The Future of the Healthcare Federal Supply Schedules
In January of this year, the Government Accountability Office (GAO) released a report, VA Acquisition Management: Steps Needed to Ensure Healthcare Federal Supply Schedules Remain Useful (GAO-20-132). The record examines the current state of the non-pharmaceutical Federal Supply Schedules and provides 11 recommendations, nine to the Department of Veterans Affairs (the VA) and two to the General Services Administration (GSA).[1] The report is a timely and thoughtful assessment of the current program and provides a roadmap for the VA and GSA to address the strategic role and contracting operations of the VA Federal Supply Schedules program in supporting Veterans Healthcare.
Pursuant to a delegation from GSA, the VA manages nine healthcare related Federal Supply Schedules (the VA FSS) that provide the VA and other authorized users with a schedule of medical products and services. The VA FSS include, among other items, medical surgical equipment, pharmaceuticals, patient mobility devices, and medical laboratory testing and analysis services. The VA FSS accounts for approximately $15.4 billion in annual purchases, with the pharmaceutical schedule accounting for about $12.6 billion and the remaining eight schedules accounting for about $2.8 billion. Sales under the eight non-pharmaceutical schedules have been relatively flat over the last four years. The GAO report covers the eight non-pharmaceutical schedules.
The GAO identified a series of challenges facing the VA FSS. Among them were a lack of collaboration between the VA and GSA, limited guidance and training for contracting staff and possible duplication between the VA FSS and the VA’s Medical Surgical Prime Vendor program. These challenges have led to increased processing times for contract awards and certain modifications, increased administrative costs for the VA and industry, and reduced access to the latest medical technologies from the commercial market.
GAO’s 11 recommendations to the VA and GSA fall into four general categories:
- The VA should provide comprehensive FSS guidance and training to the FSS contracting staff
- The VA and GSA should improve collaboration, including potential use of GSA’s procurement tools to support the VA FSS
- The VA should evaluate timeliness goals and barriers to achieving them in the contracting process
- The VA should assess FSS and MSPV-NG duplication to address resource utilization and leverage its buying power
The Coalition’s VA Multiple Award Schedule White Paper
The Coalition’s VA Multiple Award Schedule White Paper sets forth 23 recommendations to enhance the effectiveness and efficiency of the VA FSS. These recommendations are designed to make the VA FSS pricing policy:
- Recognize commercial practices whenever possible;
- Be consistent with GSA FSS policy;
- Result in more streamlined evaluation processes, and
- Reduce the cost of contracting for both Government and industry.
Chief among these recommendations is alignment with GSA policy. For example, the white paper makes specific recommendations to align the VA’s price negotiations strategy with GSA’s approach. The white paper also addresses the potential use of GSA’s e-Offer and e-Mod systems to streamline the procurement process. Along these lines, the white paper makes recommendations regarding the VA FSS audit process to improve efficiency and transparency. Interestingly, GSA and the VA have fundamentally different approaches to contract audit support for their respective FSS programs. The recommendations in the white paper better align with GSA’s approach. In sum, the white paper provides sound recommendations that are, in fact, responsive to the issues raised by GAO in its report.
Significantly, the GAO cited a three-year FSS leadership gap that exacerbated the challenges facing the program. GAO also noted that all the management positions are now filled. Timing is everything. With the FSS management positions filled, the GAO report recommendations provide a roadmap to address the long-standing contracting challenges facing the VA FSS. The Coalition’s white paper identifies specific action items along that roadmap that will improve the efficiency and effectiveness of the program. The Coalition looks forward to working with the VA FSS management team towards the common goal of a more efficient, effective FSS program that meets veterans’ healthcare needs.
There are also strategic challenges and opportunities associated with the overlap that GAO identified between the VA FSS and the MSPV-NG programs. This topic and the VA’s logistics reform efforts will be addressed in upcoming blogs.
[1] The Coalition for Government Procurement, among others, provided input to the GAO for the report.
Court Denies Huawei Lawsuit, Pentagon Drops Opposition to New Restrictions
On February 19, a Federal judge ruled that Chinese telecommunications company Huawei does not have the grounds to sue the U.S. government over Section 889 of the 2019 National Defense Authorization Act. District Judge Amos Mazzant found that Congress acted within its powers when it passed this law, which bans agencies and contractors from buying equipment from Huawei and ZTE. In a lawsuit filed last year, Huawei argued that the law was unnecessarily severe and singled out individual companies in violation of their constitutional rights. The court also ruled that Congress did not prevent Huawei from doing business in the U.S., but rather exercised its power to decide how the federal government spends its money.
