Born in the USA

Last week DOD set in motion the Trusted Capital Digital Marketplace, the goal of which is to give companies an alternative to foreign investors. Often, using foreign investors prohibits contracting with the Department of Defense (DoD). The marketplace originally piloted last year with the official launch last month.

Both companies and investors apply to join the marketplace and are screened by DoD. Those accepted are listed in the digital marketplace as trusted receivers or sources of funds and may connect with each other. As of this writing, 128 companies and 30 investors have logged into the marketplace.

Tax cuts and the Jobs Act of 2017, creating new designations for special national security-related companies in the tax code, are crucial components of the marketplace. Additionally, the fiscal 2021 National Defense Authorization Act references the marketplace program. Combined, these will increase use of the program; as users report on the program efforts, it expands. The goal is to help start-ups obtain funding without looking to foreign investors who may have adversarial ties.

Are you looking to work with the Department of Defense and trying to figure out how to get funding? Give us a call.

Practical Applications on the Chinese Tech Ban

On 23 July, the Defense Department released a memo explaining requirements for companies and contractors when the ban of telecommunications equipment made by Huawei and other China-based companies goes into effect. (Federal Computer Week, July 27, 2020)

Beginning 13 August, no contracts will be issued or extended to contractors using technologies or services and equipment made by Hikvision, ZTE or those listed in section 889(a)(1)(B) of the National Defense Authorization Act (NDAA) for Fiscal Year 2019. Any contract, task/delivery order, and off-the-shelf items purchased after 13 August must include language invoking regulation for the ban. Additionally, indefinite delivery contracts are required to be modified. (ibid)

There is a waiver process, however, pursuable by agencies. According to Alan Dhvotkin PSC executive vice president and counsel, the waiver “will most likely begin with issues identified by the telecommunications provider to its federal agency customer. The federal agency then asks for an ODNI review, which will conduct a risk assessment.” A granted waiver lasts two years and may be requested at any time. (Federal Computer Week, July 22, 2020)

Have questions or need a waiver? Give us a call.

 

What Brand is Your Telcom and Video?

Section 889 of the FY 2019 National Defense Authorization Act was passed to fight national security and intellectual property threats to the United States.  The legislation includes two prohibitions Part A and Part B. (GSA Section 889 Industry Focused Flyer, GSA.gov, July 16, 2020)

Part A, which became effective on August 13, 2019 bans telecommunications/video surveillance equipment made by the following companies:

  • Huawei Technologies Company
  • ZTE Corporation
  • Hytera Communications Corporation
  • Hangzhou Hikvision Digital Technology Company
  • Dahua Technology Company

Part A can be found in the Federal Acquisition Regulation (FAR) at FAR subpart 2.1.

Part B, effective 13 August 2020, prohibits the government from contracting with any organization that uses equipment or services of any of the companies listed under Part A. Part B applies, whether or not that usage is in performance of work under a Federal contract. In other words, if you use any of the banned companies in the fulfillment of a  non-government contract, you will be prohibited from working with the government. All contractors must verify whether they do or do not use prohibited telecommunications/video surveillance equipment or services. Part B has been added to the Federal Acquisition Regulation (FAR) at FAR subpart 4.21. (ibid)

GSA recommends companies to complete an in-depth review of all in-house technology to rule out using banned companies in Part A . If prohibited equipment or services are being used, companies that wish to continue doing business with the government must eliminate them. GSA does not take responsibility for changes contractors make, unless done so by a modification to a current contract.

However, two possible waiver procedures with extremely high standards are available. This is to ensure waivers are not used to get “around” the prohibitions.

GSA is modifying all solicitations, Indefinite Delivery Vehicles (IDVs), GWACs, and other IDIQ contracts, to include Section 889 Part B requirements immediately. These requirements will be added to GSA’s existing non-IDV contracts as those contracts have their periods of performance extended.

