Weekly Update for Government Contractors and Commercial Businesses – January 3, 2025

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GOVERNMENT CONTRACTS
 
ITAR Registration Fees Increase, Preparing Government Contractors for Financial Impact and Registration Requirements, PilieroMazza Client Alert, Isaias “Cy” Alba, IV, Aaron A. Kor
On December 10, 2024, the U.S. State Department published a Final Rule, announcing an increase in registration fees with the Directorate of Defense Trade Controls (DDTC), as required by the International Traffic in Arms Regulations (ITAR).[1] With the January 9, 2025, effective date looming, PilieroMazza discusses ITAR’s increased registration fees, registration requirements, and potential discounts that government contractors should know now to prepare. Read more here.
 
SBA Update: Final Rule Significantly Changes Effect of Size/Status Recertifications, Alters M&A Landscape for Government Contractors, PilieroMazza Client Alert, Samuel S. Finnerty
As PilieroMazza outlined on December 17, 2024, the Small Business Administration (SBA) recently issued its highly-anticipated final rule (Rule) in response to its August 2024 proposed rule and the hundreds of public comments. The Rule significantly alters the size and socioeconomic status recertification obligations for government contractors and the effect of those recertifications. The Rule impacts eligibility for set-aside contracts, alters the landscape for mergers and acquisitions (M&A) in the government contracts industry, and could have other downstream consequences. Read more here.
 
SBA Update: Final Rule Makes Investing in 8(a) Firms Easier Than Ever!, PilieroMazza Client Alert, Antonio R. Franco, Meghan F. Leemon
As PilieroMazza has been reporting, the Small Business Administration (SBA) recently issued its much-anticipated final rule, which updates and clarifies many regulations that impact small businesses. The revised regulations impact not only small businesses but also firms in preferential procurement programs like the 8(a) Program and individuals and larger businesses that do business with these firms. Of these amendments to the regulations, there are three that loosen ownership restrictions on the minority owners in 8(a) firms and should be welcomed by 8(a) owners and their minority investment partners. PilieroMazza identifies these changes and analyzes how they are beneficial to both the majority and minority owners of 8(a) firms. Read more here.
 
But My Affiliates ARE Me! GAO Rules Agencies May Limit Use of Affiliate Experience and Past Performance, PilieroMazza Blog, Isaias “Cy” Alba, IV
On November 15, 2024, the Government Accountability Office (GAO) denied a protest where a mentor-protégé joint venture offeror attempted to use the past experience of a wholly owned subsidiary of the protégé member to satisfy a solicitation requirement. The requirement specified that joint ventures must submit a relevant qualifying project from either the protégé or the mentor-protégé joint venture itself. The AtVentures, LLC[1] protest reminds us to pay close attention to solicitation requirements and offers a different perspective when considering whether to spin-off a subsidiary. Read more here.
 
H.R.4467, DHS Border Services Contracts Review Act, Enacted
On December 16, H.R.4467 passed in the Senate. The House of Representatives sent the Bill to the President on December 23. The Bill was signed by the President and became law on December 23. This Bill was introduced to the House Committee on Homeland Security by Rep. Brecheen (R-OK-2) on July 6, 2023. This Bill requires the Department of Homeland Security (DHS) to assess contracts for covered services performed by contractor personnel along the U.S. land border with Mexico. DHS has to report to Congress active contracts of more than $50 million. The full text of the Enrolled Bill is available here.
 
Small Business Administration (SBA) Proposed Rule: Government Contracting: Subcontracting Program
On December 19, SBA published a proposed rule and request for comments regarding updates and revisions to its Small Business Subcontracting Program regulations to encourage faster payments to small business subcontractors and streamline the reporting process for prime contracts. This proposed rule will require prime contractors notify contracting officers in writing when it fails to make full or timely payments to the subcontractor within 30 days past due; require prime contractors cooperate with contracting officers to correct/mitigate this failure until payment is made in full to the subcontractor; and allow contracting officers to modify a prime contractor’s past performance for failure to make full or timely payments. Comments are due on or before February 18, 2025. Read more here.
 
