Photo of J. Chris HailePhoto of Peter J. EyrePhoto of Nkechi KanuPhoto of Laura J. Mitchell BakerPhoto of Payal NanavatiPhoto of Anuj VohraPhoto of Monica DiFonzo Sterling

On Monday, August 13, 2018, President Trump signed into law the H.R. 5515, the John S. McCain National Defense Authorization Act for Fiscal Year 2019 (FY 2019 NDAA), the earliest an NDAA has been signed in over a decade.  The FY 2019 NDAA includes several provisions relevant to contractors, including replacing the definition of “commercial item” with “commercial product” and “commercial services,” discouraging the use of lowest price technically acceptable contracting, and a clause designed to accelerate payments to small businesses.

  • Section 822 requires DoD to: (1) study the frequency and effects of bid protests involving the same contract award or proposed award that have been filed at both the Government Accountability Office and the Court of Federal Claims; and (2) develop a plan, by December 1, 2019, for an expedited bid protest process for DoD procurements valued at less than $100,000.
  • Section 836 eliminates the statutory term “commercial item” – which encompassed both products and services – and creates two new, separately defined terms: “commercial product” and “commercial service.”  This section of the NDAA also makes numerous other statutory changes to reflect the new terminology and to identify where statutory provisions apply to commercial products, commercial services, or both.  These changes are effective January 1, 2020.  This section further requires DoD to submit an implementation plan to the Committees on Armed Services of the House and Senate that includes not only a timeline for substantive and technical conforming changes but also policy reviews, such as analysis of the extent to which commercial products and services should be treated similarly.
  • Section 838 grants the General Services Administration additional authority to develop competitive procedures for procurements made through commercial e-commerce portals.  For these procurements, the NDAA maintains the current Micro-Purchase Threshold (MPT) of $10,000, unlike earlier versions that had proposed increasing the MPT to $25,000.
  • Section 852 directs DoD to make prompt payments to small business concerns, with the goal of making payment within 15 days of receiving an invoice.
  • Section 866 allows the Secretary of Defense or a military department Secretary to “authorize use” of a contractor’s technical data during  pending litigation at an agency Board of Contract Appeals (Board) or the United States Court of Federal Claims (Court) to determine the extent of the government’s rights in that data.  To exercise this authority, the Secretary need only provide notice to the contractor (or subcontractor) and determine in writing that “compelling mission readiness requirements” will not permit awaiting the Board’s or Court’s final decision.
  • Section 873 requires the Department of Defense (DoD) to collect, analyze, and leverage data around the use of its Other Transaction Authority Agreements (OTAs) and to use that data to update policy and guidance related to the use of OTAs.
  • Section 875 removes the requirement for agencies to complete a Determination & Findings prior to using an Office of Management and Budget approved Government-Wide Acquisition Contract.
  • Section 880 encourages federal agencies to avoid, to the maximum extent practicable, the use of lowest-price, technically acceptable source-selection criteria in procurements predominately for the acquisition of: (i) “information technology services, cybersecurity services, systems engineering and technical assistance services, advanced electronic testing, audit or audit readiness services, health care services and records, telecommunications devices and services, or other knowledge-based professional services;” (ii) “personal protective equipment;” or (iii) “knowledge-based training or logistics services in contingency operations or other operations outside the United States, including in Afghanistan or Iraq.”
  • Section 881 permanently extends the authority provided in Section 806 of the Ike Skelton National Defense Authorization Act for Fiscal Year 2011 (Public Law 111–383) regarding the management of supply chain risk, and allows the Secretaries of Defense, Army, Navy, or Air Force to exclude certain sources for the purpose of reducing supply chain risk, and limit the disclosure of information relating to the basis for such exclusions.
  • Section 885 requires DoD to develop a process and procedures for limiting foreign access to technology through contracts, grants, cooperative agreements, or other transactions, when such limitation is in the interest of national security.
  • Section 890 requires DoD to establish a pilot program to reform and accelerate the contracting and pricing processes associated with contracts in excess of $50,000,000; the program may include no more than ten contracts, and none of the selected contracts may be part of a major defense acquisition program.

Some of these provisions (along with many other noteworthy sections) require promulgation of regulations that will bear close scrutiny by contractors.

Print:
Email this postTweet this postLike this postShare this post on LinkedIn
Photo of J. Chris Haile J. Chris Haile

J. Chris Haile is a partner at Crowell & Moring with extensive experience in government procurement law. Mr. Haile litigates disputes and counsels clients in a broad range of government contract matters, with particular emphasis on the resolution of contract disputes. For example…

J. Chris Haile is a partner at Crowell & Moring with extensive experience in government procurement law. Mr. Haile litigates disputes and counsels clients in a broad range of government contract matters, with particular emphasis on the resolution of contract disputes. For example, Mr. Haile has represented clients in matters involving the government’s breach of contract, claims for contract changes, termination for default, termination for convenience, Truth in Negotiations Act (TINA) compliance and defective pricing, commercial-item procurement, contract negotiations, and bid protests. He also represents clients in other related matters, such as investigations and audits by government agencies or inspectors general (IGs), False Claims Act / qui tam relator suits, and disclosures to the U.S. Government.