Additionally, Politico reported that DoD dropped its opposition to a proposed rule that would further restrict U.S. companies from selling to Huawei. DoD previously voiced concerns that this would hurt U.S. semiconductor manufacturers’ ability to remain a dominant force in the industry, and could take away revenue from U.S. companies that would go towards funding advanced research. Lawmakers pushed back against the Pentagon’s initial position. Defense Secretary Esper and other officials are set to meet on February 28 to discuss the rule and other Chinese-related export control issues.
Army to Increase OTAs to Drive Modernization
The Army is looking to increase the speed of contracting by using more Other Transaction (OT) Agreements for its modernization efforts. According to FedScoop, Secretary Ryan McCarthy stated that “the ‘foundation’ of all Army modernization will be migrating to the cloud.” The 2016 National Defense Authorization Act (NDAA 2016) expanded OT authority to allow agencies to work with innovative, small companies that don’t usually do business with the government. OTs have become popular with agencies, and Government spending through OTs increased from $2.3 billion in fiscal year 2017 to more than $4 billion in fiscal year 2018.
Court Issues Temporary Delay on JEDI
Federal News Network reported that Court of Federal Claims issued a preliminary injunction to stop work on DoD’s JEDI cloud contract. The injunction was issued at the request of Amazon Web Services (AWS), which filed a bid protest of the JEDI award. DoD had argued that an injunction would increase costs for DoD and harm national security.
GSA Expands Centers of Excellence to DoL
Federal Times reported that on February 13, GSA ‘s Technology Transformation Services (TTS) office partnered with the Department of Labor (DoL) through the Center of Excellence Program. The purpose of the partnership is to modernize DoLs acquisition procedures through robotic process automation. The new capabilities will be available throughout the department as a shared service. TTS Director Anil Cheriyan said that robotics process automation in combination with artificial intelligence is a focus area for TTS this year. The Center of Excellence Program was launched in 2017 to partner with different agencies to advance modernization projects. DoL joins the Office of Personnel Management, the Department of Agriculture, the Department of Housing and Urban Development, the Consumer Product Safety Commission, and the Pentagon’s Joint Artificial Intelligence Center as the agencies that have been selected for the program.
VA Electronic Health Record Delayed
Federal News Network reported that the House Veterans Affairs Committee wants clear direction from the Department of Veteran Affairs (VA) after the rollout of the electronic health record (EHR) was delayed. The VA had an original release date at its first site, the Mann-Grandstaff VA Medical Center, on March 28, but the VA announced that it needs more time to build the system and train clinicians on the capabilities properly. While lawmakers support the delay of the rollout of the EHR, they would like the VA to provide more information on the issues with the EHR. VA’s Deputy Assistant Secretary, Paul Cunningham, states that the delay is a tactical one and not due to limited resources.
GSA Awards More Small Business Contractors on OASIS
On February 13, General Services Administration’s (GSA) Office of Professional Services and Human Capital Categories (PSHC) made additional awards on the One Acquisition Solution Integrated Services (OASIS) Small Business Pool 1. 89 small businesses were awarded in this second phase of awards for Pool 1. GSA is expected to award the remainder of the OASIS Small Business Pool 1 awards in Spring 2020. OASIS Small Business Pool 1 includes a variety of professional services. See the award notification and awardee information here.
Legal Corner: DoD Releases Cybersecurity Maturity Model Certification 1.0—Once It’s Effective, Thousands of DoD Contractors, Suppliers Must Be Certified as Prerequisite to Contracting
By Mayer Brown; Marcia Madsen, David Simon, and Roger Abbott
The Legal Corner provides the legal community with an opportunity to share insights and comments on legal issues of the day. The comments herein do not necessarily reflect the views of the Coalition for Government Procurement.
On January 31, 2020, the US Department of Defense (DoD) Office of the Under Secretary of Defense for Acquisition and Sustainment (OUSD(A&S)) released Cybersecurity Maturity Model Certification (CMMC) Version 1.0. DoD developed the CMMC to provide a unified cybersecurity standard for defense contractors and suppliers across all of the Defense Industrial Base (DIB), which, according to DoD, “consists of over 300,000 companies.”1 The development of the CMMC has been driven by concerns about the widespread exfiltration of Federal Contract Information (FCI) and Controlled Unclassified Information (CUI) from the sprawling DIB, particularly at the lower and middle levels of the supply chain.2 CMMC primarily builds upon DFARS 252.204-7012, which generally requires contractors to maintain “adequate security” on all covered contractor information systems and to report any cybersecurity incidents to the DoD Cyber Crime Center (DC3) within 72 hours. It also incorporates a number of other standards, including FAR 52.204-21 (the basic standard for protecting FCI), National Institute of Standards and Technology (NIST) Special Publication (SP) 800-171, NIST SP 800-171B,3 ST SP 800-53, ISO 27001, ISO 27032, AIA NAS 993, CIS Critical Security Controls 7.1, and CERT Resilience Management Model®.