The White House: Statement from President Joe Biden on H.R. 5009, Servicemember Quality of Life Improvement and National Defense Authorization Act (NDAA) for Fiscal Year (FY) 2025
On December 23, President Biden released a statement regarding the signing into law of the NDAA for FY 2025. In his statement, President Biden noted his support of the Bill’s benefits for military personnel, national defense, foreign affairs, and homeland security and noted his concerns with other provisions, particularly the provision preventing equal treatment of all persons regardless of their gender identity. Read more here.
 
Government Accountability Office (GAO) Report: Defense Contracting, DOD Is Taking Steps to Restrict Mandatory Arbitration, but Additional Action Needed
On December 23, GAO released a report finding that the Department of Defense correctly included clauses restricting arbitration in most contracts and advising that DOD assesses whether the restriction on mandatory arbitration clause is included in its existing contracts. Read more here.
 
Small Business Administration (SBA) Press Releases: 

• President Biden Signs Law to Deliver Funding to SBA to Reopen its Disaster Loan Program and Support Recovery in Communities across the Country. On December 21, SBA announced that President Bident signed the American Relief Act into law, which provides funding for the SBA’s Disaster Loan Program. With this funding, the SBA can process financial relief for small businesses impacted by Hurricanes Milton, Helene, and other natural disasters. Read more here.
• SBA Growth Accelerator Fund Competition (GAFC) to Accelerate Innovation-Driven Ecosystem Building with up to $9 Million in Awards. On December 19, SBA announced the launch of the 2025 GAFC for entrepreneur support organizations (ESOs) focused on innovation-driven startups and entrepreneurs in underserved regions, industries, and communities to launch, grow, and scale. The competition intends to strengthen ESO capacity, build connections, and foster collaboration to expand access to the innovation economy and boost entrepreneurial activity. Read more here.

H.R.5887, Government Service Delivery Improvement Act, Passed Senate & Sent to President
On December 21, H.R.5887 passed in the Senate. The House of Representatives sent the Bill to the President on December 27. This Bill was introduced to the House Committee on Oversight and Accountability by Rep. Khanna (D-CA-17) on October 3, 2023. If enacted, this bill will require certain government officials to be responsible for improving government service delivery (i.e., providing benefits or services to individuals, businesses, and organizations via agencies or programs). The full text of the Enrolled Bill is available here.
 
Biden to Close Federal Agencies on Jan. 9 to Honor Carter’s Legacy, Federal News Network
Biden signed an executive order to officially announce a National Day of Mourning and a one-day closure of federal agencies and departments. Federal agencies will be closed on Thursday, January 9, in honor of the passing of President Jimmy Carter, who died on December 29 at the age of 100. Read more here.
 
Here Are Key Acquisition Provisions in 2025 NDAA, Federal News Network
Several key provisions aimed at streamlining the acquisition process made their way into the 2025 defense policy bill President Joe Biden signed into law. The fiscal 2025 defense policy bill codifies the middle tier and software acquisition pathways into law and streamlines milestone A and B requirements. Read more here.
 
Yellen Says Extraordinary Measures to Avoid Default Will Begin as Soon as Jan. 14, The Hill
Treasury Secretary Janet Yellen suggested in a letter to Congress that the department doesn’t think the U.S. will need to take “extraordinary measures” on Jan. 2 to avoid defaulting on its obligations and instead expects that it will reach the new limit between Jan. 14 and 23. Read more here.
 
Biden Announces More Federal Help Ahead of Small Business Saturday, Griffon News
The White House announced the new measures to aid small and disadvantaged businesses, including expanding access to federal contracts, providing targeted technical assistance, and increasing transparency in government spending. The initiatives push to simplify access to the $700 billion allocated annually in federal contracts. Read more here.
 
Breaking Down Barriers: The Challenges of Federal Micro-Purchases for Small Businesses, Federal News Network
Navigating the federal contracting landscape can be a daunting experience for small businesses. Despite the innovative solutions they offer, many face significant obstacles when trying to engage with federal agencies, particularly in micro-purchases. Read more here.
 
