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ANNOUNCEMENT: PilieroMazza Forms "COVID-19 Client Response Team," March 18, 2020
SBA to Provide Disaster Assistance Loans for Small Businesses Impacted by COVID-19
U.S. Small Business Administration (SBA) Administrator Jovita Carranza issued the following regarding COVID-19:
|[The SBA] will work directly with state governors to provide targeted, low-interest disaster recovery loans to small businesses that have been severely impacted by the situation. Additionally, the SBA continues to assist small businesses with counseling and navigating their own preparedness plans through our network of 68 District Offices and numerous Resource Partners located around the country. The SBA will continue to provide every small business with the most effective and customer-focused response possible during these times of uncertainty.|
SBA’s Economic Injury Disaster Loans offer up to $2 million in assistance for a small business. These loans can provide vital economic support to small businesses to help overcome temporary loss of revenue. Read more about accessing SBA’s COVID-19 disaster relief lending here.
CRS Examines SBA Economic Injury Disaster Loans for COVID-19
The Congressional Research Service (CRS) released an insight report titled, “SBA Economic Injury Disaster Loans for COVID-19,” which considers whether SBA could provide economic injury disaster loans to eligible businesses and organizations that have suffered substantial loss as a result of COVID-19. The COVID-19 outbreak may have significant economic implications for businesses and nonprofit organizations including negative impacts on imports, global supply chains, and tourism. Furthermore, if COVID-19 becomes widespread or prolonged it may slow global growth, and some businesses may be forced to furlough or lay off workers. The insight report examines statutory bases for economic injury disaster loans and three declarations that could make economic injury disaster loans available. Read the full insight report here.
GAO Report About SBA Disaster Loan Processing
The Government Accountability Office (GAO) released a report titled, “Small Business Administration: Disaster Loan Processing Was Timelier, but Planning Improvements and Pilot Program Evaluation Needed.” SBA’s Office of Disaster Assistance, which administers the Disaster Loan Program, regularly develops disaster plans, but does not discuss risks and risk mitigation in detail in its planning documents. As a result, there is concern that SBA may not be adequately prepared to respond to challenges that arise during its disaster response efforts. This report examines SBA's:
- planning for and response to the 2017 hurricanes;
- disaster loan application and review process; and
- implementation of the Express Bridge Loan Pilot Program.
Based on its analysis GAO made five recommendations to SBA, including that it more comprehensively document risks and plans to mitigate these risks and evaluate the implementation of the Express Bridge Loan Pilot Program. Read the full report here.
SBA Adjusts Civil Monetary Penalties for Inflation
SBA issued a final rule amending its regulations to adjust for inflation the amount of certain civil monetary penalties that are within the jurisdiction of the agency. These adjustments comply with the requirement in the Federal Civil Penalties Inflation Adjustment Act of 1990, as amended by the Federal Civil Penalties Inflation Adjustment Act Improvements Act of 2015, to make annual adjustments to the penalties. This rule adjusts civil monetary penalties authorized by the Small Business Act, the Small Business Investment Act of 1958, the Program Fraud Civil Remedies Act, and the Byrd Amendment to the Federal Regulations of Lobbying Act. Read the published version here.
GAO Cost Estimating and Assessment Guide Update
GAO released the first update to its Cost Estimating and Assessment Guide, which presents best practices associated with developing a reliable, high-quality cost estimate and those associated with effective management of program cost through the use of earned value management. The update includes improved descriptions of cost estimating steps, additional technical information, and an updated format. Read more here.