As detailed in a Legal Update regarding CMMC Draft Version 0.6, CMMC establishes a scaled benchmark against which an organization’s level of cybersecurity preparedness can be assessed and certified across five levels of cybersecurity “maturity,” ranging from Level 1 (“Basic Cyber Hygiene” required to protect FCI) to Level 3 (the minimum level for companies that access or generate CUI) to Level 5 (“Advanced/Progressive”). The CMMC framework consists of practices and processes mapped across 17 capability domains and scaled across the five cybersecurity maturity levels. For instance, Level 1 encompasses only 17 practices (one for each of the 17 capability domains), whereas Level 5 encompasses all 171 practices. This progression is illustrated in the following visual released as part of DoD’s CMMC Version 1.0 public presentation:
DoD explained its view of CMMC Version 1.0 in a press conference featuring Ellen M. Lord, undersecretary of defense for acquisition and sustainment; Kevin Fahey, assistant secretary of defense for acquisition; and Katie Arrington, special assistant to the assistant secretary of defense for acquisition for cyber and point person for CMMC.4 Throughout the press conference, Ms. Lord and Ms. Arrington stated that DoD is taking a “crawl, walk, run” approach to implementation and is mindful of the need to minimize the compliance burden for small and medium-sized businesses.
This press conference revealed the following information, which was not included in the documents released in conjunction with CMMC Version 1.0:
- The certification requirement will encompass both standard procurement contracts and Other Transaction Agreements (OTAs) and will apply to all levels of the DoD supply chain, including suppliers and small businesses. In fact, Ms. Lord noted that DoD is particularly concerned with the lower tier of the supply chain: “We know that the adversary looks at our most vulnerable link, which is usually six, seven, eight levels down in the supply chain.”
- That said, Ms. Lord reiterated that DoD values the contributions of small businesses and is working hard to minimize the burden of compliance: “One of my biggest concerns is implementing CMMC for small and medium businesses. Because that’s where a large part of innovation comes from. We need small and medium businesses in our defense industrial base, and we need to retain them.”
- Certification will be for a three-year period, and the deadline for certification will be upon notice of contract award. Failure to obtain a timely certification will not result in a penalty but will bar a company from receiving the contract.
- The expectation is that prime contractors will help suppliers and lower-tier contracts comply, whether by facilitating certification or by providing a secure environment/network to for their work. The potential extra cost for additional facilities or networks to accommodate subcontractors or suppliers is not addressed.5
- Ms. Arrington noted that smaller companies down the supply chain will not be required to have the same level of certification as prime contractors. The level of certification required will depend on whether performance requires the contractor to use or generate sensitive information.
- An Accreditation Body (AB)—an independent, non-profit, industry-funded board composed of 13 (currently undisclosed) members of the DIB and cybersecurity community—apparently was created in mid-January 2020, and will be responsible for training and certifying candidate third-party assessment organizations (C3PAOs).6 A detailed Memorandum of Understanding (MOU) between DoD and the AB is under development. A point of emphasis in the MOU will be to prevent conflicts of interest, e.g., to ensure that an assessment organization or auditor cannot review an affiliate or competitor.
- By “late spring/early summer” 2020, DoD will complete the formal rulemaking process and release a new Defense Federal Acquisition Regulation (DFAR) regarding the operation of CMMC.
- CMMC will not apply retroactively but will only apply to new contracts and will be phased in over the next five years. The expectation is that by FY 2026, all new DoD contracts will contain Go/No Go CMMC requirements.7
- Initially, CMMC requirements will be limited to roughly 10 “pathfinder” programs, which are each expected to affect roughly 150 contractors and subcontractors and will include a mix of contracts and subcontracts at all five CMMC Levels. DoD is still in the process of identifying these pathfinders. RFIs for these procurements are scheduled to be issued in June 2020, and corresponding RFPs issued in September 2020. DoD will monitor the success of the pathfinder procurements and make adjustments to the CMMC process (as needed) before issuing additional RFPs that incorporate CMMC.
