Commercial Items – Extension of Comment Period
    The Department of Defense has proposed an amendment the Defense Federal Acquisition Regulation Supplement to implement sections of the National Defense Authorization Acts for Fiscal Years 2013 and 2016 relating to commercial item acquisitions.  The comment period on the proposed rule is extended 30 days, from August 11, 2016 to November 10, 2016, 81 Fed. Reg. 70067.

    DEPARTMENT OF LABOR

    Procedures for the Handling of Retaliation Complaints 
    The DOL has provided the final text of regulations governing employee protection (retaliation or whistleblower) claims under section 1558 of the Affordable Care Act, which added section 18C to the Fair Labor Standards Act, to provide protections to employees who may have been subject to retaliation for seeking assistance under certain affordability assistance provisions or for reporting potential violations of the Affordable Care Act's consumer protections.  This rule establishes the final procedures and time frames for the handling of retaliation complaints under section 18C, including procedures and time frames for employee complaints to the Occupational Safety and Health Administration (“OSHA”), investigations by OSHA, appeals of OSHA determinations to an administrative law judge (“ALJ”) for a hearing de novo, hearings by ALJs, review of ALJ decisions by the Administrative Review Board, and judicial review of the Secretary of Labor's (Secretary's) final decision.  It also sets forth the Secretary's interpretations of the Affordable Care Act whistleblower provision on certain matters, 81 Fed. Reg. 70607.  This final rule is effective October 13, 2016.

    SMALL BUSINESS ADMINISTRATION

    Rules of Procedure Governing Cases Before the Office of Hearings and Appeals
    The SBA has proposed an amendment to the rules of practice of its Office of Hearings and Appeals (“OHA”) to implement Section 869 of the National Defense Authorization Act for Fiscal Year 2016.  This legislation authorizes OHA to decide Petitions for Reconsideration of Size Standards and adds a provision to section 3(a) of the Small Business Act to authorize OHA to hear and decide Petitions for Reconsideration of Size Standards (Size Standard Petitions or Petitions).  A Size Standard Petition may be filed at OHA after SBA publishes a final rule in the Federal Register to revise, modify, or establish a size standard.  This proposed rule would create a new subpart I in OHA's regulations (13 C.F.R part 134) to set out detailed rules of practice for Size Standard Reconsideration Petitions, revise OHA's general rules of practice in subparts A and B of part 134 as required by the new legislation, and amend SBA's small business size regulations (13 C.F.R part 121) to include Size Standard Reconsideration Petitions as part of SBA's process for establishing size standards, 81 Fed. Reg. 69723. Comments to this proposed rule are due on December 6, 2016. 

    OTHER GOVERNMENT CONTRACTING NEWS

    “DOD wants to limit size of protégé firms.” Set-Aside Alert.  Oct. 7, 2016: 2.

    The Set-Aside Alert reported new proposed DOD amendments requiring protégé firms to be less than half the size of its primary NIACS code for eligibility in the DOD’s mentor-protégé program. 

    Analysis: No Harm, No Fraud If U.S. Continues to Pay?Federal Contracts Report.  Oct. 2016: 361-384.

    The Supreme Court in Universal Health Srvs. Inc. v. United States ex rel. Escobar (U.S. No. 15-7. 6/16/16) said successful false claims must meet a high materiality standard. Justice Clarence Thomas’s four page materiality discussion suggested the government’s payment of claims despite actual knowledge of a violated requirement with no change in the government’s position can be construed as those requirements not being material. However, Barbara Taylor of Sheppard Mullin Richter & Hampton LLP suggested prior case law in district courts has consistently shown “that government knowledge is not a complete defense with respect to the element of falsity.” 

  • October 7, 2016
    • Prohibition on Contracting With Corporations with Delinquent Taxes or a Felony Conviction
    • Updating Federal Contractor Reporting of Veterans’ Employment
    • Non-Retaliation for Disclosure of Compensation Information 
    • Sole Source Contracts for Women-Owned Small Businesses
    • Consolidation and Bundling 
    • Amendment Relating to Multi-Year Contract Authority for Acquisition of Property 
    • Contractors Performing Private Security Functions 
    • Section of Bipartisan Budget Act of 2013 Implemented
    • Federal Acquisition Circular 2005-91
    • Small Entity Compliance Guide
    • Department of Defense’s (“DOD”) Defense Industrial Base (“DIB”) Cybersecurity (“CS”) Activities 
    • Early Stage Business Investment Companies – Webinar on Proposed Rule
    • Small Business Government Contracting and National Defense Authorization Act of 2013 Amendments
    • Department of Labor Implementation of OMB Guidance on Non-procurement Debarment and Suspension 
    • Establishing Paid Sick Leave for Federal Contractors
    • “Acquisition Policy Changes Are Likely at VA in Fiscal 2017.”
    • “Analysis: What the MGT Act Could Mean for Contractors.”

    This week's report follows, click here if you would like to download a copy.

    GOVERNMENT CONTRACTS

    Prohibition on Contracting With Corporations with Delinquent Taxes or a Felony Conviction

    The Department of Defense (“DOD”), General Services Administration (“GSA”), and National Aeronautics and Space Administration (“NASA”), have adopted as final, without changes, an interim rule amending the Federal Acquisition Regulation (“FAR”) to implement sections of the Consolidated and Further Continuing Appropriations Act, 2015, to prohibit the federal government from entering into a contract with any corporation having a delinquent federal tax liability or a felony conviction under any Federal law, unless the agency has considered suspension or debarment of the corporation and has made a determination that this further action is not necessary to protect the interests of the government, 81 Fed. Reg. 67728. This final rule became effective on September 30, 2016. 

    Updating Federal Contractor Reporting of Veterans’ Employment
    DOD, GSA, and NASA have adopted as final, without change, an interim rule amending the FAR to implement a final rule issued by the Department of Labor's (“DOL”) Veterans' Employment and Training Service (“VETS”) that replaced the VETS-100 and VETS-100A Federal Contractor Veterans' Employment Report forms with the VETS-4212, Federal Contractor Veterans' Employment Report form, 81 Fed. Reg. 67731. This final rule became effective on September 30, 2016. 

    Non-Retaliation for Disclosure of Compensation Information 
    DOD, GSA, and NASA have issued an interim rule amending the FAR to implement Executive Order (“E.O.”) 13665, entitled “Non-Retaliation for Disclosure of Compensation Information.”  This interim rule also implements the final rule issued by the Office of Federal Contract Compliance Programs of the DOL to implement E.O. 13665. The DOL final rule was published in the Federal Register at 80 FR 54934, on September 11, 2015, entitled “Government Contractors, Prohibitions against Pay Secrecy Policies and Actions.”  The DOL rule revises 41 C.F.R. pt. 60-1. E.O. 11246, originally issued on September 24, 1965, establishes nondiscrimination and affirmative action obligations in employment for federal contractors and subcontractors. It prohibits employment discrimination because of race, color, religion, sex, sexual orientation, gender identity, or national origin. E.O. 13665 amends E.O. 11246 to provide for a uniform policy for the federal government to prohibit federal contractors from discriminating against employees and job applicants who inquire about, discuss, or disclose their own compensation or the compensation of other employees or applicants, 81 Fed. Reg. 67732. Comments to this interim rule are due by November 29, 2016.

    Sole Source Contracts for Women-Owned Small Businesses
    DOD, GSA, and NASA have adopted as final, with a minor edit, an interim rule amending the FAR to implement regulatory changes made by the Small Business Administration (“SBA”) that provide for authority to award sole source contracts to economically disadvantaged women-owned small business concerns and to women-owned small business concerns eligible under the Women-Owned Small Business Program, 81 Fed. Reg. 67735. This final rule became effective on September 30, 2016. 

    Consolidation and Bundling 
    DOD, GSA, and NASA have issued a final rule to amend the FAR to implement sections of the Small Business Jobs Act of 2010 and regulatory changes made by the SBA, which provide for a government-wide policy on consolidation and bundling, 81 Fed. Reg. 67763. This final rule will become effective on October 31, 2016. 

    Amendment Relating to Multi-Year Contract Authority for Acquisition of Property 
    DOD, GSA, and NASA are amending FAR 17.1 to implement Section 811 of the NDAA 2016. Section 811 amended subsection (a)(1) of 10 U.S.C. § 2306(b) by striking  “substantial” and inserting “significant.”  This rule makes conforming changes at FAR 17.105-1(b)(1) to state that the head of an agency may enter into a multi-year contract for supplies, if the use of such a contract will result in significant savings of the total estimated costs of carrying out the program through annual contracts. This change applies to the DOD, NASA, and the Coast Guard, 81 Fed. Reg. 67773. This final rule will become effective on October 31, 2016.

    Contractors Performing Private Security Functions 
    DOD, GSA, and NASA have issued a final rule amending FAR 25.302 to remove the DOD-unique requirements for contractors performing private security functions outside the United States and provide a definition of “full cooperation” within FAR 52.225-26 in order to affirm that the contract clause does not foreclose any contractor rights arising in law, the FAR, or the terms of the contract when cooperating with any government-authorized investigation into incidents reported pursuant to the clause, 81 Fed. Reg. 67776. This final rule will become effective on October 31, 2016.

    Section of Bipartisan Budget Act of 2013 Implemented
    DOD, GSA and NASA have adopted as final, with changes, an interim rule amending the FAR to implement a section of the Bipartisan Budget Act of 2013. The final rule revises the allowable cost limit relative to the compensation of contractor and subcontractor employees. Also, this final rule implements the narrowly targeted exception to this allowable cost limit for scientists, engineers, or other specialists upon an agency determination that such exceptions are needed to ensure that the executive agency has continued access to needed skills and capabilities, 81 Fed. Reg. 67778. This final rule became effective on September 30, 2016.

    Federal Acquisition Circular 2005-91
    This document summarizes the FAR rules agreed to by the Civilian Agency Acquisition Council and the Defense Acquisition Regulations Council in this Federal Acquisition Circular (“FAC”) 2005-91. A companion document, the Small Entity Compliance Guide, follows this FAC, 81 Fed. Reg. 67726.

    Small Entity Compliance Guide
    This document is issued under the joint authority of DOD, GSA, and NASA. This Small Entity Compliance Guide has been prepared in accordance with section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996. It consists of a summary of the rules appearing in Federal Acquisition Circular (FAC) 2005-91, which amends the FAR. An asterisk (*) next to a rule indicates that a regulatory flexibility analysis has been prepared, 81 Fed. Reg. 67781.