Commerce Tightens Grip On State-Controlled Businesses, Law360
The U.S. Department of Commerce finalized a suite of changes enhancing its power to set duties on unfairly priced imports, including a bevy of new rules aimed at placing higher duties on companies that are effectively controlled by nonmarket economy governments. Read more here (subscription required). 
 
FTA Proposes Buy America Waiver For Electric Minibuses, Law360
The Federal Transit Administration has asked for public feedback on whether it should grant a temporary nonavailability waiver from domestic sourcing requirements for battery electric minibuses, saying it had received related requests from multiple transit operators. Read more here (subscription required).

PM WEBINAR: SBA’s Final Rule Is Here: Key Takeaways on Updates to HUBZone Program, Other Small Business Programs, and Various Small Business Matters, January 7, 2025, Meghan F. Leemon
 
TRAINING: Unlocking the Secrets of Debriefings, Government Evaluation of Proposals and Protests, January 9, 2025, Katherine B. Burrows, Eric Valle
 
TRAINING: Joint Ventures – A Roadmap for Small Business Government Contractors, January 15, 2025, Meghan F. Leemon, Aaron A. Kor
 
SEMINAR: Nuts, Bolts, and Beyond: To Be a Government Contractor, January 28, 2025, Eric Valle
 
TRAINING: Unlocking the Secrets of Debriefings, Government Evaluation of Proposals and Protests, February 5, 2025, Aaron A. Kor, Eric Valle
 
TRAINING: Joint Venture and Mentor-Protege Bidding Strategies, February 6, 2025, Peter B. Ford, Meghan F. Leemon
 
CONFERENCE: Subcontracting Essentials for 8(a) Contractors, February 12, 2025, Isaias “Cy” Alba, IV, Nichole D. Atallah, Meghan F. Leemon
 
TRAINING: Unlocking the Secrets of Debriefings, Government Evaluation of Proposals and Protests, March 6, 2025, Katherine B. Burrows, Eric Valle
 
TRAINING: Unlocking the Secrets of Debriefings, Government Evaluation of Proposals and Protests
March 13, 2025, Katherine B. Burrows, Eric Valle
 
 
BUSINESS & TRANSACTIONS / CORPORATE & ORGANIZATIONAL GOVERNANCE / GOVERNMENT CONTRACTS
 
Corporate Transparency Act, Part 7: Reporting Requirements Stayed (Again), Voluntary Reporting Allowed, PilieroMazza Client Alert, Meghan F. Leemon, Abigail “Abby” L. Baker, Cole R. Fox
In the latest twist regarding the Corporate Transparency Act (CTA), the U.S. Court of Appeals for the Fifth Circuit, on December 26, 2024, vacated its own stay of the nationwide preliminary injunction that halted the enforcement of the CTA. Thus, the CTA’s reporting requirements are not currently in effect, though voluntary reporting is allowed. See links here to Part 1, Part 2, Part 3, Part 4, Part 5, and Part 6 in this series. Read more here.

Corporate Transparency Act, Part 6: Reporting Requirements Back In Effect, Deadlines Looming, PilieroMazza Client Alert, Meghan F. Leemon, Abigail “Abby” L. Baker, Cole R. Fox
On December 23, 2024, the U.S. Court of Appeals for the Fifth Circuit granted a stay on the preliminary injunction that halted enforcement of the Corporate Transparency Act (CTA), pending resolution of the government’s appeal of the decision granting the injunction. Thus, the CTA’s reporting requirements are once again in effect, subject to FinCEN’s revised filing deadlines discussed here. Read more here.
 
 
LABOR & EMPLOYMENT
 
Unemployment Isn’t Recession-Ready — but It’s Getting Better, Says Acting Labor Secretary, NextGov/FCW
Julie Su, the acting Department of Labor secretary, has often been scrutinized for her role in California during the pandemic. She sat down with Nextgov/FCW to talk about unemployment four years later. Read more here.
 
