GSA MAS Consolidation – What Current GSA Contractors Need to Know

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This is a guest post by John Abel and Haley Lawrie of Winvale.

The GSA MAS Consolidation is here, and things are changing FAST for government contractors. Not to worry, Winvale is here with all the information your company needs to help successfully navigate the new MAS solicitation updates. We’ve seen the updates and how they affect new offerors, but let’s take a look at how current contractors will be affected.

ALL GSA Schedule holders will be receiving a notice for Mass Modification A812 – MAS Consolidation over the course of the next week or so. Some of those reading this may have already received the notice, depending on Schedule number. Below is a schedule for the release dates of the mass mod across all 24 GSA legacy Schedules:

Mass Mod A812 Release DateLegacy Schedule Number
Friday, 1/3103FAC, 23V, 36, 48, 51V, 58 I, 599
Monday, 2/300CORP (PSS)
Tuesday, 2/400CORP (PSS) Cont.
Wednesday, 2/570
Thursday, 2/670 Cont.
Friday, 2/756, 66, 67, 71, 71 II K, 72, 73,
Monday, 2/10736, 738X, 75, 751
Tuesday, 2/1176, 78, 81 I B, 84

Why is the MAS Mass Mod happening?

GSA is making active efforts to modernize and simplify the federal acquisition process by consolidating the current GSA Schedules. This mass modification will be the most important to date for GSA Contractors.

24 Schedules have been consolidated into 1 Multiple Award Schedule, 12 Large Categories, 83 Subcategories, and 316 newly formatted Special Item Numbers. GSA wants to eliminate any duplicate Schedules while continuing to meet the needs of its government buyers.

When do you need to take action on Mass Mod A812?

It is imperative that you check your email regularly to ensure that you’ve received the mass modification notice. If your contract administrator has not received the email by the corresponding date for your specific schedule, contact your GSA Administrative Contracting Officer (ACO) as soon as possible. (Don’t know who your ACO is? Find them here.)

Not only is it essential for contractors to ensure acceptance of this mass modification in order to reap the benefits of the consolidation, it is also mandatory, with a 90-day window for acceptance after the initial email notification is received. Within this mass modification, contractors will be required to:

  • Review and accept 210 FAR and GSAM clauses
  • Review the updated terms and conditions for the MAS
  • Map existing SINs on your current Schedule to new SINs under the applicable Large Categories

If you have taken exception to any solicitation clauses in previous Mass Modifications, these exceptions will not carry over and that process must occur again.

How do you know what SINs you will have awarded after the Mass Mod?

It is important to note that awarded products/services, pricing, contract number, and the period of performance for your GSA Contract will NOT change. While the Contract Type and Special Item Numbers (SINs) will change, the pricing components of your contract won’t change. You don’t need to apply for a new contract and the Mass Mod will not automatically consolidate your contracts down to one contract per your DUNs number.

GSA will provide a mapping of your current SINs to the new SINs that will go into effect upon acceptance. If you are wondering what new SINs your contract will be mapped to, we can help.

Overall, changes from this MAS consolidation will be contingent on Mass Mod A812, but there are a few things on the backend that contractors must complete in order to be fully compliant and ensure proper use of the GSA Schedule to its full potential moving forward. Although accepting the mass modification will update a number of fields within GSA’s internal systems, contractors must still manually complete the updates through programs like SIP to reflect the new MAS structure on GSA eLibrary and GSA Advantage!.

After accepting the mass mod, contractors will need to perform a SIP upload to initiate a “merge” of the legacy SINs to the new SINs within 30 days acceptance. This will ensure that all records remain current with the new MAS solicitation structure and terms and conditions so that buyers will be able to conform to the new structure when seeking out contracting partners.

How will this impact your current GSA Schedule Maintenance?

To ensure there are no hiccups when accepting the Mass Mod, GSA is suspending the ability to submit requests in eMod for “Add SIN” and “Delete SIN” modifications under the legacy Schedules on Jan. 30, 2020. The ability to process “Add SIN” and “Delete SIN” modifications will be restored March 14, 2020. All other modification types will still be accepted throughout Phase II of MAS Consolidation.

With regards to sales reporting, SINS are effective immediately when you sign the Mass Mod, and you will see both legacy SINs and new MAS SINs in SRP for the first sales reporting period after the Mass Mod approval date. After that reporting period has been completed, future reporting periods will only display the new MAS SINs.

The MAS Consolidation may seem like a huge hurdle to overcome, but it is a step in the right direction for GSA and your GSA Schedule contract. To make it easier for our clients, Winvale is hosting a webinar on Tuesday, February 25 about the MAS Consolidation and how it impacts your contract.

If you can’t make the webinar, feel free to contact our consulting team today for more information on how these updates will affect your company’s GSA Schedule and a more in-depth look into the changes. Winvale offers full-service GSA Schedule support from our experienced professionals specializing in SIP, FAR compliance, GSA Advantage! and Schedule compliance.

This post originally appeared on the Winvale blog at https://info.winvale.com/blog/gsa-mas-consolidation-phase-2-current-gsa-contractors and was reprinted with permission.