Issues and Concerns for Contractors:
Although CMMC Version 1.0 and the corresponding DoD presentation shed some additional light on the CMMC implementation, a number of questions remain.
- Supply Chain Management: It remains unclear how the certification requirements will flow down to lower tier suppliers, subcontractors, and advisors. For example, how will suppliers of commercial technology, products, and services (sold in the open market) be addressed? Will suppliers of commercially available off-the-shelf products and services be treated as part of the DIB? Will acquisitions of technology and services under the micro-purchase threshold or pursuant to an e-marketplace be covered? Will providers of professional services that are not part of the DIB (e.g., accountants, consultants, law firms) but that regularly work with defense contractors be covered by the certification requirements?
- Can the CMMC Level Determination Be Disputed? It is unclear how DoD or contracting officers will determine which level of CMMC certification will be required for a particular procurement. Where a requirement is unreasonable, overly broad, and restricts competition, challenges are reasonably foreseeable.
- Operation of the Accreditation Body: The MOU for the AB is still being developed. It is still unclear how the accreditation process will work and what the cost of accreditation will be at each CMMC level.
- Accreditation Process Unclear: No details have been revealed about which companies will perform the accreditation, what the certification process will look like, how long it will take and at what cost, and whether contractors will be able to appeal in the event of a failed audit. For instance, will a contractor that fails the auditing process have the option to seek certification from a different auditor? How will DoD ensure that the certification process is applied consistently by all the C3PAOs?
- Potential Accreditation Backlog: As a practical matter, once DoD advances past the “crawl” stage, will it be possible to accredit 300,000 companies—including an estimated 12,000–16,000 companies that handle CUI—in less than five years? Will deviations or extensions be available if an accreditation backlog makes it impossible for companies to be certified on time?
- Concern exists within the industry that there will be an inadequate number of C3PAOs to certify companies efficiently. Many companies are reluctant to enter the accreditation market because C3PAOs will be barred from competing in many procurements due to conflicts of interest.
- One concern is that if a certification backlog emerges, companies that are involved in the early “pathfinder” procurements and succeed in becoming certified will have a competitive advantage compared to companies that are unable to certify due to the backlog and accordingly are unable to compete for contracts. For instance, when the Office of Management and Budget (OMB) established the Federal Risk and Authorization Program (FedRAMP)—purportedly “to provide a cost-effective, risk-based approach for the adoption and use of cloud services to Executive departments and agencies”— it initially took companies months or even years to certify. In 2016, it took companies as long as two years to obtain a FedRAMP Authority to Operate, at a cost of as much as $4 million to $5 million—up from nine months and a cost of $250,000 in 2014.
- Impact on DoD’s Access to Technology: Will companies that do not participate in the government market find the CMMC requirements, coupled with other regulatory burdens, audits, and litigation risk, a further barrier to doing business with DoD?
- Industrial Policy: Is this an industrial policy issue that goes beyond the procurement regulatory process?
Healthcare Spotlight: DoD “Rightsizing Plan” to Affect 50 Military Treatment Facilities
On February 19, the Department of Defense (DoD) sent a “rightsizing” plan to Congress that would significantly restructure the U.S. military health system’s responsibilities over the next several years. As a part of the plan, 50 military treatment facilities would be affected in some way. Some would expand their abilities to deliver care, but 37 would no longer see family members and retirees and would only serve active duty military members. The change would affect roughly 200,000 family members and retirees. Defense health officials stated that this change is aimed towards increasing the readiness of DoD’s clinicians for wartime settings by having them focus on the active duty population. Cost savings also played a role in this decision. In its 2021 budget proposal for the Defense Health Program, the Pentagon estimated that it would save $36 million during the first year of the transition by moving some patients of military treatment facilities to private providers in DoD’s TRICARE system.
Defense officials stated that they would not begin downsizing any facilities until they were certain that local private health providers could handle the increased numbers from family members and retirees. Thomas McCaffery, the Assistant Secretary of Defense for Health Affairs, said that they will connect these individuals and families with healthcare providers in the TRICARE network. He noted that this could take several years for many locations. This downsizing proposal comes during a time of massive change for the Military Health System, including a new electronic health record and the transitioning of the management of all clinics and hospitals to the Defense Health Agency (DHA). For more details about DoD’s proposal, a transcript of a DHA Media Roundtable on this topic is posted here.
