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On August 18, 2022, the FAR Council issued a proposed amendment to the FAR implementing Executive Order 14063, Use of Project Labor Agreements for Federal Construction Projects, which requires the use of project labor agreements (PLAs) on any large-scale federal construction projects valued at or above $35 million unless an exception applies.  The Order, and the proposed rule, also give agencies discretion to use PLAs on projects under that $35 million threshold. 

In addition to expanding definitions of “construction,” “labor organization,” and “large-scale construction project” to align with E.O. 14063, the proposed rule would revise FAR 22.503 to reflect the change in policy that mandates agencies to require the use of PLAs when awarding large-scale federal construction contracts—including individual orders under Indefinite Delivery, Indefinite Quantity contracts—unless an exception applies.  The proposed rule would make the PLA requirement a mandatory flow-down.  The proposed rule would also allow agencies to include any additional agency-specific requirements in a PLA through FAR 22.504(b)(6), and would strike the current FAR 22.504(c), which grants agencies discretion to specify PLA terms and conditions. 

Continue Reading FAR Council Proposes New Rule on Project Labor Agreements for Major Construction Projects
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Last week, the United States Congress passed the $280 billion CHIPS and Science Act of 2022 (CHIPS Act)[1] to bolster domestic semiconductor and microchip manufacturing in the United States. The bipartisan legislation will facilitate federal investments in the form of grants, loans, and loan guarantees to eligible entities and create significant business opportunities for companies in the U.S. The legislation also provides funding and new programs to boost advanced workforce training and research and development in a range of scientific and technology areas. The legislation now awaits the signature of President Biden, who hailed its passage as “exactly what we need to be doing to grow our economy right now.”

The legislation seeks to reverse the decades-long decline in U.S. microchip and semiconductor manufacturing and counter the rise of China as a source for technologically advanced manufacturing processes and products. By boosting domestic manufacturing and supply chains, the legislation also aims to relieve the global semiconductor shortage that has plagued manufacturers of a diverse set of products – everything from automobiles to children’s toys – and has contributed to the nation’s supply chain woes for more than two years.

The cornerstone of the legislation is $52 billion that will be allocated to the U.S. Department of Commerce semiconductor initiative to develop and expand domestic manufacturing capacity. Implementation of that program was already underway at the Department of Commerce[2], following Congressional authorization in the Fiscal Year 2021 National Defense Authorization Act (FY21 NDAA), and the legislation passed last week now provides the critical funding needed to commence direct federal incentives for the construction, expansion, or modernization of semiconductor manufacturing facilities.

Continue Reading The CHIPS Are Down and Incentives Flow as Congress Attempts to Vitalize the U.S. Semiconductor Industry
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Major changes to the way small business contractors obtain, and agencies evaluate, past performance references are set to arrive on August 22, 2022. On July 22, 2022, the Small Business Administration (SBA) published a final rule implementing provisions of Section 868 of National Defense Authorization Act for Fiscal Year 2021. The rule provides two new methods for small business contractors to obtain past performance ratings upon which they may then rely when submitting offers on prime contracts with the Federal Government.

First, a small business offeror may rely on the past performance of a joint venture of which it is a member, as long as the small business was involved in performance of the joint venture’s contract(s).  To that end, when submitting a proposal, the small business must: (1) identify the joint venture; (2) specify the joint venture’s contract(s) the small business elects to rely upon; and (3) detail the duties and responsibilities the small business carried out as part of the joint venture. Provided these requirements are met, the procuring agency shall (per 13 C.F.R. § 125.11) consider the past performance of the joint venture when evaluating the past performance of the small business concern.

Continue Reading SBA to Implement New Methods for Evaluating Expanded Sources of Small Business Past Performance
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The General Services Administration (GSA) transition from the Dun & Bradstreet (D&B) Data Universal Number System (DUNS) to the Unique Entity Identifier (UEI), which took effect on April 4, 2022, has faced challenges.  Substantial verification and validation delays continue, agencies have had to issue guidance for the management of SAM delays, and even Congress is showing concerns.  

According to the Federal Service Desk (FSD), GSA requires entities to submit new validation documentation, despite the years of submissions to Dun & Bradstreet, because data rights limitations prevent SAM.gov from using previously validated data.

