Will the CARES Act become permanent?

In March of 2020, when the Coronovirus became a pandemic, Section 3610 of the CARES Act went into effect. This section of the CARES Act provides economic relief to contractors so that they can continue to pay their employees. Unless Congress extends Section 3610 of the CARES Act, it expires on September 30, 2021. (Washington Technology August 5, 2021)

The Professional Services Council (PSC) would like for Section 3610 to become permanent. PSC Executive Vice President David Broome feels Section 3610 should become permanent. He reasons this by looking at how several agencies have heavily relied on Section 3610 during the pandemic. GAO saw a combined $882.8 million in reimbursements from across the Departments of Defense, Energy, Homeland Security, and NASA. (ibid)

GAO staff interviewed 15 contractors and 12 agreed that Section 3610 “had a great or moderate effect on their ability to retain employees, in particular those with specialized skill or clearances.” (ibid)

According to Broome, “GAO makes the case for establishing a permanent stand-by authority that would be available when needed and in place when the next emergency happens – be it a pandemic, a cyberattack or natural disaster. Establishing this authority now would be a prudent step to implement one lesson learned from the COVID-19 pandemic and ensure that the government and contractors are prepared for the next one.” (ibid)

Are you a contractor trying to take advantage of Section 3610 and not sure where to start? Give us a call.

 

Civilian Agencies: Showing You the $$$

Fiscal year 2020 was actually good for something — Civilian agency spending. Civilian agencies spent a record $228 billion in fiscal 2020, up 17 percent from fiscal 2019. The increase can be directly attributed to the Coronavirus pandemic. (Government Executive, October 8, 2020)

According to this report, published by Bloomberg Government, Health and Human Services (HHS), Veterans Affairs, and the Department of Energy drove the increased spending. Small businesses saw a 26 percent increase, or $59.4 million spent. The Department of Defense numbers, due to security purposes, see a 90 day lag in reporting; we likely won’t see those totals before the end of the calendar year.

Here’s a quick look at the spending breakdown:

  • Health and Human Services accounted for $41.2 billion or 44  percent of the overall $33.5 billion. The bulk of the spending came from vaccines, research, ventilators, and efforts related to the pandemic.
  • Veterans Affairs came in at $33.1 billion in fiscal 2020. The spending is likely attributed to community care.
  • The Department of Energy spent upwards of $35 billion on two nuclear research labs. Of note is the fact that each lab houses “supercomputers” performing coronavirus research.
  • Small Business Administration spending went from $177 million in fiscal 2019 to over $1.5 billion in fiscal 2020. Part of this is due to an RER Solutions Inc. contract being approved for a $500 million increase without competitive bidding, as disaster recovery loan applications inundated the SBA. (ibid)

Other transaction authority contracts, which are allowed a great deal of flexibility outside of the traditional procurement limitations, are increasing year after year as well. We expect to see this continue well into the future. (ibid)

Questions about the “other transaction authority contracts” and how to take advantage of their flexibility? Give us a call.