DoD | The Contracting Education Academy

January 28, 2020 By cs

The contracting pendulum

Contracting methods have evolved over time, from three-page, performance-based contracts to specification-based contracts hundreds of pages in length, and now appear set to shift back to shorter contracts.

Maj. Don Lee and Sgt. 1st Class Rechelle Collins of the 639th Contracting Team discuss training on blanket purchase agreements conducted recently at Fort Bragg, NC. Knowing when a contracting tool like blanket purchase agreements is a good fit is a key contributor to contracting speed. (Photo by Sgt. 1st Class Terry Ann Lewis, graphic by U.S. Army Acquisition Support Center)

The implementation of statutes, regulations and policies designed to ensure fair and equitable treatment for industry became burdensome and increased the time and complexity of the acquisition process. This resulted in an ineffective procurement process that influenced mission readiness. Since that time, the contracting pendulum has swung to agile, streamlined initiatives.

These initiatives have been spearheaded by several important laws and regulations, including the National Defense Authorization Act (NDAA) for Fiscal Year 2016, which was implemented by the Section 809 Panel, secretary of the Army initiatives and strategic reforms from the Office of the Deputy Assistant Secretary of the Army for Procurement. One streamlining initiative embraced by Stuart A. Hazlett, deputy assistant secretary of the Army for procurement, is “data-driven contracting.” Data-driven contracting will facilitate analytics on raw data that can influence factors such as requirements, money spent, talent management and procurement acquisition lead time.

SIGNIFICANT CONTRACTING CHANGES

Historically, there have been significant regulatory changes that have influenced DoD contracting processes. These regulatory changes are the springboard to many contracting initiatives used today. In 1962, Congress passed Public Law 87-653, the Truth in Negotiations Act. That law specifies that when dealing in a sole-source environment, each procurement-contracting officer must certify cost as accurate, completed and current for all cost and pricing data. The Truth in Negotiations Act has been a cornerstone for ensuring that prices paid by the government are considered “fair and reasonable.”

In 1974, Congress passed legislation to establish the Office of Federal Procurement Policy (OFPP) within the Office of Management and Budget. OFPP provides direction for government-wide procurement policies, regulations and procedures; it also promotes economy, efficiency and effectiveness in the acquisition process. One way in which OFPP provides this direction is through the Federal Acquisition Regulation (FAR).

The FAR, implemented in 1984, provides uniform policies and procedures governing federal government contracts. Accompanied by the Defense Federal Acquisition Regulation Supplement (DFARS), these regulatory policies inundate contracting professionals and industry partners. In 1984, Congress also passed the Competition in Contracting Act. That act requires competition for award of all government contracts. The theory is that more competition for procurements reduces costs and allows more small businesses to win federal government contracts. It also established that if a protest is submitted to the U.S. Government Accountability Office (GAO) before contract award, the awarding of the contract will be suspended until GAO rules on the protest.

In 1994, Congress passed the Federal Acquisition Streamlining Act. That legislation established a preference for the use of commercial products and exempted commercial products from various statutory and regulatory requirements. It raised the ceiling for the use of “simplified purchase procedures” and raised the threshold for issuance synopsis. It exempted the micro-purchase from virtually all statutory requirements, and it required that paper-based contracting systems be replaced with an electronic contracting system within five years.

CONTRACTING REFORM INITIATIVES

Acquisition reform is important and provides a check and a balance between regulatory accountability and agile acquisition. Because of recent reform initiatives, the contracting pendulum has swung from complex to streamlined contracting processes, providing for efficient and rapid acquisition in support of the warfighter.

In 2005, OMB asked the OFPP to identify goods and services the government can purchase more effectively and efficiently through strategic sourcing. Strategic sourcing is an approach to supply chain management that formalizes the way information is gathered and used so that an organization can leverage its consolidated purchasing power to find the best possible values in the marketplace. As a result, the U.S. General Services Administration and Department of the Treasury established the Federal Strategic Sourcing Initiative to address government-wide opportunities to strategically source commonly purchased goods and services and eliminate duplication of efforts across agencies. An example of strategic sourcing for the Army is in the procurement of commercial hardware and software purchases under the CHESS (Computer Hardware, Enterprise Software and Solutions) program.