15 Government Contracting Tips

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Our friends at Winvale offered this post from their client Andrea Davis, Director of Contracts at Govplace, who shared these top 15 tips that she’s learned in her 20 years working for government contractors, in no particular order:

1. Late is late.

Electronically submit your competitive proposal at least 24 hours in advance to be safe. Case law is not favorable for contractors who submit their proposal less than 24 hours before the due date, even if the late delivery is the Government’s fault (e.g., the Government’s network is down).

2. Small Businesses with sub-categorizations (e.g., Women-Owned Small Businesses, or HUBZone Businesses) count TWICE OR MORE for small business reporting.

So, if you are wondering why your large business is so excited about subcontracting to a woman-owned small business (WOSB), where the owner happens to be a service-disabled veteran (SDVOSB) doing business in a HUBZone, it is because the dollars subcontracted to this entity likely count towards the subcontracting goals for: 1) Small Business, 2) WOSB, 3) SDVOSB and 4) HUBZone.

3. The subcontract type does not have to match the prime contract type, and the subcontract NAICS code does not have to match the prime contract’s NAICS code.

If I had a dollar for each instance when I heard someone state the opposite of the above truths, I’d be a millionaire.

4. Generally, concerning Government data rights / Intellectual property (IP), even if a company develops software using Government funds under a Government contract, the Government doesn’t own the software.

The Government does have unlimited rights in the software, but so does the company who developed the software.

5. You’ll never regret having a solid process in place for comparing job candidates’ resumes to GSA Labor Category minimum qualifications for education and experience.

For both your company’s employees and any lower tier subcontractor’s employees. People charging to a GSA labor category for which they are not qualified is a compliance issue that can bite you years down the road. By then, people have moved on, resumes cannot be located, the subcontractor is out of business, etc.

6. In Government contracting, ‘realism’ and ‘reasonableness’ have opposite meanings.

When the Government is checking to see if labor costs/prices are too low (i.e., if they are worried about the company being able to retain employees during contract performance), they are evaluating for ‘cost realism,’ but if they are checking to ensure prices/costs are not too high, they’re evaluating ‘cost/price reasonableness.’ It is not correct to use these words interchangeably.

7. FAR 9.6 defines prime-sub relationships, partnerships, and joint ventures as contractor team arrangements (e.g., a classic teaming agreement resulting in a subcontract once the prime contract is awarded).

But a GSA Contractor Teaming Arrangement (CTA) is entirely different. A GSA CTA is a when two companies who each have their own GSA Schedules, join together to co-prime an opportunity. Interesting fact: since all GSA CTA partners are considered co-primes, if any of the GSA CTA partners are ‘other than small’ in the solicitation’s NAICS code, the entire GSA CTA is considered Large.

8. There is a difference between regulation and law.

The FAR is mostly regulation, but it also references statutes/laws. Understand that you can influence regulation by submitting comments when the proposed regulation is posted for public comment.

9. Many non-Federal (state and local) government entities and even commercial companies performing due diligence on a company, will check for SAM.gov active exclusions (formerly, the Excluded Party List System or ‘EPLS’).

Therefore, if you are debarred from Federal contracting, some of your other future non-Federal business may be at risk as well.

10. The protest ‘effectiveness rate’ percentage (in recent years ranging 43-47%) is the best way to gauge how often a protester gets some sort of relief in response to their bid protest at GAO.

If you only look at the sustain rate percentage, which is much lower (ranging 12-17%), you are not getting the full picture. Many protests are dismissed as ‘academic’ before the 100-day time frame at GAO (often because the agency chooses to take corrective action to remedy a procurement flaw) so you can’t just look at the protests that went to a full GAO decision.

11. Post-award obligations in teaming agreements (TAs) (i.e., the requirement to enter into a subcontract) are generally not enforceable in Virginia because Virginia courts have repeatedly interpreted a TA as ‘an agreement to agree in the future.’

But some of the case law highlights things that would have potentially made the particular TA at issue enforceable. Like replacing this language: “The parties will negotiate a subcontract after prime award,” with “Prime shall award a subcontract to the subcontractor after prime award.” If you’re in the subcontractor role, try removing any language where a TA will terminate if negotiations haven’t concluded within x days of prime contract award. Virginia courts have left open the possibility that post-award obligations in TAs could be enforceable, depending on the certainty and specifics provided in the TA.

For example, while often impractical, courts have hinted that attaching a subcontract template to the TA that is contingent upon the prime being awarded the prime contract, would render the promise to award a subcontract enforceable. Note, however, that even when it is difficult for a teammate to enforce a prime’s promise in a TA to award the teammate a subcontract, that does not mean that other requirements and obligations in a TA are unenforceable. For example, the parties are still likely bound by the pre-award obligations to cooperate on preparing a proposal, to be exclusive to one-another (if applicable), and to maintain the confidentiality of information that may be disclosed pursuant to the agreement.

12. As Federal contracts professionals, we still must learn commercial contracts interpretation rules for our commercial negotiations.

