The Coalition for Government Procurement (the Coalition) would like to thank our 2012 Fall Training Conference speakers for “continuing the dialogue” regarding government-wide contracting, GSA schedules and upcoming procurement initiatives. The Fall Training Conference reflected the best in “Myth-Busting” with government and industry engaging in thoughtful conversations addressing key procurement policies, programs and procedures. By continuing the dialogue, government and industry can better work together for a more efficient and effective procurement system that delivers best value for the American taxpayer.
The Coalition thanks Acting Administrator Dan Tangherlini for providing the closing address updating the attendees on his review of GSA’s operations. The Coalition thanks Acting FAS Commissioner Mary Davie for the opening the Conference with her remarks highlighting progress on FAS’s key initiatives. The Coalition also extends our thanks to all our speakers:
Brian Friel, Federal Business Analyst, Bloomberg Government
Mark Day, Director, Office of Strategic Programs, GSA
Robert Coen, Acting Program Director, NIH Information Technology Acquisition and Assessment Center (NITAAC) GWAC Program, NIH
Darlene Coen, Deputy Program Manager, NASA SEWP
Jeffrey Koses, Director of Acquisition Operations
Shalloy Castle-Higgins, Director, Greater Southwest Acquisition Center
Susan Labman, Director, Integrated Workplace Acquisition
Gerri Watson, Director, Management Services Acquisition Center
Kay Ely, Director, Information Technology Acquisition Center
Jon Etherton, President and Owner, Etherton & Associates Inc.
Ray Bjorklund, Vice President and Chief Knowledge Officer, Deltek
Elizabeth Ferrell, Partner, McKenna Long and Aldridge LLP
Robert Levinson, Defense Analyst, Bloomberg Government
Steven L. Schooner, Nash & Cibinic Professor of Government Procurement Law and Co-Director of the Government Procurement Law Program, George Washington School of Law
David Drabkin, Director, Acquisition Policy, Northrop Grumman
Jonathan Aronie, Partner, Sheppard Mullin
Todd Richards, Acting Deputy Director, OASIS Program Management Office
David Dowd, Partner, Mayer Brown LLP
John Horan, Partner, McKenna Long & Aldridge LLP
Daniel Gordon, Associate Dean for Government Procurement Law Studies, The George Washington University School of Law
Keith Colella, Director of Small Projects & Reimbursable Services, PBS
Nancy Goode, Nancy Goode, Director of GSA’s Center for Acquisition Support
Dyad Searcy, Division Director, Financial and Business Solutions (FABS)/Acting Director for Center for Innovative Acquisition Development
Warren Blankenship, Division Director, Office of IT Schedule Operations
Angela Jones, Supervisory, Contracting Officer, Branch Chief
Keith Machen, Director, e-Commerce Division
Tim Dempsey, Chief, Systems, MAS Program Office
Houston Taylor, Assistant Commissioner, Acquisition Management
Robert Bourne, Director, MAS Program Division
Mark Lee, Policy Branch Chief, MAS Program Office
Judith Nelson, Chief, Special Programs Branch, MAS Program Office
Thank you to all who attended the Training Conference. The Coalition appreciates and values your support! We are committed to delivering great service to our members and I have been extremely pleased at the positive feedback regarding this year’s conference.
Thank you as well to the Coalition Committee Chairs, Board of Advisors and Board of Directors for your support for the conference and all our effort through the year. Finally, I would like to express a special thank you to Bill Gormley and the entire Coalition staff for putting together the 2012 Training Conference. I am extremely fortunate to work with such a talented and dedicated group; colleagues who believe in the Coalition’s mission of supporting common sense in government procurement!
The Excellence in Partnership Awards and Continuing the Dialogue, our 2012 Fall Training Conference, could not have been possible without the support of our Sponsors. The Conference, addressed acquisition policy, government-wide contracting, federal market opportunities and an FY 2013 Budget Outlook and provided a forum for constructive dialogue between government and industry. Sponsorship of this event demonstrated your support for the quality training of acquisition professionals and robust communication between government and industry with the goal of acquisition excellence.
Join your industry peers and receive this heightened exposure by becoming a sponsor for a future event! If you would like to explore sponsorship opportunities for other events, please contact Athena Oliff at firstname.lastname@example.org or 202-315-1052.
A Special Thank You to our Keystone Members!
