Agencies get tougher on misbehaving contractors

May 30, 2014 by

Federal agencies are strengthening programs to find and punish unethical contractors, and the efforts may have paid off in increased suspension and debarment activity, according to a new watchdog report.

Governmentwide suspensions and debarments have increased from 1,836 in fiscal 2009 to 4,812 in fiscal 2013, the Government Accountability Office reported (GAO-14-513). And at six agencies that had minimal suspension and debarment activity but made changes to staffing, guidance and the case referral process as recommended by GAO in 2011, the increase was even more dramatic. These agencies went from a total of 19 suspension and debarment actions in fiscal 2009 to a collective 271 actions in fiscal 2013.

The six agencies GAO studied — the Commerce, Health and Human Services, Justice, State and Treasury departments and the Federal Emergency Management Agency — all saw a big jump in their suspension and debarment activity in fiscal 2011, the year they began to address GAO’s recommendations for successful programs. The Justice Department, for instance, went from five actions in fiscal 2010 to 50 in fiscal 2011. Though all six agencies made improvements in the same three general areas GAO pinpointed — “a suspension and debarment program with dedicated staff, detailed policies and procedures, and practices that encourage an active referral process” — they emphasized different reasons for their increased activity level, the report said.

House bill would raise small business goals and require bundling justifications

May 29, 2014 by

The defense policy bill that cleared the House May 22 is controversial for multiple reasons, most stemming from its rejection of many of the Obama administration’s cost-cutting proposals in troop compensation, military bases and weapons systems.

But deep inside the 700-plus page National Defense Authorization Act are also provisions to open more federal contracting opportunities to small businesses, and some of these measures are troubling to major contractors.

“The contracting amendments offered to the NDAA are common-sense reforms that will provide opportunities for small companies trying to break into the federal marketplace,” said Rep. Sam Graves, R-Mo., chairman of the House Small Business Committee. “These amendments address many of the barriers created due to the federal procurement system’s bureaucracy and inefficiency.”

The Graves-sought provisions include one to increase the government-wide small business prime contracting goal from 23 percent of contracting dollars to 25 percent and establish a 40 percent subcontracting goal. Another would require that the administration publish contract bundling and consolidation justifications before issuing requests for proposals for awards under the General Services Administration-run Federal Strategic Sourcing Initiative.

keep reading this article at: http://www.govexec.com/management/2014/05/house-defense-bill-would-raise-small-business-contracting-goals/85249/

LPTA contracts stifle innovations, contracting officials say

May 27, 2014 by

Lowest Price, Technically Acceptable (LPTA) contracts might save the government some money, but they deter innovation, a panel of government contracting officials said Monday (May 19, 2014).

“I don’t know a senior leader in government that thinks LPTA is the best,” said Tiffany Hixson, regional commissioner for the General Services Administration. “Contracting and innovation is about risk management.”

But with shrinking budgets, agencies are looking to lower their costs and LPTA contracts do just that, said Robert Coen, acting director of the National Institutes of Health Information Technology Acquisition and Assessment Center.

“There’s way too much LPTA going on,” Coen said at the May 19 ACT-IAC Management of Change Conference. “LPTA should be used for commodity buys, not innovations.”

Keep reading this article at: http://www.fiercegovernment.com/story/lpta-contracts-stifle-innovations-contracting-officials-say/2014-05-20

GSA awards long-awaited OASIS contract

May 23, 2014 by

The General Services Administration has awarded its 10-year, multibillion dollar OASIS contract to 74 companies, according to an agency announcement.

The companies include Accenture Federal Services, LLC., Booz Allen Hamilton, Inc., Boeing Service Company, Deloitte Consulting, LLP., Lockheed Martin Integrated Systems, Inc., Raytheon Company and others across six separate pools of contractors.

OASIS is governmentwide acquisition contract that offers professional services, such as financial management and engineering, scientific and logistics services. OASIS also features separate contracts for small businesses and larger firms.

The market for all of the services offered through OASIS adds up to about $60 billion per year, according to research firm Deltek. The company estimates GSA may capture between 5 percent and 10 percent of the market — up to $6 billion a year.

Keep reading this article at: http://www.federaltimes.com/article/20140519/ACQ/305190012/GSA-awards-long-awaited-OASIS-contract

Why are so many Army and VA contracts protested?

May 21, 2014 by

Companies have protested more Army contract awards in the last 18 months than any other Defense Department agency’s awards, and the Veterans Affairs Department tops the list as the most protested non-Defense agency, according to an analysis by the open data supporters at GovTribe.

The Government Accountability Office, meanwhile, is researching electronic docketing systems to simplify and organize  the process of protesting contract awards.