The imperative ‘SHALL’ is the strongest language for contracts interpretation. ‘Will,’ ‘may,’ and ‘should’ are not as strong — use ‘shall.’

13. If you want to challenge a solicitation term (e.g., evaluation method, Statement of Work ambiguity, etc.) and you cannot resolve it through Q&As, you MUST submit a PRE-AWARD protest BEFORE THE PROPOSAL DUE DATE.

Otherwise, 98% of the time, a post-award protest challenging the solicitation will be dismissed by as untimely, regardless of the merit.

14. There is a difference between quotes and proposals. A quote is submitted in response to an RFQ and is considered ‘informational.’

The contract is not formed until the Government signs their acceptance of the ‘information’ and the contractor countersigns or starts performing. A proposal is an official offer made in response to an RFP that is valid for a specific duration of time (e.g., 60 days). It becomes a contract when the Government signs a contract with your proposal details in it.

15. Unless there have been some late 2019 cases on this topic, as of right now, the Government Accountability Office (GAO) case law on key personnel who depart a company between the time of a final proposal submission and contract award, is not favorable for contractors.

Companies would be wise to limit named key personnel (not propose more than required), and maybe offer proposed key personnel an incentive to stay until the contract is awarded (and hopefully longer). I’ve also learned that it can be helpful to get a written commitment from a departing key person that they will return to work for the company if an award is made.

This blog post appeared on the Winvale blog at https://info.winvale.com/blog/15-government-contracting-tips-from-winvale-client-govplace and was reprinted with permission.


SBA’s Implementation of HUBZone Changes

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This is a guest post by Sam Finnerty of PilieroMazza PLLC, highlighting some upcoming changes to the SBA’s HUBZone program, a program that limits competition for certain contracts to businesses in historically underutilized business zones.

These changes were designed to keep investment flowing into HUBZones and make sure they don’t lose their HUBZone status just because things got better. We don’t want making things better to stop the investment train.

As always, consult an attorney about how these changes might apply to your business.

On November 12-13, 2019, the U.S. Small Business Administration (SBA) hosted its 5th Annual Mentor Protégé Conference where SBA’s John Klein, Associate General Counsel for Procurement Law, answered questions from the audience regarding various mentor-protégé issues. Mr. Klein provided some key insights regarding recent and upcoming SBA rulemakings that will have a significant impact on small business government contractors.

On November 13, 2019,SBA sent a final rule to the Federal Register for publication that will implement comprehensive revisions to the regulations governing the Historically Underutilized Business Zone (HUBZone) Program. These revisions, as proposed in October 2018, are available here. A couple of the key changes are:

(1) an individual will continue to be treated as a HUBZone resident if that individual worked for the firm and resided in a HUBZone at the time the concern was certified or recertified as a HUBZone—even if the area where the individual lives no longer qualifies as a HUBZone or the individual has moved to a non-HUBZone area; 

(2) HUBZone firms will only be required to certify on an annual basis, meaning such concerns will no longer be required to expressly qualify as a HUBZone at the time of each offer for a HUBZone contract and award.

In addition to the revisions proposed in October 2018, the final HUBZone rule will also implement a significant change to the regulations that was proposed during public comment. Specifically, the final rule will indicate that when a company buys an office located in a HUBZone or enters into a long-term, 10-year lease for such office space, intending the space to be its principal office, the concern will be able to meet the principal office HUBZone criterion for a period of at least 10 years—even if at some point after the property is purchased or leased, the office location no longer qualifies as a HUBZone. The idea behind this rule is that the HUBZone program should incentivize and reward companies that invest in HUBZones.

For more information on this and other topics impacting government contractors, please contact a member of PilieroMazza’s Government Contracts Group.

Samuel Finnerty, the author of this Client Alert, is a member of the Firm’s Government Contracts, Small Business Programs & Advisory Services, and Government Contracts Claims and Appeals practice groups.

This post originally appeared on the PilieroMazza blog at https://www.pilieromazza.com/this-just-in-sbas-implementation-of-hubzone-changes-and-small-business-runway-extension-act-coming-soon and was adapted and reprinted with permission.


Finding Talent in a Flood of Resumes

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This is a guest post by Ross Statham of Dogwood Services Inc. Note from Bill: In a previous post, Ross shared the top three reasons to hire an executive search firm, and offered his expert tips for ensuring a productive partnership.

Want to tackle the hiring process yourself? Here are some suggestions for how to proceed, though keep in mind that the top talent will rarely respond to job postings.

