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Friday Flash, 07.26.13

Comment of the Week 

As we approach the end of July here is a word association “comment of the week” regarding the federal procurement system.  The word associations below are based on observations, comments and feedback we have received from throughout the procurement community.  The word associations are intended to spark a Myth-Busters discussion regarding the strategic direction of the federal marketplace and in particular, GSA’s Federal Supply Schedule program.  Over the course of the second half of the year the Coalition will be focusing on the issues highlighted below in our continuing efforts to bring common sense to government procurement.

  1. Mandatory use strategic sourcing = Closing the federal market.
  2. Standardized Labor Categories for Professional Services = Low Cost Technically Acceptable by other means!
  3. Federal Supply Schedule Value Proposition = Achieving best market pricing  at time of a government buy (task/delivery order) through streamlined access to the commercial marketplace
  4. Schedules Modernization = An opportunity to put commercial back in commercial item contracting!
  5. Government Unique Terms = Limits the government to obtaining the “best” of the worst commercial pricing.
  6. The Price Reduction Clause = Outdated restriction on commercial competition!  Is it really the federal government’s economic policy to, as a term of a federal contract, limit a commercial firm’s ability to compete in the private, commercial marketplace?
  7. Government-wide Blanket Purchase Agreements = Vertical Contract Duplication.
  8. Prices paid data = Incomplete without contract terms and conditions.
  9. Commoditization of services = The end of best value.
  10. Other Direct Costs = An opportunity for GSA to reduce costly contract duplication.
  11. Criticism of Federal Supply Schedule Pricing = A red herring.  See number 3 above.
  12. Better Buying Power 2.0 = The importance of thinking and providing the tools to do so effectively.
  13. Contract Duplication = Increases costs and reduces effective competition
  14. Cost reimbursement via the schedules = Why not?
  15. The FY 2013 Fourth Quarter = Pre-existing contract vehicles are more important than ever.
  16.  GSA’s market share goals = See number 3 above.
  17. Data = Not a free good.
  18. New schedule terms and conditions = The Paperwork Reduction Act
  19. The Acquisition Workforce = A best value investment.
  20. Oversight = A time for balance.

I welcome your feedback as to whether I have accurately captured the pulse from the procurement community.  I am also interested in hearing whether these items are the right ones to focus on in ensuring common sense solutions that promote sound business opportunities that deliver best value to customer agencies and the American people.

Roger Waldron



Building Quality Industry-Government Communications with DHS

The Department of Homeland Security (DHS) Office of the Chief Procurement Officer (OCPO) is measuring its progress towards increasing communications with DHS’s business partners.  In order to gather industry’s perspective on DHS communications, the OCPO held interviews this week with the vendor community.  The Coalition appreciates the OCPO for the opportunity to provide feedback on the Department’s progress to date and recommendations for the future.  We also thank members who shared their real world experience working with DHS which provided the basis for our input.  The Coalition congratulates DHS for their efforts to make myth-busting a reality and looks forward to continuing the dialogue with OCPO as part of its industry outreach.


4th Quarter Refresh Webinars to Increase Your Market Share

Join our Two Part GSA e-Tools Myth Buster Webinar series as a 4th quarter refresh to increase your market share! Attending both Part 1 (August 7) and Part II (August 15) will help you to successfully navigate GSA e-Tools and meet your objective to increase sales.  Attendees will have the opportunity to ask questions and learn about how GSA e-Tools benefit your company. You will hear how the Federal market place uses these tools and how you can benefit from this knowledge. Don’t miss the opportunity to hear from a GSA e-Tools domain expert!

Part I – August 7, 12:30 – 1:30pm

Part II – August 15, 12:30 – 1:30pm

Featured Speakers:

  • Tim Dempsey, Chief, Systems, Office of Acquisition Management Federal Acquisition Service (FAS)
  • Bill Gormley, President, The Gormley Group
  • Carolyn Alston , Executive Vice President & General Counsel, The Coalition for Government Procurement

Who Should Attend? GSA Contractors, Business Developers, Marketing Managers, Contract Managers, Sales, and Market Research professionals.

