Long exempt from application of many FAR sections, including many cost and price disclosures, commercial pricing has come under heavy scrutiny over the past year and a half. In October 2010, FAR 15.4 was changed to augment the government’s ability to obtain cost or price data on all federal contracts, including contracts which were previously exempt from such disclosure requirements. In the year plus period following the change to FAR 15.4, contractors are now finding governmental requests for data other than certified cost or pricing data for procurements which never had been subject to such requirements, such as procurements for commercial items.
Previously, market competition was thought of as an adequate control to ensure commercially based prices were fair and reasonable. If a particular product/service offered by one seller was too expensive, the government could always buy from another seller. The government’s position, however, is that the theory of market competition only makes sense provided there is actual competition. For non-competitive commercial item acquisitions, contractors are finding that the government, in particular the Department of Defense, is requesting more cost and pricing data to support such prices and relying less on the theory of market completion as a price control measure. Additionally, contractors are finding such data requests are being made not only for sole source procurements, but also procurements where multiple bids were expected but only a single bid was received.
The CB&H Government Contracting Services Group will be exhibiting and speaking at the 2012 National Veteran Small Business Conference and Expo in Detroit, Michigan being held June 26-29, 2012. The conference is hosted by the Department of Veterans Affairs with a focus on helping veteran-owned businesses maximize opportunities in the federal marketplace. It is anticipated that there will be some 6,000 participants, 500 exhibitors and over 200 training and business requirements sessions during the four-day conference.
Join Cherry, Bekaert & Holland for an educational seminar on the Service Contract Act (SCA). We will present the history and purpose of the Service Contract Act and discuss to whom it applies and when. Key terms and primary requirements will be introduced alongside of a discussion of Bona Fide Benefit Plans, common computational issues and recent regulatory changes. Brad Smith and Chris Wade from Cherry, Bekaert & Holland’s Government Contractor Services Group will be presenting.
Date - Wednesday, May 23, 2012 Registration Deadline:
Monday, May 21, 2012
Location - Cherry, Bekaert & Holland, L.L.P.
1934 Old Gallows Road - Suite 400
Vienna, VA 22182
In February, we let you know about the new contract vehicle employed by the U.S. General Services Administration (GSA) for complex, professional services contracts that include information technology (IT) components as a major part of the scope of work or contract requirement. This new contract, formerly known as Integrations, has been renamed OASIS or One Acquisition Solution for Integrated Services.
OASIS will cover multiple professional disciplines and will be used for services that are difficult to quantify prior to award, such as program management and consulting services, logistics, engineering and financial services.
The GSA has released a new Special Item Number (SIN) under IT Schedule 70 for new IT services or products. IT Schedule 70, which is the largest and most widely used acquisition vehicle in the federal government, is an indefinite delivery, indefinite quantity multiple-award schedule providing direct access to IT products and services from industry partners.
The new SIN, 132-99, is geared towards new commercial services or product offerings within the scope of IT Schedule 70, that are not currently available under any Federal Supply Service contract that provides a new service, function, task, or attribute.
The offering must be a commercial IT service or product that exists in the commercial market, but has not yet been introduced to the federal government. This new SIN is meant to serve as a temporary location for new products or services that do not meet the criteria for already established SINs.
Offerings under this SIN can remain there for up to two years while GSA researches the offer to determine which established SIN it should be placed under, or if a new permanent SIN should be created for the need that this offer seeks to address.
The Department of Defense (DoD) has proposed to amend the Defense Federal Acquisition Regulation Supplement (DFARS) to utilize automatic contract writing systems in the acquisition of commercial items and to specify flow down of clauses to commercial subcontracts* . The DoD believes the use of automatic contract writing systems will save time and governmental resources in the acquisition process for commercial items.
Currently, DFARS 252.212-7001 requires Contracting Officers manually ‘check the box’ in commercial item acquisitions to denote applicable clauses. The proposed amendment would allow automatic contract writing systems to select these clauses, removing such efforts from the hands of Contracting Officers and reduce the need for continuous update to listings of clauses applicable to commercial item acquisitions to account for modifications, such as amendments and date changes, thereby saving time and resources. The proposal1 also suggests revising DFARS clause 252.244-7000, Subcontracts for Commercial Items and Commercial Components (DoD Contracts), to specify that the contractor is not required to flow down the terms of any DFARS clause in subcontracts for commercial items unless specified in the particular clause.
The Office of Federal Procurement Policy (OFPP) has set the Executive Compensation Cap (the Cap) for 2011. The Federal Register establishes the new Cap at $763,029 for Fiscal Year 2011. The Cap is implemented at FAR 31.205-6(p), and is typically adjusted annually by the OFPP. This year’s increase is a nearly 10 percent jump from the 2010 cap of $693,951. This increase represents the third largest year-over-year increase since 2004. The Cap is effective January 1, 2011, and must be used by contractors beginning retroactively with the start of a contractor’s 2011 fiscal year.
Held over two full days, the event will offer panel discussions and open forums focused on current accounting and compliance issues faced by government contractors. Recipients will receive 16 CPE credits.
When: June 7-8, 2012 Where: The Hilton McLean, Tysons Corner CB&H Speakers Include:
Sam Davidson, Director – Cost Estimating: A Process for Profitability, and Contract Changes and Terminations – A Consequence of the Times
John Ford, Senior Consultant – Joint Ventures/Teaming Agreements
Unless we experience a significant change of course, there are going to be major cuts in both defense and non-defense spending in the coming years. The result of these expenditure reductions will not require the federal government to do more with less, but to do less with less. Contractual efforts will be delayed and extended over longer periods of time. Procurements will be reduced or completely eliminated. Even the smallest contractor will be impacted.
Join us as we discuss:
An overview of the contractual changes and terminations process.
Government rights and contractor rights.
The “Christian Doctrine” as it relates to the terminations clause.
The inter-dependence of the changes clause with the terminations clause (i.e., the loss factor).
Preventive measures to reduce the impact of the Government’s failure to exercise contract options.
Addressing the impact of a partial contract termination.
Cost and profit considerations to maximize cost recovery.
Join Cherry Bekaert & Holland, The Business Bank, and GaryRegenhardtGoldsteinWade for an educational seminar on subcontracting and teaming agreements. This seminar will present technical information about common pitfalls to avoid in structuring subcontracts, NDAs and teaming agreements while also presenting useful information on the subcontract lifecycle and how to structure a compliant subcontract management system. Government Contracting consultants Bradley Smith and Chris Wade will be presenting along with the legal expertise of Stuart Gary and Michael Wade. The session will conclude with a short panel discussion moderated by Rosemary Cruz of The Business Bank.
