September 12, 2014 by cs
A Nebraska man has pleaded guilty to fraud and money laundering charges stemming from a SDVOSB “rent-a-vet” scheme under which an ineligible business received 45 SDVOSB contracts.
According to a Department of Justice press release, the man faces up to 24 months in prison and financial penalties. He and his companies also have been suspended from government contracting and face the likelihood of debarment.
The DOJ press release alleges that beginning in 2007, Ram Hingorani and his companies, Midwest Contracting Inc. and Midwest Paving Inc., engaged in SDVOSB fraud. According to the press release, Hingorani used the service disabled status of a business partner, Ronald Waugh, to qualify MCI as a SDVOSB. However, an investigation “revealed MCI was a pass-through and/or front company for Hingorani’s other businesses and that Waugh was simply a figurehead or ‘rent-a-vet’ who was being used for his SDV status.”
The government’s investigation concluded that Hingorani, a non-SDV, controlled MCI and caused MCI to falsely self-certify as a SDVOSB. As a result of the fraudulent self-certifications, MCI was awarded 45 set-aside and sole source contracts worth approximately $23.5 million.
Hingorani faces a prison term of up to 24 months, as well as financial penalties. Hingorani and his companies are currently suspended and face the prospect of debarment. Hingorani’s SDV business partner, Waugh, was initially charged in the case as well, but the government has agreed to drop those charges.
Keep reading this article at: http://smallgovcon.com/debarment-and-penalties/sdvosb-fraud-guilty-plea-in-rent-a-vet-case/
SBA proposes revisions to employee-based size standards for manufacturing and other industry sectors
September 11, 2014 by cs
The U.S. Small Business Administration (SBA) has published two proposed rules to revise small business size standards in North American Industry Classification System (NAICS) Sector 31-33 (Manufacturing) and industries with employee-based size standards that are not a part of NAICS Sector 31-33, Sector 42 (Wholesale Trade), and Sector 44-45 (Retail Trade). The proposed rules were published in the Federal Register on Sept. 10, 2014.
As part of its comprehensive size standards review required by the Small Business Jobs Act of 2010, the SBA evaluated employee-based size standards for all 364 industries in NAICS Sector 31-33 and 57 industries and five exceptions that are not in NAICS Sectors 31-33, 42, or 44‑45 to determine whether they should be retained or revised.
In the first rule, SBA proposes to increase size standards for 209 industries in Sector 31-33. The SBA also proposes to increase the refining capacity component of the Petroleum Refiners (NAICS 324110) size standard to 200,000 barrels per calendar day total capacity for businesses that are primarily engaged in petroleum refining. The proposed rule also eliminates the requirement that 90 percent of a refiner’s output being delivered should be refined by the bidder.
In the second rule, SBA proposes to increase the employee-based size standards for 30 industries and three exceptions and decrease them for three industries that are not in Sectors 31-33, 42, or 44‑45.
Additionally, SBA proposes to remove the Information Technology Value Added Resellers exception under NAICS 541519 (Other Computer Related Services) together with its 150-employee-based size standard. Similarly, SBA also proposes to eliminate the Offshore Marine Air Transportation Services exception under NAICS 481211 and 481212 and Offshore Marine Services exception under NAICS Subsector 483 and their $30.5 million receipts based size standard. Accordingly, the second proposed rule also removes Footnotes 15 and 18 from the table of size standards.
If the changes in the two rules are adopted as proposed, nearly 1,650 more firms will become small and eligible for federal procurement and SBA’s loan programs.
Comments can be submitted on the proposed rules on or before November 10, 2014 at www.regulations.gov, identified by the following RIN numbers: (RIN 3245-AG50 for Sector 31‑33) and (RIN 3245-AG51 for employee-based size standards for industries that are not part of Sector 31-33, Sector 42 or Sector 44-45). You may also mail comments to Khem R. Sharma, Chief, Office of Size Standards, 409 3rd St., SW, Mail Code 6530, Washington, DC 20416.
For size standards review, SBA takes into account the structural characteristics of individual industries, including average firm size, startup cost and entry barriers, the degree of competition, and small business share of federal government contracting dollars. This ensures that small business size definitions reflect current economic conditions and federal marketplace in those industries.
