Most contracting occurs where government lacks privity

February 5, 2015 by

Of the over $500 billion per year spent contracting for everything from computers to carriers, the vast majority of money ultimately awarded and performed by contractors happened without a contract directly from the government. Therefore, there is usually no business relationship (privity) between the government and the contractor doing work for its benefit.

How that can be? What’s going on?

In fact, while the government awards a prime contract for products and services, most often many of the prime’s deliverables from that contract will be subcontracted out to one or many large and small business firms.

Keep reading this article at: http://www.federaltimes.com/story/government/acquisition/blog/2015/01/28/government-subcontracting/22478955/

DoD seeks 10-year extension of small business mentoring program

February 2, 2015 by

The Defense Department intends to request a 10-year extension of a program that improves the ability of socioeconomically disadvantaged small businesses to compete for defense contracts, the program’s manager said yesterday.

The Small Business Mentor-Protege Program began in 1991 as a way to foster small businesses and improve technology transfer between the Defense Department and industry, Robert Stewart said in a DoD News interview.

Despite having been in existence for nearly 25 years, the program is still categorized as a pilot and must be reauthorized in a National Defense Authorization Act every few years, he said.

Stewart said that through regular outreach with industry representatives, his office has learned that the periodic reauthorizations give the impression that the program isn’t permanent. This has a chilling effect on participation — particularly as the reauthorization period approaches, he said.

“Whenever we’re about a year, year and a half out from an authorization — since it’s a pilot program and it’s still crafted in language as a pilot program — industry does what’s called a chilling-off,” Stewart said. From the perspective of a business owner, he said, “If I’m not sure something’s going to be reauthorized, I’m going to be less apt to put business development dollars into helping facilitate small business.”

Extending the program’s authorization period would provide stability, reassure industry and save the department money, he said.

How to Participate

Small businesses seeking to become prime contractors with the department first choose a mentor from one of the more than 50 larger companies participating in the program, he explained. Part of that selection process is ensuring that the strategic goals of the two companies align, Stewart noted.

“We try to put them in a position to be as successful as possible,” he said.

The larger company provides training and mentorship, and in exchange, receives credit toward their small business contracting goals, Stewart said. If the training is provided through a procurement technical assistance center, a small business development center, minority institution or a historically black college or university, they can claim up to four times the amount spent for credit toward their actual small business participation levels.

The agreements may not last longer than three years, and once an agreement is fulfilled, the small business graduates from the program and is able to serve as a prime contractor for DoD contracts.

“Now you have a small business who’s a prime contractor [and] whose overhead is significantly lower than your traditional government contractors,” Stewart said. “They can do the exact same work, sometimes faster, sometimes cheaper, oftentimes better than larger, more cumbersome agencies or entities.”

This is a win-win situation for industry and the Defense Department, Stewart said. Larger businesses now have a pool of capable, responsive partners with which to team up and seek defense contracts, while small businesses gain better-trained employees and, by piggybacking on the capabilities of their larger partner, they can compete for contracts that they otherwise wouldn’t have been able to support.

“It works out in a lot of areas,” he said. “We’re helping grow the manufacturing-industrial base by ensuring that we’re going through our [procurement technical assistance centers], small business development centers, minority institutions and [Historically Black Colleges and Universities], but also identifying tech transfer companies that allow the United States government to be able to fight the threat that the Googles, the Amazons, the Microsofts, the Oracles face every day.”

The Way Ahead

“One of the things that we’re looking for going forward … [is that] we want to focus on the evaluation and criteria and factors to drive contracting commands across the DoD enterprise to utilize Mentor-Protege as a way to meet those subcontracting small business participation goals,” Stewart said.

To accomplish this, he said, the Office of Small Business Programs plans to develop a defense acquisition regulation that would give participants in the Mentor-Protege Program greater weight during the bid solicitation process.

“You’re going to get credit toward being already involved in DoD — you know DoD’s business, you’ve already got an established working relationship with the DoD,” Stewart said.