  1. Allow sufficient time. My own experience has been to allow two or more hours per day (minimum) for 2-3 weeks.
  2. Determine the salary range, daily duties, and a brief overview of desired qualifications.
  3. Ask for help. This could be from your HR department, from subordinates, or from others on your team. They could help you write a good job description, help you better communicate with candidates and help you to find and select better talent.
  4. Setup someone you trust (HR, a member of your team or subordinate) to do some of the heavy resume filtering before handing them over to you.
  5. Post your job opening. But as noted above, don’t have the resumes come to your work email (which can be overwhelming), have them go elsewhere for filtration. 
  6. As the resumes arrive to you, toss out those who obviously won’t make your cut. Those who are a “maybe” can be sent a (form email) note thanking them for their interest, and spelling out some details of what you are looking for and painting a realistic picture of the job. Many people can be filtered out this way, saving you additional looking.
  7. If you need to perform a software “scan” for key words again (perhaps using a Boolean search), now’s probably a good time to do so. This is particularly helpful with technical positions, when you’re looking for details of what they’ve done and when.
  8. At this point you’re starting to see where some resumes are starting to meet your needs by putting eyeballs on the ones that get your attention. Save these; if you think it appropriate, you can put their names on a spreadsheet (such as Google Sheets) with notes.
  9. As your eyeballs scan resumes, look at their last three jobs. How long were they there? What did they accomplish? What were their daily duties?
  10. If they continue to hold your interest, drill down from “scanning” to reading. Look for obvious negative and positives. Red flags may include employment gaps, evidence of decreasing responsibility, a career that has flattened or is moving in the wrong direction, short-term employment at several jobs, and multiple shifts in their career path.
  11. Continue to review your selected resumes against your criteria and each other.
  12. Found someone you like? Look them up on LinkedIn and Google them and see what you can learn about them.
  13. Telephone screen potential candidates.
  14. Bring in strong candidates for a face-to-face.

Again, you need to ask yourself if you really have the time. If so, then have at it! But if you’re like most busy executives, using an experienced outside expert will tremendously shortcut the process which will save both time and money. Most importantly, it will help you find those harder to find talented people who rarely respond to job openings.

This post was originally printed on LinkedIn at https://www.linkedin.com/pulse/finding-flood-resumes-ross-statham/ and was adapted and reprinted with permission.


Three Reasons to Hire an Executive Search Team

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This is a guest post by Ross Statham of Dogwood Services Inc.

The firm I founded and lead (Dogwood) provides talent across a wide range of industries (including the Fortune 10), non-profits and government. Typically we are called in by those who have had previous experience with trying to do their own talent search and found it was much more efficient to use us or other recruiters, or by those who tried to do their own search but realized that it was more than they could effectively take on.

First, let’s discuss the three biggest reasons that organizations use outside search firms:

  • The best talent rarely responds to job openings
  • Your H/R department may be not equipped to help with this
  • Not enough hours in the workday

Challenge #1: The best talent rarely responds to job openings

You’re probably heard it before, and it’s true. The top talent is careful and circumspect as to making career moves. The best talent rarely goes looking for new opportunities – but they will listen when the right opportunity presents itself.

Many years ago this happened to me. I received one of those calls out of the blue, which turned into a great new job well suited to my own talents in the tech field. I loved my new job and never looked back. 

Your best talent will usually need to be recruited (reached out to) by someone outside your organization. Executive recruiters use their own databases, can dig and find the right talent and pitch your organization’s strengths to the very best prospective talent.

Challenge #2: Your HR Department may not be fully equipped to help

My general observation is that most HR departments may not be fully equipped to find talent, because it’s not their primary responsibility. Even at the company I lead (a talent acquisition company, no less), our own HR folks are concerned with administering to employees, ensuring that benefits are being properly managed, paperwork is up to date, regulatory compliance is being fully met and in dealing with the myriad of payroll, benefits, vendor, personnel and other HR issues that arise every day.

Most HR departments have stated goals to include talent acquisition in their responsibilities, but even the best HR departments have difficulty in doing so. However, my opinion is that most do an excellent job of supporting the process once candidates are identified and interviewed.

Challenge #3: Not enough hours in the workday

If you’re like most people, you are constantly adjusting your daily priorities in order to get things done on time and under budget.

Do you have time for this? Probably not. Our past experience has shown that those searching for talent need to allocate between 1-3 hours per day per job opening to pore through resumes, screen out those who are completely unqualified, second screen those who may be of interest, conduct basic phone screens and perform some basic information searches on potential candidates.

Free up your time by using an outside expert

By now you are learning why successful executives use outside executive search firms.

First, find someone who already understands your industry (so you don’t have to educate them) and who already knows where some of the best talent can be found. Make sure they’re reputable, well established and have a track record of success. (Yes, it’s okay to ask for references!) Ideally, they’re large enough to be well established, but not so large that your needs can get lost in the shuffle. 

You can use a contingency-based firm (where you only pay for success), or use a retained-search firm, where you pay a fee (in advance) and they exclusively represent you to candidates. Either way works, but I generally recommend you select an experienced contingency-based firm that you’re comfortable with and give them an exclusive for 30 days. That way they’re focused on you, you have a definite time frame in front of them, and you’re only paying for results. If they don’t work out, you can add someone else to the mix as needed without additional cost.

Allocating time to your expert

One of the best executive recruiters on our team tells his new clients that he’s their sharpshooter, and they’re his spotter (to tell him how he’s doing with the people he sends them, or in military terms, to tell him where his shots are falling). Because the hiring manager he’s working with has a need for specific talent, they form a “partnership” for a relatively short time while he finds, filters, screens and interviews talent for the client. Keep that in mind – these outside experts need your input for this to work in a timely manner.