An SBA-issued White Paper entitled, “Size Standards Methodology,” which explains how SBA establishes, reviews and modifies its receipts-based and employee-based small business size standards, can be viewed at http://www.sba.gov/size.
For more information about SBA’s revisions to its small business size standards for various industry sectors, click on “What’s New with Size Standards” on SBA’s Web site at http://www.sba.gov/size.
September 10, 2014 by cs
Sales of Chinese products off the GSA Schedule has resulted in a $2.3 million False Claims Act settlement.
According to a Department of Justice press release, Samsung Electronics America, Inc. has agreed to the settlement to resolve allegations that Samsung informed GSA Schedule resellers that certain products were manufactured in “designated countries” under the Trade Agreements Act, when in fact those products were manufactured in China.
GSA Schedule contracts require that vendors certify that their products comply with the Trade Agreements Act. The TAA, in turn, generally requires that the government buy products manufactured in the United States or in a “designated country” with which the United States has a trade agreement. Many countries are designated countries under the TAA, but China is not a designated country.
Samsung has designated resellers who hold GSA Schedule contracts. Samsung certifies to its resellers that its products are TAA compliant, and those resellers then offer the products for sale off their Schedule contracts.
September 8, 2014 by cs
Davis-Bacon Act fraud has resulted in a criminal sentence for the owner of a now-defunct construction subcontractor.
According to a Department of Justice press release, the subcontractor’s owner has been sentenced to four years of probation (including 18 months of home confinement) and ordered to pay $164,627 in restitution, after pleading guilty to charges of conspiracy to pay employees less than prevailing wages on a federal construction project in Boston.
Isreb operated Taunton Forms, a construction company based in Massachusetts. In 2006, Suffolk Construction was awarded a GSA prime contract to renovate a federal building in Boston. Suffolk entered into a subcontract with Taunton Forms to perform certain concrete work on the project. Suffolk ultimately paid Taunton Forms more than $1 million under the subcontract.
Keep reading this article at: http://smallgovcon.com/debarment-and-penalties/davis-bacon-act-fraud-subcontractors-owner-sentenced/
September 5, 2014 by cs
A small business was affiliated with companies owned by the business owner’s father and siblings, based on the family relationship and the companies’ ongoing history of doing business together.
In a recent size appeal decision, the SBA Office of Hearings and Appeals held that the small business had not successfully rebutted the regulatory presumption that companies owned by close family members are affiliated, because the small business had earned substantial revenues from the alleged affiliates, and intended to issue a subcontract to both affiliates with respect to the procurement at issue.
SBA OHA’s decision in Size Appeal of Industrial Support Service, LLC, SBA No. SIZ-5576 (2014) involved an Army Corps of Engineers solicitation seeking a contractor to provide certain repair work. The solicitation was issued as a small business set-aside under NAICS code 238290 (Other Building Equipment Contractors).
Keep reading this article at: http://smallgovcon.com/sbaohadecisions/family-relationship-plus-revenues-subcontracts-caused-affiliation-says-sba-oha/
September 2, 2014 by cs
The General Services Administration has figured out a way not to have to temporarily close down its services schedules to new offerors after all.
After Federal News Radio reported the Federal Acquisition Service’s plans to suspend the services schedules to new vendors while it put the pieces in place to give the program a facelift, Tiffany Hixson, FAS’s professional services category executive, said her team has now figured out a way to run both the current schedules and the new consolidated schedule at the same time.
“Since the last time we talked, my team really has been looking at the challenge of closing the schedules even for a short period of time. Industry had quite a few concerns with that part of our acquisition strategy,” Hixson said in a follow-up interview Thursday. “So what we decided to do is open the new professional services schedule at the same time that we are going to be transitioning our existing schedules to our new contract environment. So instead of working our process in serial fashion, we are going to be doing that in parallel fashion and that takes care of the problem. So we do not have to close the schedules, which is a big win for us and also for industry.”
