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Federal Market Intelligence for Small Business |
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NDAA ‘19: LPTA, e-commerce, DOD micropurchase boost, etc.Rundown of major small biz & contracting provisionsPresident Trump on Aug. 13 signed into law HR 5515, the John S. McCain National Defense Authorization Act for Fiscal Year 2019 (NDAA), and it is a whopper. There are many provisions affecting small business federal contractors, including accelerated payments, a boost in the Defense Dept. micropurchase threshold, and new rules on low-price technically-acceptable contracts. Here is the rundown of the major federal acquisition provisions, in the order in which they appear in the 1,057- page legislation. Sec. 816 - Single Source Awards: It states that for certain single-award task and delivery contracts, the award can go to a single source if the contractor can “efficiently” perform the work. Previously, the single source was required to be able to “reasonably” perform the work. There is some concern being raised about this provision due to the lack of a clear definition of “efficiently,” Heather Mims, associate attorney of Centre Law & Consulting, wrote in a recent blog. Sec. 821 - Micropurchases: The DOD micropurchase threshold is raised to $10,000, from $5,000. Last year’s NDAA raised the civilian micropurchase threshold to $10,000. A provision to raise it to $25K was removed from the final NDAA for 2019. Sec. 822 - Bid protests: DOD is required to report on how often bid protests for the same contracts are filed both at the Government Accountability Office and the Court of Federal Claims. By Dec. 1, 2019, DOD must have a plan for an expedited bid protest process for DOD procurements valued at less than $100,000. Sec. 823 - Subcontractors: DOD must develop policies for including the best available information regarding past performance of certain subcontractors and joint venture partners. For one, in some cases there will be required information on first-tier subcontractors on construction and architect-engineer contracts performing at least 20% of the value of prime contract. Sec. 836 - Commercial item: The term, “commercial item,” is removed from regulations and replaced with new definitions for “commercial product” and “commercial service.” The changes are effective Jan. 1, 2020. DOD also is required to analyze to what extent commercial products and services should be treated similarly. Sec. 838 - E-Commerce: The General Services Administration gets authority to develop competitive procedures for federal agency use of commercial e-commerce portals. For these procurements, the final version of the NDAA maintains the current civilian agency micropurchase threshold of $10,000. Previous versions of the NDAA had proposed raising the threshold to $25,000 but there were objections from contractor advocacy groups. Sec. 851 - Small Business Strategy: DOD is directed to implement a small business strategy that is aligned with DOD’s mission. Sec. 852 - Prompt Payment: DOD is directed to pay small business contractors promptly, with a goal of payment within 15 days of invoice receipt. Sec. 854 - SBIR, STTR: Reforms to the Small Business Innovation Research (SBIR) and the Small Business Technology Transfer (STTR) programs. Sec. 855 - Construction: For federal construction contracts awarded to small businesses, the agency must provide information to the contractor on its timely definitization of requests for an equitable adjustment. Sec. 858 - PTACs: Federal funding for Procurement Technical Assistance Centers (PTACs) is raised to a 75% share, from 65%, and reduces community funding to 25%, from 35%. Sec. 860 - Commercialization: It sets up a pilot program to help SBIR awardees commercialize. Sec. 861 - Puerto Rico: The Small Business Act is modified to include a definition for Puerto Rico small businesses and to identify potential incentives for businesses in a mentor-protege relationship with Puerto-Rican small businesses. Sec. 866 - Litigation: This section states that in cases in which a contractor files litigation against DOD agencies with the Board of Contract Appeals or the Court of Federal Claims, DOD executives may authorize use of the contractor’s technical data during the litigation if there is a “compelling mission readiness” reason to do so. Sec. 873 - OTA: DOD is ordered to collect and analyze data on its use of Other Transaction Authority (OTA) and to use the data to update policies. Sec. 875 - Use of GWACs: This section removes the requirement for federal agencies to complete a Determination & Findings prior to utilizing a Government-Wide Acquisition Contract (GWAC) approved by the Office of Management and Budget. Sec. 876 - Non-priced Schedules: This section states that for certain federal supply schedule contracts for services acquired on an hourly rate, and for certain IDIQ multiple-award contracts, the contractor need not consider price as an evaluation factor for the contract award, and price shall be considered at the task order level. According to Larry Allen, president of Allen Federal Business Partners, the GSA and industry are enthusiastic about trying out the new non-priced approach. “I think the provision gives GSA the ability to conduct a test, but does not mandate that they change their program so that all service schedules become non-priced,” Allen told Set-Aside Alert. Participating vendors probably will need to capture and remit certain transaction-based information on sales, he added. Sec. 878 - PALT: The Administrator for Federal Procurement Policy must develop a uniform definition of Procurement Administrative Lead Time (PALT) and state how to measure it. Sec. 880 - LPTA: Federal agencies are directed to avoid the use of Lowest-Price, Technically Acceptable (LPTA) source-selection criteria as much as is practicable for specific types of procurements. Those procurements include “knowledge-based professional services,” (including IT services, cybersecurity services, systems engineering and technical assistance services, advanced electronic testing, audit or audit readiness services, health care services) and records and telecommunications devices and services. Other covered procurements include personal protective equipment and “knowledge-based training or logistics services” in contingency operations outside the U.S., including in Afghanistan or Iraq. Sec. 881 - Excluding sources: This permanently extends the authority provided in Section 806 of the NDAA for fiscal 2011 regarding the management of supply chain risk. It allows DOD to exclude certain sources for the purpose of reducing supply chain risk, and to limit how much information it discloses relating to such exclusions. Sec. 885 - Foreign access: DOD is required to develop a process and procedures for limiting foreign access to U.S. technology through contracts, grants, cooperative agreements or other transactions, when such limitation is in the interest of national security. Sec. 890 - Pricing reforms: DOD is ordered to set up a pilot program to reform contract pricing processes associated with contracts in excess of $50 million. More information: Text of NDAA: https://bit.ly/2wemUtL
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