During your initial call (which should only take about 15 minutes), tell them what you’re looking for, what you’re trying to accomplish and details about the job as you see it. Perhaps refer them to a subordinate for additional details and discuss compensation and benefits. Good executive recruiters know what kind of questions to ask and will guide you through areas you may not have even thought about.

Once you’ve started the process, turn them loose and let them do their jobs. You should start to see real results within two to five business days, depending upon the complexity of your needs. But remember – they need you to communicate where their shots are falling. Just five minutes per day allocated to your executive recruiter during the search can yield stellar results.

This post was originally printed on LinkedIn at https://www.linkedin.com/pulse/finding-flood-resumes-ross-statham/ and was adapted and reprinted with permission.


SBA Adopts Five-Year Receipts Calculation

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This is a guest post by PilieroMazza Partner Megan Connor and PilieroMazza Associate Anna Wright, members of PilieroMazza’s Government Contracts and Small Business Programs & Advisory Services practice groups.

Effective January 6, 2020, SBA will change the period of measurement for receipts-based size calculations from three years to five years. This change is the result of the Small Business Runway Extension Act of 2018 and SBA’s final rulemaking on December 5, 2019. This is a long-awaited change and will have far-reaching impacts for government contractors.

Importantly, SBA is adopting a two-year transition period, until January 6, 2022, during which firms may choose to use either the current three-year calculation or the new five-year calculation. After January 6, 2022, all companies must use the five-year period of measurement in determining their size under a receipts-based calculation. PilieroMazza strongly advocated for a transition period before Congress and in its comments to SBA’s rulemaking.

This shift from using a three-year period to a five-year period for the average annual receipts calculation will affect all of SBA’s receipts-based size standards, though the change in calculation will not yet apply to the SBA Business Loan and Disaster Loan Programs, which will be handled in a separate rulemaking. SBA did not address in its rulemaking how SBA would view contractors that have been using the five-year period of measurement since the Runway Extension Act became law nearly a year ago.

If you would like to know more about these changes and their potential impact on your company, please contact a member of PilieroMazza’s Government Contracts Group.


SBA Publishes Important Proposed Rule Changes to 8(a) and Mentor-Protégé Programs

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This is a guest post by Pamela J. Mazza, Managing Partner, PilieroMazza, PLLC.

On November 8, 2019, SBA published a proposed rule to merge its mentor-protégé programs and amend many of its rules governing the 8(a) program and small businesses. The proposed rule would have significant implications for the government contracting community. Comments are due by January 17, 2020, and PilieroMazza’s highlights are below.

Mentor-Protégé Programs

The proposed rule would:

  • Merge the 8(a) Mentor-Protégé Program into the All Small Mentor-Protégé Program;
  • Clarify eligibility criteria for proposed mentors and request comments on whether mentors should be restricted to mid-sized firms;
  • Provide flexibility for mentors with protégés with principle places of business in Puerto Rico;
  • Provide relief from the two mentors over the life of a protégé rule; and
  • Provide generally that protégés should be performing work under the North American Industry Classification System (NAICS) code used to qualify for the program.

Joint Ventures

The proposed rule would:

  • Eliminate joint venture approval requirements for competitive 8(a) contracts, but not sole source awards;
  • Eliminate the “three in two” rule;
  • Disallow substitution of joint venture partners who exceed the size standard for long-term contracts prior to recertification; and
  • Allow joint ventures to be populated with FSOs and provide guidance to agencies on when to allow joint ventures to bid on contracts requiring a clearance.

Multiple-Award Contracts (MAC)

The proposed rule would:

  • Require contracting officers to assign the most appropriate single NAICS code to each order under an MAC, whether for a supply or a service to ensure compliance with the non-manufacturer rule, requiring that each NAICS code be included in the underlying MAC;
  • Require an offeror to certify as to size and status in order to qualify at the time it submits its initial offer including price for an order under an UNRESTRICTED MAC, except for orders or BPAs issued under an FSS contract;
  • Require that, where the socio-economic status is first required at the order level, firms must qualify at that time; and
  • Permit size and status protests where the underlying MAC was unrestricted, except for BPAs and orders issued under an FSS schedule.

Certification

Self-certification

  • The proposed rule would allow a prime to rely on the self-certification of its subcontractor, provided the prime does not have a reason to doubt the certification.

Recertification

The proposed rule would that:

  • If a party to a joint venture becomes acquired or merges, only that partner (and not the non-affected partner) must recertify in order to qualify the joint venture to recertify;
  • A firm that mergers between proposal submission and award does not qualify for award if it could not or did not recertify, though size protests are permitted; and
  • Tribal entities are not required to recertify where ownership changes but the firm is owned to the same extent (i.e. 51%) by the ultimate entity.

