Procurement Policy

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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…

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…

On August 25, 2022, the Department of Defense (“DOD”) published — with immediate effect — two new Defense Federal Acquisition Regulation Supplement (“DFARS”) clauses requiring defense prime contractors and subcontractors disclose any work in China on certain DOD contracts.  Under the interim rule, the DOD is prohibited from awarding or extending certain new contracts if a contractor fails to disclose its use of workers in China in performance of a covered DOD contract.  Although there is no prohibition on DOD awarding a covered contract to an entity that makes a disclosure, the Department can rely on a variety of authorities to exclude certain contractors and products that represent supply chain risks, especially if the products or services involve information technology.…

Continue Reading New DFARS Clauses Require Defense Contractors to Disclose Work Performed in China

In response to industry-wide questions about price adjustments for economic inflation, the Department of Defense (DoD) has released guidance about when and how contracting officers may provide financial relief to contractors working on fixed-price contracts.  The guidance generally discourages contracting officers from granting adjustments under the Changes clause due solely to inflation.  But it does not completely close the door to adjustments, and it offers modest options for fixed-price contracts that contain an economic price adjustment clause.  Moreover, DoD encourages contracting officers to consider inserting economic price adjustment clauses in new solicitations.

This blog post summarizes DoD’s guidance, explains the mechanics of economic price adjustment clauses, and offers views about evaluating other grounds for relief.…

Continue Reading DoD Releases Guidance on Inflation and Economic Price Adjustments for Fixed-Price Contracts

Two federal agencies recently released a joint Request for Information (“RFI”) in the latest in a series of concrete steps to meet the Biden Administration’s goal to achieve 100 percent carbon pollution-free electricity (CFE)[1] in federal operations by 2030.  The RFI, issued by DLA-Energy and GSA, offers industry a chance to shape future federal CFE procurements by providing information on carbon-free electricity supplied in competitive retail markets.  Although not itself a procurement opportunity, the information submitted under the RFI will inform the parameters and conditions of CFE competitions that the federal government expects to begin as soon as this year, with contract deliveries starting in 2023.
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Continue Reading RFI Begins to Chart Course for Federal Clean Energy Procurements

If a contractor is working on a fixed-price contract, can it charge the government for attorney’s fees to defend a False Claim Act (“FCA”) case related to the contract?

In The Tolliver Group, Inc. v. United States (Fed. Cl. Jan. 22, 2020), the Court of Federal Claims (“COFC”) said the answer was “yes,” if the government was liable for an equitable adjustment under the circumstances.  The decision was welcomed by contractors facing meritless FCA suits, which are often costly to defend even when the relator plainly does not have a case.

But the Federal Circuit has thrown cold water on Tolliver — at least for now.  In a decision last week, the court of appeals vacated Tolliver on jurisdictional grounds, concluding that the legal theory of the COFC’s decision was never presented to the contracting officer for a final decision under the Contract Disputes Act of 1978 (“CDA”), and that the COFC therefore lacked jurisdiction over the contractor’s claim.  The Tolliver Group, Inc. v. United States (Fed. Cir. Dec. 13, 2021).…

Continue Reading FCA Defendants May Be Able to Recover Attorney Fees Under Their Fixed-Price Contracts, At Least For Now

On December 8, 2021, President Biden signed Executive Order 14057 (“Catalyzing Clean Energy Industries and Jobs Through Federal Sustainability”), the Administration’s latest – and most significant – effort to promote cleaner and more sustainable federal procurement.  At the heart of the new Order is the Administration’s goal to meet a net-zero emissions target across the federal government by 2050.  To do so, the Administration promises to “transform federal procurement and operations” and to leverage the government’s portfolio of “300,000 buildings, fleet of 600,000 cars and trucks, and annual purchasing power of $650 billion [in] goods and services” to facilitate increased adoption of green technology.  The new Executive Order will require further agency action to pursue and execute on these objectives, but once implemented, it appears poised to usher in a new – and greener – era of federal contracting.

