Procurement Policy

As the House and Senate Armed Services Committees prepare to mark up the Fiscal Year 2024 National Defense Authorization Act (NDAA), they are very likely to consider a number of China-related measures that have been recommended by the national security community and which could enjoy bipartisan support.  These recommendations are generally focused on countering Chinese influence in the United States or increasing the United States’ relative power advantage in the Pacific region. Continue Reading Fiscal Year 2024 National Defense Authorization Act: More China-Related Measures on the Horizon

Summary

The Department of Defense, General Services Administration, and the National Aeronautics and Space Administration have issued a proposed rule that would revise the Federal Acquisition Regulations (“FAR”) to implement section 5(b)(i) of Executive Order (“E.O.”) 14030, Climate-Related Financial Risk, requiring government contractors to publicly disclose greenhouse gas (“GHG”) emissions and climate-related financial risk and

Contractors often assume that government auditors have special authority to interpret the Cost Accounting Standards.  That assumption is easy to understand — auditors frequently take the position that there is just one “right” way for a company to do its contract cost accounting, based on how other companies do things.  But contractors should know that CAS is flexible and generally gives them options about how to comply, based on the circumstances of their business.  In short, a contractor’s business judgment matters, and contractors can use it to push back on auditors who take an overly rigid view of CAS.Continue Reading So the Auditor Says You Violated CAS?  Remember, Your Business Judgment Matters When Determining Compliance

The Department of Defense is seeking early input on implementation of the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023 (the “FY2023 NDAA”) in the Federal Acquisition Regulation and Defense Federal Acquisition Regulation.  Although this early engagement process will not replace the formal rulemaking process, it presents a significant opportunity for government contractors, technology providers, industry associations, and other interested parties to provide their perspectives on acquisition-related provisions of this year’s NDAA.  Providing early input can ensure that industry’s perspective is heard.  Indeed, providing input at this stage may impact the future rulemaking process by guiding areas of focus and influencing ways the rule makers ask for input during the rulemaking process.
Continue Reading DoD Seeks Early Input Regarding FY2023 NDAA Implementation in Acquisition Regulations

On December 23, 2022, President Biden signed the James M. Inhofe National Defense Authorization Act for Fiscal Year 2023 into law.  The Act contains two significant prohibitions regarding the procurement and use of semiconductor products and services from specific Chinese companies and other foreign countries of concern that will come into effect in December 2027. Continue Reading NDAA Prohibits Government Purchase and Use of Certain Semiconductors

In legislation passed last week, Congress directed the FAR Council to issue new rules for contractor organizational conflicts of interest.  The legislation itself did not create any new OCI standards, but provided factors for the council to consider, focusing on conflicts of interest for companies that act as consultants to the government.

It is unclear at this point what the precise nature and extent of the resulting changes to the OCI rules may be.  But the new law makes it likely that there will be some fairly significant revisions.  Congress set a deadline of Summer 2024 for the new regulations, so the contracting community should be on the lookout for a notice of proposed rulemaking in the coming months, and should not hesitate to submit comments for the government’s consideration.Continue Reading New Contractor Conflict of Interest Rules May Be Coming Soon, with a Special Focus on Consulting and Advisory Contracts

On December 1, 2022, the Department of Defense, General Services Administration, and NASA published a final rule addressing “Effective Communication Between Government and Industry,” which is aimed at “encourag[ing] communication between Government acquisition personnel and industry.”

The rule adds a paragraph to FAR 1.102-2 that reads as follows:

The Government must not hesitate to communicate

President Biden recently signed bipartisan legislation reinforcing anti-human trafficking prohibitions. The End Human Trafficking in Government Contracts Act of 2022 builds on the existing anti-human trafficking framework at Federal Acquisition Regulation (“FAR”) § 52.222-50 (Combatting Trafficking in Persons) by requiring agencies to refer contractor reports of potential human trafficking activity directly to an agency suspension and debarment official (“SDO”).  Prior to this legislation, contractors have been required to notify their contracting officer and the agency inspector general upon receiving “[a]ny credible information” that a human trafficking violation had occurred.  See FAR § 52.222-50(d)(1).  Now agencies will be required to refer these reports to their SDOs, creating additional risk for contractors that disclose potential violations. Continue Reading New Law Increases Government Scrutiny of Contractor Compliance with Anti-Trafficking Provisions

Last December, President Biden issued Executive Order 14057, “Catalyzing Clean Energy Industries and Jobs Through Federal Sustainability,” which directed the government to adopt cleaner and more sustainable procurement practices, with the ultimate objective of net-zero emissions by 2050

Pursuant to that directive, GSA has issued a new RFI seeking information regarding domestically manufactured solar photovoltaic (PV) panels and systems, as well as PV system installation.  GSA intends to use the information to develop a solar PV procurement strategy and a procurement standard for use in future solicitations — including solicitations for Power Purchase Agreements (PPA), Energy Savings Performance Contracts (ESPCs), Utility Energy Service Contracts (UESCs), and other vehicles. 

Given the RFI’s emphasis on sourcing and country of origin, it is possible that any new procurement standards for civilian contracting would parallel existing regulations at DFARS 252.225-7017, which generally require DoD contractors to make use of PV devices originating from the United States or certain designated or qualifying countries.  Of course, the ultimate impact of the RFI on future procurement strategy remains to be seen.  What is certain, however, is that the Administration is committed to clean technology procurements and that domestic preferences remain an overriding and central concern. 

Comments in response to the RFI are due by November 18, 2022.  More detail about specific topics covered in the RFI is below.Continue Reading GSA Issues Request for Information on Photovoltaic Systems

With continued inflation putting pressure on the defense supply chain, the Department of Defense (“DoD”) has released guidance encouraging contracting officers to provide mutually agreeable relief to fixed-price contractors facing untenable costs.

DoD’s guidance, dated September 9, 2022 and available at the link here, follows a similar guidance earlier this summer which recommended that contracting officers consider including economic price adjustment clauses in new solicitations.  We previously wrote about that guidance here.Continue Reading DoD Releases Updated Guidance for Firm-Fixed-Price Contractors Grappling with Inflation