    Department of Defense’s (“DOD”) Defense Industrial Base (“DIB”) Cybersecurity (“CS”) Activities 
    This final rule responds to public comments and updates DOD's DIB CS Activities. This rule implements mandatory cyber incident reporting requirements for DOD contractors and subcontractors who have agreements with DOD. In addition, the rule modifies eligibility criteria to permit greater participation in the voluntary DIB CS information sharing program, 81 Fed. Reg. 68312. This final rule will become effective on November 3, 2016. 

    SMALL BUSINESS ADMINISTRATION

    Early Stage Business Investment Companies – Webinar on Proposed Rule
    The SBA is holding a public webinar regarding its Early Stage Small Business Investment Companies proposed rule, which was published on September 19, 2016. The webinar will describe the changes proposed in the rulemaking and answer questions regarding the proposed rule, 81 Fed. Reg. 69012. The webinar will be held on October 12, 2016, beginning at 1:00 p.m. Attendees must pre-register by October 10, 2016, at 11:59 p.m.

    Small Business Government Contracting and National Defense Authorization Act of 2013 Amendments
    The SBA is correcting a final rule that appeared in the Federal Register on May 31, 2016 (81 Fed, Reg. 34243). The rule described the limitations on subcontracting that apply to set aside contracts. The rule provides that the limitations on subcontracting apply to small business set asides above $150,000 and to 8(a), HUBZone, Service-Disabled Veteran-Owned (“SDVO”) or Women-Owned Small Business (“WOSB”) set asides. The $150,000 threshold appears twice in 13 C.F.R § 125.6(a), and, thus, could be misinterpreted as applying the threshold to 8(a), HUBZone, SDVO or WOSB set-asides. This action deletes the second $150,000 threshold that appears in 13 C.F.R § 125.6(a). This final rule became effective on September 30, 2016. 

    DEPARTMENT OF LABOR

    Department of Labor Implementation of OMB Guidance on Non-procurement Debarment and Suspension 
    On April 29, 2016, the DOL’s Office of the Assistant Secretary for Administration and Management (“OASAM”) published, in the Federal Register, a direct final rule to implement OMB guidance on non-procurement debarment and suspension. The comment period for the direct final rule ended on May 31, 2016, with no comments received. For this reason, OASAM is confirming that the direct final rule became effective on May 31, 2016. 

    Establishing Paid Sick Leave for Federal Contractors
    The DOL has issued a final rule which issues regulations to implement Executive Order 13706, establishing paid sick leave for federal contractors. Executive Order 13706 (“the Order”) requires certain parties that contract with the federal government to provide their employees with up to 7 days (56 hours) of paid sick leave annually, including paid leave allowing for family care. The Order directed the Secretary of Labor to issue regulations to implement its requirements by September 30, 2016. This Final Rule defines terms used in the regulatory text, describes the categories of contracts and employees the Order covers and excludes from coverage, sets forth requirements and restrictions governing the accrual and use of paid sick leave, and prohibits interference with, or discrimination for, the exercise of rights under the Order. It also describes the obligations of contracting agencies, the DOL, and contractors under the Order, and it establishes the standards and procedures for complaints, investigations, remedies, and administrative enforcement proceedings related to alleged violations of the Order. As required by the Order, and to the extent practicable, the final rule incorporates existing definitions, procedures, remedies, and enforcement processes under the Fair Labor Standards Act, the Service Contract Act, the Davis-Bacon Act, the Family and Medical Leave Act, the Violence Against Women Act, and Executive Order 13658, Establishing a Minimum Wage for Contractors, 81 Fed. Reg. 67598. This final rule will become effective on November 29, 2016.

    OTHER GOVERNMENT CONTRACTING NEWS

    “Acquisition Policy Changes Are Likely at VA in Fiscal 2017.” Federal Contracts Report. Oct. 2016: 325-360.
    In a September report, the GAO identified 10 recommendations to improve the VA’s $20 billion annual contract spending. Among the GAO’s recommendations were for the VA to develop procedures for updating the procurement system, review strategic sourcing efforts and improve contract reviews. Contractors can also expect increased adoption of category management concepts including full-and-open competition in VA markets. 

    “Analysis: What the MGT Act Could Mean for Contractors.” Federal Contracts Report. Oct. 2016: 325-360.
    On September 22, the House passed H.R. 6004, the Modernizing Government Technology Act, shifting the federal government’s focus on maintaining its aging IT infrastructure, which can pose security risks, to introducing cloud computing, implementing cybersecurity measures and prioritizing cost-savings programs. According to the Federal Contracts Report, while Hewlett Packard Enterprises is the largest legacy IT vendor for the government and a top cloud computing vendor, there maybe an opportunity for other major cloud computing and cybersecurity vendors to provide these services

  • September 30, 2016
    • Amendments to Department of Defense (“DOD”) Mentor-Protégé Program
    • Temporary Extension of Test Program for Comprehensive Small Business Subcontracting Plans
    • Small Business Timber Set-Aside Program
    • Prohibition on Use of Any Cost-Plus System of Contracting for Military Construction and Military Family Housing Projects
    • Federal Civil Penalties Adjustment Act Amendments 
    • Extension of Comment Period for Proposed Revision of Annual Information Return/Reports

    This week's report follows, click here if you would like to download a copy.

    GOVERNMENT CONTRACTS

    Amendments to Department of Defense (“DOD”) Mentor-Protégé Program
    DOD has issued a proposed rule which will amend the DFARS to implement Section 861 of the NDAA 2016, which provides amendments to the DOD Mentor-Protégé Program. The proposed amendments will require contractors who participate in the program as mentors to report all technical or management assistance provided; any new awards of subcontracts to the protégé firm, including the value of such subcontracts; any extensions, increases in the scope of work, or additional, unreported payments to the protégé firm; the amount of any progress payments or advance payments made to the protégé firm for performance under any subcontract made under the program; any loans made to the protégé firm; all federal contracts awarded to the mentor and protégé firms as a joint venture; any assistance the mentor firm obtained for the protégé firm from small business development centers established under 15 U.S.C. § 648, entities providing procurement technical assistance under 10 U.S.C. ch. 142, or Historically Black Colleges or Universities or Minority Institutions of Higher Education; whether the terms of the mentor-protégé agreement have changed; and a narrative describing the success assistance provided under the program has had in addressing the protégé firm’s developmental needs, the impact on DOD contracts, and addressing any problems encountered. These reporting requirements apply retroactively to mentor-protégé agreements in effect on November 25, 2015, the date of enactment of the NDAA 2016.

    In addition, Section 861: (1) adds new eligibility criteria; (2) limits the number of mentor-protégé agreements to which a protégé firm may be a party; (3) limits the period of time during which a protégé firm may participate in mentor-protégé agreements under the program; (4) adds new elements to mentor-protégé agreements addressing the benefits of the agreement to DOD and goals for additional awards for which the protégé firm can compete outside the program; (5) removes business development assistance using mentor firm personnel and cash in exchange for an ownership interest in the protégé firm from the types of assistance that a mentor firm may provide to a protégé firm; (6) prohibits reimbursement of any fee assessed by the mentor firm for certain services provided to the protégé firm while participating in a joint venture with the protégé firm; (7) revises the definitions of the terms “small business concern” and “disadvantaged small business concern;” (8) adds definitions for “severely disabled individual” and “affiliated;” and (9) extends the Program for three years, 81 Fed. Reg. 65610. Comments on this proposed rule are due by November 22, 2016.

    Temporary Extension of Test Program for Comprehensive Small Business Subcontracting Plans
    DOD has issued a proposed rule to revise the DFARS to implement Section 821 of the NDAA 2015 and Section 872 of the NDAA 2016, both of which revise the Test Program for Negotiation of Comprehensive Small Business Subcontracting Plans (“Test Program.”)

    Section 821 of the NDAA 2015 provides, for contractors participating in the Test Program, to report, on a semiannual basis, as follows: (1) the amount of first-tier subcontract dollars awarded; (2) the total number of subcontracts active under the Test Program that would have otherwise required a subcontracting plan under 15 U.S.C. § 637(d); (3) costs incurred in negotiating, complying with, and reporting on comprehensive subcontracting plans; and (4) costs avoided by adoption of a comprehensive subcontracting plan. In addition, Section 821: (1) repeals section 402 of Public Law 101-574, which suspended liquidated damages under comprehensive small business subcontracting plans; (2) requires consideration, as part of the past performance evaluation of an offeror, of any failure to make a good faith effort to comply with its comprehensive subcontracting plan; (3) extends the Test Program through December 31, 2017; (4) increases the threshold for participation in the Test Program from $5,000,000 to $100,000,000; and (5) prohibits negotiation of comprehensive subcontracting plans with contractors who failed to meet the subcontracting goals of their comprehensive subcontracting plan for the prior fiscal year.

    Section 872 of the NDAA 2016 removes the prohibition on negotiation of comprehensive subcontracting plans with contractors who failed to meet the subcontracting goals of their comprehensive subcontracting plan for the prior fiscal year, 81 Fed. Reg. 65606. Comments on the proposed rule are due by November 22, 2016.

    SMALL BUSINESS ADMINISTRATION

    Small Business Timber Set-Aside Program
    The SBA is seeking comments on a proposed amendment to its regulations governing the small business timber set-aside program so that appraisals on small business set-aside sales can be made to the nearest small business mill. Currently, appraisals in small business set-aside timber sales take into account the haul costs to the nearest mill regardless of that mill's size. Since set-aside timber sales require the use of small business mills, SBA proposes that the appraisal on set-aside timber sales be made to the nearest small business mill in order to accurately reflect the estimated cost to an eligible bidder. SBA is also requesting comment on a possible policy alternative that would use a weighted approach to appraising, 81 Fed. Reg. 66199. Comments are due by November 28, 2016. 

    DEPARTMENT OF VETERANS AFFAIRS

    Prohibition on Use of Any Cost-Plus System of Contracting for Military Construction and Military Family Housing Projects 
    DOD issued a final rule amending the DFARS to implement section 2801 of the NDAA 2012 that amended Title 10 of the United States Code by prohibiting any form of cost-plus contracting for military construction projects or military family housing projects, 81 Fed. Reg. 65563. This final rule became effective on September 23, 2016. 

    Federal Civil Penalties Adjustment Act Amendments 
    The VA issued a final rule adopting, without changes, its interim final rule, which increased maximum civil monetary penalties from $10,000 to $21,563 for false loan guaranty certifications and from $5,500 to $10,781 for fraudulent claims or fraudulent statements in any VA program 81 Fed. Reg. 65551. This final rule became effective on September 23, 2016.

    LABOR AND EMPLOYMENT

    Extension of Comment Period for Proposed Revision of Annual Information Return/Reports
    The DOL has extended the comment period on the Notice of Proposed Revision of Annual Information Return/Reports, which was originally published on July 21, 2016, from October 4, 2016 to December 5, 2016, 81 Fed. Reg. 65594

  • September 23, 2016
    • Notice of Minimum Wage Rate Change for Contractors
    • SBIC - Early Stage Initiative

    This week's report follows, click here if you would like to download a copy.