8(a) Program

The proposed rule would:

  • Define “follow on contract” for purposes of retaining requirements in the program;
  • Loosen the prohibition on immediate family members owning 8(a) firms;
  • Allow for certain changes of ownership to occur without prior SBA approval;
  • Clarify SBA policy on voluntary withdrawals and early graduations from the program; and
  • Under some circumstances, allow firms to seek and obtain a multiple contract waiver from the sole-source restrictions for failure to comply with the business activity targets where certain extenuating circumstances exist that apply to multiple contracts.

Tribally-Owned Applicants and Participants

The proposed rule would require that:

  • Where a tribe, ANC, NHO, or CDC is reorganizing but ultimate ownership does not change, no prior SBA approval is required;
  • If SBA changes the primary NAICS code of a program participant because the participant has not been operating in its designated primary code for the past three years, another tribal entity be immediately qualified to apply using that code: although the program participant stated that code as its primary NAICS code, it really was not the primary NAICS code, so that code is now available for another 8(a) applicant;
  • Appeals be authorized where SBA has changed a firm’s primary NAICS code;
  • Potential for success be satisfied by a letter from a Section 17 corporation or some other economic development corporation or tribally owned holding company, so long as it can show financial strength;
  • Tribal entities not be required to submit small business subcontracting plans, as long as they are small for the NAICS code assigned to the contract; and
  • The excessive withdrawal rule generally not be applied to entities at least 51% owned by a tribe, ANC, NHO, or CDC.

Small Business Rules

The proposed rule would:

  • Require that mixed contracts include any combination of services, supplies, or construction, though construction was inadvertently omitted from the proposed rule;
  • Require that contracting officers consider past performance of first-tier subcontractors for certain bundled or consolidated contracts and for MACs over a certain dollar threshold;
  • Clarify that affiliation may be found under the newly organized concern rule where both former and current officers, directors, principal stockholders, managing members, or key employees of one company organize a new company in the same or a related industry; and
  • Request comments on how the non-manufacturer rule should be applied to multiple item procurements where one or more of the items are subject to a class waiver.

This post was originally published on the PilieroMazza blog at https://www.pilieromazza.com/blog-sba-publishes-important-proposed-rule-changes-to-8a-and-mentorprotg-programs and was reprinted with permission.

Note from Bill: The goal here is to make the rules consistent for everybody, and this is a very good thing. As a matter of speculation, it is possible we are also heading towards some kind of consolidation between the service-disabled veteran-owned small business program and the 8(a program), which are not exactly the same but probably could be treated the same. It looks like the SBA is moving in that direction, however that is not official yet by any means.


How Do I Get a GSA Schedule Contract?

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This is a guest post by Morgan Taylor of Winvale.

Having a GSA Schedule contract can provide a whole new world of business opportunities for your company. Billions of dollars go through GSA contracts each year, and there are millions of GSA contractors. The GSA Schedules program is a great way to break into government sales, but it can be a lengthy and confusing process if you’re not familiar with the requirements. Check out the steps to getting on a GSA Schedule below.

Preliminary

It is important to determine if you are eligible to submit a GSA proposal before beginning the proposal process. Below is a list of requirements to keep in mind:

  • Must have financial stability
  • Must have been in business for at least two years (unless it is a Schedule 70 Springboard offer)
  • Must be able to prove that proposed products/ services have been sold commercially
  • Must be compliant with the Trade Agreement Act (TAA)
  • Must have a DUNs Number and active SAM.gov registration

If your company meets the above requirements, then you are ready to begin the proposal process. There is a great deal of required documentation that must be submitted with a GSA proposal. The documentation is separated into three main sections: Administrative, Technical and Pricing.

Administrative

The administrative section gives GSA a background of your company. This includes documents such as financial statements, the employee handbook, the company organizational chart and SAM.gov registration. Additionally, at least one person from your company must have an active digital certificate upon submission. The administrative section also consists of various required training courses which prepare the vendor for acquisition and maintenance of a GSA Schedule.

Technical

The technical section of the proposal gives GSA a deeper look into your company’s experience and expertise. The technical section requires corporate experience and quality control narratives, which highlight the company’s skills and abilities as well as organizational functions. The technical section also includes descriptions of past projects completed and a customer ratings report called the Past Performance Evaluation.

Pricing

The pricing section is the bulk of the proposal. Offerors must provide pricing support for all proposed products or services that support the company’s commercial price list or market rates. If offering labor categories, you must provide detailed descriptions of functional responsibility, education and experience. In addition, the offeror must disclose all commercial sales practices, commercial prices, and GSA proposed pricing. The pricing section itself can include up to 15 different documents upon submittal.

Proposal to Award

Once the proposal has been submitted, GSA can either reject the offer due to insufficiencies or request clarifications. If the assigned Contracting Officer feels that the offer is sufficient, he or she will next aim to negotiate for lower prices. Once negotiations have concluded, a Final Proposal Revision (FPR) will be signed, and the contract will be awarded.

Submitting a GSA proposal can be a complicated process that requires a great deal of GSA knowledge and experience. Winvale has highly experienced consultants who have worked on proposals for nearly every GSA Schedule. Winvale consultants can support your proposal process from the very beginning all the way to award. Looking to acquire a GSA Schedule? Give us a call!

