HWR Headshot Outside Color 030314_SquareOn Wednesday, November 16, Howard Roth will present an interactive workshop at the Tri-Cities Regional Chamber of Commerce that will provide essential information small businesses need to know to protect their business.  Learn about recent updates including the SBA’s new Mentor/Protégé Program, Affiliation rules and Teaming/Joint Venturing. 

To register for this workshop, please visit Washington PTAC.

US-CourtOfFederalClaims-Seal.svgIn base operating support (BOS) services contracts, end users and Contracting Officer’s Representatives can call in maintenance requests for the BOSS contractor to perform.  When these requests are within the scope of the contract, the contractor can usually proceed with the work.  However, if the request exceeds the scope of the contract, the contractor needs to be aware that if it proceeds without the Contracting Officer’s formal approval the contractor risks not receiving compensation for the out-of-scope work.  The U.S. Court of Federal Claims recently reminded contractors of this harsh reality.

In Baistar Mechanical, Inc. v. United States, a grounds maintenance contractor, was awarded a contract to maintain the Armed Force’s Retirement Home’s 270 acre grounds in Washington, D.C.   Continue Reading BOS Contractors Beware: Did the Contracting Officer Order the Work?

On October 21st the Department of Defense (DoD) proposed an amendment to the Defense Federal Acquisition Regulation Supplement (DFARS) intended to address “a more transparent means of documenting the impact of costs incurred during the undefinitized period of an undefinitized contract action on allowable profit.” (DFARS Case 2015–D024.)  In other words, when using its Weighted Guidelines, the DoD wants a further breakdown of completed and uncompleted work in order to refine the risk scores that will ultimately impact calculating fee percentage. The Weighted Guidelines are DOD’s structured profit approach for establishing the contracting officer’s negotiating position on profit. The proposed rule is intended to add transparency to the risk scores on contracts where undefinitized work has begun, however there is clearly potential for contracting officers to “disadvantage” the contractor’s potential fee for completing work before definitization. Continue Reading DoD’s Proposed Rule Change to Weighted Guidelines May Lead to Lower Fee Scores on Undefinitized Contracts

logo-titleStarting October 25th many new federal government contract solicitations were to contain the clauses required under the Fair Pay and Safe Workplaces Final Rule based on the Executive Order put in place by the Obama administration.  These clauses would impose significant new compliance and reporting obligations on federal contractors (and eventually on subcontractors). The stated goal is to ensure that companies contracting with the Federal Government understand and comply with labor laws.

However, contractors can breathe a bit easier (for now). On October 24th, the U.S. District Court for the Eastern District of Texas granted a preliminary injunction temporarily stopping the majority of the final rule from going in to effect. In accordance with the preliminary injunction, federal contractors will not be required, at this time, to report labor law violations with their bids and proposals on federal contract solicitations. The court also enjoined the government from enforcing the requirement regarding contractor arbitration agreements with employees covering disputes arising out of Title VII of the Civil Rights Act or from torts related to sexual assault or harassment. The court did not bar implementation of the paycheck transparency requirement scheduled to take effect on January 1, 2017.

The reporting requirements in the final rule have been described as having the potential of “blacklisting” companies from award of government contracts due to the many burdens imposed by compliance with the 14 applicable labor laws. These burdens are the reason for the pending litigation in Texas.  Since the final rule is now in litigation, government contractors may be able to put off preparations for compliance if the injunction remains in place, and therefore should closely monitor this case to see if the injunction is lifted while the litigation proceeds.  However, contractors should not assume that the this injunction will remain in place forever.  While this case is pending, it would be wise for contractors to proactively review labor law violations that have had in the past year in order to be prepared in the event the injunction is lifted.  Most importantly, contractors have to consider whether any violations are “willful,” “serious,” “pervasive” or “repeated.”  Contractors need to identify any such violations early so that they may provide evidence of mitigating factors and remedial actions the company has taken since the violation.

989186336_da2f2ab7cb_oA recent Postal Service Board of Contract Appeals (PSBCA) decision provided an important reminder for everyone that even if you deliver the mail, you cannot ignore your other chores—particularly taking out the trash. In Bryant Commercial Postal, LLC v. United States Postal Service, PSBCA No. 6633, a case that sounds more like an episode of The People’s Court than a government contract claim appeal, Bryant appealed the Postal Service’s denial of Bryant’s claim for $1,700 in cleanup costs under a lease agreement between the parties.  The PSCBA agreed with Bryant, and awarded Bryant its $1,700 claim plus applicable interest.

Continue Reading The PSBCA Orders the U.S. Postal Service to Pay for its Mess

Join Oles Morrison attorney Shaun Kennedy as he explains how to “Stay Ahead of the Curve: The Art of Negotiating Subcontracts in Federal Procurements,” at the 13th Annual Bridging Partnerships Small Business Symposium on Oct. 19.

Bridging Partnerships Small Business Symposium is proudly presented by the U.S. Department of Energy and the Hanford Site Prime Contractors. Representatives from the Department of Energy and Prime Contractors collaboratively formed the Hanford Small Business Council to serve as an advocate for socioeconomic diversity at the Hanford Site.