Then, in December 2014, OFPP issued a memorandum that directed agencies to take specific actions to implement category management, an approach based on industry leading practices, to further streamline and manage entire categories of spending across government more like a single enterprise. This approach includes strategic sourcing along with a broader set of strategies, such as developing common standards in practices and contracts, and improving data analysis and information sharing to better leverage the government’s buying power and reduce unnecessary contract duplication.

The NDAA passed in 2016 streamlined the acquisition process and eliminated redundant and duplicative requirements. Section 809 of the NDAA required that the secretary of defense establish a nine-member advisory panel consisting of experts in acquisition and procurement policy. The objective of the panel is to review DOD’s acquisition regulations and provide recommendations for streamlining procurement.

Some of the significant recommendations made by the panel include expanding and clarifying the use of other-transaction authority for production. Other-transaction authority is the term commonly used to refer to DOD’s authority to carry out “certain prototype, research and production projects” other than contracts. Such authority gives DOD the flexibility necessary to adopt and incorporate business practices that reflect commercial industry standards into its award instruments. DOD currently has permanent authority to award other-transaction agreements for research, prototype and production purposes. This kind of agreement allows nontraditional vendors a pathway for doing business with the government and introducing new and innovative ideas. In fiscal year 2019, the Army awarded 854 other-transaction agreements valued at roughly $4.9 billion.

FAR and DFARS contract clauses that are required to “flow down” from prime contractors to subcontractors, especially commercial subcontractors, are excessive and create additional burdens on DOD’s supply chain. In response, the Section 809 panel updated the FAR and DFARS to reduce burdens on DOD’s commercial supply chain, to decrease cost, prevent delays, remove barriers and encourage innovation in the military services.

The panel recommended minimizing the number of government-unique terms in commercial buying. The panel noted that when the Federal Acquisition Streamlining Act was established in 1994, there were only 57 FAR and DFARS clauses applicable to commercial buying. Today there are 165, according to the panel. The proliferation of clauses applicable to commercial buying at the prime contract level directly affects the number of government-unique clauses to subcontractors offering commercial products and services.

The 2018 NDAA amended the Truth in Negotiations Act to increase the threshold for contractors submitting certified cost and pricing data from $750,000 to $2 million. Contracting officers may still require cost or pricing data without certification, as they are tasked with ensuring that the cost or pricing data is fair and reasonable. However, this change is widely embraced by contractors doing business with the government.

Finally, the 2018 NDAA made changes to the bid and protest procedures relative to the Competition in Contracting Act and allows for enhanced post-award debriefing rights for DOD. What that means for DOD acquisitions is that, when a protest is filed, the “five-day period” to file a bid protest to trigger an automatic stay of award does not start until after the government delivers a written response to the offeror. Per the NDAA, a disappointed offeror may submit, “within two business days after receiving a post-award debriefing, additional questions related to the debriefing.” The law requires that “ … [t]he agency shall respond in writing to any additional question … within five business days” and that “the agency shall not consider the debriefing to be concluded until the agency delivers its written responses.”

ARMY CONTRACTING REFORM

The Army awards thousands of contracts yearly to support military forces worldwide. In FY19, the Army awarded 212,094 contract actions estimated at $94.59 billion. This does not include grants, government purchase-card buys, cooperative agreements or other authorized transactions that increased the estimate to $104.89 billion.

In 2017, the secretary of the Army directed initiatives to reform Army contracting, issuing “Army Directive 2017-32 (Acquisition Reform Initiative #6: Streamlining the Contracting Process),” which mandated streamlining practices within Army contracting to reduce the time it takes to develop and award a contract.