Morgan Taylor is a consultant for Winvale’s Professional Services Department where she provides GSA Schedule acquisition and maintenance support to her clients. Morgan is currently a member of the National Contract Management Association (NCMA).


Comparing Commercial and DoD/Federal Market Sector Business Environments

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This is a guest post by R.J. Kolton, SVP of Data Systems Analysts (DSA), Inc. and VP of Mid-Tier Advocacy, Inc.

The 17-person 809 panel was tasked with finding ways to streamline and improve the defense acquisition process. I met with the 809 Panel in February 2017 and I found it important to speak about the challenges facing mid-tier companies.

Another question the panel asked me to address was what are the differences between contracting with the Department of Defense and a commercial sector.

New entrants, such as “Silicon Valley” companies, entering via OTAs and other mechanisms will eventually confront the same challenges as traditional players in the defense sector. This is particularly the case as they achieve success, become established, and play by the same rules as traditional government contractors.

These new entrants must prepare to operate in a defense contracting business environment. Described below are key differences between the commercial and DoD business environments, which impact directly on the business models companies operating in those environments adopt:

1) Commercial Environment:

  • Customer/company commercial contractual practices reflect the need to adhere to general legal contractual requirements as defined by local, State, and federal government and are far less complex and formal than the practices encountered when working with DoD and to comply with the FAR/DFAR.
  • Commercial marketplace involves rapid customer decision making and compressed timelines.
  • Commercial marketplace includes flexible contractual arrangements that foster rapid business deals.
  • In general, there is no requirement to meet specific socio-economic/small business targets in contracting.
  • Customers have more flexibility to develop and establish criteria for selecting venders.
  • Awarded work often involves rapid delivery of products and services.
  • Companies focus on rapidly closing deals, maintaining continuous cash flow, and minimizing peaks and valleys in revenue/profit streams.
  • Companies maintain robust sales and marketing capacity to continuously sustain and grow business.
  • Commercial companies offering products/services relevant to DoD market sector stress continuous R&D and product scaling and improvement in order to sustain competitive position.
  • Losing companies in commercial transactions have little recourse to protest customer’s decision.

2) DoD Contracting Environment:

  • Contractual practices are guided by FAR and DFAR, unless waived, such as OTAs; procedures are formal and time intensive.
  • Customer procurement strategies, criteria, and practices reflect guidelines provided by Executive Branch, Congress, DoD, and DoD agencies, which leads to complex customer requirements.
  • Customer decision making involves multiple layers of leaders; all must adhere to specified procedures, which is time intensive.
  • Contractual arrangements promote adherence to intent and letter of the law rather than focusing on rapid award of contracts.
  • DoD agencies must stress adherence to socio-economic/small business targets.
  • DoD agencies allocate significant time and resources to develop criteria, specifications, and requirements for contractual competitions; companies operating in the defense market space establish business model that are influenced by those government characteristics.
  • Companies focus on obtaining access to contract vehicles, winning task orders or full & open competitions, and protecting incumbent work.
  • Awarded work often involves multi-year contracts; this reduces the challenges associated with short duration commercial work.
  • Companies address continuous cash flow and minimizing peaks and valleys in revenue/profit streams by sustaining numerous concurrent contracts.
  • Successful defense-oriented companies maintain BD teams that focus on account management/business intelligence, capture, and proposal development.
  • While many defense companies by their nature focus on R&D and building new capacity to remain competitive, they are influenced in their investments by the need to invest in activities required to meet DoD certifications and requirements (e.g.,  financial and security compliance, ISO-standards, CMMI-standards, etc.).
  • DoD is generally unwilling to compensate companies for being innovative; viewed as a value-added trait.
  • Companies operating in the defense market sector must obtain and sustain key certifications to remain competitive, such as ISO 9001:2008/2015, ISO 20000, ISO 27001, CMMI-3 & 4, NIST compliance, etc. This involves major internal investments.
  • Losing companies in DoD transactions can protest large procurements; this impacts government procurement strategies and timelines.

Companies must design their organizations to optimize performance relative to the customers they serve, and as I’ve shown, the commercial market is very different form the Government market.

Given this, the DoD will be challenged in enticing non-traditional companies to enter the DoD market sector. While the DoD can offer short-term relief to the various barriers to entry, non-traditional players in that market sector will eventually have to adapt business models that support congressional and DoD policy requirements.

Randy J. (“RJ”) Kolton is VP of Mid-Tier Advocacy Group, and Senior Vice President (SVP), Business Development for Data Systems Analysts (DSA), Inc., a mid-sized, employee-owned company that is a leader in delivering business driven information technology and consulting solutions and services to the Federal Government and industry. Building on experience spanning more than five decades, DSA has deep expertise and comprehensive understanding of the operational, security, collaboration, and identity management challenges our customers must address.


7 Ways that Mid-Tier Companies Are Being Squeezed Out of DoD Contracts

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This is a guest post by R.J. Kolton, SVP of Data Systems Analysts (DSA), Inc. and VP of Mid-Tier Advocacy, Inc.