Between September 2012 and May 13, the Army posted more than 12,000 contract award notices on the Federal Business Opportunities website and received 891 protests. That’s a 7 percent protest rate, GovTribe said, noting that some awards are protested more than once and not all protests are public, so the statistic may be misleading.

Table by GovTribe, Inc.

VA had a 6 percent protest rate by the same measure, with more than 400 protests. The Homeland Security Department was the next protested non-Defense agency, with fewer than 250 protests. The analysis did not include a percentage rate for DHS, and GovTribe declined to provide one.

Keep reading this article at: http://www.nextgov.com/cio-briefing/2014/05/why-are-so-many-army-and-va-contracts-protested/84589

Customs and Border Protection agency offers more information to losing bidders

May 19, 2014 by

Customs and Border Protection’s IT technology acquisition operation is developing ways to help explain to unsuccessful contract bidders why they lost out to competitors, according to the agency’s top IT acquisition official.

In remarks at a presentation on acquisition and programming at FOSE in Washington, D.C., Guy Torres, CBP director of IT contracting, said he and his legal team had developed an “explanation plus” document to provide more information to vendors bidding under Federal Acquisition Regulation. The FAR can restrict providing explicit information on some bids to vendors. Torres said he wanted to provide some information to help vendors understand why they may have lost, instead of providing only a short statement that they didn’t get a contract.

Keep reading this article at: http://fcw.com/articles/2014/05/13/cbp-informs-losing-vendors.aspx

GSA lab brings registration tracking to SAM, demos FBOpen

May 16, 2014 by

The General Services Administration (GSA) unveiled tools that they say will simplify the process for small businesses to find contracting opportunities.

The initiatives were part of a May 9 program showcasing the agency’s 18F team – a lab of developers and designers from both inside and outside the government working together to build digital services that will be used across agencies.

GSA says one of those services will help small businesses search for contracting opportunities. FBOpen acts as a website where businesses can search available federal contracts and grants across all federal platforms.

Since FBOpen was unveiled, 1,750 users have queried it 50,000 times, said Presidential Innovation Fellow and 18F developer Aaron Snow at the event.

Keep reading this article at: http://www.fiercegovernment.com/story/gsas-18f-lab-brings-registration-tracking-sam-demos-fbopen/2014-05-11

Federal Circuit’s Metcalf decision a big win for contractors

May 15, 2014 by

In a recent decision, the U.S. Court of Appeals for the Federal Circuit (“CAFC”) the supervising court for the Court of Federal Claims and the Boards of Contract Appeals, among others) clarified important legal principles concerning the federal government’s duty of good faith and fair dealing and its responsibility for differing site conditions. Metcalf Construction Company, Inc. v. United States controls disputes with the federal government and also provides authority and rationale useful to contractors in disputes with any project owner, public or private.

In October 2002, Metcalf Construction, a small business based in Hawaii, was awarded a $48 million contract to design and build 212 housing units for the U.S. Navy on a Marine Corps base in Hawaii. Saying the project did not go smoothly is an understatement. Metcalf’s performance was hindered and delayed by unanticipated soil conditions and other issues made worse by the Navy’s failure to administer the contract fairly and according to its terms. By the time the Navy finally accepted the project as complete in March 2007, almost two full years after the original completion date, Metcalf had incurred costs in excess of $76 million — leaving the contractor with losses of approximately $27 million.

Keep reading this article at: http://www.mondaq.com/unitedstates/x/311802/Building+Construction/Federal+Circuits+Metcalf+Decision+a+Big+Win+for+Contractors&email_access=on

GSA wants contractors to sign on the digital line

May 13, 2014 by

While most documents generated by the government have made the transition from paper to digital, there are still a few hiccups in the process, notably contracts and other documents that require signatures.

The General Services Administration is looking for an agency-wide service that can obviate the need for pen-and-ink signatures and move the contracting process entirely online, according to documents posted on April 28, 2014. GSA now uses a variety of procedures to obtain signatures, some of which include a mix of electronic and pen-and-ink, or what the agency calls “wet” signatures. Transitioning fully to digital signatures would raise GSA’s efficiency and reduce costs, the agency said.

The document, posted on the Federal Business Opportunities Contracting site, is a sources sought notice, which means GSA wants to gather feedback from industry about possible products but isn’t seeking bids yet. The agency expects to issue a formal solicitation and award a contract before the end of 2015, the notice said.

Keep reading this article at: http://www.nextgov.com/emerging-tech/2014/04/gsa-wants-contractors-sign-digital-line/83236

Chicago construction firm pays $12 million to settle DBE contract fraud claims

May 12, 2014 by

A Chicago-based construction company will pay the United States and the State of Illinois $12 million to resolve allegations of fraud on government programs designed to benefit women- and minority-owned sub-contractors under the terms of a civil settlement agreement announced May 1, 2014. The contractor, James McHugh Construction Co., Inc., allegedly failed to abide by federal and state requirements for the participation of disadvantaged business enterprises (DBEs) in contracts to perform seven construction projects involving roads, highways, and transit lines, funded by the federal and state governments between 2004 and 2011.