    GOVERNMENT CONTRACTS

    Notice of Minimum Wage Rate Change for Contractors
    The Wage and Hour Division of the U.S. Department of Labor issued a notice announcing that beginning January 1, 2017, the Executive Order minimum wage rate that generally must be paid to workers performing work on, or in connection with, covered contracts will increase from $10.15 per hour to $10.20 per hour, and the required minimum cash wage that generally must be paid to tipped employees performing work on, or in connection with, covered contracts will increase to $6.80 per hour, 81 Fed. Reg. 64513. This notice became effective on September 20, 2016. 

    SMALL BUSINESS ADMINISTRATION

    SBIC - Early Stage Initiative
    SBA has proposed a rule to make changes to its Early Stage Small Business Investment Company (“SBIC”) initiative, which was launched in 2012 as a five-year effort as part of President Obama's Startup America Initiative. The intent of the initiative was to license and provide SBA-guaranteed leverage to Early Stage SBICs that would focus on making investments in early stage small businesses. To date, SBA has only licensed five Early Stage SBICs. In an attempt to attract more qualified early stage fund managers, this rule proposes changes to the initiative with respect to licensing, non-SBA borrowing, and leverage eligibility. In addition, this rule reflects SBA's intention to continue licensing and providing SBA-guaranteed leverage to Early Stage SBICs beyond the five-year term of the initiative, and proposes certain technical changes to SBA's Early Stage regulations, 81 Fed. Reg. 64075. Comments on the proposed rule are due by October 19, 2016. 

  • September 16, 2016
    GOVERNMENT CONTRACTS
    • GSAR Construction Contract Administration
    • GSAR Federal Supply Schedule, Order-Level Materials
    • Civil Monetary Penalty Inflation Adjustment
    • Audit of Settlement Proposals
     

    GSAR Construction Contract Administration
    The GSA has issued a proposed rule to revise GSAR part 536, Construction and Architect-Engineer Contracts, and related parts, to maintain consistency with the FAR and to clarify, update, and incorporate existing construction contract administration guidance previously implemented through internal Public Building Service policies.  The five categories of the proposed rule changes are: (1) Incorporating existing agency policy previously issued through other means, (2) reorganizing to better align with the FAR, (3) incorporating agency unique clauses, (4) incorporating supplemental material, and (5) editing for clarity.  The proposed rule includes a total of five new agency unique provisions and clauses, six new supplemental clauses, and revision and reorganization of eight existing provisions and clauses, 81 Fed. Reg. 62434.  Comments to the proposed rule are due on, or before, November 8, 2016.

    GSAR Federal Supply Schedule, Order-Level Materials
    The GSA has issued a proposed rule to amend the GSAR to clarify the authority to acquire order-level materials when placing a task order or establishing a Blanket Purchase Agreement against a Federal Supply Schedule (“FSS”) contract. This proposed rule seeks to provide clear and comprehensive implementation of the ability to acquire order-level materials through the FSS program, to create parity between FSS contracts and commercial indefinite-delivery/indefinite-quantity (“IDIQ”) contracts, to reduce the need to conduct less efficient procurement transactions, lower barriers of entry to the federal marketplace, and to make it easier to do business the federal government, 81 Fed. Reg. 62445.  Comments to the proposed rule are due on, or before, November 8, 2016.

    Civil Monetary Penalty Inflation Adjustment
    In accordance with the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 (“the 2015 Act”), the Department of Defense must adjust the level of all civil monetary penalties under its jurisdiction through a final rule and make subsequent annual adjustments for inflation.  The inflation adjustment must be determined by increasing the maximum CMP or the range of minimum and maximum CMPs, as applicable, for each CMP by the cost-of-living adjustment, rounded to the nearest multiple of $1.  The cost-of-living adjustment is the percentage (if any) for each CMP by which the Consumer Price Index (“CPI”) for the month of October preceding the date of the adjustment (January 15), exceeds the CPI for the month of October in the previous calendar year.  The initial adjustment to a CMP may not exceed 150 percent of the corresponding level in effect on November 2, 2015.  Any increased penalties will only apply to violations which occur after the date on which the increase takes effect. Each CMP subject to the jurisdiction of the Department of Defense has been adjusted in accordance with the 2015 Act.  In compliance with the 2015 Act, the Department of Defense has amended its CMP penalty amounts, 81 Fed. Reg. 62629.  This rule is effective September 12, 2016.

    Audit of Settlement Proposals
    DoD, GSA, and NASA have issued a proposed rule to amend the FAR to raise the dollar threshold requirement for the audit of prime contract settlement proposals and subcontract settlements from $100,000 to $750,000, 81 Fed. Reg. 63158.  Comments to the proposed rule are due on, or before, November 14, 2016. 

  • September 9, 2016
    • Pilot Program for Streamlining Awards for Innovative Technology Projects
    • Costs Related to Counterfeit Electronic Parts
    • Savings Arrangements Established by States for Non-Governmental Employees

    This week's report follows, click here if you would like to download a copy.

    GOVERNMENT CONTRACTS

    Pilot Program for Streamlining Awards for Innovative Technology Projects
    DOD is proposing to amend the DFARS to implement Section 873 of the National Defense Authorization Act for Fiscal Year 2016 which (1) provides an exception from the certified cost and pricing data requirements, and from the records examination requirement for contracts, subcontracts, or modifications of contracts or subcontracts, valued at less than $7.5 million awarded to a small business or nontraditional defense contractor pursuant to a technical, merit-based selection procedure or under the Small Business Innovation Research (“SBIR”) Program; (2) provides authority to determine that submission of cost and pricing data should be required based on past performance of the specific small business or nontraditional defense contractor or analysis of other information specific to the award; (3) provides an exception from the records examination requirement at 10 U.S.C. § 2313 for contracts valued at less than $7.5 million awarded to a small business or nontraditional defense contractor pursuant to a technical, merit-based selection procedure or under the SBIR Program; and (4) provides authority to determine that auditing of records should be required based on past performance of the specific small business or nontraditional defense contractor or analysis of other information specific to the award. These exceptions would end on October 1, 2020, 81 Fed. Reg. 59594. Comments to the proposed rule are due by October 31, 2016.

    Costs Related to Counterfeit Electronic Parts
    DOD issued a final rule amending the DFARS to implement Section 885(a) of the National Defense Authorization Act for Fiscal Year 2016 that amends the allowability of costs of counterfeit electronic parts, or suspected counterfeit electronic parts, and the cost of rework or corrective action that may be required to remedy the use, or inclusion, of such parts, 81 Fed. Reg. 59510. The rule is effective August 30, 2016.

    LABOR AND EMPLOYMENT

    Savings Arrangements Established by States for Non-Governmental Employees
    The Department of Labor, Employee Benefits Security Administration, has issued a final rule that: (1) describes circumstances in which state payroll deduction savings programs with automatic enrollment would not give rise to the establishment of employee pension benefit plans under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”); (2) provides guidance for states in designing such programs so as to reduce the risk of ERISA preemption of the relevant state laws; and (3) provides guidance to private-sector employers that may be covered by such state laws, 81 Fed. Reg. 59464. This rule is effective October 31, 2016.

     
  • August 26, 2016
    • Fair Pay and Safe Workplaces
    • Guidance for Executive Order 13673, "Fair Pay and Safe Workplaces"

    This week's report follows, click here if you would like to download a copy.

    GOVERNMENT CONTRACTS

    Fair Pay and Safe Workplaces
    DOD, GSA, and NASA issued a final rule amending the FAR to implement Executive Order 13673, Fair Pay and Safe Workplaces, which is designed to increase efficiency and cost savings in Federal contracting by improving contractor compliance with labor laws. The Department of Labor is simultaneously issuing final guidance to assist federal agencies in implementation of the Executive Order in conjunction with the FAR final rule, 81 Fed. Reg. 58562.  This final rule is effective October 25, 2016. 

    LABOR AND EMPLOYMENT

    Guidance for Executive Order 13673, “Fair Pay and Safe Workplaces”
    The Department of Labor (the Department) published final guidance (the Guidance) to assist the Federal Acquisition Regulatory Council (the FAR Council) and Federal contracting agencies in the implementation of Executive Order 13673, Fair Pay and Safe Workplaces. Executive Order 13673 (the Order) contains new requirements designed to increase efficiency and cost savings in the federal contracting process. By law, federal agencies already must contract only with “responsible” sources.  Among other directives, the Order provides explicit new instructions for federal contracting officers to consider a contractor's compliance with certain federal and state labor laws as a part of the determination of contractor “responsibility” that contracting officers presently must undertake before awarding a federal contract.  In addition, the Order directs the FAR Council to propose the rules and regulations necessary to carry out the Order and the Department to develop guidance to help implement the new requirements. In this final Guidance, the Department provides detailed definitions for various terms used in the Order and the FAR rule to categorize and classify labor law violations, and the Department provides a summary of the processes through which contracting agencies will assess a contractor's overall record of labor law compliance and carry out their other duties under the Order, 81 Fed. Reg. 58654.  This final Guidance is being published simultaneously with the FAR Council's final rule and is effective on October 25, 2016.  Contractors and Federal agencies may use this Guidance beginning August 25, 2016. 

  • August 12, 2016
    • Procurement of Commercial Items
    • OMB to Announce Final Decisions for 2017 NAICS Revisions
    • Amendment of Americans With Disabilities Act Title II and Title III

    This week's report follows, click here if you would like to download a copy.

    GOVERNMENT CONTRACTS

    Procurement of Commercial Items
    DOD is proposing to amend the DFARS to implement sections of the National Defense Authorization Acts for Fiscal Years 2013 and 2016 relating to commercial item acquisitions as follows: (1) definitions of “market prices,” “market research,” “nontraditional defense contractor,” “relevant sales data,” and “uncertified cost data” are added; (2) DFARS 212.102, applicability, is amended to instruct contracting officers on the treatment of prior commercial item determinations and nontraditional defense contractors; (3) DFARS 212.209, determination of price reasonableness, is added to provide a hierarchy of data for contracting officers to consider when making determinations of price reasonableness; (4) DFARS subpart 212.72, limitation on conversion of procurement from commercial acquisition procedures, is added; (5) DFARS 215.402, pricing policy, is amended to provide information regarding the contracting officer's responsibility for determining if the information provided by the offeror is sufficient to determine price reasonableness; and (6) DFARS 215.403-1, prohibition on obtaining certified cost or pricing data (10 U.S.C. 2306a and 41 U.S.C. chapter 35), is amended to provide a reference to 212.102 regarding prior commercial item determinations as well as several other technical amendments, 81 Fed. Reg. 53101. Comments on the proposed rule are due by October 11, 2016.