Legal Corner: Acetris Federal Circuit Decision Provides Important New Guidance Regarding the TAA, Limits on CBP Authority, and the Scope of the Court of Claims’ Bid Protest Jurisdiction
By: Stephen Ruscus, Partner, Morgan Lewis and Donna Lee Yesner, Senior Counsel, Morgan Lewis
The Legal Corner provides the legal community with an opportunity to share insights and comments on legal issues of the day. The comments herein do not necessarily reflect the views of the Coalition for Government Procurement.
We previously have written extensively regarding the United States Court of Claims’ lower court decision in Acetris v. United States. In that case, Acetris argued that every iteration of the FAR since 1984 has expressly permitted offers of domestic end products in contracts subject to the WTO GPA and Trade Agreements Clause, or, more broadly, since 1999, all end products manufactured in the United States regardless of the source of the components. On February 10, 2020, the United States Court of Appeals for the Federal Circuit affirmed the lower court’s determination that the plain language of the Trade Agreements Clause permitted Acetris to certify and offer product manufactured in the United States even if not substantially transformed here. The Federal Circuit further admonished that “[i]f the government is dissatisfied with how the FAR defines ‘U.S.-made end product,’ it must change the definition, not argue for an untenable construction of the existing definition.”
The Federal Circuit’s decision had three additional important takeaways:
Limit on CBP Authority
Prior to the Acetris protest, Acetris explained to the VA that the procuring agency, not Customs and Border Protection (CBP), was required to make the determination whether Acetris’ products were manufactured in the U.S. under the FAR, as this determination is outside the scope of CBP’s authority. The VA stated that CBP’s rulings were wholly determinative of a product’s eligibility for acquisition under the FAR Trade Agreements Clause and required Acetris to obtain a CBP country of origin determination for its products. Acetris requested that CBP make a country of origin determination as required by the VA and expressly requested that CBP include in that determination a statement (viewable by the VA) that CBP had no jurisdiction to opine on the meaning of “manufactured in the United States” under the FAR Trade Agreements Clause. Had CBP done this, there likely would have been no Acetris contract terminations, no subsequent bid protest, and no resulting Acetris decisions. Instead, CBP determined that Acetris’ finished end product, which was manufactured in New Jersey, was not a U.S.-made end product under the FAR because the API was sourced from India. The Federal Circuit decision in Acetris settles this issue once and for all, stating that “[t]he CBP had no colorable authority to opine on the FAR” and that CBP is authorized only to apply the “TAA’s statutory country-of-origin test, which is different from the FAR’s test.” The corollary to this, as stated by the Court, is that the U.S. Court of International Trade (CIT) has no colorable jurisdiction to “review the merits of a CBP decision on … FAR compliance.” Thus, at a minimum, for U.S.-made products, CBP country of origin opinions would not be determinative of product eligibility under the FAR.
Substantial Transformation Not in Accord with CBP’s Determination
Again, prior to the bid protest, CBP issued a determination that Acetris’ product (Entecavir Tablets) was a product of India because Indian API was not substantially transformed in the manufacturing of the prescription drug end product, which took place in New Jersey. This decision did not address Acetris’ arguments, including FDA distinctions between approved prescription drug products and raw chemical API, and, instead, repeated a standard answer CBP has given repeatedly in recent years. CBP essentially held that, with few exceptions, the country of origin of a pharmaceutical is the country of origin of the API used in manufacturing that product. CBP’s position was that the raw API was not substantially transformed by the manufacturing process because the molecule was unchanged in the prescription drug formula. In its decision, the Federal Circuit expressly determined that Acetris’ Entecavir product was neither wholly manufactured nor substantially transformed in India, and, therefore, it was not a product of India for purposes of U.S. procurement under the Trade Agreements Clause. In so doing, the Court stressed that the TAA country of origin test does not ask whether a particular component has been transformed but rather where the end product purchased by the government was substantially transformed into that product. As the Federal Circuit has jurisdiction over the CIT and its interpretations of the TAA, the effect of this decision on CBP substantial transformation determinations remains to be seen.
