What happens to your contract administration disputes—such as termination settlement proposals (TSPs), requests for equitable adjustment (REAs), claims, and appeals—pending before Contracting Officers (COs), the Boards of Contact Appeal (BCAs), and the Court of Federal Claims (COFC) when the federal government shuts down? This question is especially relevant to the present shutdown, given the amount of terminations federal contractors are dealing with due to the change in administration and shifting government priorities in 2025. This blog provides a quick rundown of how the shutdown will impact new and existing TSPs, REAs, claims, and appeals.
Pending TSPs, REAs, and Claims
TSPs, REAs, and claims that contractors already submitted to federal agencies whose contracting staff were furloughed are unlikely to be addressed until the shutdown ends. While there is no set deadline for COs to respond to TSPs and REAs, contracting officers typically have 60 days to make a decision on claims, unless the claim is over $100,000, in which case the CO has 60 days to respond to the contractor in writing and provide a reasonable future date by which the agency intends to issue its decision on the claim.
If the shutdown lasts long enough that it surpasses the 60-day deadline or other reasonable future date established by the agency for your pending claim, the best practice is to immediately follow up with the CO once the shutdown ends to ask for the status of their decision on the claim. The contracting officer is likely to seek a reasonable extension of time to make their decision. It is unlikely the BCAs or COFC would deny such an extension in the event that a contractor disputes it, provided that the extension is reasonable. Something like a day-for-day extension to match the time the CO was furloughed (e.g., a 10-day extension to the final deadline for a 10-day shutdown) is almost certainly reasonable; however, a contracting officer seeking a six-month extension to address a claim without support for why they need the extra time is likely unreasonable. Every claim is different and the length of time that would be considered “reasonable” depends on how large and complex the claim is. If you find yourself in a situation where you are considering disputing a contracting officer’s request for extension to provide a decision on a claim that was pending during the shutdown, please don’t hesitate to contact PilieroMazza for advice on whether or how to dispute the extension with the BCAs or COFC.
Pending Appeals
The major BCAs—the ASBCA and CBCA—confirmed they furloughed all non-essential personnel, but both have stated they remain open to receive filings during the shutdown. The ASBCA suspended all deadlines for pending discovery, reports, depositions, etc., for the duration of the government shutdown and stated that all filing due dates and appeal schedules will be updated once the government returns to an open status. The CBCA canceled all hearings and conferences scheduled to occur during the shutdown and stated that, except for statutory deadlines, each CBCA judge will have the discretion to modify the deadlines established in a specific case that occur during and after the lapse in appropriations.
It should be business as usual for contractors with appeals pending before the Postal Service Board of Contract Appeals (PSBCA). USPS issued a statement that operations will not be interrupted by the shutdown due to its status as an independent entity generally funded through the sale of USPS products and services rather than tax dollars. Our understanding is that, except for the USPS OIG, all components—including the PSBCA—are non-appropriated and will remain fully operational throughout the shutdown.
As discussed in our client alert regarding bid protests, COFC will remain open during the shutdown, and all deadlines will remain in effect. Additionally, the Court of Appeals for the Federal Circuit confirmed it will remain open for business during the shutdown and all filing deadlines and oral arguments will proceed as scheduled.
New Disputes
For any TSP, REA, claim, or appeal not yet submitted to the government, it is critical to remember the statute of limitations does not toll (i.e., the clock does not stop running) for a government shutdown. Do not waive your right to seek an equitable adjustment for a contract administration dispute by failing to timely submit your proposal, claim, or appeal during a shutdown!
Even if there are no COs or administrative law judges in the office to receive your correspondence, it is critical that you submit it on time. Both the ASBCA and CBCA underscored this point by expressly stating the shutdown does not impact the deadline for filing new appeals. The ASBCA writes “we are open to receive new appeal filings via email and we expect parties to continue to submit timely notices of appeal, regardless of the shutdown” and the CBCA writes that “any statutory limitations on the time within which a filing must be made will not be waived or tolled during the appropriations lapse.”
PilieroMazza recently covered this topic in-depth, but here is a quick reminder of the major deadlines to keep in mind:
- TSPs: Contractors must submit TSPs within the required timeframe, which is generally one year from receipt of a termination notice, depending on the FAR clause at issue. It’s critical to submit the TSP on time, as failure to do so permits the CO to unilaterally determine the amount due to the contractor.
- REAs: In some circumstances, there is no set regulatory deadline for an REA or requirement to file an REA, though they are often a precursor to a claim. However, it is imperative to review your contract as there are certain instances where an REA must be submitted within an established period of time. For instance, if issued a stop-work order under FAR 52.242-15, a contractor must assert its right to the adjustment within 30 days after the end of the period of work stoppage.
- Claims: Contractors have six years from the date that they knew or should have known of the dispute giving rise to the claim to submit a claim to the government.
- Appeals: Contractors have 90 days from the date that the agency denies the claim to appeal to the BCAs and one year from the date that the agency denies the claim to appeal to COFC.
Shutdown Related Disputes
To the extent that the shutdown itself creates a contract administration dispute, we are standing by to help. For more information, check out our client alert about Reducing the Negative Impacts of a Government Shutdown for Federal Contractors.
Should you have any questions regarding SWOs, terminations, REAs, claims, appeals, or any other government contract dispute, please contact Lauren Brier, Josie Farinelli, or another member of PilieroMazza’s REAs, Claims, and Appeals or Government Contracts practice groups.
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