    OMB to Announce Final Decisions for 2017 NAICS Revisions
    The Office of Management and Budget (“OMB”) is announcing its final decisions for adoption of NAICS revisions for 2017 as recommended by the Economic Classification Policy Committee (“ECPC”) in Part IV of OMB's notice for solicitation of comments published in the Federal Register on August 4, 2015, 81 Fed. Reg. 52584. Effective Dates:  Federal statistical establishment data published for reference years beginning on or after January 1, 2017, should be published using the 2017 NAICS United States codes. Publication of a 2017 NAICS United States Manual or supplement is planned for January 2017. 

    LABOR AND EMPLOYMENT

    Amendment of Americans With Disabilities Act Title II and Title III
    The Department of Justice (“DOJ”) is issuing this final rule to amend its Americans with Disabilities Act (ADA) regulations in order to incorporate the statutory changes to the ADA set forth in the ADA Amendments Act of 2008 (ADA Amendments Act or the Act), which took effect on January 1, 2009. In response to earlier Supreme Court decisions that significantly narrowed the application of the definition of “disability'' under the ADA, Congress enacted the ADA Amendments Act to restore the understanding that the definition of “disability” shall be broadly construed and applied without extensive analysis. Congress intended that the primary object of attention in cases brought under the ADA should be whether covered entities have complied with their statutory obligations not to discriminate based on disability. In this final rule, the DOJ is adding new sections to its Title II and Title III ADA regulations to set forth the proper meaning and interpretation of the definition of “disability” and to make related changes required by the ADA Amendments Act in other sections of the regulations, 81 Fed. Reg. 53204. This rule is effective October 11, 2016.

     
  • August 5, 2016
    • HUBZone and the National Defense Authorization Act for Fiscal Year 2016 Amendments
    • Detection and Avoidance of Counterfeit Electronic Parts
    • Amendments Related to Sources of Electronic Parts

    This week's report follows, click here if you would like to download a copy.

    SMALL BUSINESS ADMINISTRATION

    Small Business Mentor-Protégé Programs
    The SBA is amending its regulations to the HUBZone Program.  The amendments: (1) authorize Native Hawaiian Organizations (“NHO”) to own HUBZone small business concerns; (2)  expand the HUBZone Program to assist small businesses in disaster areas and base closure areas; and (3) provide equal treatment under the HUBZone Program for small businesses owned by NHOs, 81 Fed. Reg. 51312.  Comments are due by September 6, 2016.  The final rule is effective October 3, 2016.

    GOVERNMENT CONTRACTS

    Detection and Avoidance of Counterfeit Electronic Parts
    The DOD issued a final rule amending the DFARS to implement a requirement that addresses required sources of electronic parts for defense contractors and subcontractors.  This rule requires DOD contractors and subcontractors, except in limited circumstances, to acquire electronic parts from trusted suppliers in order to further address the avoidance of counterfeit electronic parts. DOD contractors and subcontractors that are not the original component manufacturer are required by this rule to notify the contracting officer if it is not possible to obtain an electronic part from a trusted supplier.  For those instances where the contractor obtains electronic parts from sources other than a trusted supplier, the contractor is responsible for inspection, testing, and authentication in accordance with existing applicable industry standards, 81 Fed. Reg. 50635.  The rule is effective August 2, 2016.

    Amendments Related to Sources of Electronic Parts
    The DOD is proposing to amend the DFARS to implement a section of the National Defense Authorization Act for Fiscal Year 2016 that makes contractors and subcontractors subject to approval, as well as review and audit, by appropriate DOD officials when identifying a contractor-approved supplier of electronic parts, 81 Fed. Reg. 50680.  Comments are due by October 3, 2016.

  • July 22, 2016
    • Small Business Mentor-Protégé Programs
    • Civil Monetary Penalties Inflation Adjustment

    This week's report follows, click here if you would like to download a copy.

    GOVERNMENT CONTRACTS

    Small Business Mentor-Protégé Programs
    The U.S. Small Business Administration (“SBA”) is amending its regulations to implement provisions of the Small Business Jobs Act of 2010, and the National Defense Authorization Act for Fiscal Year 2013. Based on authorities provided in these two statutes, the rule: (1) establishes a government-wide mentor-protégé program for all small business concerns, consistent with SBA’s mentor-protégé program for participants in SBA’s 8(a) Business Development (“BD”) program; (2) makes minor changes to the mentor-protégé provisions for the 8(a) BD program in order to make the mentor-protégé rules for each of the programs as consistent as possible; (3) amends the current joint venture provisions to clarify the conditions for creating and operating joint venture partnerships, including the effect of such partnerships on any mentor-protégé relationships; (4) makes several additional changes to current size and 8(a) Office of Hearings and Appeals; and (5) makes changes to HUBZone regulations concerning, among other things, ownership and control, changes in primary industry, standards of review, and interested party status for some appeals. The final rule is scheduled to be published on July 25, 2016; however, to see a pre-publication of the final rule, click here.

    DEPARTMENT OF JUSTICE

    Civil Monetary Penalties Inflation Adjustment
    In accordance with the provisions of the Bipartisan Budget Act of 2015, the Department of Justice is adjusting, for inflation, civil monetary penalties assessed, or enforced, by components of the department. The amounts of the adjustments were determined according to a formula set forth in the Inflation Adjustment Act, 81 Fed. Reg. 42491. This rule is effective August 1, 2016 and comments are due on, or before, August 29, 2016.

  • July 15, 2016
    • Small Business Subcontracting Improvements
    • FPI Blanket Waiver Threshold

    This week's report follows, click here if you would like to download a copy.

    GOVERNMENT CONTRACTING

    Small Business Subcontracting Improvements
    DOD, GSA, and NASA issued a final rule amending the FAR to implement the following regulatory changes made by the Small Business Administration, which provide for a governmentwide policy on small business subcontracting:

    (1) Requiring prime contractors to make good faith efforts to utilize their proposed small business subcontractors during performance of a contract to the same degree the prime contractor relied on the small business in preparing and submitting its bid or proposal. To the extent a prime contractor is unable to make a good faith effort to utilize its small business subcontractors as described above, the prime contractor is required to explain, in writing, within 30 days of contract completion, to the contracting officer the reasons why it is unable to do so;

    (2) Authorizing contracting officers to calculate subcontracting goals in terms of total contract dollars in addition to the required goals in terms of total subcontracted dollars;

    (3) Providing contracting officers with the discretion to require a subcontracting plan in instances where a small business rerepresents its size as an other than small business;

    (4) Requiring subcontracting plans even for modifications under the subcontracting plan threshold if said modifications would cause the contract to exceed the plan threshold;

    (5) Requiring prime contractors to assign North American Industry Classification System (NAICS) codes to subcontracts;

    (6) Restricting prime contractors from prohibiting a subcontractor from discussing payment or utilization matters with the contracting officer;

    (7) Requiring prime contractors to resubmit a corrected subcontracting report within 30 days of receiving the contracting officer's notice of report rejection;

    (8) Requiring prime contractors to provide the socioeconomic status of the subcontractor in the notification to unsuccessful offerors for subcontracts;

    (9) Requiring prime contracts with subcontracting plans on task and delivery order contracts to report order level subcontracting information after November 2017;

    (10) Funding agencies receiving small business subcontracting credit; and(11) On indefinite-delivery, indefinite-quantity contracts, the contracting officer may establish subcontracting goals at the order level (but not a new subcontracting plan), 81 Fed. Reg. 45833. This final rule is effective November 1, 2016.

    FPI Blanket Waiver Threshold

    DOD, GSA, and NASA are issuing a final rule amending the Federal Acquisition Regulation (FAR) to increase the blanket waiver threshold for small dollar-value purchases from Federal Prison Industries (FPI) by Federal agencies from $3,000 to $3,500, 81 Fed. Reg. 45854. This final rule is effective August 15, 2016.

  • July 1, 2016
    • Affiliation for Business Loan Programs and Surety Bond Guarantee Program
    • Acquisition Threshold for Special Emergency Procurement Authority
    • Amendment to the Defense Federal Acquisition Regulation Supplement
    • Pilot Program on Acquisition of Military Purpose Non-developmental Items
    • Defense Contractors Performing Private Security Functions
    • Treatment of Interagency and State and Local Purchases
    • Contract Financing
    • Administrative Cost to Issue and Administer a Contract
    • Civil Penalties Inflation Adjustments

    This week's report follows, click here if you would like to download a copy.

    SMALL BUSINESS ADMINISTRATION

    Affiliation for Business Loan Programs and Surety Bond Guarantee Program
    This final rule amends the regulations pertaining to the determination of size eligibility based on affiliation by creating distinctive requirements for small business applicants for assistance from the Business Loan, Disaster Loan and Surety Bond Guarantee Program.  For purposes of this rule, the Business Loan Programs consist of the 7(a) Loan Program, the Microloan Program, the Intermediary Lending Pilot Program, and the Development Company Loan Program.  This rule redefines and establishes separate affiliation guidance applicable only to small business applicants in these programs, 81 Fed. Reg. 41423.  This rule is effective July 27, 2016.
     

    GOVERNMENT CONTRACTS

    Acquisition Threshold for Special Emergency Procurement Authority
    DOD, GSA, and NASA are proposing to amend the Federal Acquisition Regulation (FAR) to implement the National Defense Authorization Act for Fiscal Year 2016 to increase the simplified acquisition threshold for special emergency procurement authority from $300,000 to $750,000 (within the United States) and from $1 million to $1.5 million (outside the United States), 81 Fed. Reg. 39882.  Comments to this proposed amendment are due by August 19, 2016.

    Amendment to the Defense Federal Acquisition Regulation Supplement

    DOD issued a final rule amending the DFARS to delete the supplemental coverage for the definition “simplified acquisition threshold.”  This supplemental definition was included in DFARS when there was no existing coverage in the FAR.  The simplified acquisition threshold for humanitarian or peacekeeping operations has been added to the FAR under final rule 2015-020. There is no need to duplicate the definition in the DFARS; therefore, this rule removes the supplemental definition at DFARS part 202, 81 Fed. Reg. 42556.  This rule became effective on June 30, 2016.

    Pilot Program on Acquisition of Military Purpose Non-developmental Items
    DOD issued an interim rule amending the DFARS to implement Section 892 of the National Defense Authorization Act for Fiscal Year 2016.  Section 892 removes the requirements for the use of competitive procedures and for awards to be made to nontraditional defense contractors under the Pilot Program on Acquisition of Military Purpose Non-developmental Items.  Section 892 also increases the threshold for use of the pilot program to contracts up to $100 million, 81 Fed. Reg. 42557.  This interim rule is effective June 30, 2016.  Comments on the interim rule are due by August 29, 2016.