Keep reading this article at: http://www.federalnewsradio.com/65/3690349/GSA-suspends-adding-new-vendors-to-services-schedules-
August 29, 2014 by cs
State and local government spending on information goods and services is projected to grow at a 3.3 percent rate between now and 2019, increasing to $70 billion from $60.4 billion over that period. This would mark the third consecutive annual forecast of better than 3 percent growth.
However, government contractors looking to make the most of this market may want to pick and choose their business development targets.
State governments are likely to be the most robust consumers in the market. Deltek’s research into state budgets found that state-level IT spending grew almost 5 percent over the past year, and will likely continue at this rate or better over the next few years.
Keep reading this article at: http://www.washingtonpost.com/business/capitalbusiness/deltek-state-local-government-it-spending-increase-is-an-opportunity-for-contractors/2014/08/22/4f6f0834-288d-11e4-8593-da634b334390_story.html
August 28, 2014 by cs
On August 6, 2014, the U.S. Department of Labor (DOL) announced a proposed rule that would require most federal contractors and subcontractors annually to submit Equal Pay Reports on employee compensation to the Office of Federal Contract Compliance Programs (OFCCP). The aim of the proposed rule is to collect summary data on how federal contractors and subcontractors pay their employees, with an eye toward identifying potential gender-based and race-based pay disparities. This marks a significant change in compliance requirements for the federal contractor community because until now, federal contractors were required to disclose compensation data only in OFCCP compliance reviews.
The Equal Pay Report rule comes after President Obama issued a presidential memorandum on April 8, 2014, instructing the Secretary of Labor to propose a rule to collect summary compensation data from federal contractors and subcontractors. The proposed rule would require contractors to provide compensation information for their workforce broken down by sex, race, ethnicity and specified job categories. The rule was published in the Federal Register on August 8, 2014, and all comments must be received by November 6, 2014. After consideration of public comments, the DOL is anticipated to issue a final rule in the first half of 2015.
Keep reading this article at: http://www.mondaq.com/article.asp?articleid=334810
August 25, 2014 by cs
In the sixth of its annual studies, a small business advocacy group has again blasted the government for allegedly awarding contracts to major corporations when policy intends for them to go to legitimate small businesses. The Small Business Administration offered other possible explanations for the apparent discrepancies.
The Petaluma, Calif.-based American Small Business League’s new study of fiscal 2013 procurement data concluded that of the top 100 companies receiving the highest-valued small business federal contracts, “79 were large companies that exceeded the SBA’s small business size standards, five were anomalous and 16 were legitimate small businesses.”
The group’s annual studies also show that the number of top-100 contracting companies that are large firms has risen steadily, from 60 in fiscal 2009 to 84 in fiscal 2013.
The large corporations that received the contracts in question in fiscal 2013 included Lockheed Martin Corp., General Dynamics Corp., Boeing Co., General Electric, Oracle Corp., Apple Inc., Verizon, Bank of America Corp., Citigroup Inc., PepsiCo, Comcast Corp., Intel Corp., John Deere Co. and many more, said the league, which published brief company-by-company profiles.
Keep reading this article at: http://www.govexec.com/contracting/2014/08/how-many-big-contractors-are-actually-posing-small-businesses/91694
August 22, 2014 by cs
The General Services Administration (GSA) wants to make it easier for agencies to buy professional, management, technology and a host of other kinds of services from the schedule contracts. To that end, GSA will consolidate seven different professional services contracts into what could end up being one mega- schedule.
Tiffany Hixson, GSA’s Federal Acquisition Service’s professional services category executive, said the goal is to consolidate the schedules of as many as 500 vendors by November 2015.
“We are really hoping that will make it much easier for federal contracting officers to get those services, in particular where we have a requirement that covers a number of services areas. So instead of having to compete those services across a number of schedules, they will just be able to go to one,” Hixson said in an exclusive interview with Federal News Radio. “We think that will make it a lot more user friendly from a contracting officer perspective. Additionally, we will be able to reduce our administrative overhead, and for our contractors, it will reduce the cost of administering the number of schedules that we’ve got in the professional services area.”
Keep reading this article at: http://www.federalnewsradio.com/446/3685243/GSA-applying-its-IT-model-to-overhaul-of-services-schedules