Vol. II, No. 6
FebBizOpps.gov to Replace CBD, Performance-Based Contracts Preferred
GAO Contracting Out Panel to Hold Meeting June 11
DOT Issues Proposed Regs to Implement MOU with SBA
SBA Proposes Revised SBIR Policy Directive
USTR to Monitor Foreign Procurement Practices
FY 2000 Spending Jumps 10% to $218.8 Billion
Executive Compensation Benchmark Raised to $374,228
Comments on "Blacklisting" Regulations Extended
Two Federal Acquisition Circulars (FACs) were published during May, both of which contained interim rules that make some significant changes to the Federal Acquisition Regulation (FAR) to implement various provisions of the National Defense Authorization Act for Fiscal Year 2001 (Public Law 106-398). FAC 97-25, published May 2, establishes a preference for performance-based contracts or task orders, and prohibits the use of minimum experience or education requirements for contractor personnel in the acquisition of information technology services except under limited circumstances. FAC 97-26, published May 16, establishes "Federal Business Opportunities" (http://www.fedbizopps.gov) as the single point of universal electronic public access to governmentwide procurement opportunities (the "governmentwide point of entry" (GPE)), and it will eventually replace the Commerce Business Daily (CBD). (EDITOR'S NOTE: For more on the acquisition-related provisions of Public Law 106-398, see the December 2000 Federal Contracts Perspective article "Experience Requirements for IT Workers Restricted.")
Both these interim rules went into effect May 2. Comments must be submitted no later than July 2, 2001, to General Services Administration, FAR Secretariat (MVP), 1800 F Street, NW, Room 4035, Attn: Ms. Laurie Duarte, Washington, DC 20405. Electronic comments on Item 1 may be submitted to firstname.lastname@example.org, and on Item 2 to email@example.com.
All three of these interim rules went into effect May 16. Comments must be submitted no later than July 16, 2001, to the General Services Administration address above. Electronic comments on Item 1 may be submitted to firstname.lastname@example.org; on Item 2 to email@example.com; and on Item three to firstname.lastname@example.org.
The General Accounting Office (GAO) Commercial Activities Panel has announced its first public meeting on the transfer of commercial activities currently performed by government employees to federal contractors, commonly known as "contracting out" or "out-sourcing." The meeting will be held on June 11 starting at 9:00 a.m., in the Walsh-Reckord Hall of States at One Massachusetts Avenue, Washington, DC. The Panel is interested in hearing views on the principles and policies that should govern decisions concerning whether particular functions should be performed by the public sector or the private sector.
Individuals who wish to attend or participate in the hearing (each presenter will have 3 to 5 minutes to make an oral statement) should contact William T. Woods at 202-512-8214, and submit written summaries of their statements by 5:30 p.m. on June 4, 2001, to the General Accounting Office, Office of the General Counsel, Room 7476, 441 G Street, NW, Washington, DC 20548, or by e-mail to A76panel@gao.gov.
Two additional hearings currently are planned. One will be held in Indianapolis, IN, on August 8, 2001, and will focus on alternatives to the public/private competitions conducted pursuant to Office of Management and Budget (OMB) Circular A-76, Performance of Commercial Activities. Another will be held in San Antonio, Texas, on August 15, 2001, and will address current processes under OMB Circular A-76 and the Federal Activities Inventory Reform (FAIR) Act.
For more on the panel, see the April 2001 Federal Contracts Perspective article "GAO to Convene Panel on Contracting Out," and the May 2001 article "GAO Names Members of Contracting Out Panel."
The Department of Transportation (DOT) has published a proposed regulation to make several changes to its Disadvantaged Business Enterprise (DBE) program (Title 49 of the Code of Federal Regulations, Part 26). The primary changes involve instituting a uniform reporting form and a uniform certification application, and establishing procedures for implementing the provisions of a Memorandum of Understanding (MOU) between DOT and the Small Business Administration (SBA) in which DOT recognizes SBA-certified small disadvantaged businesses (SDBs) as eligible for its DBE program, and vice versa.
Three copies of comments must be submitted no later than June 7, 2001, to the Docket Clerk, Docket No. OST-2000-7639, Department of Transportation, 400 7th Street, SW, Room PL-401, Washington, DC 20590.
To implement provisions of the Small Business Innovation Research Program Reauthorization Act of 2000 (Public Law 106-554), the Small Business Administration (SBA) has published proposed revisions to guidance on federal conduct of the Small Business Innovative Research (SBIR) program. While the most notable provision of the Reauthorization Act is the extension of the SBIR program through September 30, 2008, there are several other significant provisions in the law that are addressed in the proposed guidance.
But first, a little explanation of the SBIR program:
Some of the proposed changes to the SBIR policy are:
Comments on this proposed policy directive should be received on or before June 18, 2001, by Maurice Swinton, Assistant Administrator for Technology, Office of Technology, Office of Policy, Planning, and Liaison, Office of Government Contracting/Business Development, U.S. Small Business Administration, 409 3rd Street, SW, Washington, DC 20416, or by e-mail to email@example.com.