For more details and to register, visit  If you have any questions, please contact Athena Oliff at or (202) 315-1052.


NIH and Big Data

The National Institutes of Health (NIH) plans to invest nearly $96 million over the next four years to use big data to solve persistent health challenges. The funds will be distributed through six to eight centers of excellence. In order to ensure fairness, the funds are being filtered through the centers of excellence by outside researchers.

The Big Data to Knowledge, BD2K, Centers of Excellence will be in charge of making complex and unstructured data sets more accessible to biomedical researchers through new software. NIH has been in the forefront among government agencies to use this new brand of data analysis. Eric Green, NIH’s chief data officer, notes “BD2K aims to enable a quantum leap in the ability of the biomedical research enterprise to maximize the value of the growing volume and complexity of bio medical data.”


DoD Prepares for FY14 Sequestration

During his second term confirmation hearing last week, vice chairman of the Joint Chiefs of Staff Adm. James A. Winnefeld said the Department of Defense (DoD) is preparing details on an FY14 budget plan that would include automatic sequestration cuts.  The report is expected October 1.  In a recent letter to the Senate Armed Services Committee, Secretary of Defense Chuck Hagel strongly opposed the $52 billion cuts that are being drawn up in the DoD FY14 sequestration contingency plan. Notable for contractors Hagel writes, “these serious adverse effects…would spill over to the defense industry.” The Secretary of Defense also explained that industry jobs would be lost and small businesses would suffer as prime contractors limit work to protect their own workforce.


GSA in Favor of Public Private Partnerships

The General Services Administration (GSA) believes public-private partnerships may be one of the best ways to accelerate the pace of Federal property disposal, cut costs and reduce waste, as reported by Fed News Radio. On July 23, GSA Administrator Dan Tangherlini stated that “GSA has been looking to utilize new tools to leverage the equity in our older, outdated buildings to get new, highly efficient space for our federal agencies.” The Administrator also said that public-private partnerships represent a promising approach for reevaluating space and using it more effectively, along with the transformational effect of technology in offices. “While we’ve taken steps to improve the utilization rates, the reality is agencies still need buildings to do their jobs,” notes subcommittee Chairman Lou Barletta (R-Pa.).  A question remains about whether GSA can provide that space in a more cost effective manner. GSA officials believe public-private partnerships (P3s) have the potential to help leverage private expertise in meeting those needs and developing and restoring agency properties.


Meet Your Member Services Exec!

Have questions about your membership benefits or how to get more involved in the Coalition? Contact Sandy Arce, our Member Services Executive. Sandy can help you sign up to get updates on any of our committees and working groups, let you know about upcoming events and training opportunities, provide policy updates, and answer any questions you may have about your discounts and benefits.


Prior to joining the Coalition, Sandy was a Market Intelligence Analyst at FedSources Inc. where she specialized in Civilian, Defense, State and Local IT and Professional Services requirements. Sandy holds a Bachelor of Arts degree from the University of Mary Washington and a master’s degree in public policy from George Mason University and has lived and studied abroad in Bolivia and Argentina. Sandy is an avid soccer (fútbol) fan and has traveled to over 20 countries in the last 6 years. If you have any questions regarding your membership benefits or would like ideas on where to travel this summer, you can reach Sandy at or 202-315-1054.


House Introduces Federal Construction Legislation

On Friday July 19, two bills were introduced to streamline the government’s construction contracting processes and cut costs—the Design Build Efficiency and Jobs Act and the Commonsense Construction Contracting Act. The Design Build Efficiency and Jobs Act would require agencies to use a two-phase approach for construction contracting. This allows agencies to assess offerors’ technical qualifications prior to making a significant investment in a complete proposal. Industry witnesses told lawmakers present at a hearing for the House Small Business Subcommittee on Contracting and Workforce that the cost of bidding on single-phase procurements presents a serious barrier for small firms. Representative Gerry Connolly (D-VA) noted, “Two- step design-build contracts have proven incredibly effective in enhancing federal contracting competition and strengthen our nation’s most innovative and talented small businesses.”