In order to achieve net-zero emissions by 2050, the Executive Order and an accompanying “Federal Sustainability Plan” set four primary goals:

  1. Power: 100 percent carbon pollution-free electricity on a net annual basis by 2030;
  2. Vehicles: 100 percent zero-emission vehicle acquisitions by 2035, including 100 percent zero-emission light-duty vehicle acquisitions by 2027;
  3. Buildings: A net-zero emissions building portfolio by 2045, including a 50 percent emissions reduction by 2032; and
  4. Materials: Net-zero emissions from federal procurement no later than 2050, including a Buy Clean policy to promote use of construction materials with lower embodied emissions.

This blog post consists of three parts: (1) a summary of each of the four major goals referenced above; (2) a description of the Executive Order’s procedures for implementation, together with the exceptions to its coverage; and (3) concluding thoughts about key takeaways of this Executive Order for the contracting community and potential new entrants into the federal marketplace.…

Continue Reading Biden Executive Order Promises to “Transform Federal Procurement” to Meet Net-Zero Emissions Target

Addressing climate change has been a priority for President Biden since his first day in office.  On December 8, 2021, President Biden continued that focus by issuing Executive Order (EO) 14057, Catalyzing Clean Energy Industries and Jobs Through Federal Sustainability, which includes a number of requirements directed at introducing sustainability to federal acquisitions.

This most recent EO announces an administration policy to achieve net-zero emissions from federal procurement by 2050 and comes on the heels of the public comment period extension to January 13, 2022 in response to EO 14030, Climate-Related Financial Risk.  Although the administration will likely be rolling out additional sustainability requirements in the coming months, contractors currently have an opportunity to help shape an initial requirement that may end up effectively establishing an environmental, social, and governance or “ESG” reporting requirement. …
Continue Reading Contractors Have an Opportunity to Help Shape ESG Requirements

[This article was originally published in Law360.]

Amidst the whirlwind of M&A activity in the government contracts industry, a recent bid protest decision from the Government Accountability Office (GAO) highlights the importance of proper planning to protect prime contract proposals during M&A and other corporate transactions.  Last month, GAO denied a protest from ICI Services Corporation (ICI), which challenged the U.S. Navy’s decision to award a task order to Serco, Inc. (Serco) under the SeaPort Next Generation (SeaPort-NxG) vehicle.  Although ICI raised a “multitude of challenges,” GAO focused on what it considered the gravamen of ICI’s protest — that Serco was ineligible for award because it allegedly was not a complete successor-in-interest to the Naval Systems Business Unit (NSBU) of Alion Science and Technology Corporation (Alion).  Serco had acquired the NSBU from Alion in July 2019, and has been operating the NSBU in the several months since then.

For years, contractors have faced an amalgamation of protest decisions assessing the impact of transactions on proposals for new prime contracts.  The recent ICI decision provides some additional guidance and, more importantly, underscores GAO’s stated intent that its decisions not frustrate pending proposals merely because a corporate transaction has taken place or is expected to take place, but instead ensure that the procuring agency has reasonably considered the impact of the transaction and concluded that the resulting contract will be performed in materially the same way as described in the proposal.  In the absence clear guidance in the Federal Acquisition Regulation (FAR) on the treatment of bids in connection with a corporate transaction, GAO’s decision in ICI offers some clarity for contractors and a framework for agencies when assessing the impact of a transaction.  Although every transaction and proposal is unique, the ICI decision highlights some key considerations for contractors.
Continue Reading Buying a Business Without Losing the Pipeline: Further Guidance for Protecting Proposals

The government is moving forward with further changes to Buy American Act (“BAA”) regulations.  But based on yesterday’s public meeting to discuss the July 30 notice of proposed rulemaking (“NPRM”) to revise existing BAA regulations, it remains to be seen exactly where those changes are headed.

As discussed in our prior client alert, the NPRM implements Executive Order 14005 (“Ensuring the Future Is Made in All of America by All of America’s Workers”) by proposing three major changes to existing BAA regulations: (1) higher domestic content thresholds; (2) enhanced price preferences for “critical” items and components; and (3) new domestic content reporting requirements for “critical” items and components.  The agenda for the public meeting covered each of these changes, as well as other questions raised in the NPRM related to BAA waivers and exceptions.…

Continue Reading Buy American Act Update: FAR Council Holds Public Meeting on New Proposed Rule