During the 2012 Fall Conference, the Coalition honored individuals and organizations from government and the contractor community who have made a difference by improving the procurement system and delivering best value to the taxpayer. The 2012 Excellence in Partnership recognitions go to:
- Civilian Government Savings Award – Wesley Dewalt, GSA
- Civilian Myth-Busters Awards – Department of Homeland Security, GSA’s Creative Services Team in Auburn, WA and the NITAAC GWAC Program, NIH
- Best Government Veteran Hiring Program – The United States Postal Service
- Best Industry Veteran Hiring Program – CACI and L-3
- Lifetime Achievement Award – Daniel Gordon, Associate Dean for Government Procurement Law Studies, George Washington University School of Law
The Coalition would like to thank Dan Gordon for addressing the Fall Conference attendees during lunch on the second day. Congratulations to all the honorees!
This week, more than 200 members, Coalition guest and government executives and acquisition professionals from across the country gathered for The Coalition for Government Procurement’s annual Fall Conference in Arlington, Virginia. During the two day training event, attendees participated in a myth-buster’s dialogue with high level acquisition leadership from GSA, NASA, and the National Institutes of Health about opportunities in the Federal market and acquisition policy changes contractors can expect in FY2013.
Some of the highlights:
- OASIS: GSA is reviewing the comments received from the government on the OASIS business case. The business case will be finalized with 15 days for public comment. The latest estimate for the release of the draft RFP is December 2012 or early January 2013.
- NASA SEWP: NASA anticipates that the SEWP V Draft RFP will be available by the end of this calendar year.
- Strategic Sourcing continues to be a high priority. Five new Federal Strategic Sourcing vehicles are expected in FY2013 and FY2014. GSA Acting Administrator, Dan Tangherlini, is personally involved in an effort to strengthen strategic sourcing government-wide as part of the President’s Management Advisory Board. GSA is also integrating strategic sourcing principles into OASIS based on feedback on their business case.
- Price Transparency & Data Reporting: GSA described customer agency interest in greater transparency concerning prices paid and the ability to compare prices— expect pressure to lower prices and at the same time report more data in this area.
- Schedules Harmonization is being implemented to standardize solicitation language and consolidate the number of GSA Schedules from more than 30 to approximately 8. Through demand management, Schedules and SINS with fewer business transactions may be closed to new offers for a period of time.
As a follow-up to the 2012 Fall Conference, registered attendees will receive the slides from the event early next week.
Budget Sequestration, the WARN Act and Compliance Costs—Implications for Contractors
Jim Schweiter, Partner, McKenna Long & Aldridge LLP
Last August, Congress passed the Budget Control Act of 2011 (Pub. L. 112-25). This law authorized raising the debt ceiling, established caps on discretionary spending, and put in place a process known as sequestration to implement a total of $1.2 trillion in automatic spending cuts through fiscal year 2021, unless Congress passes a bill which the president signs to avert such a result. Sequestration is a process of automatic, largely across-the-board spending reductions under which budgetary resources are permanently canceled in order to achieve compulsory deficit reduction.
Much has been written about the draconian effects sequestration will have on the programs, projects and activities of executive branch agencies. Senior executive branch officials, members of Congress and industry leaders all predict catastrophe if sequestration is implemented. In the case of government contractors, the decline in new government work caused by funding reductions, or the truncation of existing government work through contract terminations, changes, or other mechanisms, may cause employers to consider terminating or laying off employees. As a result, it is important for employers to understand their rights and obligations under the Worker Adjustment and Retraining Notification (WARN) Act.
Notification Requirements under the WARN Act
The primary purpose of the WARN Act is to require certain employers to provide at least 60 days advance notice to employees who are impacted by a “plant closing” or “mass layoff.” Each of these terms has a lengthy statutory and regulatory definition but, in brief, a “plant closing” refers to a shutdown of a site of employment resulting in an employment loss for at least 50 employees, while a “mass layoff” means a reduction in force at a single site of employment impacting at least (1) 50 employees and 33 percent of the active employees at that site, or (2) 500 employees.
As a general rule, whenever an employer foresees that 50 or more employees could lose employment at a site of employment within a 90-day period, that employer should carefully analyze whether the definition of a “plant closing” or “mass layoff” may have been met, and thus whether WARN notice requirements have been triggered. If the WARN notice requirements are triggered, the employer must provide written notice of the anticipated employment loss to (1) the affected employees (or to their representative if unionized), (2) a designated state official, and (3) the chief elected official of the unit of local government within which the layoff or plant closing will occur. If the employer provides less than 60 days’ notice before the employment action, it may be subject to paying wages and benefits to the affected employees for the portion of the 60-day period in which notice was not given, in addition to other potential penalties.
