Game Planning, Not a Game

Federal News Network surveyed 100 or so government contractors during the final week of the shutdown about current contracted projects and expectations once the shutdown ended.

Not surprisingly, 71 percent said projects would be delayed and 40 percent believe it would take more than four weeks to get up to speed. Respondents also thought high costs would accrue during the re-start. Comments included the following:

  • Significant costs associated with re-start include rescheduled travel, reworked program plans, and employee hiring
  • Security clearance waits
  • Awaiting payment of invoices submitted before the shutdown
  • Permanent loss of employees to commercial firms due in part to fear of future shutdowns. (Federal News Network February 2019)

The Office of Management and Budget (OMB) requested that agencies move swiftly to pay contractors along with federal employees. However, agencies themselves are experiencing payment backlog, as several of the government’s invoice processing agencies had large portions of their own workforces furloughed. Before they returned, contractors’ unpaid invoices had been stacking up, awaiting formal acceptance and payment since 22 December 2018. (ibid)

We are hopeful that Congress passes legislation to make contractors ‘whole’ once future shutdowns ends, but we’re not holding our breath. Prudent contractors should plan for fiscal management upon another shutdown, possibly as early as 15 February.

Questions about your payments? We can try to help at 301-913-5000.

Open. Shut. Ajar?

By now, everyone is acutely aware that the government experienced the longest shutdown in US history. Doors opened on Monday but it is hardly back to business as usual. Contractors face countless bottlenecks as well as hurry-up-and-wait scenarios. Has the stop work order been rescinded? Does the contractor’s badge still work? If not, is a new clearance necessary? When work starts up again, will all employees be in place and ready to go? While it took no time at all to close the doors, opening them and getting back to business, as usual, is likely going to take some time. This, coupled with the looming possibility of yet another shut down, adds to the already less than perfect predicament in which government contractors finds themselves.

Homeland Security offered expectations with the re-start. Soraya Correa, chief procurement officer at DHS issued a notice stating, “If the particular RFP or RFQ established a deadline for submission of a proposal or quotation after Dec. 21, 2018 and the DHS funding lapse is not resolved prior to the deadline established in the RFP, then the proposal or quotations shall be due within seven business days following the resolution of the DHS funding lapse.” Correa also wrote, “If the particular RFP or RFQ provided for the submission of questions, comments or other forms of inquiry after Dec. 21, 2018 and the DHS funding lapse is not resolved prior to the deadline established in the RFP for this type of submission, then the submission shall be due within five business days following the resolution of the DHS funding lapse and resumption of business operations.” She explained that responses to RFIs are due three business days following the resumption of DHSs business operations. (Federal News Network January 2019)

OMB revised its guidance to agencies on 22 January, suggesting a recall of workers in order to pay contractors who billed the government before the 21 December shutdown. (ibid) Small businesses need those payments as soon as possible, whereas larger contractors have a little more room to work with as their pockets are deeper. Whether large or small, the pain is real and expected to last for a long time to come.

Hopefully, should the government shut its doors again, agencies are more prepared with notices to contractors. Setting expectations could relieve at least some of the panic.

Are you trying to figure out how to navigate through this trying time? Give us a call at 301-913-5000, We can help.

 

Shutdown is Long, Still Going Strong

Is there an end in sight? Will the Dems and Trump come to an agreement soon? Will you get paid? Will you receive back pay for the time the government doors are shut? These are the questions government workers, contractors, and subcontractors are asking.

Here’s what we know:

• Private companies that serve civilian agencies such as the Department of Homeland Security, the United States Agency for International Development (USAID), and the EPA have been told to stop work on specific contracts. (No word as to what happens next.) (Washington Post January 6, 2019)

• The government is offering guidance to contractors on an agency-by-agency basis and contractors are starting to receive “stop work order” notices from those agencies that no longer have funds. (Department of Defense and intelligence agencies are, for the most part, unaffected.) (ibid)

• FEMA has posted a “blanket” stop work order. This likely will not affect deep pockets of larger companies working on FEMA contracts, but will undoubtedly negatively impact smaller businesses. Government workers will get back pay, government contractors will not. (Washington Post, January 6, 2019)

As feared, the smaller the business the greater the impact.

Have questions about your contracts with the government and what you should be doing? Give us a call at 301-913-5000.