The 17-person 809 panel, created in Section 809 of the FY 2016 National Defense Authorization Act (NDAA), was tasked with finding ways to streamline and improve the defense acquisition process. The panel had two years to develop recommendations for changes in the regulation and associated statute to achieve those ends.

As part of its review, the Section 809 Panel reviewed the DoD small business program. The panel ultimately developed several specific recommendations designed to improve how the DoD small business program supports DoD initiatives. One of the major areas of interest was determining how to promote the entry of non-traditional DoD companies who offered advanced technology and innovative solutions to DoD challenges.

I met with the 809 Panel in February 2017. I found it important to note that mid-tier companies performing in the DoD market sector play a major role in generating jobs and enhancing overall economic growth for the Nation and that mid-tier companies, defined as companies earning $25M-$500M annually, are being squeezed by small businesses on one side and by large businesses on the other.

In that context, I offered seven points, which also generally apply to small businesses, innovating companies developing new technologies, and companies that are new entrants into the defense market space.

  1. First, mid-tier companies cannot grow effectively if they are primarily subcontractors to large businesses since subcontractors are unable to obtain significant workshare.  Large businesses have little motivation to offer mid-tier companies significant work since DoD acquisition policies encourage them to award subcontracts to small businesses. 
  2. Second, the primary pathway for growth for mid-tier companies is to win large multiple award, indefinite delivery/indefinite quantity (IDIQ) contracts as primes so they can compete for agency task orders. However, to win these IDIQs, mid-tier companies must surmount major challenges:
    • Mid-tiers are often locked out of large multiple award IDIQs owing to significant past performance criteria.
    • The tendency of DoD agencies to consolidate contracts to reduce administrative burdens and costs, which favors large businesses. Such IDIQ consolidation reduces opportunities for mid-tier companies to penetrate and support customer agencies, which constrains future growth. Consolidation also poses risk to growth owing to long period of performance of awarded IDIQs; mid-tier companies often have to wait a decade before they can compete again as an IDIQ prime if they miss out on the near-term opportunity.
  3. Third, mid-tier companies must contend with ever rising costs that increase their indirect rates and make it more difficult to compete against large businesses. These cost increases are the result of several factors, chief among them are supporting employee benefits under newly enacted national healthcare polices, responding to current and emerging cyber security requirements, maintaining sophisticated auditable financial systems, and obtaining certifications and appraisals, such as ISO-9001:2008/20015, ISO 20000, ISO 27001 and CMMI-3/4, which DoD agencies increasingly require of companies seeking to pursue and perform work.
  4. Fourth, while mid-tier companies are capable of providing the same or better level of service and customer relations as large businesses, their competiveness is hampered by higher overhead costs relative to large businesses because they lack the scale to absorb those indirect costs. These higher costs, combined with the lowest price technically acceptable and low price competition environment we are experiencing in the defense sector, hinder mid-tier companies in achieving success as they compete against large business on full and open competitions. 
  5. Fifth, North American Industry Classification System (NAICS) codes used to classify DoD work and define company size standards offer little support for mid-tier companies. While some NAICS codes, such as 541712/5, Research and Development, reflect a size standard of 1000 employees, up from 500 employees in Feb 2016, DoD agency contracting officials tend to strictly interpret the type of work performed and the size standard offers little benefit to mid-tier companies. Hence, there are no contracting tools to benefit or promote mid-tier company growth.
  6. Sixth, graduating small businesses confront major challenges as they evolve into mid-tier companies and must compete as newly minted large businesses. While seeking a merger or acquisition may represent a potential exit strategy, in many cases, successful small businesses owe their growth to small business contract awards, which are of little value to large business acquirers. Hence, the businesses are at great risk of failing shortly after graduating from small business status: they are too big to be small and too small to be effective as large businesses. While the Congress and DoD have done an excellent job in establishing policies that promote small business growth, particularly for socio-economic challenged groups, they have failed to establish an effective strategy to promote business health and growth across the total business life cycle, from start-up/small business through mid-tier to large business.
  7. Seventh, and my final point, small business officials in DoD agencies generally sympathize with the challenges mid-tier companies confront, however they state they can do little to help without congressional and/or department involvement and legislation. Their focus is on accomplishing their duties by promoting the various small business classifications.

The US lacks a strategic approach to promoting growth of US businesses supporting the DoD. The current government programs that promote the interests of small businesses fail to account for their eventual growth into being mid-tier companies. At that point, such companies must compete against small businesses, other mid-tier companies, and very large companies. This poses great challenges to rising small businesses. I believe Congress and DoD should seek avenues to promote the lifecycle growth of companies by accounting for those mid-tier company challenges.

Randy J. (“RJ”) Kolton is VP of Mid-Tier Advocacy Group, and Senior Vice President (SVP), Business Development for Data Systems Analysts (DSA), Inc., a mid-sized, employee-owned company that is a leader in delivering business driven information technology and consulting solutions and services to the Federal Government and industry. Building on experience spanning more than five decades, DSA has deep expertise and comprehensive understanding of the operational, security, collaboration, and identity management challenges our customers must address.


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