    Defense Contractors Performing Private Security Functions

    DOD issued a final rule amending the DFARS to consolidate all requirements for contractors performing private security functions outside the United States applicable to DOD contracts in the DFARS and make changes regarding applicability and high-level quality assurance standards, 81 Fed. Reg. 42559.  This final rule became effective on June 30, 2016.

    Treatment of Interagency and State and Local Purchases

    DOD issued a final rule amending the DFARS to implement a section of the National Defense Authorization Act for Fiscal Year 2016 that is entitled “Treatment of Interagency and State and Local Purchases.”  This section provides that contracts executed by DOD as a result of the transfer of contracts from GSA, or for which DOD serves as an item manager for products on behalf of GSA, shall not be subject to certain domestic source restrictions, to the extent that such contracts are for the purchase of products by other federal agencies, or state or local governments, 81 Fed. Reg. 42562.  This final rule became effective on June 30, 2016.

    Contract Financing

    DOD is proposing to amend the DFARS regarding the use of customary contract financing, other than loan guarantees and advance payments, identified in FAR part 32, on fixed-price contracts with a period of performance in excess of one year that meet the dollar thresholds established in FAR 32.104(d), 81 Fed. Reg. 42607.  Comments on the proposed amendment are due by August 29, 2016.

    Administrative Cost to Issue and Administer a Contract

    DOD is proposing to amend the DFARS to implement a policy that addresses the government's cost to award and administer a contract, for the purpose of evaluating bids for multiple awards, 81 Fed. Reg. 42608.  Comments on the proposed rule are due by August 29, 2016.

    BUREAU OF INDIAN AFFAIRS

    Civil Penalties Inflation Adjustments
    The Bureau of Indian Affairs, Interior has issued an interim final rule adjusting the level of civil monetary penalties contained in Indian Affairs regulations with an initial “catch-up” adjustment under the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015 and Office of Management and Budget guidance.  The purpose of these adjustments is to maintain the deterrent effect of civil penalties and to further the policy goals of the underlying statutes, 81 Fed. Reg. 42478.  This interim final rule is effective on August 1, 2016, and comments are due by August 29, 2016.

  • June 24, 2016
    • Jon Williams Testifies in Kingdomware Senate Committee Hearing
    • Small Business Transforming America's Regions Act of 2016
    • Federal Acquisition Regulation: Strategic Sourcing Documentation
    • Federal Civil Penalties Adjustment Act Amendments
    • Transactional Data Reporting

    This week's report follows, click here if you would like to download a copy.

    SENATE TESTIMONY

    Jon Williams Testifies in Kingdomware Senate Committee Hearing
    On June 23, Jon Williams, Partner in the PilieroMazza Government Contracts Group, testified before the U.S. Senate Committee on Small Business & Entrepreneurship. The committee held a hearing on the ramifications of the Supreme Court’s recent decision in Kingdomware Technologies, Inc. v. United States. Mr. Williams, and others, testified about the significance of the Kingdomware ruling for veteran-owned small businesses. The Supreme Court found that the “Vets First” mandate applies to all Department of Veterans Affairs contracts, including Federal Supply Schedule (“FSS”) task orders. This ruling is expected to increase contracting opportunities for veteran-owned small businesses at the VA.

    Tom Leney, Executive Director of the VA’s Office of Small and Disadvantaged Business Utilization, told the committee that the VA will comply with the Supreme Court’s ruling and is aggressively looking at how to implement the decision throughout its acquisition system. The VA expects to have policies to accomplish this by mid-July, at which time the VA will report back to the committee. John Shoraka, Associate Administrator of Government Contracting and Business Development for the U.S. Small Business Administration, told the committee that SBA is examining whether the Kingdomware ruling has government-wide applicability for FSS task orders and how it impacts goaling. 

    GOVERMENT CONTRACTS

    Small Business Transforming America's Regions Act of 2016
    The HUBZone Program was created in 1997 to spur economic development in historically underutilized regions of the country. The aim is as worthwhile now as it was then, and there remains a real need for the HUBZone Program to be the engine of economic growth in many struggling communities. However, despite the needs, HUBZone spending has been in steady decline over the past several years, and is overall much lower than the other small business programs, both in terms of prime contracting and subcontracting goal achievement. The hard data and anecdotal evidence indicate that, to reach its full potential, the HUBZone Program needs to be simpler and more business friendly. Given the heightened attention to the program, Congress is currently considering several significant proposals, such as S.2838, which proposes to change the length of a HUBZone’s redesignated status from three to seven years. 

    Federal Acquisition Regulation: Strategic Sourcing Documentation
    DOD, GSA, and NASA are proposing to revise the FAR to implement section 816 of the National Defense Authorization Act for Fiscal Year 2016 to increase the simplified acquisition threshold for special emergency procurement authority from $300,000 to $750,000 within the United States, and from $1 million to $1.5 million outside the United States. The threshold is used for acquisitions of supplies or services that, as determined by the head of the agency, are to be used to support a contingency operation or to facilitate defense against or recovery from nuclear, biological, chemical, or radiological attack, 81 Fed. Reg. 39883. Comments are due by August 19, 2016.

    Federal Civil Penalties Adjustment Act Amendments
    Department of Veterans Affairs (“VA”), interim final rule, the Federal Civil Monetary Penalties Act of 1990, as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, sets forth a formula increasing the maximum statutory amounts for civil monetary penalties and requires federal agencies to give notice of the new maximum amounts by regulation. Accordingly, this document gives notice that the VA is increasing maximum civil monetary penalties from $10,000 to $21,563 for false loan guaranty certifications and from $5,500 to $10,781 for fraudulent claims or fraudulent statements in any VA program, 81 Fed. Reg. 40523. This interim final rule became effective June 22, 2016. Comments are due by August 22, 2016.

    Transactional Data Reporting
    The General Services Administration (GSA) is amending the General Services Administration Acquisition Regulation to include clauses that require vendors to report transactional data from orders placed against certain Federal Supply Schedule (FSS) contracts, Governmentwide Acquisition Contracts, and Governmentwide Indefinite-Delivery, Indefinite-Quantity Contracts. GSA will introduce a new Transactional Data Reporting clause to its FSS contracts in phases, beginning with a pilot for select Schedules and Special Item Numbers. Participating vendors will no longer be subject to the existing requirements for Commercial Sales Practices disclosures and Price Reductions clause basis of award monitoring, resulting in a substantial burden reduction, 81 Fed. Reg. 41104. This rule became effective June 23, 2016.

  • June 17, 2016

    DEPARTMENT OF LABOR

    • DOL Issues Final Rule on Discrimination on the Basis of Sex

    This week's report follows, click here if you would like to download a copy.

    DEPARTMENT OF LABOR

    DOL Issues Final Rule on Discrimination on the Basis of Sex
    The U.S. Department of Labor's Office of Federal Contract Compliance Programs has published this final rule to detail obligations that covered federal government contractors, subcontractors, federally-assisted construction contractors, and subcontractors must meet under Executive Order 11246, as amended, to ensure nondiscrimination in employment on the basis of sex, and to take affirmative action to ensure that applicants and employees are treated without regard to their sex  This rule substantially revises the existing Sex Discrimination Guidelines. The provisions in this final rule articulate well-established case law and/or applicable requirements from other federal agencies and, therefore, the requirements for affected entities are largely unchanged by this rule, 81 Fed. Reg. 39108. These regulations are effective August 15, 2016. 

  • June 10, 2016

    GOVERNMENT CONTRACTS

    • OMB Issues Final Guidance for Category Management
    • Amendments Proposed for 2017 NDAA
    • SBA Releases Semiannual Regulatory Agenda

    This week's report follows, click here if you would like to download a copy.

    GOVERNMENT CONTRACTS

    OMB Issues Final Guidance for Category Management
    Final guidance from the Office of Management and Budget (OMB) last week has accelerated the push for government-wide consolidation of acquisitions for software licenses. Part of the so-called “category management” initiative, the government’s goal is to eliminate redundancy in software licenses and make the buying and managing of software management more efficient and unified by grouping similar products into categories. OMB’s guidance creates an “Enterprise Software Category Team” that will be responsible for the software acquisition category across government.  The aim is to promote model software agreements and more government-wide deals, to eliminate the fragmented way the government currently procures software. Federal agencies now have target dates later this summer and this fall to appoint a responsible software manager to oversee commercial software agreements and licenses and to inventory the agency’s software. Starting November 30th, agencies will have to make quarterly reports to OMB on their cost savings from improved software license management.

    Amendments Proposed for 2017 NDAA
    On May 26, Delaware Senator Tom Carper proposed several amendments to S. 2943, the 2017 National Defense Authorization Act.  Section 829K, if adopted, would allow competition for prices at the task order level instead of at the contract level.  Section 829N would require OMB to advise executive agencies with their implementation of the category management initiative.  Click here for more information.

    SBA Releases Semiannual Regulatory Agenda
    On June 9, The Small Business Administration (SBA) released its semiannual list of current and projected rulemakings, as well as completed SBA actions.  SBA hopes that the agenda would enable the public to be more aware of, and participate in, SBA’s regulatory activity.  Click here to view the list.

  • June 3, 2016

    GOVERNMENT CONTRACTS

    • Small Business Government Contracting and National Defense Authorization Act of 2013

    This week's report follows, click here if you would like to download a copy.

    GOVERNMENT CONTRACTS

    Small Business Government Contracting and National Defense Authorization Act of 2013
    This final rule amends the U.S. Small Business Administration's (SBA or Agency) regulations to implement provisions of the National Defense Authorization Act of 2013, which pertains to performance requirements applicable to small business and socioeconomic program set-aside contracts and small business subcontracting.  This rule also amends SBA's regulations concerning the nonmanufacturer rule and affiliation rules.  Further, this rule allows a joint venture to qualify as small for any government procurement as long as each partner to the joint venture qualifies individually as small under the size standard corresponding to the NAICS code assigned in the solicitation, 81 Fed. Reg. 34243.  This rule is effective on June 30, 2016. 

    SBA issued this rule after considering all comments provided in the rulemaking and, while we are still reviewing the rule in more detail, we are pleased that the rule accounts for concerns raised during the rulemaking process and is not as onerous as the proposed rule.  Also on May 31, we posted a blog article by Jon Williams and Pam Mazza, which has further details and highlights from the final rule.

  • May 27, 2016

    GOVERNMENT CONTRACTS

    • Debt Refinancing in 504 Loan Program
    • Small Business Size Standards

    This week's report follows, click here if you would like to download a copy.