In accordance with this reform initiative, the deputy assistant secretary of the Army for procurement (DASA(P)) embarked on extensive reformation initiatives. They include:

1. Developed a centralized policy to standardize contracting policies across the Army.

2. Created policies and procedures that will facilitate the efficient implementation of category management. One policy, currently in coordination, aligns contracting activities to categories. This policy will promote habitual relationships among the contracting centers, category managers and customers. The draft policy stipulates that customers shall only submit their requirement to the designated contracting office. Aligning contracting activities with categories will assist in enforcing standard levels of services, limit standard levels of service end-run actions, and limit contract-action shopping among contracting centers.

3. Of 312 authorities identified in the FAR and DFARS, the Army delegated 159 authorities to a level lower than the assistant secretary of the Army for acquisition, logistics and technology (ASA(ALT)). This increased efficiency and eliminated the requirement to staff packages to ASA(ALT) for signature and approval, thereby saving time, money and resources.

4. Established “reform managers” to lead changes to contracting processes and develop new streamlined procedures, e.g., source selection, pricing cell, etc.

5. DASA(P) is also embracing “data-driven decision-making in contracting.” This type of contracting involves making decisions based on actual raw data derived from the automated contract systems. Data-driven decision-making improves how requirements are communicated between major stakeholders such as financial managers, program managers, requirements activities and industry partners. The bottom line is that everybody wins through increased productivity in procuring goods and services for the warfighter.

CONCLUSION

On Sept. 30, 2019, in a message to the Army force, Secretary of the Army Ryan D. McCarthy said, “We must maintain a sustainable level of readiness to meet current demands while executing an aggressive modernization strategy to ensure the total Army remains the most lethal ground combat force in the world.”

To achieve that end, the contracting pendulum must swing toward less restrictive acquisition policies and procedures.

For more information, go to https://spcs3.kc.army.mil/asaalt/procurement/SitePages/PAMHome.aspx#&panel1-3

This article was published in the 2020 Winter issue of Army AL&T Magazine. See: https://www.dvidshub.net/news/357393/contracting-pendulum

January 27, 2020 By cs

These IT, cyber provisions in the NDAA may have flown under your radar

The 2020 National Defense Authorization Act always is chalk full of interesting and impactful policy changes or updates.

The thing with the 1,794-page bill is knowing where to look.

No one person can read through the roughly 8 pounds of paper without missing a few important nuggets. So with some help of some federal experts, I dug into the NDAA and found several provisions that likely flew under your radar:

Marine Corps Maj. Gen. Dennis Crall, the senior military adviser for cyber policy for the Defense Department’s chief information officer, offered simple advice at the recent AFCEA Northern Virginia luncheon: “Read the NDAA.”

Specifically, Crall wanted industry to look at the provision requiring each military service to create a principal cyber adviser — Section 905, if you are keeping score at home.

“Congress gave us very directed tasks and responsibilities for this new billet or this new role. There are also some implied tasks. The services need some time to go through this and decide how they are going to provide a level of sufficient implementation,” Crall said.

Keep reading this article at: https://federalnewsnetwork.com/reporters-notebook-jason-miller/2020/01/these-it-cyber-provisions-in-the-ndaa-may-have-flown-under-you-radar/

January 24, 2020 By cs

Leaning forward into the new year

In this article, originally published in the Jan.-Feb. 2020 issue of Defense Acquisition magazine, Under Secretary of Defense for Acquisition & Sustainment Ellen Lord talks about her reorganized department’s quest to use innovative techniques to expeditiously and cost-effectively deliver the goods and services needed by U.S. warfighters.

A new year has begun for our team. We continue using the momentum built thus far to propel us forward. Take a look at where we have come from. On Feb. 1, 2018, we stood up the new Acquisition and Sustainment (A&S) organization as mandated by Congress — and on Sept. 4, 2018, we had our first official day as a reorganized department. Of course, we used this opportunity to better shape our organization and acquisition system to meet the demands of the 21st century. Even while leadership has changed, our mission endures: Enable the Delivery and Sustainment of Secure and Resilient Capabilities to the Warfighter and Internal Partners Quickly and Cost Effectively. Our National Defense Strategy was instrumental as we built departmental norms and strategy.

A&S employees at all levels are driving the organization forward together, full speed ahead with several significant projects.

