5 Key Ways a Contractor Can Be Subject to a Government Claim

The performance of any government contract by a contractor has the potential to bring certain monetary risks of a government claim against the contractor. Below, we discuss 5 key ways a government contractor can be subject to a government claim and best practices to reduce your risks. 1. Overpayment A common type of government claim is based upon what the government considers to be an overpayment on its part. For example, an agency might have paid an invoice where the . . . Read More

Small Business Set Asides Now Allowed Outside the U.S.: What You Need to Know

Effective May 26, 2022, the Federal Acquisition Regulation (FAR) gives contracting officers the discretion to apply the Small Business Act (Act)—implemented by FAR Part 19—outside the United States and its outlying areas.  This final rule (Rule) could create significant business opportunities for small business government contractors capable of competing for overseas procurements.  By way of background, the Small Business Administration (SBA) has consistently taken the position that the Act is not geographically limited and, as a result, FAR Part 19, should . . . Read More

New Virginia Law Prohibits “Pay-When-Paid” and “Pay-If-Paid” Provisions in Construction Contracts

Construction contracts routinely set payment terms as “pay-when-paid” or “pay-if-paid.” These terms protect the prime contractor from bearing all the risk of nonpayment by the owner. In Virginia, however, that will not be true for much longer. Last month, Virginia lawmakers passed Senate Bill 550, which makes “pay-when-paid” and “pay-if-paid” clauses unenforceable in most circumstances. Specifically, the new law applies to both public construction contracts and certain private construction contracts that involve at least one general contractor and one subcontractor. . . . Read More

Fraud Allegations Could Bedevil Borrowers in SBA COVID-19 Relief Programs for Many Years

As everyone who has been tracking the COVID-19 relief programs since 2020 knows, at the outset there was massive confusion about the programs’ requirements as well as fear that funding could run out before businesses with uncertain futures could secure assistance. Now, two years later, we have heard from numerous clients who have received notice that the Small Business Administration (SBA) intends to audit the Paycheck Protection Program (PPP) Loan or Economic Injury Disaster Loan (EIDL) applications, and even of . . . Read More

Federal Circuit Clarifies the Scope of Incorporation by Reference

A recent Federal Circuit decision supplies helpful direction to contractors wishing to incorporate their standard commercial terms and conditions into their government contracts. The federal government often claims that it wants to make its contracting process more like the commercial marketplace, but the government does not make it easy for commercial companies to do business with it. CSI Aviation, Inc. v. Dep’t of Homeland Security highlights the potential confusion surrounding the terms and conditions governing government contracts for commercial products or services. There, the contractor succeeded after several . . . Read More

SBA Requests Comments on Potential Change in Size Standard for Resellers

On April 26, 2022, the U.S. Small Business Administration (SBA) issued a proposed rule regarding its small business size standards for federal contractors in manufacturing and other industries with employee-based size standards. Small business federal contractors should take note of the proposed changes and consider whether to address this proposal by submitting a public comment by the June 27 deadline. SBA’s proposals include potential increases in the size standards for 150 industries. These include the size standard for surgical appliance and supplies manufacturing . . . Read More

OHA Confirms M&A-Related Recertification Won’t Impact Contractor’s Eligibility Under Pre-Existing Contracts

For small businesses, navigating the recertification rules promulgated by the Small Business Administration (SBA) is no easy task. SBA rules generally provide that the size of a concern is determined at the date of its initial offer including price and if the firm is small at that time, it generally will be considered small throughout the life of the contract. However, if a concern undergoes a merger, sale, or acquisition, or novates its small business contract to another concern (each . . . Read More

GSA Moratorium on Enforcement of Economic Price Adjustment Provisions: 3 Important Takeaways for Government Contractors

In response to rising costs for government contractors amid skyrocketing inflation, the General Services Administration (GSA) is temporarily suspending the enforcement of many limitations contained in several Economic Price Adjustment (EPA) contract clauses. Below we summarize three important takeaways for federal contractors—especially small businesses and small-disadvantaged businesses—to help you manage your GSA contract performance in light of rapidly changing economic circumstances. The GSA’s March 17, 2022, acquisition letter establishing the moratorium applies to these EPA contract clauses: GSAR 552.216-70 Economic Price Adjustment . . . Read More

President Biden Signs PRICE Act to Reform Federal Procurement and Help Federal Small Business Contractors

President Biden recently signed the PRICE Act (Promoting Rigorous and Innovative Cost Efficiencies for Federal Procurement and Acquisitions Act). The Act expands opportunities for small businesses to work with the federal government and encourages identification and promotion of best practices for acquisition techniques and procurement practices. In this blog, we review the goals of the Act and its impact on the small business contracting community. The PRICE Act amplifies the role of federal small business contractors by encouraging the adoption of innovative . . . Read More

Board Rejects Software Company’s Attempt to Enforce License Agreement Against Government Agency

Software companies frequently choose to sell their products to the government through resellers as a cost-effective way to reach the federal marketplace with minimal compliance obligations. But even when the government purchases software from a reseller, the government often must agree to the software company’s end-user license agreement (EULA). For years, there have been questions about how software companies could enforce those EULAs. There is still no definitive answer, but the Civilian Board of Contract Appeals (CBCA) recently confirmed that . . . Read More