Agency Spending During the Pandemic

Government contractors are experiencing difficulties as they work through obstacles and uncertainties during the COVID-19 pandemic. However, if you thought spending would slow, think again.

In response to the emergency, spending likely exceeded $100 billion for the month of March, according to a webcast hosted by George Mason University’s Center for Government Contracting (GMU). Because of a standard 90-day reporting lag, that figure is likely to be even higher. (Washington Technology, March 31, 2020)

The department of Health and Human Services is responsible for the bulk of non-defense contracting activity with commitments of approximately $748.5 million under research and development. Eric Lofgren, a GMU research fellow, feels the majority of that is going toward “Other Transaction” contracts, designed for speed of fielding capabilities as they fall outside of traditional acquisition regulations. (ibid)

Orders are also being solicited and placed for Personal Protective Equipment (PPE) as well as services such as testing and cleaning. Orders of this nature could very well rise to over $100 billion in response to the COVID-19 emergency. Non-defense spending, as of 27 March, totaled $15 billion, which is on track for spending during the same timeframe in 2019. However, the recently passed CARES Act stimulus package frees up $2 trillion so agencies have funds available for immediate use. (ibid)

The Department of Defense is looking at how the commercial industry is designing solutions. In March, DoD requested white papers from the academic community and private industry for prototype solutions to prevent, contain, treat, and detect coronavirus as well as other possible bio-threats. Many believe this is just the start as DoD begins to support the federal government’s pandemic response. (ibid)

Jerry McGinn, executive director of the GMU GovCon Center and former head of DoD’s manufacturing and industrial base policy office said, “Initially a lot of industry was in the sources sought phase of solicitations, now you’re starting to see they’re just going straight to solicitations…. They’re publishing notices on one day and requiring responses the next, and this is just going to accelerate.”

Questions about these solicitations and how your company might provide solutions? Give us a call.

Easier Contract Awards Paper a Silver Lining

The General Services Administration (GSA), The Department of Veterans Affairs (VA), and IRS raised the micro-purchase threshold (MPT) and the simplified acquisition threshold (SAT) last week, in response to the coronavirus relief effort This allows these agencies to expedite contract award timeframes. (Federal News Network, March 20, 2020)

As required under the 2020 Defense Authorization bill, the Defense Department raised the threshold for sole-source 8(a) contracts up to $100 million as well. The non-emergency threshold for 8(a) contracts is $22 million. (ibid)

GSA and VA have raised their MPT and SAT threshold for purchases both in and outside of the US while the IRS raised theirs for purchases within the US only, to speed up the time it takes to make contract awards.

The MPT is increased to:

  • $20,000 for contracts awarded and performed or purchases made within the U.S.
  • $30,000 for contracts awarded and performed or purchases made outside the U.S.

The SAT is increased to:

  • $750,000 for contracts performed or awarded and purchases made within the U.S.
  • $1.5 million for contracts awarded, performed or purchases made outside the U.S.

The SAT supporting contingency operations or major disaster recovery is increased to $13 million.

All thresholds, in place through at least 30 June, give agencies the ability to be nimble and make purchases quickly. They are “specific to only to support the designated National Emergency COVID-19. FAR Part 6 also provides the opportunity to expedite purchases after justifying exceptions to competition. There may also be opportunities to use existing contracts by negotiating a bilateral modification to allow for additional quantities of goods or a surge for services included in concurrent awards,” according to Angela Billups, VA’s executive director in the Office of Acquisition and Logistics and senior procurement executive. (ibid)

To track acquisition costs for the coronavirus response, the Federal Acquisition Regulations Council set up a new code in the Federal Procurement Data System, P20C. (ibid)

Jeff Koses, GSA’s senior procurement executive stated in a recent memo that local set-aside rules are not applicable because this is a national emergency and not a strictly local one. According to Koses, some exceptions that allow agencies to restrict or limit competition are:

  • phoning a reasonable number of vendors
  • obtaining “on the spot” quotes
  • keeping the period of performance brief (ibid)

The changes to the MPT and SAT were made prior to the Defense Production Act being invoked. The Defense Production Act, authorizes certain agencies providing specific products or services with relation to the coronavirus relief efforts, to move to the front of the line. However, GSA strongly advises contracting officers to verify pricing and contractor details on GSA Advantage and GSA eLibrary. (ibid)

Interested in contracting for relief efforts? Give us a call.