Purchase Agreement Components, Part 1: Options for Forms of Purchase Price Consideration in Acquisition Agreements, March 10, 2020, Frank Massaro
Whenever parties enter into negotiations to buy and sell a target company, one of the first points of discussion is the purchase price. In particular, the purchase price discussion often reflects the amount of cash that will be paid by the buyer to the seller at closing, and, in fact, nearly all acquisitions involve cash as all or part of the purchase price consideration. However, a cash payment at closing is not the only type of consideration that is common in acquisition agreements, and other forms of consideration and the timing of their payment to the seller can help parties manage the risks associated with the acquisition and create incentives for continued cooperation between the parties. This blog, Part 1 in a 5-part series, will provide a brief overview of forms of consideration and the timing of their payment common in acquisition agreements. [Read More]
"Constructive Demotion" Claim Under Title VII Gains Traction in 4th Circuit District Courts, March 11, 2020, Paul Mengel
While the viability of a claim of “constructive demotion” under Title VII of the Civil Rights Act of 1964 (Title VII) has yet to be determined by the Fourth Circuit, a series of cases in district courts within the Circuit suggest that such might not be the case for long. In one such recent case, Judge Conrad of the U.S. District Court for the Western District of Virginia denied a defendant truck driver training company’s motion to dismiss a constructive demotion claim brought by a female instructor. Diana Salmons, the plaintiff in Salmons v. Commercial Driver Services, Inc., Case No. 7:19-cv-00532, claimed she was subjected to a pervasive pattern of sexual harassment at the hands of her male counterparts and, as a result, she brought a five-count complaint alleging sexual harassment, hostile work environment, discriminatory and retaliatory constructive demotion and constructive discharge, and sex-based wage discrimination, in violation of Title VII. Employers should be aware of the increased number of constructive demotion cases and the courts’ rulings on these matters, as well as conduct regular sexual harassment training to prevent this sort of behavior from occurring in the workplace. [Read More]
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Reselling Laptops and Tablets to the Federal Government Just Got Easier, March 12, 2020, Jon Williams
SBA issued a class waiver of the non-manufacturer rule (NMR) on March 9, 2020. Effective April 8, 2020, it waives the NMR for commercially available off-the-shelf (COTS) laptop and tablet computers. The waiver is great news for small business resellers in the IT industry because the waiver will make it easier for these small businesses to comply with the NMR when reselling COTS laptops and tablets to federal agencies. [Read More]
NASA OIG Examines Space Launch System Program Costs and Contracts
The National Aeronautics and Space Administration’s (NASA) Office of Inspector General (OIG) released a report titled, “NASA’s Management of Space Launch System Program Costs and Contracts.” In 2011 and 2012, NASA contracted with three commercial companies—The Boeing Company (Boeing), Aerojet-Rocketdyne (Aerojet), and Northrop Grumman—to develop the major elements of the Space Launch System (SLS) for the first two Artemis missions. This report updates the status of development and examines the remaining major SLS elements and corresponding contracts with Boeing, Aerojet, and Northrop Grumman. Specifically, the OIG assessed the extent to which:
- the SLS Program is meeting cost and schedule goals for Artemis I,
- NASA is tracking and appropriately reporting overall cost and schedule goals, and
- the SLS Program is managing cost and schedule for key contracts.
Read the full report here.
GAO Discusses Lessons Learned From Missile Defense Acquisition Efforts
GAO released the testimony of Cristina T. Chaplain, Director, Contracting and National Security Acquisitions, who testified before the U.S. House of Representatives, Committed on Armed Services, Subcommittee on Strategic Forces. Ms. Chaplain’s testimony summarized the lessons GAO identified in prior reviews of the Missile Defense Agency (MDA) that can be applied to strengthen transparency and acquisition practices for developing and fielding missile defense elements. Specifically, this testimony provides information on (1) steps MDA has taken to increase transparency and reduce acquisition risks and (2) ongoing challenges associated with improving transparency and reducing high risk acquisition practices. Read the full testimony here.
Related Government Contracts Law Presentations by PilieroMazza
The Cyberspace Solarium Commission Releases Report Aimed at Defending Against Cyber Threats
The Cyberspace Solarium Commission (CSC) was established in the John S. McCain National Defense Authorization Act for Fiscal Year 2019 to "develop a consensus on a strategic approach to defending the United States in cyberspace against cyber attacks of significant consequences." In its report, the Cyberspace Solarium Commission's proposes a strategy of layered cyber deterrence, offering over eighty (80) recommendations to implement the strategy.
These recommendations are organized into 6 pillars:
- Reform the U.S. Government's Structure and Organization for Cyberspace.
- Strengthen Norms and Non-Military Tools.
- Promote National Resilience.
- Reshape the Cyber Ecosystem.
- Operationalize Cybersecurity Collaboration with the Private Sector.
- Preserve and Employ the Military Instrument of National Power.
GAO Evaluates DOD’s Data Access Pilot Program
GAO released a report titled, “Federally Funded Research and Development Centers: Improved Oversight and Evaluation Needed for DOD’s Data Access Pilot Program.” The Department of Defense (DOD) launched a three-year pilot program in December 2017 to enable a streamlined process to share certain sensitive data, such as data collected from its contractors, with its Federally Funded Research and Development Centers (FFRDC). At times, FFRDCs need to access such data to support DOD. The pilot was intended to reduce the burden on FFRDCs to seek permission from hundreds of contractors to access information needed for their research. Six of DOD’s ten (10) FFRDCs have taken part in the pilot, enrolling a combined total of thirty-three (33) projects. DOD officials and FFRDC representatives reported that the streamlined process made the use of sensitive data feasible. As a result, FFRDCs with completed projects in GAO’s sample indicated they were able to provide more robust analyses or insights to DOD. Read the full report here.
Workplace Morals Clauses Take Hold Beyond Show Business in #MeToo Era
Bloomberg Law reports that morality clauses, which allow companies to terminate contracts based on behavior that could damage corporate reputation, largely appear in contracts for Hollywood actors and endorsement deals with stars or athletes. However, their use has expanded into companies’ executive-level managers as employers on Wall Street and beyond seek to avoid backlash from executive misconduct that can affect their bottom lines. The clauses have become common in merger and acquisition agreements, publishing deals, investor contracts, and as a term of employment for top executives, according to a report from Yale Law School, as well as media reports in the wake of #MeToo. Read more here.