Scope of Bid Protest Jurisdiction in the Court of Federal Claims
Bid protest jurisdiction in the CFC is prescribed under 28 U.S.C. § 1491(b), which permits protests of interested parties objecting to “any alleged violation of statute or regulation in connection with a procurement or a proposed procurement.” Previously, both the Federal Circuit and the CFC have on multiple occasions explained that the “in connection with a procurement or proposed procurement” is interpreted broadly to cover “all stages of the process of acquiring property or services, beginning with the process for determining a need for property or services and ending with contract completion and closeout.” In addition, the contractor needed to “demonstrate that the government at least initiated a procurement, or initiated ‘the process for determining a need’ for acquisition.” We think of this as verticality in the procurement process. However, as the Federal Circuit decision in Acetris makes clear, Section 1491 also permits protests of interested parties in connection with “future procurements … likely to occur,” in the relatively near future; in this case, future procurements of prescription drugs that could be anticipated essentially because supplies inevitably run low and existing contract vehicles for necessary drugs expire. Because the court concluded that Acetris would likely submit bids in future procurements and be confronted by the same VA legal position in those procurements, Acetris maintained its standing to challenge the agency’s action.
Having reached these conclusions, the Court found certain aspects of the remedy granted by the lower court unclear and remanded the case for issuance of an order,
Declaring:
(1) under the TAA, a pharmaceutical product using API made in India does not, because of that fact, thereby become the “product of” India; and
(2) under the FAR, the term “U.S.-made end product” may include products manufactured in the United States using API made in another country, and
Enjoining:
the VA from excluding Acetris’ products manufactured in Aurolife’s Dayton, New Jersey facility from future procurements.
The Government has 90 days to petition the Supreme Court for certiorari. We will provide updates as developments occur. Should you have any questions about this alert or otherwise, please do not hesitate to contact government contracts team members:
Stephen Ruscus (202-739–5870 (stephen.ruscus@morganlewis.com) or Donna Lee Yesner (202-739-5887) (donna.yesner@morganlewis.com).
The Coalition and Morgan Lewis are hosting a webinar to dive deeper into the impact of this decision. Please join Stephen and Donna on February 26 at 12:00PM, as they discuss the decision and its implications for finished drug products that are not manufactured in the U.S. and for non-drug products manufactured in the U.S.
Click here to register for the webinar.
Off the Shelf: The State of Small Business Contracting
This week Ken Dodds, government contracting industry expert at Live Oak Bank, and David Black, partner and co-chair of Holland & Knight’s Government Contracts Group, joined Off the Shelf for a wide ranging discussion on the state of federal small business contracting.
Dodds and Black took a look at the government’s performance drivers in meeting small business prime contract goals. 
They also provided key insights on the state of the federal small business market what small businesses need to know about category management, Best-In-Class contracts, and interagency contracting.
Dodds and Black also shared insights on key regulatory and oversight trends for small business subcontracting plans and what it means for both small and large businesses, and took a look at trends in mergers and acquisitions and the growing criticality of supply chain risk management and what it all means for the federal market. To listen to the program, click here.
Off the Shelf: Procurement 2019 – The Year that Was
This week Jason Miller, executive editor for the Federal News Network, joins Off the Shelf, for a retrospective look at 2019, the procurement year that was.
Miller highlights the key procurement programs and policy developments of 2019 sharing his insights on the state of the federal procurement system.
Schedules Consolidation, JEDI, e-commerce, and Best in Class contracts are among the topics tackled in a wide-ranging interview. Miller also provides his thoughts on the year ahead and what 2020 may bring. Click here to listen to the podcast.
BRIC/Cyber Committee Meeting on CMMC, Feb. 25
The Coalition will be hosting a joint BRIC and Cyber and Supply Chain Security Committee meeting on Tuesday, February 25 at 10:00 AM. The topics for the meeting include: NDAA and Appropriations bills, Budget Control Act caps and related issues, and CMMC implementation. The speakers for the meeting are Marcia Madsen and David A. Simon [invited] of Mayer Brown, Jon Etherton and Moshe Schwartz from Etherton & Associates, and Tim Cook, Center for Procurement Advocacy.
Joint BRIC and Cyber Committee Meeting
Tuesday, February 25 at 10:00 AM
CGI Federal
1000 N Glebe Rd.
Arlington, VA 22201
If you would like to attend the meeting, please RSVP to Michael Hanafin at MHanafin@thecgp.org.
Webinar – Trade Agreements Act Update, February 26
On February 10, 2020, the Federal Circuit issued a decision in Acetris Health, LLC v. United States, a case of first impression with huge implications for drug manufacturers that source API from non-designated countries. The court held that the finished drug product not the API was the product being acquired by the government, and it was not a product of India because it was not substantially transformed in India, and thus was not prohibited under the Trade Agreement Act. Further, the court held that the procuring agency, not CBP, must decide if the product complies with FAR and that CBP lacked jurisdiction to decide whether a product complied with the FAR. Finally, the court determined the product was U.S.-made because it was manufactured in the U.S., and therefore it was not necessary to determine whether the product was also substantially transformed in the U.S..