Source: http://www.defense.gov/news/newsarticle.aspx?id=128014

Tight budgets, terrorism and task orders: What’s next for government contracting

January 30, 2015 by

If you ask government contractors to talk about what affects their business, it takes less than a minute before you hear the familiar refrains of budget cuts, sequestration, and political gridlock. Those issues may be at the top of everyone’s minds now, but for those who do business with the government, a long-term vision is essential for surviving Washington’s ongoing crises.

Capital Business asked local executives to take a step back and name one issue that will be a game-changer for contracting over the next decade.

From the threat of terrorism to the inexperience of a younger government workforce, here’s what they said:

Kenneth Asbury – Chief executive of CACI International, a large services contractor

Now, more than almost any time I can recall, the world is a very dangerous place in many dimensions.

Keep reading this article at: http://www.washingtonpost.com/business/capitalbusiness/tight-budgets-terrorism-and-task-orders-whats-next-for-government-contracting/2015/01/23/b78d5884-a0ca-11e4-b146-577832eafcb4_story.html

Survey: Federal procurement culture impedes innovation

January 29, 2015 by

Signs of technology malaise can be seen across the federal government. The Pentagon has warned that it is losing its military technological superiority as other countries rush to develop advanced conventional and cyber weapons to counter U.S. armaments and satellites. The U.S. intelligence community worries that technologies it used to own almost exclusively — like high-resolution satellite imagery, encryption and biometrics — are progressing far more rapidly in the civilian world.

These appear to be symptoms of a widespread ailment that affects government contracting, say procurement experts. “Agency acquisition professionals are not focused on innovation,” says a new report by the consulting firm Grant Thornton LLP and the Professional Services Council, a trade group that represents government contractors.

The report is based on a survey of 51 acquisition executives. Asked to rank issues based on their importance, innovation placed low. It was rated as the fifth of six objectives of a “sound acquisition process” even though senior administration officials have been emphatic about the need for agencies to become more innovative.

“Innovation is the word of the day,” and yet the bulk of the federal acquisition community has neither the incentives nor the skills to change the status quo and attract innovative vendors, says Stan Soloway, president and CEO of the Professional Services Council.

Keep reading this article at: http://www.nationaldefensemagazine.org/blog/Lists/Posts/Post.aspx?ID=1719

Small companies to take on bigger contracts under SBA proposed rule

January 28, 2015 by

A new rule proposed by the Small Business Administration could help small companies team up to go after larger government contracts.

“Projects in the federal procurement arena have gotten larger, more complex, and it’s become more difficult for individual small businesses to pursue these types of projects,” John Shoraka, associate administrator of government contracting and business at SBA, said on the Federal Drive with Tom Temin Tuesday.

SBA issued the proposed rule on Dec. 29, nearly a year after Congress passed the fiscal 2013 Defense Authorization bill changing certain provisions in the Small Business Act.

Keep reading this article at: http://www.federalnewsradio.com/522/3784191/Small-companies-to-take-on-bigger-contracts-under-SBA-proposed-rule

Small businesses gain ground in contracting — here’s why

January 23, 2015 by

At the end of the year, Federal News Radio’s “Off the Shelf” explored “What’s it like in the GWAC world?” Featuring Rob Coen, acting director of NIH’s GWAC program, and Joyce Woytek, NASA’s SEWP program manager, the interview covered the current and future state of GWACs.

As they shared the increased success of small businesses, three approaches stood out: more stringent requirements for vetting small businesses up front; inclusion of all five socio-economic categories in the contracts; and the use of on-ramps. At Deltek we are seeing – or expect to see – these approaches incorporated as part of several highly anticipated programs to be solicited this year.

Increased Vetting

Asked what’s driving the success of small business awards on his programs, Mr. Coen explained that spending more time upfront vetting small businesses – which must meet more stringent requirements – has resulted in increased comfort for government buyers. In turn, they have seen more high-dollar value/complex procurements for set-asides.

Keep reading this article at: http://www.federaltimes.com/story/government/acquisition/blog/2015/01/16/small-business-success/21859669/

About the author: Jennifer Sakole is the principal analyst for Federal Information Solutions at Deltek.