    GOVERNMENT CONTRACTS

    Debt Refinancing in 504 Loan Program
    The Small Business Administration has issued an interim final rule that implements Section 521 of Division E, the Consolidated Appropriations Act, 2016, which authorizes projects approved for financing under Title V of the Small Business Investment Act to include the refinancing of qualified debt, 81 Fed. Reg. 33123.  Comments are due by July 25, 2016 and the rule is effective June 24, 2016. 

    Small Business Size Standards
    The Small Business Administration (SBA) hereby gives notice of its intended application, and interpretation, of the interaffiliate transactions exclusion from annual receipts set forth in its Small Business Size Regulations.  SBA will apply the exclusion to properly documented transactions between a concern and its domestic or foreign affiliates, regardless of the type of relationship that resulted in the finding of affiliation, 81 Fed. Reg. 32635.  This policy statement is effective May 24, 2016 and comments are due by July 25, 2016.

  • May 20, 2016

    LABOR AND EMPLOYMENT

    • Overtime Final Rule

    GOVERNMENT CONTRACTS

    • Simplified Acquisition Threshold for Overseas Acquisitions in Support of Humanitarian or Peacekeeping Operations
    • Basic Safeguarding of Contractor Information Systems
    • Improvement in Design-Build Construction Process

    SMALL BUSINESS

    • Small Entity Compliance Guide
    • Civil Penalties Inflation Adjustments

    LABOR AND EMPLOYMENT

    Overtime Final Rule
    The Department of Labor issued its final overtime rule which updates the salary level required for the executive, administrative, and professional (“white collar”) exemption to ensure that the Fair Labor Standards Act’s intended overtime protections are fully implemented.  The Final Rule focuses primarily on updating the salary and compensation levels needed for executive, administrative, and professional workers to be exempt.  Specifically, the Final Rule: (1) sets the standard salary level at the 40th percentile of earnings of full-time salaried workers in the lowest-wage Census Region, currently the South, which is $913 per week or $47,476 annually for a full-year worker; (2) sets the total annual compensation requirement for highly compensated employees subject to a minimal duties test to the annual equivalent of the 90th percentile of full-time salaried workers nationally, which is $134,004; and (3) establishes a mechanism for automatically updating the salary and compensation levels every three years to maintain the levels at the above percentiles and to ensure that they continue to provide useful and effective tests for exemption.

    Additionally, the Final Rule amends the salary basis test to allow employers to use nondiscretionary bonuses and incentive payments (including commissions) to satisfy up to 10 percent of the new standard salary level.  The final rule is scheduled to be published on May 23, 2016.  Follow this link for the Fed. Reg. Pre-Publication.  The final rule is effective December 1, 2016.

    PilieroMazza is offering a webinar on June 2, 2016 at 2:00 p.m. and will provide an overview of the Fair Labor Standards Act, including the new rules, and compliance strategies.  More Information.


    GOVERNMENT CONTRACTS

    Simplified Acquisition Threshold for Overseas Acquisitions in Support of Humanitarian or Peacekeeping Operations
    DoD, GSA, and NASA are issuing a final rule to amend the Federal Acquisition Regulation to implement a section of U.S. Code which establishes a higher simplified acquisition threshold for overseas acquisitions in support of humanitarian or peacekeeping operations, 81 Fed. Reg. 30438.  The rule is effective June 15, 2016. 


    Basic Safeguarding of Contractor Information Systems
    DoD, GSA, and NASA are issuing a final rule amending the Federal Acquisition Regulation (FAR) to add a new subpart and contract clause for the basic safeguarding of contractor information systems that process, store or transmit Federal contract information. The clause does not relieve the contractor of any other specific safeguarding requirement specified by Federal agencies and departments as it relates to covered contractor information systems generally or other Federal requirements for safeguarding Controlled Unclassified Information (CUI) as established by Executive Order.  Systems that contain classified information, or CUI such as personally identifiable information, require more than the basic level of protection, 81 Fed. Reg. 30439.  The rule is effective June 15, 2016. 

    Improvement in Design-Build Construction Process
    DoD, GSA, and NASA are issuing a final rule amending the Federal Acquisition Regulation to implement section 814 of the National Defense Authorization Act for Fiscal Year 2015 that requires the head of the contracting activity to approve any determinations to select more than five offerors to submit phase-two proposals for a two-phase design- build construction acquisition that is valued at greater than $4 million, 81 Fed. Reg. 30447.  The rule is effective June 15, 2016.

    SMALL BUSINESS

    Small Entity Compliance Guide
    The Small Entity Compliance Guide has been prepared in accordance with section 212 of the Small Business Regulatory Enforcement Fairness Act of 1996.  It consists of a summary of the rules appearing in Federal Acquisition Circular 2005-88, which amends the Federal Acquisition Regulation (FAC).  An asterisk (*) next to a rule indicates that a regulatory flexibility analysis has been prepared. Interested parties may obtain further information regarding these rules by referring to FAC 2005-88, 81 Fed. Reg. 30449.   

    Civil Penalties Inflation Adjustments
    The Small Business Administration (“SBA”) is amending its regulations, as required by the Federal Civil Penalties Inflation Adjustment Act, to adjust, for inflation, the amount of certain civil monetary penalties that are within the jurisdiction of the agency, 81 Fed. Reg. 31489.  Comments are due on, or before, July 18, 2016 and the rule is effective on August 1, 2016.

  • May 13, 2016
    • DFARS: Multiyear Contract Requirements
    • Administrative Cost to Issue and Administer a Contract

    DEPARTMENT OF LABOR

    • Combating Trafficking in Persons – Definition of ‘‘Recruitment Fees’’
    • Improving Tracking of Workplace Injuries and Illnesses

    This week's report follows, click here if you would like to download a copy.

    GOVERNMENT CONTRACTS

    DFARS: Multiyear Contract Requirements

    DOD issued a final rule amending the Defense Federal Acquisition Regulation Supplement to implement a section of the National Defense Authorization Act for Fiscal Year 2015 and a section of the Department of Defense Appropriations Act, 2015, which addresses various requirements for multiyear contracts, 81 Fed. Reg. 28730. The final rule became effective on May 10, 2016. 

    Administrative Cost to Issue and Administer a Contract

    DOD, GSA, and NASA are proposing to amend the Federal Acquisition Regulation to revise the estimated administrative cost to award and administer a contract, for the purpose of evaluating bids for multiple awards, 81 Fed. Reg. 29514. Comments are due by July 11, 2016. 

    DEPARTMENT OF LABOR

    Combating Trafficking in Persons – Definition of ‘‘Recruitment Fees’’

    DOD, GSA, and NASA are proposing to amend the Federal Acquisition Regulation (“FAR”) to provide a definition of “recruitment fees.”  The FAR policy on combating trafficking in persons prohibits contractors from charging employees recruitment fees, in accordance with the Executive Order entitled “Strengthening Protections Against Trafficking in Persons in Federal Contracts,” 81 Fed. Reg. 29244. Comments are due by July 11, 2016.

    Improving Tracking of Workplace Injuries and Illnesses

    OSHA issued a final rule revising its Recording and Reporting Occupational Injuries and Illnesses regulation to require employers in certain industries to electronically submit injury and illness data. The final rule requires establishments with 250 or more employees to electronically submit information to OSHA annually. Second, the final rule requires establishments with 20 or more employees, but fewer than 250 employees, in certain designated industries, to electronically submit information to OSHA or OSHA's designee annually. Third, the final rule requires, upon notification, employers to electronically submit information to OSHA or OSHA's designee. OSHA intends to post the data from these submissions on a publicly accessible web site. The final rule also amends OSHA's recordkeeping regulation to update requirements on how employers inform employees to report work-related injuries and illnesses to their employer, 81 Fed. Reg. 29624. This final rule will become effective on January 1, 2017, except for sections 1904.35 and 1904.36, which will become effective on August 10, 2016. 

  • April 22, 2016

    DEPARTMENT OF LABOR

    • Procedures for Handling Retaliation Complaints

    GOVERNMENT CONTRACTS

    • GAO Proposes Rule to Create New Electronic Filing System and Fee

    This week's report follows, click here if you would like to download a copy.

    DEPARTMENT OF LABOR

    Procedures for Handling Retaliation Complaints

    This rule establishes the final procedures and time frames for the handling of retaliation or whistleblower complaints under FDA Food Safety Modernization Act (FSMA), including procedures and time frames for employee complaints to the Occupational Safety and Health Administration, investigations by OSHA, appeals of OSHA determinations to an administrative law judge (ALJ) for a hearing de novo, hearings by ALJs, review of ALJ decisions by the Administrative Review Board (ARB) (acting on behalf of the Secretary of Labor), and judicial review of the secretary's final decision, 81 Fed. Reg. 22530. This final rule became effective on April 18, 2016.

    GOVERNMENT CONTRACTS

    GAO Proposes Rule to Create New Electronic Filing System and Fee

    The Government Accountability Office (GAO) is proposing to amend its Bid Protest Regulations, to implement the requirements in Sec. 1501 of the Consolidated Appropriations Act for Fiscal Year 2014, in accordance with the Competition in Contracting Act of 1984, and to make administrative changes to reflect current practice and to streamline the bid protest process. The proposed amendments implement the legislation’s direction to establish, and operate, an electronic filing and document dissemination system for the filing of bid protests with GAO and to implement a bid protest filing fee, to be paid when a protester initiates a protest action, 81 Fed. Reg. 22197. Comments are due by May 16, 2016.

  • April 8, 2016

    SMALL BUSINESS

    • Clauses With Alternates—Small Business Programs

    GOVERNMENT CONTRACTS

    • Prohibition on Use of Any Cost-Plus System

    This week's report follows, click here if you would like to download a copy.

    SMALL BUSINESS

    Clauses With Alternates—Small Business Programs

    The Department of Defense (DOD) issued a final rule amending DFARS to clarify clauses and their prescriptions for small business programs and to create basic and alternate clauses structured in a manner to facilitate use of automated contract writing systems. This final rule provides the basic clause at 252.219-7003, Small Business Subcontracting Plan in full text as well as the alternate to the basic clause in full text, instead of only reflecting the paragraphs that are different. The clause at DFARS 252.219-7010, now titled “Notification of Competition Limited to Eligible 8(a) Concerns—Partnership Agreement” is modified to incorporate FAR clause 52.219-18 and its two alternates into the existing clause at DFARS 252.219-7010, 81 Fed. Reg. 17045. The rule became effective March 25, 2016.

