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SBA Proposes Revisions to Ownership and Control Requirements for the 8(a) Business Development Program, 10.24.22, Meghan Leemon
As PilieroMazza noted recently here, the Small Business Administration (SBA) released a major proposed rulemaking that will impact government contractors, primarily those that are participants in the 8(a) Business Development Program. PilieroMazza has posted a series of blogs regarding SBA’s proposed rulemaking, and this client alert highlights some of the proposed changes that pertain specifically to the 8(a) Program. Read more here.
Potential Changes on the Horizon for DOT’s Disadvantaged Business Enterprise Program, 10.18.22, Jackie Unger
The Department of Transportation’s (DOT) Disadvantaged Business Enterprise (DBE) Program is in the midst of a major overhaul that would update, streamline, and clarify existing rules; strengthen implementation; and increase reporting requirements. The DOT’s DBE Program allows small businesses owned by socially and economically disadvantaged individuals to tap into billions of dollars’ worth of contracting opportunities issued at the state and local level through federally-funded infrastructure projects. On July 21, 2022, DOT issued a notice of proposed rulemaking (Rule) which presents the biggest potential changes to the DBE Program since 2014. This client alert covers major changes from the Rule that will affect all stakeholders in the DBE Program including certifying agencies, DBE-certified contractors and applicants, and contractors seeking to team with DBE firms. Read more here.
GSA Publishes Draft Solicitation for Alliant 3 Contract
The General Services Administration published a draft solicitation seeking feedback for the upcoming government-wide IT services and solutions contract, Alliant 3. The new contract scope will encompass “every conceivable aspect of IT services” including any future IT services. The release of the Alliant 3 draft solicitation comes about two months after GSA announced a $25 billion ceiling increase of its Alliant 2 customized IT services contract to the new ceiling of $75 billion. Comments on the draft solicitation are due January 6, 2023. Read more here.
Two More Protests Filed Against Polaris
Two additional protests have been filed in response to the terms of General Services Administration’s Polaris IT contract vehicle. The protesting organizations argue that the solicitation violates Small Business Administration (SBA) regulations by limiting the number of mentor-protégé joint ventures that can submit proposals. The organizations also argued that Polaris’ past performance requirements violate SBA regulations regarding considerations of offerors’ past experiences. Polaris currently requires that the protégé submit at least one of its own relevant past experiences or an experience from the joint venture. Read more here.
CAAC Consultation to Issue a Class Deviation from the FAR to Provide Time for the System Implementation of FAC 2022-08
The Civilian Agency Acquisition Council (CAAC) published a letter authorizing agencies to issue a class deviation to utilize the new policies in Federal Acquisition Circular (FAC) 2022-08 (87 FR 58218) published on September 23, 2022. The deviation allows agencies to use the new policies while the Integrated Award Environment is working to implement the new policies in the System for Award Management (SAM). The Federal Acquisition Regulation (FAR) cases in FAC 2022-08 make changes to entity representations in SAM (i.e., FAR provisions 52.212-3, Offeror Representations and Certifications—Commercial Products and Commercial Services, at paragraph (c) and 52.219-1, Small Business Program Representations, also at paragraph (c)). Starting October 28, 2022, the new version of these two provisions will be shown on eCFR and acquisition.gov, but will not appear on SAM. Until the SAM system is updated, contracting officers cannot rely on certain representations in SAM. Therefore, CAAC is requiring that contracting officers follow the procedures outlined in its letter until the FAR changes are implemented in SAM.gov. Read more here.
TSA Updates Rail Rules to Combat Rising Cybersecurity Threats
The Biden Administration updated and extended rules for freight and passenger rail, bolstering operators’ efforts to respond to growing cyber threats. The Transportation Security Administration debuted a directive that requires railroad carriers to have an updated plan to respond to cyberattacks and further test the effectiveness of their protections. The policy, which took effect October 24, 2022, replaces a similar security directive the agency issued last year, which was set to expire at the end of 2022, and has the support of industry. Read more here (subscription required).
AI Training Act Signed into Law
The President signed the AI Training Act into law. The bill requires the Office of Management and Budget to create a training program for the acquisition workforce addressing the risks artificial intelligence (AI) poses regarding privacy and discrimination. The training will also cover the opportunities AI presents for the Federal government. Read more here.
SBA OIG Releases Report on Top Agency FY23 Challenges
The Small Business Administration (SBA) Office of Inspector General (OIG) released a report on the agency’s top management and performance challenges for Fiscal Year 2023. The report discusses eight major performance challenges that the SBA faces, as well as the issues that contribute to these challenges, many of which have been outlined in previous OIG reports. One major challenge that the SBA must address is managing COVID-19 stimulus spending as the agency faces fraud in programs like the Economic Injury Disaster Loan Program and the Paycheck Protection Program. Read more here.