GSA is hosting the following events so that industry may obtain additional guidance:

  1. The GSA Office of Small Business Utilization webinar on Section 889, July 30, 2020, 2:00 p.m. EST, registration may be found here.
  2. GSA recorded virtual webinar August 12, 2020, at 1:00 p.m. EST, registration forthcoming. This webinar will include leaders from GSA’s business lines explaining how they are implementing Section 889 into their business lines and panelists will answer pre-collected questions. (Questions may be sent to gsaombudsman@gsa.gov to arrive by COB August 5, 2020.) (ibid)

GSA recommends that vendors study the tools and publications to aid their understanding and compliance, as provided in Acquisition.gov.

Not certain if your contract is affected by Section 889 Part B and if so, what you can do? Give us a call.

Bye Bye Self Certify

Certification changes for Women-Owned Small Businesses (WOSBs) and Economically Disadvantaged WOSBs (EDWOSBs) will occur this summer. The Small Business Administration (SBA) expects the updated regulation to be published on 30 June 2020, and to go into effect 30 days after. (U.S. Small Business Administration)

Info we have so far includes:

  • Self-certification as a WOSB or EDWOSB will end
  • Certification, going forward, will be accomplished through an approved third-party entity or through SBA’s free online certification at certify.sba.gov. (ibid)

To assist in awarding women-owned business contracts, the government limits competition, by including just those businesses participating in the women’s contracting program. The goal of the government is to award the contracts to women-owned businesses in industries where WOSBs are underrepresented. Some contracts are restricted even further to include economically disadvantaged women-owned small businesses (EDWOSBs) only. The SBA keeps a current list of those eligible industries. (ibid)

Eligibility for the women’s contracting program:

  • Qualify as a small business
  • Company at least 51% owned and controlled by women who are U.S. citizens
  • A company with the day-to-day management of operations and long-term decisions controlled by women

Eligibility for the economically disadvantaged business within the women’s contracting program:

  • Meet all requirements of the women’s contracting program
  • Business is owned/controlled by one or more women, each with a personal net worth less than $750,000
  • Business is owned/controlled by one or more women, each with $350,000 or less in adjusted gross income averaged over the previous three years
  • Business is owned/controlled by one or more women, each $6 million or less in personal assets

The eligibility requirements are spelled out in Title 13 Part 127 Subpart B of the Code of Federal Regulations (CFR). (ibid)

To participate in the women’s contracting program, you must be certified as a women-owned business. First the company must have a profile on SAM.gov, and then go through the aforemention process at certify.SBA.gov. The SBA has approved the following four organizations to provide third-party certifications:

Updating certification information annually through both SAM.gov and certify.SBA.gov will maintain your status within the program as well as make contracting officers aware that your business meets the eligibility requirements to compete under the WOSB or EDWOSB umbrella.

Questions about self-certification, third-party certification, or the women-owned business contracting arena? Give us a call.

 

Lead Times! Get Your Lead Times Here!

When is the actual start and end of Procurement Administrative Lead Times (PALT)? The Office of Federal Procurement Policy (OFPP) is working on a measurement to answer this question, which seems to be not only a grey area in the procurement arena but a disputed one, as well.

OFPP is looking at the 2019 National Defense Authorization Act, section 878, which describes PALT as “the time between the date on which an initial solicitation for a contract or order is issued by a federal department or agency and the date of the award of the contract or order.”  OFPP would like to marginalize procurement process delays and believes having this definition in place will minimize those delays. (FCW, February 24, 2020)

The Professional Services Council and the Council of Defense and Space Industry Associations both welcome the definition being put in place. However, naysayers argue the OFPP language misses pre-solicitation work, such as: creating a requirements planning package that provides solicitation facts prior to issue; or when a particular contract is initially funded. According to some, the current definition ignores pre-solicitation lead time factors which do contribute to the time needed for a contracting officer to move from contract request to contract requirement in solicitation. (ibid)

Wondering how this affects your upcoming proposal efforts? Give us a call.