    GOVERNMENT CONTRACTS

    Prohibition on Use of Any Cost-Plus System

    DOD is proposing to amend DFARS to implement a section of the National Defense Authorization Act for Fiscal Year 2012 that amended title 10 of the United States Code by prohibiting any form of cost-plus contracting for military construction projects or military family housing projects, 81 Fed. Reg. 17050.  Comments on the proposed rule are due by May 24, 2016.

     
  • March 25, 2016

    DEPARTMENT OF LABOR

    • Interpretation of the “Advice” Exemption

    This week's report follows, click here if you would like to download a copy.

    DEPARTMENT OF LABOR

    Interpretation of the “Advice” Exemption

    The Office of Labor-Management Standards of the Department of Labor (Department') is revising the Form LM-20 Agreement, Activities Report and the Form LM-10 Employer Report in response to its June 21, 2011 Notice of Proposed Rulemaking (NPRM). In the NPRM, the Department proposed to revise its interpretation of the advice exemption in section 203(c) of the Labor-Management Reporting and Disclosure Act (LMRDA) to better effectuate the requirement that employers and their labor relations consultants report activities undertaken with an object, directly or indirectly, to persuade employees about how to exercise their rights to union representation and collective bargaining.

    The final rule adopts the proposed rule, with modifications, and provides increased transparency to workers without imposing any restraints on the content, timing, or method by which an employer chooses to make known to its employees its position on matters relating to union representation or collective bargaining. The final rule also maintains the LMRDA's section 203(c) advice exemption and the traditional privileges and disclosure requirements associated with the attorney-client relationship. Additionally, with this rule, the Department requires that Forms LM-10 and LM-20 be filed electronically, 81 Fed. Reg. 15924. This final rule is effective on April 25, 2016 and will be applicable to arrangements and agreements, as well as payments (including reimbursed expenses), made on or after July 1, 2016. 

  • March 18, 2016

    DEPARTMENT OF LABOR

    • Establishing Paid Sick Leave for Federal Contractors
    • Procedures for Handling Retaliation Complaints under MAP-21
    • Procedures for Handling Retaliation Complaints under the Consumer Financial Protection Act of 2010

    This week's report follows, click here if you would like to download a copy.

    DEPARTMENT OF LABOR

    Establishing Paid Sick Leave for Federal Contractors

    The Department of Labor, Wage and Hour Division, issued a proposed rule extending the comment period for filing written comments on the proposed rulemaking: Establishing Paid Sick Leave for Federal Contractors from March 28, 2016 until April 12, 2016. The Notice of Proposed Rulemaking was published in the Federal Register on February 25, 2016, 81 Fed. Reg. 13306. Comments must be received by 11:59 p.m. on April 12, 2016. 

    Procedures for Handling Retaliation Complaints under MAP-21

    The Department of Labor has provided the interim final text of the regulations governing the employee protection (retaliation or whistleblower) provisions of section 31307 of the Moving Ahead for Progress in the 21st Century Act (MAP-21 or the Act). This rule establishes procedures and time frames for the handling of retaliation complaints under MAP- 21, including procedures and time frames for employee complaints to the Occupational Safety and Health Administration (OSHA), investigations by OSHA, appeals of OSHA determinations to an administrative law judge (ALJ) for a hearing de novo, hearings by ALJs, review of ALJ decisions by the Administrative Review Board (ARB) (acting on behalf of the Secretary of Labor) and judicial review of the Secretary's final decision. It also sets forth the Secretary's interpretations of the MAP-21 whistleblower provision on certain matters, 81 Fed. Reg. 13976. This interim final rule is effective on March 16, 2016. Comments and additional materials are due on, or before, by May 16, 2016. 

    Procedures for Handling Retaliation Complaints under the Consumer Financial Protection Act of 2010

    The Department of Labor has establishes the final procedures and time frames for the handling of retaliation complaints under CFPA, including procedures and timeframes for employee complaints to the Occupational Safety and Health Administration (OSHA), investigations by OSHA, appeals of OSHA determinations to an administrative law judge (ALJ) for a hearing de novo, hearings by ALJs, review of ALJ decisions by the Administrative Review Board (ARB) (acting on behalf of the Secretary of Labor) and judicial review of the Secretary of Labor's final decision, 81 Fed. Reg. 14374. The final rule is effective March 17, 2016. 

  • March 11, 2016

    GOVERNMENT CONTRACTS

    • Establishing Paid Sick Leave for Federal Contractors

    This week's report follows, click here if you would like to download a copy.

    GOVERNMENT CONTRACTS

    Information on Corporate Contractor Performance and Integrity

    DOD, GSA, and NASA issued a final rule amending the FAR to implement section 852 of the NDAA for Fiscal Year 2013 to include, in the Federal Awardee Performance and Integrity Information System, to the extent practicable, identification of any immediate owner or subsidiary, and all predecessors of an offeror that held a Federal contract or grant within the last three years. The objective is to provide a more comprehensive understanding of the performance and integrity of the corporation before awarding a federal contract, 81 Fed. Reg. 11988. This rule is effective April 6, 2016. 

  • March 4, 2016

    SMALL BUSINESS ADMINISTRATION

    • Underrepresented Industries Identified, Expansion, and Spending Goals Met for WOSB Program
    • SBIR/STTR Programs to be Reauthorized

    GOVERNMENT CONTRACTS

    • Establishing Paid Sick Leave for Federal Contractors

    This week's report follows, click here if you would like to download a copy.

    SMALL BUSINESS ADMINISTRATION

    Underrepresented Industries Identified, Expansion, and Spending Goals Met for WOSB Program

    On March 3, 2016, the U.S. Small Business Administration (SBA) announced the results of a study that identified industries in which women-owned small businesses (WOSBs) were underrepresented in federal contracting in connection with the Women-Owned Small Business Federal Contract Program (WOSB Program), 81 Fed. Reg. 11340. The study was conducted as part of a requirement within Section 825 of the National Defense Authorization Act of 2015, of which SBA had to comply with to carry out the program. The designations of industries contained in this notice apply to all solicitations issued on or after the effective date. SBA also published updated NAICS code lists for EDWOSB and WOSB set-aside and sole source contracts, which included over 100 more eligible six-digit NAICS codes, including 237310, Highway, Street, and Bridge Construction, 237990, Other Heavy and Civil Engineering Construction, and 562910, Remediation Services, among others.

    The results of the study comes on the heels of an SBA announcement on March 2, 2016 that revealed for the first time, federal government spending in FY 2015 met the 5 percent spending goal for WOSBs. According to the SBA, 5.05 percent, or $17.8 billion of all federal small business eligible contracting dollars, were awarded to WOSBs.

    SBIR/STTR Programs to be Reauthorized

    On March 2, 2016, Steve Chabot (R-OH), Chairman of the House Committee on Small Business, announced at a hearing that he will begin the process for reauthorizing the Small Business Innovation Research (SBIR) and Small Business Technology Transfer (STTR) programs—something the committee believes “would give stability and predictability to thousands of American entrepreneurs.” The programs were set to expire in 2017. Click here to read the news release.

    GOVERNMENT CONTRACTS

    Establishing Paid Sick Leave for Federal Contractors

    The Department of Labor is proposing regulations to implement Executive Order 13706–Establishing Paid Sick Leave for Federal Contractors (the Order), which requires certain parties that contract with the Federal Government to provide their employees with up to seven days of paid sick leave annually, including paid leave allowing for family care. The Order directs the Secretary of Labor to issue regulations by September 30, 2016 to implement the Order's requirements. This proposed rule defines terms used in the regulatory text, describes the categories of contracts and employees the Order covers, excludes from coverage, sets forth requirements and restrictions governing the accrual and use of paid sick leave, and prohibits interference with, or discrimination for, the exercise of rights under the Order. It also describes the obligations of contracting agencies, the Department of Labor, and contractors under the Order, and it establishes the standards and procedures for complaints, investigations, remedies, and administrative enforcement proceedings related to alleged violations of the Order, 81 Fed. Reg. 9592. Comments are due March 28, 2016. 

     
  • February 5, 2016
    • Small Business Investment Company Program

    Click here if you would like to download a copy.

    SMALL BUSINESS ADMINISTRATION

    Small Business Investment Company Program

    SBA proposed a rule defining a new class of small business investment companies (SBICs) that will seek to generate positive and measurable social impact, in addition to financial return. This proposed rule sets forth regulations applicable to Impact SBICs with respect to licensing, leverage eligibility, fees, reporting, and compliance requirements, 81 Fed. Reg. 5666. Comments are due by March 4, 2016.

  • January 29, 2016

    SMALL BUSINESS ADMINISTRATION

    • Employee-Based Size Standards in Wholesale Trade and Retail Trade
    • Small Business Size Standards: Inflation Adjustment to Monetary-Based Size Standards
    • Industries with Employee-Based Size Standards Not Part of Manufacturing, Wholesale Trade, or Retail Trade
    • Small Business Size Standards for Manufacturing

    DEPARTMENT OF LABOR

    • Implementation of the Nondiscrimination and Equal Opportunity Provisions of the Workforce Innovation and Opportunity Act

    This week's report follows, click here if you would like to download a copy.

    SMALL BUSINESS ADMINISTRATION

    Employee Based Size Standards in Wholesale Trade and Retail Trade

    The U.S. Small Business Administration (SBA or Agency) increased 47 small business size standards based on the number of employees.  These increases affect 46 industries in North American Industry Classification System (NAICS) Sector 42, Wholesale Trade, and one industry in NAICS Sector 44-45, Retail Trade.  SBA retained the size standards for the remaining industries in those sectors and the 500 employee size standard for the federal government's procurement of supplies under the non-manufacturer rule.  The revisions adopted in this rule primarily affect eligibility for SBA's financial assistance programs, and have no impact on federal procurement programs, 81 CFR 3941.  This rule is effective February 26, 2016.

    Small Business Size Standards: Inflation Adjustment to Monetary-Based Size Standards

    This rule finalized, without change, the U.S. Small Business Administration's (SBA) June 12, 2014 interim final rule that adjusted monetary small business size standards (i.e., receipts, assets, net worth, and net income) for inflation that has occurred since the last inflation adjustment in 2008.  Specifically, the interim final rule increased all industry-specific monetary small business size standards by 8.73 percent, except the $750,000 receipts-based size standard for agricultural enterprises established by the Small Business Act.  The interim final rule also increased, by the same rate, the tangible net worth and net income-based alternative size standard for the Small Business Investment Company Program, as well as receipts-based size standards for Sales of Government Property (Other Than Manufacturing) and Stockpile Purchases, 81 CFR 3949.  This rule became effective January 25, 2016.

