The new year isn’t starting out well for at least one contractor who just agreed to settle a False Claims Act case alleging that he submitted multiple false bids from two controlled companies and bribed other companies to do the same. Although this example is extreme, commercial item contractors need to be aware that the federal enforcement community is taking a long look at whether competitive practices, including those that many consider to be established commercial procedures, reduce competition and result in the government paying higher prices. The current case, per a January 3rd DOJ press release, involves two Maintenance, Repair, and Operations (MRO) contractors controlled by the same person. Johnny Buscema Jr. of New Port Richey, Florida, and his companies, S.A.F.E. Structure Designs, based in Las Vegas, and U.S.A. Manufacturing were the two cited in the press release. DOJ alleges that Buscema submitted non-competitive bids, paid other vendors to submit non-competitive bids, and submitted multiple bids from his own two companies on the same solicitations to assist the prime vendor in meeting its obligation to obtain bids from two or three vendors and make the bids appear more competitive. Although the settlement amount is only $1 million, no contractor should take solace in that. First, that amount was set based on what DOJ believed could reasonably be recovered. Larger companies would face higher monetary penalties. Second, Buscema likely had to spend hundreds of thousands of dollars defending against the case, in addition to lost productivity an, third, quite likely, a reduced opportunity for subsequent DLA MRO awards. Companies submitting bids for the same OEM solutions should take care to ensure that there isn’t even the appearance of bid rigging or discouraging competition. No one wants to start the year over $1M behind.
Well, that was more interesting than it needed to be. Congress finally passed a CR that will keep the government open through March 14th and then left Washington for the holiday break. While December winds down, though, here are three things contractors can expect to see that will shape their markets and business approaches.
1. A New Congress With New Priorities: The 119th Congress arrives in Washington in early January. While both chambers will be Republican-controlled, margins in the House will make passing anything of substance difficult. New committee chairs will also come into power with their own legislative and oversight agendas. Contractors should definitely be prepared to have the government acquisition market come under scrutiny, both as part of DOGE-related cost cutting initiatives and for increased attention on fraud, waste, and abuse.
2. New Political Appointees Will Begin To Arrive: As of January 20th a host of new political appointees will take up positions in the executive branch. While some high-profile positions require Senate confirmation, many more do not. Contractors should get familiar with the new faces and their priorities as soon as possible. Being proactive on how you can help and showcasing the value you bring to government missions are essential actions. Never assume that people “know” what you do for them if you haven’t told them lately.
3. Expect Disruptions to Business: Whether because of delayed FY’25 appropriations, the time it takes new leaders to get up to speed, or the impact of new policies on government business, contractors should expect speed bumps. While some of these may be mitigated by proactive messaging, companies should proceed with caution as some programs supported by the outgoing administration will almost certainly not be supported or continued by new leaders.
Proceed with caution until you know what this means for your specific business. Contractors can look forward to at least two types of “March Madness” only two months later as action heats up on both the college basketball season and 2025 appropriations. Happy New Year indeed.
Small Business Multiple Award Contract (MAC) companies will no longer be able to be identified as small for business conducted under their MAC’s if they are purchased by a non-small business under a new rule recently published by the Small Business Administration (SBA). Such contractors had previously been able to continue being considered small for the duration of the original MAC award, even if acquired during the contract term. As of January 17, 2026, however, this will no longer be the case. The SBA change was tucked inside a massive rulemaking that, on its face, impacted only HUBZone contractors. The second part of the rule title, “Clarifications to Other Small Business Programs” is perhaps one of the SBA’s largest Read more
Allen Federal has seen and heard a lot of strange things over our 30+ years in federal acquisition. Both contractors and government officials have caught us by surprise. What is oblivious to some is obvious to others. As a public service, and back by popular demand, here is our “top 10” list of questions and statements from just 2024, none of which we are making up. If this leaves you scratching your head, please contact us here at Allen Federal or take some time away from government procurement.
- I didn’t know that was an actual rule.
- Is it a problem if my contract is FOB destination and I’ve been charging for shipping (a repeat offender)?
- I didn’t think there were any rules if we were just a sub.
- My prime didn’t flow anything down to me.
- What do you mean I can’t charge a price higher than my Schedule contract price (for a Schedule transaction)?
- Can I take an order against my expired contract?
- You charge for that?
- From a GSA CO: We can’t tell you why we did that.
- I can’t have a discussion with you since we’re in the RFI stage.
- And yes, this happened again: Can you send me a copy of the FAR so we can red-line it?
The current Continuing Resolution (CR) funding all government agencies expires at midnight December 20th. With no apparent agreement on top level spending numbers, it appears increasingly likely that Congress will pass a CR funding the government through sometime in March. Appropriations experts have noted that full appropriations measures weren’t passed until late April during the initial year of the first Trump administration. There doesn’t appear to be a major push for a government shutdown right before the Christmas holiday, but any CR will realistically need to have Democratic support in the House to pass. Whether that will come Read more