 

Constitution_of_the_United_States,_page_1Last month, the U.S. Court of Appeals for the D.C. Circuit handed down an opinion in Rothe Development, Inc. v. U.S. Department of Defense affirming a lower court’s 2015 decision denying a challenge to the constitutionality of Small Business Administration’s (“SBA”) 8(a) business development program (“8(a) Program”). However, reading the majority and dissenting opinion leads one to seriously question whether the book is truly closed on this case and/or other challenges to the constitutionality of the 8(a) Program.

As the D.C. Circuit put it, the 8(a) Program permits the SBA “to enter into contracts with other federal agencies, which the SBA then subcontracts to eligible small businesses that compete for the subcontracts in a sheltered market.”  To be eligible to participate in the 8(a) Program, a business must be owned by “socially and economically disadvantaged” individuals, meaning persons “who have been subjected to racial or ethnic prejudice or cultural bias because of their identity as a member of a group without regard to their individual qualities.”

In the Rothe Development case, plaintiff Rothe, who was not an 8(a) Program participant (and who claimed it was not economically and socially disadvantaged and therefore not eligible for the 8(a) Program), filed a lawsuit against the U.S. Department of Defense (“DoD”) and SBA in federal court challenging the constitutionality of the 8(a) Program. Rothe alleged that the 8(a) Program violated Rothe’s right to equal protection under the Due Process Clause of the Fifth Amendment. Importantly, Rothe’s challenge was limited to whether the statutory provisions defining “socially disadvantaged” small business owners (15 U.S.C. § 637(a)(5)) were facially unconstitutional.

In June 2015, the U.S. District Court Judge Ketanji Brown Jackson issued summary judgment in favor of DoD and SBA, ruling that the 8(a) Program was constitutional on its face.  Judge Jackson ruled that because the statutory provision at issue (15 U.S.C. § 637(a)(5)) contained a racial classification, the strict scrutiny test applied.  However, Judge Jackson also ruled that the statutory provision was facially constitutional under the strict scrutiny test because the government satisfied both elements of the test: (1) the government articulated an established compelling interest for the 8(a) Program—namely, remedying race-based discrimination and its effects, and (2) the 8(a) Program is narrowly tailored to achieve the established compelling interest.

Rothe appealed, and this month the D.C. Circuit denied Rothe’s appeal.  Interestingly, even though the D.C. Circuit found the statute constitutional, the D.C. Circuit’s reasoning significantly departs from the reasoning in Judge Brown Jackson’s decision.  A two-judge majority on the D.C. Circuit concluded that the challenged statutory provision did not contains a racial classification, Continue Reading SBA’s 8(a) Program Survives Constitutionality Challenge … For Now

5327892367_454a17f409_oWhile we hate to be the bearer of bad news, disappointed bidders may soon face a significant obstacle to protest an agency’s award decision of a task or delivery order.  Barring prompt Congressional action (a phrase that is rarely a good thing), the Government Accountability Office’s (“GAO”) jurisdiction over most civilian agency task or deliver order protests conducted will expire on September 30, 2016, leaving contractors little chance to challenge civilian agency award decisions.

Current Task or Delivery Order Bid Protest Jurisdiction

Jurisdiction for bid protests of task or delivery orders has endured a tumultuous history.  Over the past 20 years, Congress has limited and expanded the task or delivery order bid protest jurisdiction numerous times.

Currently, a contractor’s ability to protest the “issuance or proposed issuance of a task or delivery order” is governed by two separate, but similar, statutes: (i) 41 U.S.C. § 4106 (applicable to civilian agencies); and (ii) 10 U.S.C. § 2304c (applicable to the Department of Defense).  Both statutes contain identical language generally prohibiting bid protests of task or delivery order procurements, except under the following circumstances: Continue Reading “Sunset” Date Draws Closer on GAO’s Jurisdiction to Review Bid Protests of Civilian Agency Task Order Procurements

CV-22 Osprey | US Air ForceOn September 2, 2016, the Department of Defense (the “DoD”) issued a memorandum entitled “Guidance on Commercial Item Determinations and the Determination of Price Reasonableness for Commercial Items.”  This new guidance effectively rescinds prior guidance issued by the DoD in February 2015 regarding commercial item determinations, and to preview guidance required by Section 831 of the FY 2013 National Defense Authorization Act (“NDAA”).  The latest memorandum provides DoD’s guidance while awaiting the finalization of a proposed rule on commercial items (81 Federal Register 53101) implementing Sections 851-853 and 855-857 of FY 2016 NDAA and Section 831 of the FY 2013 NDAA.

DoD’s recently released guidance aims to highlight the underlying tenets of the FY 2016 NDAA legislation to improve the consistency and timeliness of commercial item determinations, and the price reasonableness determination for those items. Continue Reading Department of Defense Rescinds 2015 Commercial Items Guidance

03f0e71Join attorney Shaun C. Kennedy on Sept. 13 for a Tri-County Regional Chamber of Commerce and Washington PTAC seminar on “Small Business Contracting & Legal Issues.”  In this interactive workshop, Shaun will provide information about recent updates in federal government contracting as well as other essential subjects small businesses need to know to protect their business including the SBA’s updates to the Mentor-Protégé Program, affiliation rules, and teaming/Joint Venturing. This workshop is a great opportunity for eastern Washington businesses to get government contracting legal questions answered. RSVP for the event here.