EXTEND YOUR OFFER OR PROTEST

An offer on a government contract is normally subject to a specified offer (bid or proposal) acceptance period. Standard Form (“SF”) 33, Solicitation, Offer and Award, includes a block 12 which states that either a minimum offer acceptance period is specified in FAR 52.214-16 (which is included in the solicitation), or if not so included, then the acceptance period to maintain the offeror’s prices is 60 calendar days, unless the offeror inserts a different period in block 12. For commercial contracts using SF 1449, Solicitation-Contract Order for Commercial Items, the minimum offer acceptance period is 30 calendar days, unless a different period is specified in an addendum to the solicitation. This is provided for in FAR 52.212-1, which is incorporated by reference in the SF … Continue reading

TERMINATION OF AN 8(A) CONTRACTOR FOR FAILURE TO PAY A SUBCONTRACTOR

A recent decision by the Small Business Administration’s (“SBA”) Office of Hearings and Appeals (“OHA”) sustained the SBA’s termination of an 8(a) contractor for failing to pay a subcontractor $68,688.53, citing this failure as a lack of business integrity. Corporate Portfolio Management Solutions, SBA No. BDPT-567, Feb. 15, 2018. OHA noted that the failure to pay the subcontractor, Procon, and failure to comply with either an arbitration agreement or a civil judgment entered against Corporate Portfolio, amounted to conduct indicating a lack of business integrity. Because there was no basis for determining that the SBA’s decision was arbitrary, capricious or contrary to law, OHA dismissed Corporate Portfolio’s appeal and declined jurisdiction. By regulation, SBA accepts a business into the 8(a) program for 9 years, so … Continue reading

THE GAO HAS NO BID PROTEST JURISDICTION OVER FANNIE MAE AND FREDDIE MAC

Even though the Federal National Mortgage Association (FNMA or “Fannie Mae”) and the Federal Home Loan Mortgage Corporation (FHLMC or “Freddie Mac”) were in receivership, they are not “federal agencies” and are not subject to the bid protest jurisdiction of the Government Accountability Office (“GAO”). S.E. James & Co., B-415733, Feb. 7, 2018. S.E. James protested actions by Fannie and Freddie not to include their company on a list of approved insurance agencies. GAO noted that both Fannie and Freddie are chartered as for-profit, shareholder-owned corporations, and seek to enhance the liquidity, stability and affordability of mortgage credit. Because of their deteriorating financial condition, which threatened the stability of the financial market, Fannie and Freddie were placed into conservatorships. The GAO dismissed the protest because … Continue reading

UNREASONABLE RESTRICTIONS ON QUOTATION OR PROPOSAL REVISIONS

Federal Acquisition Regulation (“FAR”) 15.307 states that “[a]t the conclusion of discussions, each offeror still in the competitive range shall be given an opportunity to submit a final proposal revision….” This same requirement for fairness applies to negotiated procurements that seek proposals as well as quotations from offerors. Recently, the Government Accountability Office (“GAO”) reminded agencies that when they seek a final offer, they cannot restrict a contractor’s ability to make amendments in areas where there have been amendments that materially impact those areas. In Castro & Co., B-415508.4, Feb. 13, 2018, the Department of Homeland Security (“DHS”) issued an amendment to a solicitation for financial statement audit and internal control support services. After DHS selected the awardee, it received post-award protests, and decided to … Continue reading

WHAT IS A FAIR MARKET PRICE IN SET-ASIDES?

What is a fair market price, or a fair and reasonable price? The Federal Acquisition Regulation (“FAR”) requires that in a small business set-aside, the government must have a reasonable expectation that the award price will be reasonable, i.e., award will be made at “fair market prices:” FAR 19.502-2 Total small business set-asides. [] (b) [] The contracting officer shall set aside any acquisition over $150,000 for small business participation when there is a reasonable expectation that— (1) Offers will be obtained from at least two responsible small business concerns offering the products of different small business concerns [] and (2) Award will be made at fair market prices. Partial set-asides include the same “fair market price” requirement: 19.502-3 Partial set-asides. (a) The contracting officer … Continue reading