Hear from Stephen Ruscus and Donna Lee Yesner of Morgan, Lewis and Bockius, who successfully protested the VA’s decision to exclude the company’s products in the Court of Federal Claims, defended the decision on appeal and have 11 current cases before the Court of International Trade challenging CBP’s country of origin determinations on behalf of Acetris.
The webinar will discuss the decision and its implications for finished drug products that are not manufactured in the U.S. and for non-drug products manufactured in the U.S. More broadly, the decision is important for bid protests challenging agency interpretations of statutes and regulations, because, like mootness, it expands the concept of interested party beyond the particular solicitation or contract award when the government’s interpretation will persist and the plaintiff is likely to bid in the future and be affected by the interpretation.
Click here to register for the webinar.
Webinar – Prepare for ASTRO Launch: Draft RFP Insight, March 4
GSA FEDSIM has been commissioned by DoD to establish a multiple award IDIQ contract program dedicated to unmanned, manned, and optionally manned systems, robotics, and platforms. Code-named ASTRO, the program is expected to be a unique DoD focused contract vehicle that will capture a lot of attention this year as a critical federal acquisition. Similar to OASIS, ASTRO will utilize a self-scoring system to evaluate a contractor’s status as a best-in-class solution provider. On February 5th, GSA FEDSIM issued a draft RFP and is slated to hold one-on-one due diligence sessions with interested vendors on February 18th through the 20th. Prospective contractors would be wise to consider the latest news as GSA moves forward.
Please join the Coalition as we host Baker Tilly to provide an overview of the ASTRO contract, expected contract requirements, and what contractors should consider as they make bidding decisions, including:
– Program Drivers
– ASTRO Background
– Anticipated FEDSIM Proposal Evaluation Criteria
– Vendor Self-Scoring
– Impact of “Bootstrapping” on Small and Mid-Tier Businesses
– Proposal Preparation Lessons Learned From OASIS
– Bid / No-Bid Factors
Click here to register for the webinar.
Join the Dialogue on GSA’s e-Tools and the MAS Consolidation, March 10
All members are welcome to join a dialogue with Judith Zawatsky, Deputy Assistant Commissioner for the Office of Systems Management at GSA, on March 10th at 10am in Tysons Corner. The meeting will be hosted by the IT/Services Committee. Judith and her team will address e-Tools in the context of the Schedules Consolidation, for example e-Buy (how is GSA preparing and what outreach is being conducted with agencies), e-Offer, and e-Mod.
If you have any questions about GSA’s e-Tools that you would like GSA to address during the meeting, please send them to Aubrey at awoolley@thecgp.org.
RSVPs are required to attend. Please email Michael Hanafin at mhanafin@thecgp.org to RSVP and receive the meeting location or the dial-in number.
Small Business Committee Meeting, March 16
Please join the Small Business Committee of the Coalition for Government Procurement, on March 16, as they welcome Maggie Moore, Professional Staff Member, and Therese Meers, Counsel, of the Senate Small Business Committee.
Moore and Meers will discuss important issues impacting small business government contractors including, barriers to entry, CMMC certification, the impact of the Runway Extension Act, proposed sole source increases, and proposed changes to the calculation of size for employee-based size standards.
RSVPs are required to attend this meeting. There will also be a dial-in option. To RSVP or to receive dial-in information, please email Michael Hanafin at MHanafin@thecgp.org
Webinar – Bid Protest Update for Commercial Contractors, March 25
Please join the Coalition for a 1-hour webinar on March 25, 2020 focusing on recent bid protest decisions relevant to commercial contractors. This webinar will feature Perkins Coie’s Seth Locke and Alexander Canizares and will provide an overview of several recent bid protest decisions by the Government Accountability Office and the U.S. Court of Federal Claims as well as offer practical considerations for commercial contractors when bidding on contracts and evaluating the likelihood and viability of a potential bid protest. Among the topics that will be discussed are recent cases involving (1) the scope of the government’s obligation to consider commercially available solutions; (2) challenges related to Other Transaction (OT) agreements; (3) the government’s justification for issuing a sole-source award based on an “urgent and compelling need,” and (4) the extent to which a contract modification may be set aside as anti-competitive and unlawful.
Click here to register.