Biden Signs off on a 2% Federal Pay Raise for Most Civilian Employees, Federal News Network
Most civilian federal employees are set to receive a 2% federal pay raise beginning in January, after President Joe Biden signed an executive order, finalizing the 2025 raise for the General Schedule. Read more here.

TRAINING: Labor Rules & Regulations: Federal Market Compliance, January 29, 2025, Nichole D. Atallah
 
CONFERENCE: Ins and Outs of the Service Contract Act for 8(a) Contractors, February 12, 2025, Nichole D. Atallah
 
TRAINING: Labor Rules & Regulations: Federal Market Compliance, February 26, 2025, Sarah L. Nash
 
 
CYBERSECURITY & DATA PRIVACY
 
H.R.7524, GSA Technology Accountability Act, Enacted
On December 16, H.R.7524 passed in the Senate. The House of Representatives sent the Bill to the President on December 23. The Bill was signed by the President and became law on December 23. This Bill was introduced to the House Committee on Oversight and Accountability by Rep. Sessions (R-TX-17) on March 5, 2024. This Bill requires the General Services Administration (GSA) to report to Congress on projects funded by the Federal Citizen Services Fund and the Acquisition Services Fund on information technology before expenditures are made. The full text of the Enrolled Bill is available here.
 
H.R.9566, Source Code Harmonization and Reuse in Information Technology Act (SHARE IT Act), Enacted
On December 17, H.R.9566 passed in the Senate. The House of Representatives sent the Bill to the President on December 23. The Bill was signed by the President and became law on December 23. This Bill was introduced to the House Committee on Oversight and Accountability by Rep. Langworthy (R-NY-23) on September 12, 2024. This Bill requires federal agencies to ensure that source code produced under an agency contract, funded exclusively by the federal government, or developed by federal employees as part of their official duties and certain technical components of the code are (1) owned by the agency, (2) stored at no less than one public or private repository, and (3) accessible to federal employees. Agency contracts for custom-development of software must acquire and exercise rights sufficient to allow government-wide access, sharing, use, and modification of any custom-developed code. The full text of the Enrolled Bill is available here.
 
Department of Defense (DOD) News Releases:

• DOD Reissues Nuclear Weapons Systems Surety Program Standards. On December 17, DOD announced that it reissued DOD Instruction 3150.02, “DoD Nuclear Weapons Systems Surety Program.” The reissuance is an important update to the Department’s four nuclear surety standards, to elevate and integrate nuclear weapon system risk management processes for surety and cybersecurity, and ensure U.S. nuclear weapons are safe, secure, and under positive control.  Read more here.
• DOD Releases Version 4.3 Update to Online Cyber Resilient Weapon Systems Body of Knowledge for Engineering Workforce. On December 16, DOD announced that it released Version 4.3 of the Online Cyber Resilient Weapon Systems Body of Knowledge (CRWS-BoK), a free resource designed to support the public and private sector workforces in designing, engineering, and safeguarding secure cyber resilient systems. Read more here.

Cybersecurity Response: Not Just an IT Issue but an Emergency Preparedness Priority, NextGov/FCW
Government and private sector organizations have begun to recognize that physical and virtual assets must be protected from cyber threats in the same way as IT. Read more here.
 
State Data Privacy Law Patchwork Expands by Eight States in 2025, Bloomberg Government 
Companies that handle consumer data must comply with eight new state privacy laws in 2025, further complicating the national array of various requirements they must follow. Five of those laws take effect in January in Delaware, Iowa, Nebraska, New Hampshire, and New Jersey. Tennessee, Minnesota, and Maryland come online later in the year. Twenty states overall have enacted broad data privacy protections that give residents more control over how businesses collect and use their data. Read more here (subscription required). 
 
Congress Approves 2025 NDAA with Important Cyber Provisions, NextGov/FCW
The must-pass fiscal year 2025 defense policy bill advanced out of the Senate to President Joe Biden’s desk with a list of cybersecurity measures focused on technology aid to foreign allies and cyber defense hardening at home. Left out was language that would have helped clarify the scope and reach of a controversial surveillance power that was renewed in April. Read more here.