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Tag: GAO

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.

 

Federal Supply Schedules: VA=GSA????

Earlier this year the Government Accountability Office (GAO) released the report, “VA Acquisition Management: Steps Needed to Ensure Healthcare Federal Supply Schedules Remain Useful (GAO-20-132).” (Federal News Network, February 21, 2020)

The report dives into the non-pharmaceutical Federal Supply Schedules and lays out 11 recommendations, nine to the Department of Veterans Affairs and two to the General Services Administration (GSA). The report also outlines how the VA and GSA should address their contracting operations supporting veterans healthcare. (ibid)

For some background, the Veterans Administration manages nine healthcare-related Federal Supply Schedules (VA FSS) that provide medical devices as well as services. Included in the VA FSS are medical-surgical equipment, pharmaceuticals, patient mobility devices, laboratory testing, and analysis services. The VA FSS accounts for about $15.4 billion in annual purchases, the pharmaceutical schedule making up $12.6 billion, with the additional eight schedules coming in at about $2.8 billion. For the last four years, sales under the eight non-pharmaceutical schedules have been somewhat flat. (ibid)

It turns out that the VA and GSA have a few areas where they are lacking a “team” mentality. The GAO also finds there is limited guidance and training of the VA contracting staff and it seems the VA FSS and the VA’s Medical-Surgical Prime Vendor program are duplicating efforts. This means longer processing times for contract awards, contract mods and higher admin costs for the VA and industry as a whole. (ibid)

GAO recommends the following:

  1. The VA provide comprehensive FSS guidance and training to the FSS contracting staff
  2. The VA and GSA improve collaboration, including the potential use of GSA’s procurement tools to support the VA FSS
  3. The VA evaluate timeliness goals and barriers to achieving them in the contracting process
  4. The VA assess FSS and MSPV-NB duplication to resource utilization and leverage its buying power (ibid)

The Coalition’s “VA Multiple Award Schedule White Paper” gives recommendations to increase the effectiveness and efficiency of the VA FSS. The recommendations are:

  • Recognize commercial practices when possible
  • Consistency with GSA/FSS policy
  • Streamline the evaluation processes
  • Reduce contracting costs for the government as well as industry (ibid)

The white paper goes on to make specific recommendations to align the VA’s price negotiations strategy with GSA’s approach. Additionally, the white paper touches on the use of GSA’s e-Offer and e0Mod systems to streamline the procurement process. As it turns out, the VA and GSA have very different approaches to contract audit support for their FSS programs. The white paper recommends the two align with GSA’s approach. (ibid)

Will there be more opportunities to work with the VA once their processes are synced up to GSAs? Give us a call.

Self Certification — No More ;-(

The 2015 National Defense Authorization Act mandated that the Small Business Administration (SBA) discontinue self-certification of women-owned and other small businesses. In 2020, SBA plans to finalize a self-certification rule that closes a loophole allowing participants in the SBA’s Women-Owned Small Business (WOSB) program to self-certify. (Federal News Network, June 2019)

Approximately one-quarter of all federal contracts are held by small businesses, which over the past six years has helped federal agencies to  exceed  SBA’s governmentwide small business contracting goal. This year’s spending of more than $120 billion on small business contracts surpasses last year’s spending by nearly $15 billion.

The Government Accountability Office reported in March that almost 40 percent of WOSB-certified businesses were ineligible. Meanwhile, SBA’s Office of Inspector General June 2018 audit found 89 percent of sole-source (50 out of 56 contracts) did not meet all program criteria. Basically, there is currently no way to know if the contracts, listed in the chart below, were actually eligible for the sole-source awards. (ibid)

Rob Wong, SBA’s associate administrator of the Office of Government promotes a formal certification to  give the program some much-needed integrity. Wong said, “simply put, the wrong companies were receiving our contracts, we want to make sure that, if a company receives a contract through these programs, they’re actually eligible to receive it.” (ibid)

SBA has subsequently published a proposed rule in the Federal Register eliminating self-certification and providing a free online certification application to WOSB. Comments on the proposed rule are being accepted until July 15. In Wong’s opinion, it is high time to streamline the vetting process for the many other set-aside programs, all of which have different sets of eligibility criteria. Wong feels that going to three formal certifications for 8(a), Historically Underutilized Business Zones, women-owned, and service-disabled veterans will unify the processes. The rule with set-aside screening is expected to take a year for the changes to take effect. (ibid)

Do you have questions about the new certification process and how it may affect your current contract or an upcoming opportunity? Give us a call at 301-913-5000.

DoE Bureaucracy Hard at Work

In fiscal year 2016, the General Accounting Office (GAO) conducted an audit of 28 entities to address issues with Department of Energy (DoE) contractor oversight. DoE, including it’s National Nuclear Security Administration, is the largest federal civilian contracting agency, spending about 90 percent of its appropriations on contracts with companies, universities, and others for federal research and development,  production, and engineering. (GAO, March 12, 2019)

After reviewing contracting and subcontracting data and documents, analyzing regulations, and interviewing federal officials and contractor representatives, GAO found: DoE awards about $23.6 billion in prime contracts with about 30 percent ($6.9 billion) of that total going to subcontractors in the form of universities, different companies, or entities; almost all 28 primes were also subs; subcontractors totaled nearly 3,000; and subcontractor complexity makes it difficult to figure out the relationship between the various parties. (ibid)

More than $3.4 billion in subcontract costs (over a ten year period) were never audited. Because the statute of limitations is six years (according to the Contract Disputes Act), many unallowable costs may not be recovered. (ibid)

GAO made six recommendations, including that DoE develop procedures requiring local offices to verify completion of subcontract audits and that DoE independently review subcontractor ownership information to identify potential conflicts of interest. DoE agreed with all recommendations except to independently review subcontractor ownership information. (ibid) Huh. Wonder why.