On Friday July 19, the House Small Business Subcommittee on Contracting and Workforce chairman Richard Hanna (R-NY) introduced the Commonsense Construction contracting Act of 2013. The bill would amend the Small Business Act and prohibit the use of reverse auctions for design and construction services if the contract is more suitable to be awarded to a small business program. Chairman Hanna noted, “Reverse auctions simply do not make sense for these kind of services, because they fail to guarantee lowest price, lead to imprudent bidding, and inadequately ensure that the winning bidder is responsive and responsible.”


Legal Corner

Beware the Anti-Deficiency Act and the New Interim Rule Regarding Indemnification Clauses in Social Media and License Agreements

By Jason N. Workmaster, Partner & Marques O. Peterson, Associate, McKenna Long & Aldridge LLP

On June 21, 2013, the FAR Council issued an immediately-effective interim rule  that provides that any indemnification clause that is included in an End User License Agreement (EULA), Terms of Service (TOS), or similar legal instrument and that would create a violation of the Anti-Deficiency Act (31 U.S.C. § 1341) (the “ADA”) is unenforceable against the Government—regardless of actions a contracting officer might have taken indicating acceptance of the clause.  See 78 Fed. Reg. 37,686 (Jun. 21, 2013).  The ADA is a Federal statute that, among other things, prohibits government employees from entering into an “obligation exceeding an amount available in an appropriation or fund for [that] obligation.”  31 U.S.C. § 1341(a)(1(A).  The FAR Council issued the interim rule “to address concerns [relating to the ADA] raised in an opinion from the U.S. Department of Justice (DOJ), Office of Legal Counsel (OLC) involving the use of unrestricted, open-ended indemnification clauses in acquisitions for social media applications,” even though the Government contends that, even without the regulatory change, the clauses in questions were unenforceable under existing law.  Id.

Recently, government officials have become concerned about the use by government employees of internet based social media applications and licenses, and the specific terms of their respective agreements for these applications.  The concern arose from the recognition that many supplies or services purchased by government employees through social media applications are subject to supplier license agreements, particularly in information technology acquisitions.  As a result, in a March 2012 opinion, OLC addressed the circumstance in which a government purchase card holder, in the course of registering for a social media or license agreement account, consents to an online TOS agreement that holds the provider of the service harmless in the event that harm is caused to a third party when the application is used by the Government.  According to the OLC, such a circumstance amounts to the government employee binding the Government, without statutory authorization or other exception, to an open-ended, unrestricted indemnification term.  The OLC contends that this constitutes an ADA violation because the agency’s agreement to an open-ended indemnification clause, such as the TOS described above, could result in the agency’s legal liability for an amount in excess of the agency’s appropriation.

Responding to the OLC opinion,  the Office of Management and Budget (OMB) issued a memorandum on April 4, 2013 outlining management actions to ensure agencies act in compliance with the ADA and consistent with the OLC opinion.  See OMB Guidance M-13-10, Antideficiency Act implications of Certain Online Terms of Service Agreements, available at

Prompted by the OMB memorandum, the FAR Council drafted this interim rule to address the perceived risk of an alleged ADA violation arising from indemnification clauses in the TOS of social media products.  Moreover, the interim rule raises the possibility of additional coverage in the FAR to address other  clauses in these TOSs that the Government apparently believes may create ADA violations.  For example, the FAR Council highlighted a clause – one requiring the automatic renewal of subscription service – that it asserts might violate the ADA if it obligated the Government to pay for supplies or services in advance of the agency’s appropriation.  Such additional coverage, however, was left to another day and is not included in the current interim rule.

Instead, for now, the interim rule amends FAR parts 12, 13, 32, 43, and 52 to state that indemnification clauses that violate the ADA are unenforceable, as noted above.  While adding little to existing law, it is likely that these changes will make it at least somewhat harder for contractors to demonstrate that the Government is bound by these indemnification provisions—which the Government contends were unenforceable anyway.

In any event, written comments about the rule are due to the Regulatory Secretariat on or before August 20, 2013, and this interim rule is a good reminder that the Government remains vigilant about using the ADA and its regulation-making power to the fullest extent possible.