Adaptive Acquisition Framework

For starters, the Adaptive Acquisition Framework has been introduced, along with a rewrite of what had become a cumbersome document, the Department of Defense (DoD) Instruction 5000 Series. This way forward removes a longstanding system of bureaucracy and red tape by turning the procurement process into one that empowers users to be creative decision makers and problem solvers. The acquisition workforce will choose between a set of established pathways and timelines — specifically designed for a diversity of purchases — requiring different levels of urgency. Using the new policy, acquisition professionals will be given autonomy, within legal parameters, to churn up tailored solutions. All of these revisions should allow for DoD partnerships with commercial industry in real time, enabling the DoD to keep products up to date with emerging technologies, and delivering capabilities “at the speed of relevance.”

Program Sustainment

Improving program sustainment outcomes for the F-35 fighter jet is another top priority for A&S. Developed to replace multiple U.S. fighter jets with a platform that maximizes commonality, and therefore economies of scale, the DoD has fielded three configurations to satisfy United States Air Force, United States Marine Corps, United States Navy and multiple international partners’ tactical aircraft requirements. A&S is dedicated to achieving the DoD’s aim for an 80 percent mission capability rating by defining performance imperatives, metrics, establishing detailed success elements and applying commercial best practices. These efforts help ensure a ready and affordable fleet of fifth-generation fighters critical to preserving air dominance both for the United States and our allied partners in this era of strategic competition.

Software Development

Like anywhere else, DoD systems are enabled by hardware but are defined by the software used. With the technology industry innovating quickly, the DoD must figure out how to keep up with fast moving software development and life cycles. By engaging Agile and DevOps methods for more iterative processing, end users will be involved earlier and more often, enabling continuous integration and helping the DoD meet its goal to develop and sustain software simultaneously. Based on recommendations by the Defense Innovation Board, a new software acquisition policy of approaching the challenge from the business side is being finalized to allow for these more rapid techniques. Pilot programs are rolling out to define corresponding procedures even further. Along these lines, the DoD has asked Congress to specifically appropriate money for defense software and is awaiting budget review and National Defense Authorization Act spending decisions.

Cybersecurity

The Cyber Security Maturity Model Certification (CMMC) was developed (using the best industry standards) to ensure the cyber hygiene of the Defense Industrial Base is complete and protects critical information in the DoD. As part of the CMMC, a consortium of unbiased parties will oversee the training, quality and administration of a third party that will certify that industrial base partners uphold accepted standards. This effort was spearheaded by our Acquisition team in working to roll out version 0.6 of the model by November 2019 and version 1.0 by the first of this year. The consortium is to begin training and accreditation of certifiers with certification beginning by June. Contracts will be required to include this certification in their evaluation criteria, beginning this October.

Chemicals

Chemical agents Perfluorooctane Sulfonate (PFOS) and Perfluorooctanoic Acid (PFOA) are part of a larger chemical class known as Per- and Polyfluoroalkyl substances (PFAS). Following a health advisory issued by the Environmental Protection Agency that warned against PFAS chemicals in drinking water, studies discovered the presence of the harmful agents in many industrial and consumer products, including nonstick cookware and microwave popcorn bags.

In DoD applications, the chemicals have been found in firefighting foam used to rapidly extinguish fuel fires. Although successful in protecting against catastrophic loss of life and property, it is now known that the release of PFAS can potentially contaminate private wells and public water systems. A national committee and a task force were established to provide an aggressive, holistic approach to find and fund an effective substitute for firefighting foam without PFAS, develop and implement cleanup standards, make lasting policy change, and coordinate across federal agencies. The DoD discontinued land-based use of the firefighting foam in training, testing and maintenance. Now, when the foam is used in emergencies to save lives, releases are treated as a chemical spill. Affected soil is contained and removed, to ensure that no additional PFAS pollute the groundwater. The DoD has identified 36 drinking water systems containing unsafe PFOS and PFOA — some of those systems are servicing military installations and surrounding communities. In an effort to protect these areas, A&S is using investigative data to prioritize the U.S. Government’s actions in appropriately addressing drinking water issues caused by DoD activities.