Continue Reading SAM Transition to UEI Plagued with Registration Processing Delays
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On July 7, 2022, the General Services Administration (“GSA”) published an Advance Notice of Proposed Rulemaking (“ANPR”) seeking public comment on revising GSA policies and procedures to reduce single-use plastics in purchased products and their packing and shipping materials.  GSA is acting in furtherance of the directives set forth in Executive Order 14057, Catalyzing Clean Energy Industries and Jobs Through Federal Sustainability (discussed here), which, among other things, directed GSA to use federal procurement policy as a way to support a recycled content market.  Thus, for purchases under the Federal Supply Schedule program, as well as GSA’s construction, concession, and facility maintenance contracts, GSA seeks to reduce reliance on single-use plastics and move toward what the Administration considers to be “environmentally preferable” materials.

Continue Reading GSA Exploring New Regulations to Reduce Single-Use Plastic in Federal Procurement
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On June 23, 2022, a federal grand jury returned an indictment against Army contractor Envistacom LLC and two of its executives alleging participation in a fraudulent scheme that deprived the federal government of competition and making false representations to the government in furtherance of the conspiracy. The indictment also charged the executive as a co-conspirator, and asserts the conspirators coordinated in the preparation of so-called “competitive quotes” submitted in connection with 8(a) set aside contracts. The quotes were allegedly fraudulently inflated in order to all but guarantee the government customer would sole source the award to the conspirators’ pre-determined bidder. This indictment represents the fruits of yet another investigation by the Department of Justice’s Procurement Collusion Strike Force (“PCSF”).

According to the indictment, the defendants conspired to prepare and secure “sham” pricing quotes from third-party companies that were intentionally higher than Envistacom’s proposals to ensure that the government issued sole source awards to Envistacom. Further, the defendants allegedly coordinated with an unnamed government employee who acted as a co-conspirator and assisted in preparing and submitting Independent Government Cost Estimates (“IGCE”) for certain set aside contracts to ensure that the pre-determined bidder’s proposal would be lower than the IGCEs. Finally, the indictment alleges that the defendants made “false statements, representations, and material omissions to federal government contracting officials” about the IGCEs being “legitimate” and the sham quotes being “competitive.”

Continue Reading Procurement Collusion Strike Force Nabs Another Military Contractor in Bid Rigging Scheme
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On June 6, 2022, President Biden issued a White House Fact Sheet (“Fact Sheet”) outlining President Biden’s “Bold Executive Action to Spur Domestic Clean Energy Manufacturing” along with five related Defense Production Act (“DPA”) Presidential Determinations[1] (“Presidential Determinations”) and a Declaration of Emergency and Authorization for Temporary Extensions of Time and Duty-Free Importation of Solar Cells and Module from Southeast Asia (the “Declaration”).  The Fact Sheet states the President is (1) authorizing use of the DPA to accelerate domestic production of clean energy technologies; (2) encouraging domestic solar manufacturing capacity through the use of master supply agreements with enhanced domestic preferences; and (3) creating a two-year trade regulation bridge as domestic manufacturing for solar products scales up.  The White House stated that these actions are being taken to lower energy costs, reduce risks to the power grid, and mitigate climate change.  The Department of Energy (“DOE”) also released a statement on June 6 about the DPA Presidential Determinations which describes DOE’s concerns with regard to each material or technology for which a determination was issued.  The statements made by the White House and DOE also make clear that these actions to employ the DPA are part of the Administration’s broader “all of government” approach to addressing Environmental Justice, with the intention to “strongly encourage projects with environmental justice outcomes that empower the clean energy transition in low income communities historically overburdened by legacy pollution.”

Continue Reading President Biden Employs Defense Production Act and Tariff Act in Domestic Clean Energy Manufacturing Push
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As Russia’s assault on Ukraine continues, countries around the world are taking action.  Relevant to U.S. Government contractors, on April 22, the Defense Logistics Agency (“DLA”) issued a Request for Information (“RFI”) seeking information on companies’ abilities to deliver military and commercial assistance to Ukraine.  The RFI states that “the Biden Administration is working around…

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On March 17, 2022, the National Institute of Standards and Technology (“NIST”) published an initial draft of its Artificial Intelligence (AI) Risk Management Framework (“AI RMF”) to promote the development and use of responsible AI technologies and systems.  When final, the three-part AI RMF is intended for voluntary use and to improve the ability to…

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2021 was another busy year in False Claims Act enforcement and litigation. Significant decisions were issued across the circuits, spanning government dismissal authority, materiality, scienter, Rule 9(b) pleading standards, the Eighth Amendment’s Excessive Fines Clause, and more. The year also saw proposed amendments introduced by Senator Chuck Grassley aimed at strengthening the statute and overruling …