The federal and state governments claimed that McHugh violated the federal and Illinois False Claims Acts by making false statements and claims for payment to government agencies regarding McHugh’s compliance with federal and state requirements to include DBEs in the construction projects.

As a result of the $12 million settlement, the federal government will receive $7.2 million and the state government will receive $4.8 million. In a separate administrative settlement and compliance agreement, McHugh agreed to implement a corporate compliance program, appoint a compliance officer, and be subject to an independent monitor for three years, in exchange for the federal, state, and City of Chicago transportation agencies and contracting authorities’ agreement not to bar McHugh from future government contracts. This allows McHugh to continue pursuing and performing public works projects while ensuring that it remains compliant with DBE regulations.

“It was more costly in the long run for McHugh to avoid its obligations to hire women and minority-owned businesses than it would have been simply to comply with the requirements and retain disadvantaged businesses to actually participate in these public construction projects,” said Zachary T. Fardon, United States Attorney for the Northern District of Illinois. “It’s important that McHugh and other companies realize that compliance with these requirements is both a good business decision and the right thing to do,” he added.

The investigation revealed that McHugh Construction falsely used subcontractors to help secure bids for major public construction projects. Specifically, the company used women-owned small businesses to submit false claims to the state and federal governments for millions of dollars when in fact, those businesses never completed the level of work required by law.

The settlement arose from a lawsuit that was filed in 2008 by Ryan Keiser, who was a project manager for Perdel Contracting Corp. and Accurate Steel Installers, Inc. (ASI), at three of the McHugh construction sites. The lawsuit was filed under the qui tam or whistleblower provisions of the federal and state False Claims Acts.

The federal and state statutes permit private individuals to sue for “false claims” on behalf of the government and to share in any recovery. Mr. Keiser will receive 17 percent of the $12 million settlement or $2,040,000 ― $1,224,000 from the United States share, and $816,000 from Illinois’ portion of the settlement.

The federal and state governments contended that in bids for these contacts, in the final contracts, and in claims for payment, McHugh falsely stated that Perdel and ASI, which were both certified as DBE firms owned by Elizabeth Perino, would perform or had performed work on the projects in satisfaction of federal and state DBE participation requirements in the contracts. The governments contended that contrary to McHugh’s statements, Perdel and ASI often functioned merely as “pass-throughs,” performing little, if any, work that would qualify for participation credit under federal and state DBE requirements. Perino, who owned Perdel and ASI in Lockport, was charged with federal mail fraud in 2011, and the case remains pending.

According to the settlement agreement, the governments also contended that Perdel and ASI’s contracted work for McHugh often exceeded the companies’ capacity and experience. Although their projects with McHugh were substantially greater in size and scope than they had previously performed, Perdel and ASI’s expertise to perform larger and more complex projects did not change correspondingly. Rather than Perdel and ASI performing, managing, or supervising the work that McHugh represented they would, McHugh frequently managed union workers they each hired. In some cases, McHugh directed Perdel and ASI as to which union crews to hire.

McHugh, not Perdel or ASI, also selected certain suppliers on each of the contracts, determined the quantity and quality of those materials, negotiated the price, and often drafted a purchase order for Perdel or ASI to put on their letterhead, the governments contended.  That kind of conduct violates federal and state provisions that are designed to give a share of the actual work of government-funded construction projects to minority- and women-owned businesses.

The settlement is neither an admission of liability by McHugh nor a concession by the state and federal governments that their contentions are not well founded, and McHugh expressly denies the claims.

The settlement was reached on behalf of the U.S. Department of Transportation, the Illinois Department of Transportation, the Illinois State Toll Highway Authority, and the Regional Transportation Authority.

The separate three-year administrative monitoring settlement and compliance agreement was reached between McHugh and the Federal Transit Administration, the Federal Highway Administration, the U.S. and Illinois Transportation Departments and their procurement officers, and the City of Chicago. In exchange for the government entities’ agreement not to pursue any suspension or debarment action against McHugh for the covered conduct, McHugh agreed to implement a corporate compliance program and appoint a compliance officer who is knowledgeable about DBE programs. The company also agreed to retain an independent monitor to evaluate McHugh’s performance and submit periodic reports to the government agencies and officials, and to make six presentations to those agencies and officials to discuss and promote compliant policies and procedures for working with DBE firms.

Source: http://www.justice.gov/usao/iln/pr/chicago/2014/pr0501_01.html