Both national and industry media have lit up this week with stories on how a clash over whether or not to raise the US’ debt ceiling could cause at least a partial government shut down. Should contractors be concerned? Not yet, anyway. The “extraordinary measures” taken this week by the Treasury Department have delayed any potential partial shutdown until late May or early June. Business should continue normally for some time. Contractors should work hard with their customers to get key acquisitions in place over the next four months. The closer Read more
So much hype surrounds the end of the federal fiscal year that contractors could be forgiven for thinking that they could spend the rest of the year at the beach. It turns out, though, that there is real business being done right now. The Air Force made two large awards this week on significant tech systems that together top $500 million in spending. The VA is moving quickly on its T4NG 2 contract that will have a ceiling of $60 billion, three times larger than the current contract. Smaller awards on innovative projects have been made by Energy and DHS. Read more
Is it enough for a company to develop a rationale on why it believed it was compliant with key contract terms after an allegation of a False Claims Act violation? That question may now be decided by the Supreme Court. A recent JD Supra article from the firm of Husch Lowell, LLP stated that lower courts had agreed with the company that an after-the-fact rationale on why it believed it was compliant with its contract was sufficient. (United States ex rel. Schutte et al. v. Supervalu Inc. et al.). Government lawyers argued, however, that an after-the-fact reasonable Read more
As contractors and their government customers await spending allocations for individual offices, now is a perfect time to showcase the solutions your customers can buy when the money does arrive. Every contractor’s calendar should have multiple appointments each day with both new prospects and existing customers. These are the longer, content filled discussions that simply aren’t possible later in the fiscal year. They can truly establish your company as a partner and give your customer information they may need to make good acquisition decisions later. Showing your company’s established, successful federal business can also establish you as a low-risk, reliable contractor. New market entries should show other public sector experience or be prepared to show how commercial market success stories are relevant to a prospective federal customer. Federal agencies tend to favor low-risk partners, with innovation being a term with a slightly different meaning than what it has commercially. Contractors should take care, though, not to just promote any old solution. Reading procurement forecasts, previous budget requests, and doing market research on what your targets are likely to buy are all essential. Having a great new piece of technology may not be enough. Remember that most larger acquisitions are planned well in advance. Showing how your solutions match to actual acquisition plans ensures that everyone’s time is well used. Successful companies also know that they must be ready to answer the “how” question, as in “how can I buy from you?”. While no contractor should force their customer to sift through multiple acquisition options, having 2-3 preferred and easy to use acquisition methods is a definite best practice. The ability to have in-depth educational discussions shrinks significantly about midway through the third quarter of the fiscal year. Make sure you plan accordingly and schedule those meetings now.
The Federal Acquisition Regulation (FAR) Council is seeking comments from industry on its proposed rule requiring contractors with over $7.5 million in annual government business to take various steps, depending on total sales, to track, report, and mitigate their greenhouse gas (GHG) emissions. Before the Council implements the rule, however, they should analyze the costs associated with it against any perceived benefits. The current generic term for this asks “is the juice worth the squeeze?”. It is an established best practice that all regulatory actions, including those that are procurement-related, go through a cost benefit analysis to ensure that the new requirements are justified based on quantifiable evidence. The costs of new GHG tracking and mitigation requirements are real, yet the universe of companies doing business in this market is small compared to the much, much larger commercial market. It is unlikely that merely imposing the requirements called for in the proposed rule would have any meaningful impact on worldwide GHG emissions. The FAR Council should quantify the expected benefits and weigh them against the cost of implementation before imposing new costs on industry. It should not be too much for industry to ask the government to do a little of its own research before it imposes new research requirements on others. If the Council does elect to move ahead, though, it should absolutely do so in tandem with the Securities and Exchange Commission that is also developing GHG requirements for publicly traded companies. The SEC rules could have a wider impact, but if the two actions are not coordinated, publicly traded companies that also sell to the government could be covered by two similar, but not identical, rules, each with its own data collection, reporting, and mitigation requirements. That adds to both cost and confusion for contractors and will ironically have the potential impact of requiring more paper generation, driving up GHG emissions. Contractors should absolutely comment on the proposed rule and understand the potential impact on their business. In the meantime, the FAR Council should take care to not impose new costs that will bring little, if any benefit, and coordinate its actions with other agencies promulgating similar rules.