LATENT AMBIGUITY

It is an important rule of interpretation for both solicitations and contracts that the reader must examine the plain language of the document, and resolve questions of interpretation by reading the document as a whole and in a manner that gives effect to all provisions. Where the language is unambiguous, then it can be interpreted and its meaning understood. But, where there are two possible reasonable interpretations of a document, then an ambiguity exists. There are two types of ambiguities: Patent ambiguities: where the ambiguity is an obvious, gross or glaring error (for example, one page includes a specification of six inches for an item, but on a later page, the same specification is referred to as 7.5 inches). Latent ambiguity: a more subtle ambiguity … Continue reading

ONLY A CONTRACTOR, NOT AN IMPOSTOR, MAY SUBMIT A CLAIM

An Air Force contracting officer (“CO”) receives an email referencing Contract No. H92237-13-C-5002 (the “Contract”) for general labor services for a base in Afghanistan. The General Director of Tawhid Afzali Construction Company (“TACC”), Mr. Muhmmad Nazeer, states in the email that his company did not receive payment for the three year old Contract, enclosing a purported copy of the Contract which was dated three years prior and showed a face amount of $72,400. The information on the face of the Contract contradicted the original award determination in the contract file which stated that “it is determined that Najibullah Rahmal, in the amount of $94,240, is most advantageous to the government.” The CO has no copy of the Contract in the file, and no record of … Continue reading

THE LATE OFFER RULE DOES NOT APPLY TO QUOTATIONS

The general rule in government procurement is that when a contractor submits an offer, it must be on time as stated in the solicitation. With very limited exceptions, “late is late” and the offer generally may not be considered. This is reflected in the three Federal Acquisition Regulation (“FAR”) sections dealing with instructions to offerors: FAR 52.212-1(2), Instructors to Offerors-Commercial Items (for use in Commercial Item procurements); FAR 52.214-7(b), Late Submissions, Modifications, and Withdrawals of Bids (for use in Sealed Bidding); and FAR 52.215-1(c)(3), Instructions to Offerors, Competitive Acquisition (for use in Negotiated Procurement). All three FAR sections contain virtually identical language that “[A]ny offer, [bid or proposal], modification, revision, or withdrawal of an offer received at the Government office designated in the solicitation after … Continue reading

POTENTIAL IMPACT OF NEW GUIDANCE ON FALSE CLAIMS ACT CASES

Two new Department of Justice (“DOJ”) Memoranda could have a potential impact on Civil False Act Claims cases, as well as other civil enforcement cases. The two memos are: Memorandum from Michael D. Granston, Director, Commercial Litigation Branch, Fraud Section, “Factors for Evaluating Dismissal Pursuant to 31 U.S.C. § 3730(c)(2)(A),” issued Jan. 10, 2018 (apparently leaked from DOJ and now available on the internet); and Memorandum from Associate Attorney General Rachel Brand, “Limiting Use of Agency Guidance Documents in Affirmative Civil Enforcement Cases,” issued Jan. 25, 2018. First Memorandum Effect on Quit Tam Actions in False Claims Act Cases The first memo deals with factors that the DOJ will consider in determining whether or not to seek dismissal in qui tam suits where the DOJ … Continue reading

CAUTION ON “REFRESHES” OF YOUR MULTIPLE AWARD SCHEDULE CONTRACT

The General Services Administration (“GSA”) announced on April 26, 2018 that it will require that multiple award schedule contractors accept the bilateral Commercial Supplier Agreements (“CSA”) modification through a “refresh” of the contract. This change is described in 83 Fed. Reg. 7631 (Feb. 22, 2018) and will add or update add/update clause 552.212-4 Contract Terms and Conditions Commercial Items (JAN 2017) (DEVIATION – FEB 2018) (ALTERNATE I – JAN 2017) (DEVIATION – FEB 2007). The inclusion of this new clause involving Commercial Supplier Agreements makes certain common commercial license terms unenforceable, and invalidates them, even if they are included in your contract. These clauses often conflict with the Appropriations language in the U.S. Code. The new clause also addresses liability and assignments as well as … Continue reading