Join The Coalition at GSA’s FAST 2020
The FAST 2020 is right around the corner! The training conference will be held April 14 – 16 in Atlanta, Georgia. It will bring together thousands of government and industry acquisition professionals, senior executives, and program managers for three days packed with training, dialogue, and collaboration on key procurement policies, procedures, and programs. The conference agenda will include key/leading acquisition management programs, like Category Management and associated Best in Class contracts, acquisition innovation initiatives (think OTAs), and supply chain risk management and cyber security (think Section 889). Of course, the agenda will include training and government-industry exchanges on the Multiple Award Schedules (MAS), IT GWAC, OASIS, and much, much more.
The Coalition commends GSA for its commitment and hard work focused on creating a cost effective, government-wide training event that will enhance understanding and support the procurement system in delivering best value mission support for customer agencies and the American people. Already, over 500 firms have signed up as exhibitors, and space is filling up. Many of the exhibitors are Coalition members, and the Coalition will be at booth 515 throughout the conference. Additionally, the Coalition will be hosting a complimentary reception for members on the evening of April 14 at the Omni Hotel, right across the street from the Georgia World Congress Center. We will share more details as they become available. We hope to see you there.
Here is more information on the agenda, events, and registration for FAST 2020.
GSA Announces March 2020 Professional Services Round Table
The General Services Administration (GSA) is hosting three round tables for the Professional Services Category to discuss category management and to help companies build a better opportunity pipeline. The forums will be held:
- Small Businesses: Tuesday, March 17 @ 2:30 – 4:00 p.m. EST
- Mid-tier Businesses: Wednesday, March 18 @ 10:00 – 11:30 a.m. EST
- Large businesses: Wednesday, March 18 @ 1:00 – 2:30 p.m. EST
The purpose of the event is for GSA to capture industry data, insight, and recommendations on category specific issues in a structured manner that supports business cases and category management strategic plans.
The roundtables will be held at GSA Headquarters, 1800F in Washington D.C. and there is a maximum of 25 attendees per round table. One representative per company. (The session will not be available in a webcast).
If you’re interested in participating please email Zachary Lerner (zachary.lerner@gsa.gov) before the close of business Friday, February 28.
OIG Audit of SDVOSB Contract Awards
The Department of Defense (DoD)Office of Inspector General (OIG) released the findings and recommendations of an audit of DoD contract awards to service-disabled veteran-owned small business (SDVOSB). The OIG found that DoD awarded 27 contracts, valued at $827.8 million, to 16 ineligible contractors. DoD also awarded 6 contracts, valued at $164.7 million, to 3 contractors without verifying subcontracting requirements.
The ineligible contractors did not meet the requirements for SDVOSB status. DoD contractors self-certify as SDVOSB and DoD does not have procedures to verify the accuracy of the contractors’ status. While the Office of Small Business Programs (OSBP) director disagreed with the report’s findings, OIG has the following recommendations for the OSBP director:
- coordinate with the Military Departments and Defense agencies and review contractors we determined to be ineligible and contractors that were denied SDVOSB status by the VA Center for Verification and Evaluation, and take action, through the SBA, as necessary;
- implement procedures, in coordination with the Defense Pricing and Contracting (DPC), to require contractors to submit documentation to support their SDVOSB status, as well as other socio‑economic statuses, prior to contract award, and perform periodic reviews of SDVOSB contractors;
- implement procedures, in coordination with DPC, for contracting personnel to track subcontracting percentages required for SDVOSB contracts;
- coordinate with DPC, the General Services Administration and the SBA and implement procedures to ensure that contractors update their SAM status if the SBA determines the contractors are ineligible; and
- coordinate with DPC and the SBA and implement procedures to ensure protest results are communicated to contracting personnel DoD-wide, and reinforce procedures to ensure contracting personnel are aware of the protest procedures and their responsibilities.
Section 889 Webinar Now Posted Online
What Every Federal Contractor Needs to Know about NDAA Section 889
On February 5, Jonathan Aronie of Sheppard Mullin and Michael Thompson of the General Services Administration (GSA) presented a webinar on Section 889 of the National Defense Authorization Act of 2019, which bans certain Chinese telecommunications equipment and services from the supply chain. The webinar provided a brief overview of the rule, explained its scope, and suggested compliance best practices. The presenters also addressed several frequently asked questions including questions regarding the application of the rule to overseas affiliates, the reach of the rule to parent companies and subsidiaries, the usefulness of vendor certifications, and the scope of the August 2020 “use” prohibition. To access the webinar, click here.
