payments | The Contracting Education Academy

October 2, 2020 By cs

DoD explains how contractors will get reimbursed for COVID expenses — if Congress cuts a check

With lawmakers and the White House unable to come to an agreement on a new coronavirus stimulus package, it’s unlikely that money requested to reimburse defense contractors for pandemic-related expenses will reach these companies until at least the second quarter of 2021, according to the Pentagon’s top weapons buyer.

Ellen Lord, defense undersecretary for acquisition and sustainment, laid out the reimbursement process. She said it would take the Pentagon five to six months to distribute those funds after they are approved by Congress.

“Then we want to look at all of the proposals at once,” Lord said at a recent Defense News Conference. “It isn’t going to be a first in, first out, and we have to rationalize using the rules we’ve put in place what would be reimbursable and what’s not.”

Lord estimated that the tab for defense contractors’ pandemic expenses from March 15 to Sept. 15 would come to “between $10 and $20 billion.”

Keep reading this article at: https://www.defenseone.com/business/2020/09/dod-explains-how-contractors-will-get-reimbursed-covid-expenses-if-congress-cuts-check/168344/

August 21, 2020 By cs

DoD working on policy to pay back contractors faster for work stopped by COVID

The Defense Department has been slowly reimbursing companies for work that is unable to be completed because of the coronavirus.

However, Pentagon acquisition chief Ellen Lord said it may be coming faster in the near future.

Lord told members of the Professional Services Council that DoD sent a policy over to the Office of Management and Budget (OMB) that would push through claims for payments of $2 million or less.

“We have developed a streamlined path forward for low dollar value reimbursements under $2 million, and a path to settle globally at a company or division level that will eliminate the need to have proposals and negotiations on the contract-by-contract basis,” Lord said.

DoD is planning to use a tiered system that will look at claims depending on how large they are and impose varying levels of oversight over them.

Keep reading this article at: https://federalnewsnetwork.com/dod-reporters-notebook-jared-serbu/2020/08/defense-department-working-on-policy-to-pay-back-contractors-faster-for-work-stopped-by-covid/

June 25, 2020 By cs

Pentagon IG offers advice for effective contracting during pandemic

With billions of dollars in CARES Act funding yet to be spent and several billion more potentially in the appropriations pipeline, it’s far too early to tell how effectively the Defense Department is spending its share of the disaster funding.

**Click on image above to download the report.**

But according to the Pentagon’s inspector general, DoD — and its auditors — have more than enough experience with prior emergencies to know what to do, and what not to do, to make sure money is spent well even when contracts have to be executed quickly.

In a new special report, drawing on 36 earlier audits that dealt with contracting during previous emergencies, the OIG tries to outline what it considers best practices for contracting under time pressure.

“It is a very fast paced, ever changing environment right now with this pandemic. But what contracting officers are experiencing right now is similar to pressures that were present during past disaster response and relief efforts. So our intent here was to highlight best practices and lessons learned that really span a significant portion of time,” Theresa Hull, the assistant inspector general for audit acquisition, contracting, and sustainment said in an interview for Federal News Network’s On DoD. “Our reports go back to Hurricane Katrina in 2005 but also include the more recent hurricanes, Florence and Irma, and we highlighted four areas that the contracting community should be aware of: Communication and coordination; documentation, consistency in the contracting process, and staffing and training.”

Keep reading this article at: https://federalnewsnetwork.com/on-dod/2020/06/pentagon-ig-offers-advice-for-effective-contracting-during-pandemic/

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/

June 24, 2020 By cs

Pentagon starts bailing out companies that have lost business due to coronavirus

The Pentagon has begun to bail out U.S. companies that have seen large parts of their business dry up amid the coronavirus pandemic, in a bid to make sure they can still build weapons.

Officials have announced that five mid-tier defense companies had received a total of $135 million to “help sustain defense-critical workforce capabilities in body armor, aircraft manufacturing, and shipbuilding,” according to a Defense Department statement. “These actions will help to retain critical workforce capabilities throughout the disruption caused by COVID-19 and to restore some jobs lost because of the pandemic,” Lt. Col. Mike Andrews, a Defense Department spokesman, said in the statement.

Meanwhile, a senior Pentagon official told lawmakers that DoD plans to ask Congress for money to reimburse many of its contractors for COVID-related expenditures; for example, wages paid to keep employees on the payroll despite idled production lines and vacated offices; purchases of personal protective gear, and alterations to factory and other work spaces for social distancing.

These moves will buttress earlier Pentagon efforts to shore up its COVID-rattled contractors, including paying firms more money up front and awarding multibillion-dollar contracts earlier than planned.

Keep reading this article at: https://www.defenseone.com/business/2020/06/pentagon-starts-bailing-out-companies-have-lost-business-due-coronavirus/166106/

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 Defense Department has been slowly reimbursing companies for work that is unable to be completed because of the coronavirus.

With billions of dollars in CARES Act funding yet to be spent and several billion more potentially in the appropriations pipeline, it’s far too early to tell how effectively the Defense Department is spending its share of the disaster funding.

The Pentagon has begun to bail out U.S. companies that have seen large parts of their business dry up amid the coronavirus pandemic, in a bid to make sure they can still build weapons.

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.

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