Alignment

Going forward, the A&S organization will continue aligning itself to support the DoD’s top priorities. These projects, and many others, are critical pieces that fit together into the much larger goals of defending the country and arming the Warfighter.

Source: https://www.dau.edu/library/defense-atl/DATLFiles/Jan-Feb2020/DEFACQ%20Jan-Feb%202020.pdf

January 21, 2020 By cs

DoD marks 20th anniversary of Trafficking Victims Protection Act

This year marks the 20th anniversary of the Trafficking Victims Protection Act of 2000, the first comprehensive law in the U.S. to address the transnational crime of human trafficking.

The law created the ”3P” framework: preventing trafficking; prosecute traffickers; and protecting and assisting trafficking victims. Congress reauthorized the law in 2003, 2005, 2008, 2013, 2017 and 2018.

In 2002, National Security Presidential Directive 22 directed U.S. government agencies to create a strategic plan to implement the trafficking law.

In observing the anniversary, DoD is highlighting the following milestones:

In 2003, DoD was the first federal agency to have its inspector general assess its efforts in combating the trafficking of persons;
DoD was the first federal agency to require its personnel to take training in combating the trafficking of persons. The effort started with military personnel in 2005 and expanded to civilians in 2010;
In 2005, DoD added a statute to the Uniform Code of Military Justice prohibiting patronizing a prostitute, building on the approach to trafficking and related activities laid out for federal agencies by the presidential directive; and
In 2006, DoD was the first federal agency to add a trafficking-in-persons clause to all of its contracts, as required by the Defense Federal Acquisition Regulation Supplement.

Also in 2006, DoD took action after a Multinational Force Iraq inspection found indications of labor trafficking, including widespread deceptive hiring practices and excessive recruitment fees, substandard worker living conditions at some sites, and widespread confiscation of passports of third-country workers in Iraq.

In response, DoD ordered military contractors and subcontractors to return the passports of all workers in Iraq. The department also set standards for housing and living space for the thousands of civilian workers in Iraq and Afghanistan.

That same year, the Combating the Trafficking of Persons program manager office was established.

In 2012, DoD became the first U.S. government agency to form a task force and draft a strategic plan on combating the trafficking of persons.

DoD created specialized training tailored for leaders, investigative professionals, acquisition professionals and education professionals. ”General awareness” training teaches DoD personnel that child soldiers are trafficking victims.

Source: https://www.defense.gov/explore/story/Article/2052349/dod-marks-20th-anniversary-of-trafficking-victims-protection-act/

January 16, 2020 By cs

Amazon will ask judge to halt work on DoD’s JEDI contract

With less than a month to go before the Pentagon and Microsoft get to work on building the military’s new Joint Enterprise Defense Infrastructure (JEDI) cloud, Amazon Web Services said Monday that it would ask a court to temporarily block any meaningful work under the controversial contract.

AWS gave notice of its plans as part of a status update its attorneys and the Justice Department filed jointly with the Court of Federal Claims. As part of the company’s bid protest lawsuit, its lawyers have previously said they were considering asking the court for a preliminary injunction, but the latest filing is the first concrete indication of their plans.

DoD has already said it intends to issue Microsoft the first “substantive” task order to begin building the unclassified portions of JEDI by Feb. 11. Because AWS wants to stop the work before then, and because DoD considers the project urgent to national security, lawyers for all three parties have already agreed on an expedited schedule for the court to consider either a preliminary injunction or temporary restraining order.

Judge Patricia E. Campbell-Smith would still need to agree to that schedule, but under the proposal, AWS plans to file its formal request to block work on JEDI by Jan. 24. DoD and Amazon would then have a little more than a week to respond with their filings asking the judge to deny it, and the court would issue a final ruling by Feb. 11, the day DoD plans to issue the first task order.

Keep reading this article at: https://federalnewsnetwork.com/defense-main/2020/01/amazon-will-ask-judge-to-halt-work-on-dods-jedi-contract/