The BDO GovCon Week Ahead - November 2020
November 23, 2020
Define the Word “Need”: Several months after the Paycheck Protection Program (PPP) closed, the Small Business Administration (SBA) is now going back to borrowers to ask clarifying questions. The SBA is currently reviewing draft Loan Necessity Questionnaire forms that may be sent to borrowers with an original principal amount of $2 million or more.
The questionnaires will ask borrowers to disclose revenue figures, provide details and timelines on shutdowns and alterations to business operations, disclose employee compensation during the loan period that would exceed $250,000 (when annualized) and reconcile debt pre-prepayments made during the loan period.
Borrowers will have 10 business days to complete the questionnaire and return it to their lender, certifying that their responses are true and correct. Incomplete answers and forms may result in a determination that borrowers were ineligible for loans and the SBA may seek loan repayment or other remedies.
For more information, please click this link.
For more information on the questionnaire, please click this link.
Continued Support for an Old Icon: Initially entering service over 40 years ago, the F-15 has long been a staple of the U.S. Air Force fleet and an asset to our allies. The F-15 has seen numerous iterations and upgrades from its initial design crafted by McDonnel Douglas, now part of Boeing.
As current models age and new variants are produced, Boeing has secured a contract that could be worth up to $10 billion to modernize and support ally Saudi Arabia’s F-15 fleet. Under this contract, Boeing will support maintenance and modernization efforts covering all systems, including software and hardware, installation of modifications and structural component design.
Saudi Arabia currently possesses three variants of the F-15: The F-15C/D, F-15S and F-15SA. These aircraft average ages range from 38 years-old for the F-15C/D variants, to 5years-old for the F-15SA. It is unclear what variants this contract will focus on; however, it is expected that Boeing will provide services to the whole of Saudi Arabia’s fleet.
As newer fighter jets like the F-35 and F-22 dominate headlines, it is exciting to see continued support and belief in the tried-and-true F-15. As Boeing continues to revitalize the F-15, the defense world can expect to see the icon in the skies for decades to come.
For more information, please click this link.
Is the End Near? On November 18, pharmaceutical giant Pfizer provided a final analysis of its promising COVID-19 vaccine candidate. Backing up Pfizer’s initial clinical trial data, which saw its vaccine protect nine out of ten candidates from COVID-19, final analysis indicates an even better efficacy rate of 95%. Meanwhile, another vaccine front-runner, Moderna, announced a similar efficacy rate of 94% for its COVID-19 vaccine on November 16.
Following Pfizer’s initial clinical trial data, the Trump administration announced that, following FDA approval, nearly 20 million people could be vaccinated in the month of December and 25 – 30 million people could be vaccinated in subsequent months. This metric depends, however, on how many vaccines are approved for emergency use by the FDA and assumes that no unforeseen issues arise.
According to Operation Warp Speed (OWS) Chief Operating Officer, General Gustave Perna, once a vaccine receives emergency use authorization, vaccinations will begin within 24 hours. This news sent stock markets rallying and presents a possible light at the end of the global pandemic tunnel.
November 16, 2020
Removing Bureaucracy - How HHS Is Planning to Do Their Part: “That’s how it’s always been done,” is a phrase that can frustrate even the most dedicated customer, employee or fan of innovation, improvement and growth. Earlier this month, the Department of Health and Human Services (HHS) issued a notice of proposed rulemaking geared toward removing bureaucracy and challenging the status quo of some of its more burdensome and ineffective regulations in accordance with the Regulatory Flexibility Act.
The proposed rulemaking would require that HHS sift through its almost 2,500 regulations every 10 years to determine if they are having the desired impact or if they are no longer needed. Exempt from this change would be requirements issued jointly with other agencies, requirements issued for a military or foreign affairs function or requirements issued around personnel matters.
HHS would have two years to review any of the other regulations that are more than 10 years old, which, according to their data analysis, is about 85 percent of the requirements issued before 1990. If the results of the review show that a requirement should be edited or rescinded, HHS has the freedom to not enforce it, on a case-by-case basis, until the rule is amended or removed.
For more information, please click this link.
The Hunt for an American Red October: Hundreds of feet below the ocean, in the pitch-black abyss, roams one of the U.S. military’s most powerful and strategic weapons: the submarine. Over the last few years, alongside the F-35 and Gerald R. Ford Class Aircraft Carrier programs, upgrading the submarine fleet has been a top priority of the Department of Defense (DoD).