GSA to Build Evidence on Advancing Equitable Outcomes Through the American Rescue Plan
The General Services Administration announced it has awarded a multi-year contract to the American Institutes for Research to examine the role of the American Rescue Plan (ARP) in advancing equitable outcomes across a range of federal, state, and locally implemented programs. President Biden signed the historic $1.9 trillion ARP on March 11, 2021, to help families, workers, communities, and small business owners recover from the public health and economic impact of COVID-19. Major components of the ARP were designed to respond to the disproportionate negative impacts of the pandemic on underserved individuals and communities. Read more here.
Small Business Investment Company Investment Diversification and Growth
The Small Business Administration (SBA) is proposing to revise the regulations for the Small Business Investment Company (SBIC) program to significantly reduce barriers to program participation for new SBIC fund managers and funds investing in underserved communities and geographies, capital intensive investments, and technologies critical to national security and economic development. SBA’s proposed rule would introduce an additional type of SBIC, Accrual SBICs, to increase program investment diversification and patient capital financing for small businesses and modernize rules to lower financial barriers to program participation. Comments are due December 19, 2022. Read more here.
Increasing New Entrants from Underserved Communities and Advancing Equity in DOE Management and Operating and Major Site and Facility Subcontracts
The Department of Energy (DOE) published an Acquisition Letter, AL-2023-01, that provides guidance to Heads of Contracting Activities and contracting officers on how to increase new entrants in DOE management and operating and major site and facility subcontracts. Read more here.
U.S. Imposes Semiconductor and Aviation Tech Sanctions on Russia
The State Department announced new sanctions on Russian technology procurement, following international concerns over the transfer of unmanned aerial vehicles between Russia and Iran. Specifically, the State Department officials designated Russian procurement agent Yury Yuryevich Orekhov and his companies Nord-Deutsche Industrieanlagenbau GmbH and Opus Energy Trading LLC as prohibited from conducting business with U.S. entities. Orekhov and his businesses were sanctioned pursuant to President Biden’s executive order signed in April that restricted Russian business activity with U.S. corporations and citizens. Read more here.
Upcoming Government Contracts Presentations
Update Regarding Executive Order 14042, Ensuring Adequate COVID Safety Protocols for Federal Contractors
Consistent with an October 14, 2022, notification from the Office of Management and Budget (OMB) and the Safer Federal Workforce Task Force (Task Force), OMB has issued guidance to agencies concerning the implementation of Executive Order 14042, Ensuring Adequate COVID Safety Protocols for Federal Contractors. Despite the lifting of the nationwide bar to enforcement on October 18, 2022, at this time agencies should not: (1) take any steps to require covered contractors and subcontractors to come into compliance with previously issued Task Force guidance; or (2) enforce any contract clauses implementing Executive Order 14042. To allow time to develop advice and processes for meeting agencies’ obligations under Executive Order 14042 and applicable court orders, agencies should follow the instructions provided in the OMB guidance here.
DOD Announcement on COVID Safety Protocols for Federal Contractors
The Department of Defense’s (DOD) Defense Pricing and Contracting (DPC) published an announcement to ensure that DOD Components take no action to: require covered contractors and subcontractors to come into compliance with previously issued Safer Federal Workforce Task Force guidance or enforce contract clauses implementing Executive Order 14042, Ensuring Adequate COVID Safety Protocols for Federal Contractors. DOD’s announcement is in effect until further notice. Read more here.
Upcoming Labor & Employment Presentations
Treasury Releases CFIUS Enforcement and Penalty Guidelines
The Department of the Treasury, as Chair of the Committee on Foreign Investment in the United States (CFIUS) released its first-ever CFIUS Enforcement and Penalty Guidelines. CFIUS’s mandate of identifying and mitigating certain national security risks while maintaining the U.S. openness to foreign investment often requires CFIUS to enter into agreements or impose conditions on transaction parties to mitigate risks to national security that arise from a transaction. The new guidelines provide the public with information about how CFIUS assesses violations of the laws and regulations that govern transaction parties, including potential breaches of CFIUS mitigation agreements. Read more here.
Final Defendant in Conspiracy to Manufacture, Import, and Sell Counterfeit Military Clothing and Gear Sentenced to Federal Prison
Terry Roe—the final defendant to be sentenced in a wide-ranging conspiracy that developed, manufactured, and imported $20 million worth of Chinese-made counterfeit U.S. military uniforms and gear that were passed off as genuine American-made products to the U.S. military—was sentenced to 24 months in federal prison. Read more here.
Upcoming Litigation & Dispute Resolution Presentations