The WARN Act recognizes that plant closings and mass layoffs cannot always be anticipated months in advance, and certain exceptions to the 60-day notice requirement exist. The “unforeseeable business circumstances” exception is the relevant exception that would be associated with layoffs or plant closings resulting from the January 2, 2013 onset of sequestration. This exception encompasses a “sudden, dramatic, and unexpected action or condition outside the employer’s control.” The Labor Department’s interpretive guidance noted that although budget sequestration can be seen months in advance, the actual impact on a particular contractor may be unknown until much later. Therefore, an abrupt termination of a particular contract might qualify under the “unforeseeable business circumstances” exception. If contractors must lay off or separate their employees in less than 60 days, such announcements would be sudden and dramatic and therefore consistent with the WARN Act. According to the Labor Department, in such cases employers would not have to provide the full 60-day notice.
Contractor Costs and the WARN Act
The Office of Management and Budget (OMB) just issued new guidance that certain liability and litigation costs associated with WARN Act compliance will be allowable costs under government contracts. Under the OMB memorandum, if sequestration occurs and an agency terminates or modifies a contract which causes the contractor to order a plant closing or layoffs subject to the WARN Act’s notification requirements, and that contractor has followed the Labor Department’s guidance, then any resulting court-determined, WARN Act-based employee compensation costs, attorneys fees and other litigation costs would qualify as allowable costs which would be reimbursable by the contracting agency, regardless of the litigation outcome. Such costs would also have to be both allocable to the contract in question and reasonable in accordance with existing FAR principles.
This new OMB memorandum has prompted several large defense contractors to announce that they will not issue WARN Act notices before January 2, 2013. However, the guidance has exacerbated partisan tensions. Senators Charles Grassley (R-IA) and Kelly Ayotte (R-NH) announced jointly that they had sent a letter of inquiry “asking under what authority the administration is using to say it is okay to disregard the law,” and then promise contractors “a taxpayer funded bailout for their legal expenses if they do so.”
Regardless of the seemingly inevitable partisanship that accompanies the run up to a presidential election, there are several points about the most recent OMB memorandum for contractors to bear in mind. First, the implementation of sequestration alone does not portend layoffs or plant closings triggering WARN Act notice requirements. There must be some adverse contract action flowing from sequestration’s funding reductions which affects an employer. In addition, the OMB guidance clearly contemplates a court determination of both employee compensation costs, as well as attorneys fees and other litigation costs. However, employers may incur substantial costs associated with the publication and dissemination of WARN Act notices or employee negotiations and settlements not resulting in litigation. Under the OMB guidance, these costs would not seem to be allowable. Contractors who anticipate potential WARN Act liability should seek guidance from contracting officers about the extent to which their WARN Act-related costs will be allowable. Awareness of the OMB memorandum by DCAA and DCMA personnel will almost certainly also take time, and ignorance of the OMB guidance could complicate audits. Finally, before allowable costs may be reimbursed, the Government must have funds available to do so. If sequestration occurs, agencies may not have sufficient funding to reimburse WARN Act-related costs. Even if litigation resulted from a WARN Act dispute, the Judgment Fund would not be available for such purposes because the litigation would not involve the United States.
Prudent employers should prepare for various scenarios and have contingency plans in place to provide appropriate notice as soon as it becomes clear that a particular contract action will cause a WARN-triggering employment loss. Some companies are considering “provisional notices,” which communicate to all employees that federal budgetary issues could result in an employment loss. However, because they do not indicate which specific employees will be impacted and the specific date on which the employment loss will occur, such provisional notices may be “better than nothing” (and may show the employer’s good faith efforts to try to comply with WARN) but are still unlikely to fully satisfy the requirements of WARN. Finally, employers should be aware that several states have their own plant closing laws (sometimes referred to as “mini-WARN” statutes), and some of these laws have more stringent requirements that the federal law. Employers should thus analyze relevant state laws in states in which a significant employment loss may occur.
 Pub. L. 100-379, codified at 29 USC 2101 et. seq.