JanSan MRO Market Baskets Open for Comment

GSA has released revised versions of the JanSan and MRO market baskets for industry comment.  The FSSI JanSan and MRO Teams are interested in receiving feedback on whether the item descriptions make sense or if improvements are needed.  They would also like to hear if the descriptions are clear or if more information should be provided.  GSA asks that vendors provide specific recommendations as to how the item descriptions should be revised and to please include the item Reference ID.  Comments are due August 1, 2013.

JanSan Revised Market Basket

MRO Revised Market Basket

Members who are interested in providing input for a submission from the Coalition, please contact Aubrey Woolley at or (202) 315-1053.


New York: FSSI OS3 & Region 2 Industry Days

GSA Region 2 will host the following industry days in New York City on August 6 and 7.

         1. FSSI Office Supplies (OS3) Industry Day- August 6

The FSSI Office Supplies (OS) Program Management Office (PMO) will host an FSSI OS3 Industry Day from 9:30am to 12:30pm at the Jacob K. Javits Federal Building in New York City on August 6.  Come learn about and discuss the direction of FSSI OS3, highlights of the strategically sourced office supplies program and prepare for issuance of solicitation. The FSSI OS3 Industry day will serve as a forum for collaboration and information sharing among the FSSI OS2 Team, industry partners and potential agency stakeholders.  For more details and to register, visit

         2. FASTRACK to NYC: Region 2 Industry Day- August 7 (updated version coming from GSA)

GSA’s National Administrative & Office Supplies Acquisition Center will host an Industry Day from 7:30am to 4:00pm at the Jacob K. Javits Federal Building in New York City on August 7. GSA invites all industry partners who are current GSA Multiple Award Schedule (MAS) contractors on MAS 67, 75, 76, 81IB, 736, 738x, and MOBIS 874 to this day of learning and networking.  Topics include: Contract Administration & Management, Sustainability and Federal Green Mandates, Disaster Recovery and State/Local Programs.  Seating is limited and available on a first come basis.  For more details and to register, visit

If you have any questions, members should email


GSA OS3 FSSI Question to Members

GSA’s Interact Community for Office Supply 3 (OS3) posted a question about expanding the Office Supply FSSI BPA to include certain furniture and IT products. GSA would like feedback on whether it should include small stand alone office furniture items and plug-in IT transactional purchases. Members should let us know by July 30 if you would like the Coalition to submit comments.  Comments should be submitted to Roy Dicharry at


GSA Communications Forum – July 31st

On July 31, 2013, key officials from GSA’s Federal Acquisition Service (FAS) will join the Coalition to discuss GSA’s marketing message and initiatives designed to increase market share.

GSA Administrator, Dan Tangherlini, has set an agency goal of having a 17% share of the federal market by the end of the fiscal year, with a goal of a 90 percent in 10 years.  According to Administrator Tangherlini and Tom Sharpe, FAS Commissioner, GSA will increase savings across the federal government by increasing its market share.

  • Understand GSA’s market strategy
  • Learn more about its market growth initiatives
  • Hear how the agency plans to achieve its  goals
  • Identify new ways to effectively market your GSA Schedules

A GSA panel led by Tami Riggs, Assistant Commissioner, Office of Customer Accounts and Research will help contractors understand and convey the marketing message about GSA’s government-wide contracting capabilities and how the agency can increase efficiency, reduce costs and address contract duplication for customer agencies.

This is a must attend event for contractors that wish to better understand the GSA market and more strategically target prospective federal customers through GSA Contracts.

Registration Fees and Information – Register Here!

8:00 am – Registration and Networking Breakfast

9:00 am – Program Begins

Keystone Member: Complimentary
Premier Member: $65
Regular Member: $75
Non-Member: $130
Government: $15 – Must Show Government ID


Save the Date – 2013 Fall Conference – October 30th

Join the Coalition on October 30 for its 2013 Fall Training Conference: The New Federal Market. Hear from Federal agency Chief Financial Officers, Congressional staff and industry leaders about the evolving government market and how best to adjust to this new environment.  The conference will be held at the Fairview Park Marriot in Falls Church, VA.  More details will be available soon. Please contact Athena Oliff at to learn more about sponsorship opportunities or for other information about the event.

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