Total federal contract spending was flat in 2011, according to the Office of Management and Budget.

Contract spending declined in 2010. OMB says this is the first time in nearly two decades that spending has either fallen or held steady for two straight years.

In a blog post, OMB controller Danny Werfel said the administration is moving aggressively to buy less and buy smarter.

A dispute between a prime contractor and subcontractor will be settled in court.

The Washington Business Journal reports that System High Corp. sued ManTech International after ManTech dropped the service-disabled veteran-owned small business as a subcontractor. System High alleges that ManTech terminated the subcontract after System High refused to hire the larger company as a subcontractor on its contract with DARPA. The suit says ManTech then began recruiting System High’s employees for jobs with the new subcontractor.

In its complaint, filed in U.S. District Court in Alexandria, VA, System High asks for an injunction prohibiting ManTech from terminating subcontracts and poaching employees. It seeks damages of at least $14.8 million, plus punitive damages.

Neither company responded to requests for comment.

A Florida father and his two sons have run a succession of companies, all selling medical supplies, that have remained in the 8(a) program for 18 years, according to an investigation by Bloomberg.

They are among a dozen repeat participants identified by Bloomberg in the nine-year 8(a) program. The companies have won more than $400 million in set-aside contracts since 1990. Officials of all the companies denied any wrongdoing.

In addition, Bloomberg said SBA certified multiple 8(a) companies at the same address 100 times since 1990, a warning sign of violation of affiliation rules.

SBA told the news service it is revamping its IT systems so it can cross-check 8(a) companies.

A federal jury in Tampa, FL, found two men guilty of conspiracy to defraud the United States and to commit wire fraud by creating a sham company to get small business contracts.

The U.S. attorney said when the men’s business, B.I.B. Consultants, outgrew its size standard, they created a sham company and received a $100 million set-aside contract to provide translators for the military’s Southern Command. Eduardo Blanchet and Daniel Guillan of Orlando face up to 20 years in prison and were ordered to forfeit more than $9 million.

Infighting among House Republicans is threatening passage of a highway construction bill, the newspaper Politico reported.

The highway bill is traditionally a favorite of Congress members because they get to announce new projects for voters back home. But tight budgets are squeezing out the usual sweeteners.

Highway funding will shut down March 31 unless Congress acts. Republican members are holding up the bill over a variety of concerns. Beyond the differences over the content of the bill, Politico said its sponsor, House Transportation Committee Chairman John Mica, R-FL, has angered some members of the powerful freshman class by announcing plans to challenge a freshman member in his state’s primary.

Sen. Olympia Snowe, a longtime leader on the Small Business Committee, says she will retire this year. Snowe, a 65-year-old Maine Republican, has served as committee chair when her party had a majority and as ranking minority member under Democratic control.

The committee has been a rare example of bipartisanship in a deeply polarized Congress. Snowe and the current chair, Mary Landrieu, D-LA, often cosponsored legislation and issued joint announcements.

Snowe, one of the few moderate Republicans in Congress, indicated she is tired of the partisan battles. “Unfortunately, I do not realistically expect the partisanship of recent years in the Senate to change over the short term,” she said in a statement.

Landrieu said, “While I am sad to see her leave, it is my hope that this will serve as a wake-up call that we cannot continue to allow the divisive, hyper-partisan atmosphere in the Senate continue to drive out our moderate members.”