Wanna Connect a Hybrid Cloud?

The Department of Defense (DoD) wants a hybrid cloud environment to serve as the cornerstone for department-wide use of artificial intelligence. The Joint Artificial Intelligence Center (JAIC) issued two sources sought notices from all business that can provide system engineering and integration “to support the procurement, implementation, and operation of a hybrid and multi-cloud deployable development and production platform for Artificial Intelligence and Machine Learning (AI/ML) solutions.” (Fedscoop, November 25, 2019)

This hybrid cloud environment will form the basis of the Joint Common Foundation (JCF), a DoD/Government  AI/ML development platform, containing Data, Tools, and Processes. JCF will include shared data, reusable tools, frameworks, and standards. Additionally, it will include cloud and edge services to develop, secure, test and evaluate, deliver, and sustain capabilities. “The JCF will incorporate the architecture and software artifacts of the Enterprise Development, Security and Operations (DevSecOps) initiative and evolve toward enabling the DoD Artificial Intelligence Strategy.” (ibid)

Proposed vendors answer specific questions about past experience integrating multiple cloud providers at scale with continuous development and integration while meeting security compliance standards. A solicitation conference will be held in early 2020, followed by a request for quotation, and award by the end of September 2020.

The award of JCF will move swiftly. Give us a call if we can answer any questions or assist with your proposal efforts.

CMMC a Plus for Small Businesses?

Katie Arrington, on staff  with the Undersecretary of Defense for Acquisition and Sustainment believes nation-states are actively targeting small businesses digitally. And, she says, we are losing the battle of cyberattacks. (Fifth Domain, October 8, 2019)

According to Arrington, rivals cost the US an estimated $600 billion per year and 5G will multiply that number exponentially by 2025. As a result, Arrington believes the cybersecurity maturity model certification (CMMC) is actually intended for small businesses. (ibid)

CMMC grades company cybersecurity on a scale of one (least secure) to five (most stringent). Small businesses must comply with a tiered rating structure. So a company offering cleaning services may need only comply with CMMC level one while an engineering firm is held to level four

Arrington says that CMMC levels the playing field. Old compliance standards allowed companies to perform their contracts while working on their plan of action to become technically acceptable. This left sensitive systems that require additional security controls vulnerable and with weak spots. Many small businesses do not have the resources to obtain a high CMMC level, ultimately limiting competition in the marketplace; others fear the costs will be so high, that small companies will be priced out of the marketplace and limit their ability to compete on government contracts. 

The most recent Navy breaches targeted contractors without classified information per se, but taken in total the data disclosed sensitive capabilities. This is exactly what the CMMC framework addresses. (ibid)

Requests for proposals are expected to include CMMC requirements, as early as fall 2020.

Questions about CMMC requirements? Give us a call.

CMMC RFI

The Department of Defense (DoD) has issued a request for information for the “long-term implementation, functioning, sustainment, and growth” of the Cybersecurity Maturity Model Certification (CMMC). (FedBizOps.gov, October 3, 2019)

Last month, DoD issued version 0.4 of the CMMC. Contractors may now see the cybersecurity standards required when working on projects with controlled but unclassified information. CMMC will assist DoD to secure more than 300,000 organizations. (Fed Scoop, October 4, 2019)

The accreditation body does not directly perform the assessments but manages third-party organizations that do. It is  a nonprofit that utilizes “revenues generated through dues, fees, partner relationships, conferences, etc.” to fund the work.  The deadline to submit feedback is October 21, 2019. (FedBizOps.gov ibid)

We’d be glad to discuss this RFI with you. Just give us a call.