CARES Act | The Contracting Education Academy

June 17, 2020 By cs

Pentagon says it needs billions to repay contractors for employee leave

The Coronavirus Aid, Relief, and Economic Security (CARES) Act gave the Defense Department the authority to reimburse federal contractors who faced sudden expenses because of COVID-19.

But the bill didn’t include any new funding to make those payments, and DoD officials are telling Congress they need billions of additional dollars to make contractors whole.

One section of the law — Section 3610 — lets agencies repay contractors who put their employees on paid leave rather than furloughing or laying them off. The idea was to keep as much of the industrial base workforce as possible in a ready state.

But those reimbursements are “subject to the availability of appropriations,” which aren’t expected to come through until Congress passes the next round of coronavirus relief. DoD officials have submitted a rough cost estimate to the Office of Management and Budget (OMB).

But in testimony before the House Armed Services Committee (HASC), Ellen Lord, the undersecretary of Defense for acquisition and sustainment, declined to provide an exact figure, saying only that it’s likely to be in the double-digit billion dollar range. In any event, the bill is expected to be so large that DoD can’t pay it out of its existing budget without affecting other programs, she said.

Keep reading this article at: https://federalnewsnetwork.com/defense-main/2020/06/pentagon-says-it-needs-billions-to-repay-contractors-for-employee-leave/

The Contracting Education Academy at Georgia Tech has established a webpage where all contract-related developments related to the coronavirus (COVID-19) are summarized. Find the page at: https://contractingacademy.gatech.edu/coronavirus-information-for-contracting-officers-and-contractors/

May 5, 2020 By cs

Navy hoping to keep some acquisition momentum during COVID-19

The Navy says the way it is procuring goods and services during the COVID-19 outbreak may help quicken acquisitions later on during the crisis and keep programs on target for whenever it ends.

Speaking at the recent virtual Sea Air Space Conference, Navy acquisition chief James Geurts said the service is injecting money into the acquisition system to keep companies liquid with cash so they can stay afloat. The Navy is also speeding up contract awards.

“We are going to apply all the things we’ve learned during this to accelerate during the recovery phase because ships still need to come out on time,” Geurts said. “We’ve got to do the maintenance, we’ve got to continue to supply lethal capabilities to our sailors and marines and we can’t afford to lag the recovery.”

Geurts said he does not foresee the crisis affecting the Navy’s priorities after things return to normal. The Navy still wants at least 350 ships and it wants to field its Columbia-class submarine. The trick is keeping everything on schedule or close to it through the coronavirus outbreak.

“What’s important is that we don’t let the delay and disruption carry any further than it has to into the execution of our programs,” Geurts said. “There will be delay and disruption. The program teams have looked hard into where we were prior to this crisis so we can separate issues we had going in from issues caused by the crisis.”

Keep reading this article at: https://federalnewsnetwork.com/navy/2020/04/navy-hoping-to-keep-some-acquisition-momentum-during-covid-19/

May 1, 2020 By cs

DoD expects three month acquisition delays, billions in payouts to contractors

The Defense Department will suffer serious setbacks on developing weapons and pay companies billions of dollars in relief funds as a result of COVID-19.

The Pentagon expects a three-month delay across the board for major acquisition programs, putting a kink in systems like the Ford Class Aircraft Carrier, the Columbia Class Ballistics Missile Submarine and the Next Generation Operational Control System.

“Particularly, we see a slowdown in the shipyards,” Ellen Lord, defense undersecretary for acquisition and sustainment, told reporters Monday at the Pentagon. “Aviation is the most highly impacted sector that we have. Right now there isn’t any specific COVID penalty that we see for a specific program; however, we do anticipate a three-month slowdown in terms of execution.”

Lord said DoD is now starting to look at key procurement milestones that may be impacted by the delays.

Meanwhile, DoD is just beginning to take into account the amount of money in relief funds it will have to pay out to companies unable to do government work because of the coronavirus.

Keep reading this article at: https://federalnewsnetwork.com/defense-main/2020/04/dod-expects-three-month-acquisition-delays-billions-in-payouts-to-contractors/

April 27, 2020 By cs

OTAs given greater flexibility to foster innovation in coronavirus response

Defense Department leaders and agencies have been granted much-needed flexibility to respond to the coronavirus pandemic.