Last week, the Navy awarded an initial $9.4 billion to General Dynamics Electric Boat, a subsidiary of General Dynamics, to begin construction work on the new Columbia class of nuclear-armed ballistic submarines. This new class of submarine is meant to replace the aging Ohio class of submarines, whose roots date back to the 1970s. The total program is expected to cost upward of $100 billion.
This new class of submarine is planned to be nuclear-powered (meaning it will maintain a nearly unlimited range), have a completely new propulsion system, be quieter and more efficient than the current Ohio class and contain all the latest technology.
The new submarine is expected to enter service in 2031.
For more information, please click this link.
How Fast Can the FAR Be? The Space Development Agency (SDA), along with the Space Command and Space Force, are the DoD’s newest and arguably most innovative fields. As such, it makes sense for such a fast-growing, tech-savvy military branch to utilize the DoD’s newest contracting mechanisms, Other Transactional Agreements (OTAs) and middle-tier acquisitions, right? Well, not quite.
The SDA has chosen to utilize the tried and true Federal Acquisition Regulation (FAR) contracting approach in its most recent award, an indefinite-delivery/indefinite-quantity (IDIQ) contract with an initial value of $18 million, that could rise to $112 million, to Perspecta for the development and building of first elements needed for a brand new architecture of low-Earth orbit satellites.
This is particularly interesting because the total time to award this contract under the FAR contracting standard took only three and a half months from final request for proposals to the award of the contract to Perspecta. This is practically unheard of for the traditionally snail-paced contracting mechanism.
Now that the SDA has been able to streamline the FAR acquisition standard, could we see other agencies take up such an approach? If so, what impact could this have on the future of acquisition, OTAs and other upcoming contracting mechanisms?
For more information, please click this link.
November 9, 2020
FBI Warns Healthcare Systems of Immanent Cyber-Attacks: Although, by and large, we are apart, the COVID-19 pandemic has served to boost collaborative efforts between companies, nations and people. This collaboration is done to keep people and their communities safe and healthy, as well as accelerate the creation and deployment of a vaccine and therapeutic developments needed to bring an end to the global blight. However, not all actors are being so understanding. The FBI and numerous federal agencies are seeing a worrying increase in cyberattacks against healthcare systems and have warned that further attacks are immanent.
These cyberattacks use ransomware to scramble healthcare system data into an unintelligible mess that can only be undone if the target pays a ransom within an allotted time period. If the target refuses, the data is lost to cyberspace. Security experts have seen at least five U.S. hospital systems targeted this week and expect the impact could reach hundreds more. So far in 2020, 59 U.S. healthcare systems have been impacted by ransomware that has disrupted patient care at up to 510 facilities.
The attackers can range from foreign governments, decentralized gangs of cybercriminals, lone-wolf attackers and everything in between. The most recent attacks, however, can be attributed to a Russian-speaking criminal organization.
As the FBI and federal agencies warn healthcare and other big-data system providers of the potential of immanent cyberattacks, there are steps employees can take to protect their company’s data integrity, including:
- Ensuring passwords are strong, changing them regularly, and never sharing them with others
- Never clicking on links from suspicious emails and other communications
- Alerting their IT team or provider of any potential breach of network integrity
For more information, please click this link.
The Schedule F Debacle Continues: In a follow up to last week’s news on President Trump’s controversial executive order instituting a Schedule F within the excepted service of the federal government, House democrats are demanding the administration cease its implementation immediately.
This executive order has been a hot bed of controversy due to fears that new Schedule F employees could feasibly be hired and fired from their positions by agency heads and will possess far fewer civil service protections than what have long been offered. The purpose of civil service protections is to maintain a fair, bureaucratic base that does not change every four to eight years with the coming and going of administrations.
Specifically, House democrats have signed a petition arguing that it is unclear if the White House or federal agencies have reviewed the possible impacts the new Schedule could pose to federal employees and the services they support. Additionally, House democrats have echoed concerns brought by government officials and civilians alike, stating that, “the executive order is a harmful attack on the integrity of our Government because it will permit the replacement of non-partisan civil servants with partisan Trump loyalists.”
As noted in last week’s GovCon Week Ahead, this executive order is largely considered to be symbolic, but the swift backlash from House democrats, coming less than a week from election day, shows that this executive order is not one that will be brushed under the proverbial rug.
For more information, please click this link.