Photo of Peter J. Eyre Peter J. Eyre

Peter J. Eyre is a partner and co-chair of Crowell & Moring’s Government Contracts Group. He is also a member of the firm’s Management Board. Peter was named to BTI Consulting Group’s list of “Client Service All-Stars” in 2016, 2017, and 2019 and…

Peter J. Eyre is a partner and co-chair of Crowell & Moring’s Government Contracts Group. He is also a member of the firm’s Management Board. Peter was named to BTI Consulting Group’s list of “Client Service All-Stars” in 2016, 2017, and 2019 and has been named an Acritas Star, Acritas Stars Independently Rated Lawyers (2016, 2017, 2019). He is nationally ranked by Chambers USA in Government Contracts since 2014, and by Super Lawyers since 2017.

Photo of Nkechi Kanu Nkechi Kanu

Nkechi A. Kanu is a counsel in the Washington, D.C. office of Crowell & Moring, where she is a member of the firm’s Government Contracts Group.

Nkechi’s practice focuses on False Claims Act investigations and litigation. Nkechi has significant experience assisting companies with…

Nkechi A. Kanu is a counsel in the Washington, D.C. office of Crowell & Moring, where she is a member of the firm’s Government Contracts Group.

Nkechi’s practice focuses on False Claims Act investigations and litigation. Nkechi has significant experience assisting companies with complex internal investigations and represents clients in government investigations involving allegations of fraud. She also focuses on assisting clients with investigations relating to cybersecurity and information security compliance. Her complementary litigation practice involves defending companies in government-facing litigation arising under the FCA, resulting in the dismissal of qui tam complaints and successful settlements of FCA claims with DOJ.

Photo of Laura J. Mitchell Baker Laura J. Mitchell Baker

Laura J. Mitchell Baker is a counsel with Crowell & Moring’s Government Contracts Group in the firm’s Washington, D.C. office.

Laura represents government contractors in litigation and administrative matters, including contract disputes with state and federal entities, suspension and debarment proceedings, mandatory disclosures…

Laura J. Mitchell Baker is a counsel with Crowell & Moring’s Government Contracts Group in the firm’s Washington, D.C. office.

Laura represents government contractors in litigation and administrative matters, including contract disputes with state and federal entities, suspension and debarment proceedings, mandatory disclosures to the government, prime-sub disputes, and False Claims Act investigations. Her practice also includes counseling on federal, state, and local government contracts, government contracts due diligence, and regulatory and compliance matters, as well as conducting internal investigations.

Photo of Payal Nanavati Payal Nanavati

Payal Nanavati is an associate in the firm’s Washington, D.C. office, where she practices in the Health Care and Government Contracts groups. Payal’s government contracts practice focuses on defending companies under the False Claims Act (FCA), litigation before the Armed Services Board of…

Payal Nanavati is an associate in the firm’s Washington, D.C. office, where she practices in the Health Care and Government Contracts groups. Payal’s government contracts practice focuses on defending companies under the False Claims Act (FCA), litigation before the Armed Services Board of Contract Appeals (ASBCA), and bid protests before the Government Accountability Office (GAO). Her health care practice includes working with providers and plans seeking to comply with laws and regulations applicable to digital health initiatives, fraud and abuse, and mental health parity.

Photo of Anuj Vohra Anuj Vohra

Anuj Vohra litigates high-stakes disputes on behalf of government contractors in federal and state court, and maintains an active bid protest practice before the U.S. Government Accountability Office and the U.S. Court of Federal Claims. He also assists clients with an array of…

Anuj Vohra litigates high-stakes disputes on behalf of government contractors in federal and state court, and maintains an active bid protest practice before the U.S. Government Accountability Office and the U.S. Court of Federal Claims. He also assists clients with an array of issues related to contract formation (including subcontracts and teaming agreements), regulatory compliance, internal and government-facing investigations, suspension and debarment, organizational conflicts of interest (“OCIs”), intellectual property and data rights, and the Freedom of Information Act (“FOIA”).

Prior to entering private practice, Anuj spent six years as a Trial Attorney in the U.S. Department of Justice’s Commercial Litigation Branch. At DOJ, he was a member of the Bid Protest Team—which handles the department’s largest and most complex protests—and served as lead counsel in dozens of matters representing the United States in commercial disputes before the U.S. Court of Appeals for the Federal Circuit, the Court of Federal Claims, and the U.S. Court of International Trade.

Photo of Monica DiFonzo Sterling Monica DiFonzo Sterling

Monica DiFonzo Sterling is a counsel in the Washington, D.C. office of Crowell & Moring, where she is a member of the firm’s Government Contracts Group.

Monica has an active government contracts counseling and litigation practice focusing on False Claims Act investigations, bid…

Monica DiFonzo Sterling is a counsel in the Washington, D.C. office of Crowell & Moring, where she is a member of the firm’s Government Contracts Group.

Monica has an active government contracts counseling and litigation practice focusing on False Claims Act investigations, bid protests, federal regulatory and ethics compliance, and government contracts disputes before the Government Accountability Office and the U.S. Court of Federal Claims.