**Click on image above to open memorandum.**

Last week, Under Secretary of Defense for Acquisition & Sustainment Ellen Lord delegated approval authority for Other Transaction Agreements (OTAs) related to the coronavirus response, consistent with Section 13006 of the CARES Act.

In an April 5 memorandum, Under Secretary Lord designated approval authorities for OTA prototype projects and follow-on production contracts and agreements as follows:

Above $100 million, and up to $500 million, to the Directors of Defense Agencies/Field Activities with contracting authority, as well as the Director of the Defense Innovation Unit. This authority was otherwise vested in the Senior Procurement Executives (SPEs) of the Military Departments, the Director of the Defense Advanced Research Projects Agency (“DARPA”), and the Director of the Missile Defense Agency (MDA).
Above $500 million, to the SPEs of the Military Departments, and the Directors of DARPA and the MDA. This authority was otherwise restricted to the Under Secretaries for Acquisition & Sustainment and Research & Engineering. Approval authority for OT prototype actions between $100 million and $500 million may now be further delegated by the SPE or Director.

In addition, in lieu of providing 30 days’ advance notice to congressional defense committees of OTAs above $500 million that are related to COVID-19, Section 13006 permits Under Secretary Lord or the Under Secretary of Defense for Research & Engineering to provide notice as soon as practicable after the OTA’s commencement.

Keep reading this article at: https://www.insidegovernmentcontracts.com/2020/04/other-transaction-authorities-given-greater-flexibility-to-foster-innovation-in-coronavirus-response/

April 21, 2020 By cs

OMB releases guidance to clarify coronavirus relief act’s contracting provisions

On Friday, April 17 the Trump administration released guidance to clarify how and when agencies can reimburse contractors as outlined in the recently enacted novel coronavirus economic relief legislation.

**Click on image above to download OMB Memorandum M-20-22.**

The Office of Management and Budget published a memo to supplement Section 3610 of the $2.2 trillion CARES Act, which allows federal agencies to use their funds to give contractors sick or paid leave during the pandemic if they are not able to access their worksites or telework. Although the administration advised agencies to “maximize telework” for contractors, that is not possible for many contractor jobs, including some involving sensitive or classified work. Trade associations that represent federal contractors previously welcomed this provision, but then asked for more clarification.

For applicable contractors, agencies can “modify the terms and conditions of a contract, or other agreement” to “reimburse at the minimum applicable contract billing rates” up to an “average of 40 hours per week [for] any paid leave (including sick leave) a contractor provides to keep its employees or subcontractors in a ready state,” according to the legislation. The new guidance says agencies can use their funds to reimburse contractors from the period of March 27 (when the CARE Act was signed) to September 30, 2020. Initially, the bill did not give a start date.

Additionally, the Office of Federal Procurement Policy within OMB “has developed [the] guidance to help agencies make rational business decisions that balance the need for contractor resiliency with the need for good stewardship,” Michael Wooten, OFPP administrator, told Government Executive on Friday. This includes being mindful of the challenges small businesses face and helping contractors secure the correct documentation they need for reimbursement.

Keep reading this article at: https://www.nextgov.com/cio-briefing/2020/04/trump-administration-releases-guidance-clarify-coronavirus-relief-acts-contracting-provisions/164729/

The Coronavirus Aid, Relief, and Economic Security (CARES) Act gave the Defense Department the authority to reimburse federal contractors who faced sudden expenses because of COVID-19.

The Navy says the way it is procuring goods and services during the COVID-19 outbreak may help quicken acquisitions later on during the crisis and keep programs on target for whenever it ends.

The Defense Department will suffer serious setbacks on developing weapons and pay companies billions of dollars in relief funds as a result of COVID-19.

Defense Department leaders and agencies have been granted much-needed flexibility to respond to the coronavirus pandemic.

On Friday, April 17 the Trump administration released guidance to clarify how and when agencies can reimburse contractors as outlined in the recently enacted novel coronavirus economic relief legislation.

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