    Industries with Employee-Based Size Standards Not Part of Manufacturing,
    Wholesale Trade, or Retail Trade

    The U.S. Small Business Administration (SBA) has modified 36 employee-based small business size standards for industries and sub-industries (“exceptions”) in SBA’s table of size standards that are not part of North American Industry Classification System (NAICS) Sector 31-33 (Manufacturing), Sector 42 (Wholesale Trade), or Sector 44-45 (Retail Trade).

    Specifically, SBA adopted 750 employees as the size standard for the ERS exception under NAICS 562910 instead of its proposed increase from 500 employees to 1,250 employees.  In addition, SBA maintained the Information Technology Value Added Resellers (ITVAR) exception under NAICS 541519 (Other Computer Related Services) and kept the 150 employee size standard; however, it amended Footnote 18 to SBA's table of size standards by adding the requirement that the supply (i.e. computer hardware and software) component of small business set-aside ITVAR contracts must comply with the nonmanufacturing performance requirements or non-manufacturer rule (NMR).

    SBA also decreased the size standards from 500 employees to 250 employees for three industries, namely NAICS 212113 (Anthracite Mining), NAICS 212222 (Silver Ore Mining), and NAICS 212291 (Uranium-Radium-Vanadium Ore Mining) and eliminated the Offshore Marine Air Transportation Services exception under NAICS 481211 and 481212, as well as the Offshore Marine Services exception under NAICS Subsector 483 and their $30.5 million receipts-based size standard.  This change includes removing Footnote 15 from the table of size standards, 81 CFR 4436.  This rule is effective February 26, 2016. 

    Small Business Size Standards for Manufacturing

    The U.S. Small Business Administration (SBA) increased small business size standards for 209 industries in North American Industry Classification System (NAICS) Sector 31-33, Manufacturing.  SBA also modified the size standard for NAICS 324110, Petroleum Refiners, by increasing the refining capacity component of the size standard to 200,000 barrels per calendar day for businesses that are primarily engaged in petroleum refining and by eliminating the requirement that 90 percent of the output to be delivered be refined by the successful bidder from either crude oil or bona fide feedstocks.  SBA also updated Footnote 5 to NAICS 326211 to reflect the current Census Product Classification Codes 3262111 and 3262113, 81 CFR 4469.   This rule is effective February 26, 2016.

    DEPARTMENT OF LABOR

    Implementation of the Nondiscrimination and Equal Opportunity Provisions of the Workforce Innovation and Opportunity Act

    The U.S. Department of Labor (Department) is proposing to issue nondiscrimination and equal opportunity regulations, replacing its regulation which implemented Section 188 of the Workforce Innovation and Opportunity Act (WIOA).  Section 188 of WIOA prohibits the exclusion of an individual from participation in, denial of the benefits of, discrimination in, or denial of employment in the administration of, or in connection with, any programs and activities funded or otherwise financially assisted in whole or in part under Title I of WIOA because of race, color, religion, sex, national origin, age, disability, political affiliation or belief, and for beneficiaries only, citizenship status, or participation in a program or activity that receives financial assistance under Title I of WIOA.

    These proposed regulations would update the nondiscrimination and equal opportunity regulation consistent with current law and address its application to current workforce development and workplace practices and issues.  This notice of proposed rule revises the final rule issued in July 2015, and generally carries over the policies and procedures found in Department regulations, 81 CFR 4494.  Comments are due by March 28, 2016.

  • January 22, 2016

    GOVERNMENT CONTRACTS

    • Payment of Subcontractors

    SMALL BUSINESS ADMINISTRATION

    • Final Rule Adopted for Uniform Administrative Requirements and More

    This week's report follows, click here if you would like to download a copy.

    GOVERNMENT CONTRACTS

    Payment of Subcontractors

    DOD, GSA, and NASA are proposing to amend the Federal Acquisition Regulation to implement the section of the Small Business Jobs Act of 2010 that requires contractors to notify the contracting officer, in writing, if the contractor pays a reduced price to a small business subcontractor, or if the contractor's payment to a small business contractor is more than 90 days past due, 81 CFR 3087. Comments are due by March 21, 2016.

    SMALL BUSINESS ADMINISTRATION

    Final Rule Adopted for Uniform Administrative Requirements and More

    The U.S. Small Business Administration (SBA) adopt as a final rule—with one change—a joint interim final rule published with the Office of Management and Budget (OMB) for all federal award-making agencies that implemented guidance on uniform administrative requirements, cost principles, and audit requirements for federal awards (Uniform Guidance). This rule is necessary to incorporate into regulation and thus bring into effect the uniform huidance as required by OMB for the SBA, 81 CFR 1115. This rule is effective February 10, 2016.

  • January 8, 2016

    GOVERNMENT CONTRACTS

    • 2016 Adverse Effect Wage Rates
    • Removal of Requirement to File Direct-Pay Fee Agreements With the Office of the General Counsel
    • Network Penetration Reporting and Contracting for Cloud Services
    • Federal Acquisition Regulation; Sole Source Contracts for Women-Owned Small Businesses
    • Trade Agreements Thresholds
    • Federal Acquisition Regulation; Definition of ‘‘Multiple-Award Contract’’
    • Defense Contractors Performing Private Security Functions
    • Multiyear Contract Requirements

    SMALL BUSINESS ADMINISTRATION

    • Community Advantage Pilot Program
    • Interest Rates

    This week's report follows, click here if you would like to download a copy.

    GOVERNMENT CONTRACTS

    2016 Adverse Effect Wage Rates

    Effective December 22, 2015, the Employment and Training Administration of the Department of Labor (Department) announced the 2016 Adverse Effect Wage Rates (AEWRs) for the employment of temporary or seasonal nonimmigrant foreign workers (H-2A workers) to perform agricultural labor or services. The Department’s H–2A regulations provide that employers must pay their H–2A workers and workers in corresponding employment at least the highest of: (1) The AEWR; (2) the prevailing hourly wage rate; (3) the prevailing piece rate; (4) the agreed-upon collective bargaining wage rate, if applicable; or (5) the federal or state minimum wage rate, in effect at the time the work is performed, 80 CFR 79614

    Removal of Requirement To File Direct-Pay Fee Agreements With the Office of the General Counsel

    Effective December 29, 2015, the Department of Veterans Affairs (VA) amended its regulations concerning the payment of fees for representation by agents and attorneys in proceedings before the VA. Specifically, this rule removes the requirement that an agent or attorney file a direct-pay fee agreement with both the VA Office of the General Counsel and the agency of original jurisdiction. The intended effect of this final rule is to require that direct-pay fee agreements be submitted only to the agency of original jurisdiction, thereby eliminating duplicate filings by agents and attorneys, 80 CFR 81191

    Network Penetration Reporting and Contracting for Cloud Services

    Effective December 30, 2015, the DOD issued an interim rule amending the Defense Federal Acquisition Regulation Supplement to provide contractors with additional time to implement security requirements specified by a National Institute of Standards and Technology Special Publication, 80 CFR 81472. Comments are due by February 29, 2016.

    Federal Acquisition Regulation; Sole Source Contracts for Women-Owned Small Businesses

    Effective December 31, 2015, DOD, GSA, and NASA issued an interim rule amending the FAR to implement regulatory changes made by the SBA that provide for EDWOSB/WOSB sole source authority. Implementation of these sole source procedures in the FAR ensures that contracting officers now have the tools necessary to maximize federal procurement opportunities for WOSB concerns through sole source contract awards. In general, an award under the WOSB program may be pursued on a sole source basis when the contracting officer does not have a reasonable expectation, through market research, that two or more eligible EDWOSB or WOSB concerns will submit offers at a fair and reasonable price, but identifies one responsible EDWOSB or WOSB that can perform at a fair and reasonable price. The dollar thresholds for sole source awards are equal to or less than $6.5 million for manufacturing requirements and equal to or less than $4 million for all other requirements, including all options, 80 CFR 81888. Comments are due by February 29, 2016.

    Trade Agreements Thresholds

    Effective January 1, 2016, DOD, GSA, and NASA issued a final rule amending the FAR to incorporate revised thresholds for application of the World Trade Organization Government Procurement Agreement and the Free Trade Agreements as determined by the United States Trade Representative, 80 CFR 81894.

    Federal Acquisition Regulation; Definition of ‘‘Multiple-Award Contract’’

    Effective February 1, 2016, DOD, GSA, and NASA issued a final rule amending the FAR to define “multiple-award contract,” 80 CFR 81887.

    Defense Contractors Performing Private Security Functions

    The DOD is proposing to amend the DFARS to consolidate requirements applicable to DOD contracts for private security functions performed in designated areas outside the United States, make changes regarding applicability, and revise applicable quality assurance standards 80 CFR 81496. Comments are due by January 29, 2016.

    Multiyear Contract Requirements

    DOD is proposing to amend the DFARS to implement section 816 of the National Defense Authorization Act for Fiscal Year 2015 (“NDAA 2015”) and section 8010 of the Department of Defense Appropriations Act for FY 2015 (“DOD Appropriations Act 2015”).  Section 846 of the NDAA 2015 provides that a multiyear contract may not be entered into for a defense acquisition program that has been specifically authorized by law to be carried out using multiyear authority unless the Secretary of Defense certifies, in writing no later than 30 days before award of the contract, that certain conditions have been met. Section 8010 of the DOD Appropriations Act 2015, makes the following changes: (1) A multiyear contract may not be terminated without 30-day prior notification to the congressional defense committees; (2) A multiyear contract may not be entered into unless the head of the agency ensures that: (a) cancellation provisions in the contract do not include consideration of recurring manufacturing costs of the contractor associated with the production of unfunded units to be delivered under the contract; (b) the contract provides that payments to the contractor under the contract shall not be made in advance of incurred costs on funded units; and (c) the contract does not provide for a price adjustment based on a failure to award a follow-on contract, 80 CFR 81499. Comments are due by February 29, 2016.

    SMALL BUSINESS ADMINISTRATION

    Community Advantage Pilot Program

    Effective December 28, 2015, the Small Business Administration (“SBA”') issued a notice extending the term of the Community Advantage (“CA”) Pilot Program and laid out a plan to evaluate whether it should be made permanent, to improve the effectiveness of the program, to expand program eligibility to new organizations, and to revise other program requirements, including certain regulatory waivers. The CA Pilot Program increases SBA-guaranteed loans to small businesses in underserved areas. The CA Pilot Program will remain in effect until March 31, 2020, 80 CFR 80872. Comments are due by February 26, 2016.

    Interest Rates

    The Small Business Administration (“SBA”) publishes an interest rate called the optional “peg” rate on a quarterly basis. The “peg” rate is a weighted average cost of money to the government for maturities similar to the average SBA direct loan, and may be used as a base rate for guaranteed fluctuating interest rate SBA loans. For the January-March quarter of FY 2016 the rate will be 2.38 percent, 80 CFR 80441.