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On April 20, 2015, the Supreme Court declined to review a March 2014 Federal Circuit decision holding that the Department of Housing and Urban Development (“HUD”) cannot use cooperative agreements—and instead must use procurement contracts—to administer funds under Section 8 of the United States Housing Act of 1937.  The case is CMS Contract Management Services v. United States, 745 F.3d 1379 (Fed. Cir. 2014).  We reported on the Solicitor General’s petition for a writ of certiorari, which advocated that the Court reverse the Federal Circuit and revive the use of cooperative agreements in this context.

The Court’s cert denial came without comment or dissent, and functions to leave in place the ruling below.  The potential reach of the Federal Circuit’s decision is unclear.…

Continue Reading Supreme Court’s Denial of Cert Means Questionable Future for Certain Cooperative Agreements

Earlier this month the Solicitor General, on behalf of the Department of Housing and Urban Development (“HUD”), filed a petition asking the Supreme Court to review a March 2014 Federal Circuit decision holding that HUD cannot use cooperative agreements—and instead must use procurement contracts—to administer funds under Section 8 of the United States Housing Act of 1937. The petition is United States v. CMS Contract Management Services (No. 14-781).

Under Section 8, HUD maintains annual contribution contracts (“ACC”) with state and local public housing agencies (“PHA”) to administer $9 billion of federal housing assistance every year to low-income families. In 2011, HUD recompeted the ACCs nationwide, which triggered almost 70 protests in the Government Accountability Office (“GAO”) by PHAs that did not receive new ACCs. In response, HUD withdrew the protested ACC awards (which covered 42 states), and in 2012 announced a new competition for the ACCs, now explicitly characterized as cooperative agreements whose “purpose” was to assist state and local governments “in addressing the shortage of affordable housing.” A flurry of pre-award protests in the GAO followed, in which certain PHPs argued that HUD was not permitted to treat the ACCs as cooperative agreements, and instead needed to treat them as procurement contracts (subject to standard procurement regulations prohibiting certain allegedly anticompetitive terms of the ACC competition). The GAO agreed with the PHPs, but HUD opted not to follow the GAO’s recommendation. Undeterred, the PHPs brought their protest to the Court of Federal Claims, which sided with HUD. On appeal, the Federal Circuit reversed, coming to the same conclusion as the GAO that the ACCs needed to be treated as procurement contracts.…

Continue Reading HUD Asks Supreme Court to Revive Use of Cooperative Agreements for Section 8 Funds