DUNS Gets a 16-Month Stay of Execution: 58 years ago, John Glenn became the first American to orbit the Earth and Bob Dylan released his debut album. Also of note in 1962, but referenced slightly less often in trivia, Dun & Bradstreet created the data universal numbering system (DUNS), which has since provided over 330 million business entities with a unique nine-digit number identifier.
The government heavily relies on the use of DUNS in multiple systems, including on the General Services Administration (GSA) System for Award Management (SAM) website. However, in 2019, the GSA awarded a new contract to transition away from DUNS to a new Unique Entity Identifier (UEI). Federal agencies were given until December 2020 to transition from DUNS to UEI, but Government officials realized that they needed more time.
As a result, the deadline, after which no new DUNS numbers will be issued, has been extended to April 2022. During this extended transition period, the government hopes to have both DUNS and UEI numbers issued to continue testing/patching their systems and to ensure continuity of services if any systems are not able to process UEI numbers.
For more information, please click this link.
November 2, 2020
New Orders to Old Rules: Less than two weeks from the presidential election, President Trump has signed a controversial executive order that could bring the job security of thousands of government employees into the political ring. This executive order could remove decades-old civil service protections for federal employees. The civil service makes up the permanent, professional branches of governmental administration and does not include the military, judicial branches or elected politicians. Rather, these employees make up the proverbial bureaucratic side of the government and include federal attorneys, regulators, public health experts, etc.
This new executive order institutes a “Schedule F” within the excepted service of the federal government, and will be comprised of “employees in confidential, policy-determining, policy-making, or policy-advocating positions.” Agency heads have been instructed to determine which current employees fit this definition, and to move them to Schedule F. This change is to be made regardless of the employee’s current schedule within the excepted service or if they are members of the competitive service.
The controversy arises because these Schedule F employees could feasibly be hired and fired from their position by agency heads, much like political appointees who rotate with each administration, with far fewer civil service protections that were once offered. The purpose of civil service protections is to maintain a fair, bureaucratic base that does not change every four to eight years with the coming and going of administrations.
This executive order is largely symbolic, but only time will tell the true ramifications of its passing.
For more information, please click this link.
In the Age of Technology… Less R&D? It is a commonly known fact that the United States’ military budget is the largest in the world. In FY20, this budget eclipsed $730 billion, representing a larger budget than the next 10 countries, including China, India, Russia, and the United Kingdom combined. With a budget this healthy, it could be expected that all sectors and areas of defense might receive equitable funding; however, this is not the case.
The Department of Defense (DoD) is divvying out the lion’s share of funding to products and leaving research and development (R&D) spending close to pre-9/11 levels. R&D spend is critical to maintaining and advancing the technological lead the U.S. defense sector has enjoyed for decades in comparison to its adversaries and allies alike. The hardest-hit phase of R&D spend has been late-stage R&D funding while the System Development and Demonstration (SDD) phase, which accounts for technologies that have already been prototyped and are being more widely tested, maintains the largest portion of funding.
Although the R&D funding allocated from the DoD’s considerable budget may be proportionally low, this does not represent the whole picture. Funding through traditional contracting methods for R&D is down, but in response, the DoD has been expanding its utilization of Other Transactional Agreements (OTAs), which allows for greater flexibility when providing funding to R&D and prototyping efforts. Unfortunately, even if large portions of OTA funding go to R&D and prototyping efforts, because OTAs are made up of industry consortiums and not individual companies, it is difficult track exactly where the dollars are going. Even with OTA spending and an increasing defense budget, R&D funding is well below other sectors, and has not caught up to historical amounts.
For more information, please click this link.
A One-Stop Shop for All Your Government Acquisition Information Needs: As many government contractors have become aware, some even painfully so, several contracting websites and tools have already and continue to be transitioned over to the beta.SAM.gov website (beta.SAM). The transition of the FedBizOpps (FBO) functionality over to beta.SAM left a bad taste in the mouths of many, so, the move of the reporting functions from the Federal Procurement Data System (FPDS) to beta.SAM called for a slightly more cautious approach from the General Services Administration (GSA).
GSA officially moved the FPDS reporting functions for administrative, static, standard and ad hoc reporting over to beta.SAM in mid-October, after a seven-month period wherein the functionality was available on both sites. GSA hasn’t disclosed any issues or problems and stated that they have seen a steady level of usage on beta.SAM since the move. The remaining FPDS functionality and information is also planned to be moved to beta.SAM, but at this point there are no definitive plans as to when.
For more information, please click this link.
SHARE