Small business contracting opportunities continue to expand

January 22, 2015 by

New and exciting small business contracting opportunities are out there – if you know where to look.

Under Federal Acquisition Subpart 19.5 (Set-Asides for Small Businesses), government purchases with an anticipated dollar value exceeding $3,000 (but not over $150,000) are automatically reserved for performance by qualifying small businesses.  For procurements over $150,000, the contract must be set-aside for exclusive small business performance when there is a reasonable expectation that offers will be received from at least two reasonable small business concerns at a fair market price.

Among these regulations is a little known stipulation that the set-aside requirements apply “only in the United States or its outlying areas.”  The extent of this limitation was recently put to the test in connection with a procurement involving both foreign and domestic chartering services that was set-aside for small business performance by the Department of the Navy, Military Sealift Command (MSC).

Keep reading this article at: http://www.mondaq.com/article.asp?articleid=365930

Vet admits fraud ‘in spades’ prompted $1.5M TX hospital contract

January 16, 2015 by

A Navy veteran has pleaded guilty to charges that he lied about his company’s qualifications to the Veterans Affairs Department to get $1.5 million in contracts for work at one of its hospitals.

Colorado resident Jonathan Patrick Saunders is president and co-owner of Saunders MEP Inc., which has been awarded government contracts around the country — including one for building construction projects at the VA Hospital in Kerrville, TX, which is at the center of his criminal case.

He was indicted by a federal grand jury in March 2013 on six counts of wire fraud and two counts of aggravated identity theft. To avoid trial, he pleaded guilty Jan. 6th to one count of wire fraud.

The indictment said that when Saunders applied in March 2008 for the Kerrville contract, he claimed that his company qualified as a “service disabled veteran-owned small business,” that certain people with engineering or architectural qualifications worked for the company and that the company had done work on a previous project. In reality, his plea deal said, none of that was true, and Saunders now acknowledges pumping up the credentials of his company.

Keep reading this article at: http://www.mysanantonio.com/news/local/crime/article/Vet-admits-fraud-in-spades-prompted-1-5M-6000085.php

Another day, another rule for federal contractors

January 15, 2015 by

As we previously noted, federal contractors have been besieged in recent months with regulatory changes and enforcement initiatives advanced by the Office of Federal Contract Compliance Programs (“OFCCP”) and various divisions within the Department of Labor (“DOL”). The holiday season has not offered any relief, as the DOL recently announced its final rule implementing Executive Order (“EO”) 13672 on December 3, 2014.

EO 13672, signed by President Obama on July 21, 2014, required the DOL to update the rules that implemented EO 11246, which previously prohibited discrimination by federal contractors and subcontractors on the basis of race, color, religion, sex, and national origin. EO 13672 called for the DOL to add gender identity and sexual orientation to the classes that EO 11246 protects. President Obama’s directive is the first federal action aimed at ensuring LGBT workplace equality in the private sector. The final rule will take effect 120 days from the date of its publication in the Federal Register, which is on or about the first week of March 2015.

The final rule applies to federal contractors holding contracts entered into or modified on or after the date the rule takes effect. In addition to updating the existing rules to include gender identity and sexual orientation, the final rule also updates the Equal Opportunity Clause included in federal contracts. That clause now states that the contractor considers all applicants for employment without regard to race, color, religion, sex, sexual orientation, gender identity, national origin, disability, or age. Federal contractors and subcontractors must also include similar statements in their job solicitations and required notices posted conspicuously at work sites.

Keep reading this article at: http://www.mondaq.com/article.asp?articleid=361034

Defense agency faulted for wrongful challenge to contractor

January 14, 2015 by

The Defense Contract Audit Agency’s decision to reject $6.6 million in a contractor’s claimed costs in fiscal 2008 did not comply with generally accepted government auditing standards, the Defense Department’s watchdog found.

The probe of a complaint received over the inspector general’s hotline substantiated a challenge to methods used by auditors in DCAA’s Central Region.

Keep reading this article at: http://www.govexec.com/contracting/2014/12/defense-agency-faulted-wrongful-challenge-contractor/102063/