Domestic sourcing requirements are not new, but the Government is always developing new tools for increasing the sourcing of goods from the U.S. and allied countries. Both sides of the political aisle have marched to a drumbeat of increased domestic sourcing for the past several years. Most recently, the Biden Administration implemented Executive Order 14005
In Honeywell International, Inc., the ASBCA declined to dismiss a roughly $151 million claim by DCMA alleging a violation of CAS 410, holding that the government’s allegations were sufficient to state a claim for improper treatment of G&A expenses. The Board’s decision provides guidance on how to interpret CAS 410 — a topic that is often addressed by auditors, but has rarely been the subject of written opinions by the courts or boards of contract appeals.
Continue Reading ASBCA: Government Can Pursue $151 Million Claim Under CAS 410
Earlier this month, the Federal Circuit provided new guidance on the high burden that the government must carry to terminate a contract for default. In Dep’t of Transp. v. Eagle Peak Rock & Paving, Inc., the Federal Circuit held that the validity of a termination decision does not depend exclusively on the contracting officer’s reasoning — rather, the government must produce evidence during litigation to prove the contractor’s default under a de novo standard of review. The Eagle Peak decision illustrates that, absent a threshold showing that the contracting officer’s decision was pretextual, contractors challenging a default decision should focus on developing the “clean slate” record needed to rebut the government’s allegations, rather than disputing the contracting officer’s rationale (or lack thereof) for termination.
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.
In August 2020, the Office of Management and Budget (“OMB”) amended its Guidance for Grants and Agreements set forth under 2 CFR (commonly referred to as the “Uniform Guidance”). The Covington team wrote about that amendment, and in particular, the implementation of Section 889 requirements, here. Now, almost three years later, OMB is requesting feedback in anticipation of further amending the Uniform Guidance.
This is the twenty-first in a series of Covington blogs on implementation of Executive Order 14028, “Improving the Nation’s Cybersecurity,” issued by President Biden on May 12, 2021 (the “Cyber EO”). The first blog summarized the Cyber EO’s key provisions and timelines, and the subsequent blogs described the actions taken by various Government agencies to implement the Cyber EO from June 2021 through December 2022. This blog describes key actions taken to implement the Cyber EO during January 2023.
Continue Reading January 2023 Developments Under President Biden’s Cybersecurity Executive Order
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.