On April 30, the U.S. Trade Representative (USTR) reported to Congress on the countries that engage in significant and persistent practices of discrimination against U.S. products and services in government procurement.
The report identifies only one discriminatory procurement practice: the "special and exclusive rights" provided to telecommunications entities of Austria, Belgium, Denmark, Finland, France, Ireland, Italy, Luxembourg, the Netherlands, Sweden, and the United Kingdom. These "rights" were first identified in 1992 and were the reason for FAR Subpart 25.6, Trade Sanctions. The FAR Subpart 25.6 sanctions remain in effect (the sanctions do not apply to the Department of Defense.)
However, the report describes a number of foreign procurement practices that are of significant concern to U.S. exporters and that are being closely monitored:
Fiscal Year (FY) 2000 spending by the federal government increased a whopping 10% over the FY 1999 spending -- from $198.8 billion to $218.8 billion. This is the most money spent by the government through contracts since the government began keeping statistics in FY 1979 -- the previous high was $210.7 in FY 1991.
The following are the largest agencies' FY 2000 spending totals (in billions) and the percentage change from FY 1999:
|General Services Administration||$11.1||+46.1%|
|National Aeronautics and Space Administration||$11.1||-0.8%|
|Health and Human Services||$4.5||-7.5%|
|Tennessee Valley Authority||$4.4||*|
|Housing and Urban Development||$1.1||+40.3%|
|Environmental Protection Agency||$1.0||-23.2%|
|Social Security Administration||$0.6||+13.7%|
|Agency for International Development||$0.6||-12.8%|
|Federal Emergency Management Agency||$0.2||-17.5%|
|Office of Personnel Management||$0.2||+19.9%|
The following states received the most federal contract money in FY 2000 (in billions), with their FY 1999 rank and dollar amount change in parentheses:
|1. California (1)||$25.5 (+$1.2)|
|2. Virginia (2)||$21.0 (+$2.4)|
|3. Texas (3)||$18.1 (+$4.5)|
|4. Maryland (4)||$10.3 ($0.0)|
|5. Florida (5)||$7.9 ($0.0)|
|6. District of Columbia (6)||$7.4 (+$1.2)|
|7. New York (7)||$5.9 (+$0.2)|
|8. Missouri (8)||$5.7 (+$0.3)|
|9. Pennsylvania (10)||$5.6 (+$0.3)|
|10. Massachusetts (9)||$5.6 (+$0.2)|
Office of Management and Budged (OMB) Deputy Director Sean O'Keefe has decided to increase the "benchmark compensation amount" for senior executives by more than $20,000, from $353,010 to $374,228. This figure is "the median amount of the compensation provided for all senior executives of all benchmark corporations [those with annual sales in excess of $50 million] for the most recent year..." Mr. O'Keefe settled on that figure based on commercially available surveys and after consultation with the director of the Defense Contract Audit Agency (DCAA).
The $374,228 is the maximum amount of compensation [that is, wages, salary, bonuses, deferred compensation, and employer contributions to defined contribution pension plans] that is allowable under federal contracts for "the five most highly compensated employees in management positions at each home office and each segment of the contractor." However, the benchmark compensation amount is not a limit on the compensation an executive may receive -- $374,228 is the maximum amount the government will reimburse contractors for their senior executives' compensation. See paragraph (p) of FAR 31.205-6, Personal Compensation.
The benchmark compensation amount applies to contract costs incurred after January 1, 2001, for contractor fiscal year 2001 and subsequent contractor fiscal years unless and until revised by OMB, which is required to set the benchmark compensation amount annually.
The deadline for comments on the proposed rule to permanently repeal FAC 97-21 (the "blacklisting" regulations) has been extended from June 4 until July 6. In addition, a public meeting will be held on June 18 to permit an open dialogue on the proposed rule. (EDITOR'S NOTE: For more on the suspension and proposed repeal of FAC 97-21, see the May 2001 Federal Contracts Perspective article "'Blacklisting Rule' Suspended, FAC 97-21 Proposed for Permanent Repeal.")
Comments on the proposed repeal should be sent to General Services Administration, FAR Secretariat (MVP), 1800 F Street, NW, Room 4035, ATTN: Laurie Duarte, Washington, DC 20405; e-mail: firstname.lastname@example.org.
The public meeting will be held between 12:00 p.m. and 4:00 p.m. at National Aeronautics and Space Administration, Headquarters Auditorium 300 E Street, SW, First Floor, West Lobby, Washington, DC 20546. Those wishing to attend the meeting or make a presentation on the proposed rule should contact and submit a copy of the presentation by June 4, 2001, to Ralph DeStephano at GSA, 202-501-1758.
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