 20 C.F.R. 639.9(b)(1); see also, 29 USC 2102(b)(2).
 Department of Labor, Training and Employment Guidance Letter No. 3-12, July 30, 2012.
 Office of Management and Budget, Guidance on Allowable Contracting Costs Associated with the Worker Adjustment and Retraining Notification (WARN) Act, Memorandum for the Chief Financial Officers and Senior Procurement Executives of Executive Departments and Agencies, Sept. 28, 2012.
 Sara Sorcher, White House Moves to Head Off Sequester Layoffs, National Journal, Sept. 29, 2012, at http://www.nationaljournal.com/nationalsecurity/white-house-moves-to-head-off-sequester-layoffs-20120928.
 Senators John McCain, R-Ariz., and Lindsey Graham, R-S.C., called the guidance “politically motivated” and said they’d block any contractor payments by the Pentagon to cover failure of issuing WARN Act notices. Joyce Tsai, Partisan Debate Deepens over Layoff Notices Before Sequestration, Stars and Stripes, Oct. 5, 2012, at http://www.stripes.com/partisan-debate-deepens-over-layoff-notices-before-sequestration-1.192039.
 Letter from Senators Charles Grassley and Kelly Ayotte to Jeffrey Zients, Acting Director, Office of Management and Budget, (Oct. 1, 2012), at http://www.grassley.senate.gov/about/upload/100220121.pdf.
 31 USC 1304.
This week, Coalition President Roger Waldron spoke at the bisnow Federal Markets & Property Summit featuring leadership from Capitol Hill, GSA’s Public Buildings Service and Federal Acquisition Service (FAS), and the private sector. It was PBS Commissioner Dorothy Robyn’s first public event since joining GSA. Roger Waldron served on a panel with FAS Commissioner Mary Davie discussing FAS activities that support PBS and agency customers and acquisition opportunities for the private sector. Also speaking were Senator Ben Cardin (D-MD) and Representative Christopher Van Hollen (D-MD).
During the 2012 Fall Conference, GSA expressed interest in hearing from Coalition members about contract clauses that increase costs without adding value to the government. The Coalition is putting together a list of these contract clauses to share with GSA. Please submit your list to Carolyn Alston at email@example.com or Aubrey Woolley at firstname.lastname@example.org.
On Thursday, Coalition President Roger Waldron participated in a public-private sector dialogue on acquisition with the Department of Homeland Security. The meeting, held at the TSA Systems Integration Facility, provided industry associations with an opportunity to speak to senior-level officials about their views on acquisition. The Coalition would like to thank DHS Chief Procurement Officer Nick Nayak and his team for the invitation and for their commitment to engaging with industry to improve acquisition outcomes.
The intensive, one day training workshop teaches the basics of utilizing the Multiple Award Schedules program. Over the course of the workshop you will learn how to obtain and manage your GSA schedule, market GSA contracts, comply with Federal procurement requirements, follow policy changes, and prepare for MAS audits. A highlight of the course is training on GSA’s electronic tools including eBuy, GSA Adavantage! and GSA eLibrary. Other material covered will include of structuring your contract to address the schedule compliance requirements while retaining flexibility to compete in the federal and commercial market place, as well as training on the new FAR 8.4 ordering procedures. The courses will be taught by those on the front lines of GSA schedule negotiations and contract management.
Attendees are eligible to earn up to 8 CLP credits with submission of an attendance certificate and course training packet available for pick-up after the event. REGISTER HERE!
Increased small business utilization is a high a priority for the Federal Government. As a result, regulatory, legislative and agency level changes that -impact the Federal market are all possible.
On November 28, the Coalition will host a small business forum to gain insight into significant changes to the small business rules and how they will impact sales to federal agencies.
Small Business Administration – Looking Ahead at Federal Acquisition Priorities and Changes
A. John Shoraka, Associate Administrator of Government Contracting and Business Development, SBA
Small and Large Business Collaboration in the Federal Market – What Works and What Needs to Work Better.
Panel Moderator – Joseph Hornyak, Partner, Holland and Knight
James Connal, Vice President, Red River Computer
Tom Walker, Government Manager, Nucraft Furniture
Wayne Pizer, Vice President, L-3 National Security Solutions
Who Should Attend:
Small Businesses that sell to Federal Agencies Federal OSDBU Directors
Large businesses that subcontract to, team with, Federal Buying Officials
or sells indirectly through small businesses