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Daniel A. Bellman has over 25 years experience as an attorney working in the area of government contracts, fraud and "white collar" crime. Located about 30 minutes from the Defense Supply Center Columbus (DSCC), Columbus, Ohio.
Government Contract News and Developments
Are SDB Preferences Now Extinct?
Contracting preferences for Small Disadvantaged Businesses (SDB’s) may go the way of the dinosaur because of a recent decision holding such preferences unconstitutional.
In Rothe Development Corporation v. Department of Defense, No. 2006-1017, November 4, 2008, the United States Court of Appeals for the Federal Circuit held the so-called Section 1207 provisions, giving preferences to SDBs, are unconstitutional under the equal protection provisions of the United States Constitution. As a result, the Under Secretary of Defense on March 10, 2009 directed that the Department of Defense immediately cease the “award of contracts and orders under contracts, advance payments, and the award of grants or scholarships or the addition of funds to existing grants and scholarships” that rely exclusively on the Section 1207 provisions. See Under Secretary of Defense Memorandum, March 10, 2009 [click here]
The consequence is that Small Disadvantaged Businesses will no longer receive evaluation preferences for Federal contracts under FAR 52.219-23. This decision also could impact Section 8(a) set-asides to Small Disadvantaged Businesses. . . [more]
Has Your Contract Been Terminated?
In recent years, the Defense Logistics Agency awarded a number of large, multi-year contracts. Under these contracts, contractors committed to provide supplies at fixed prices that were negotiated years earlier when prices were more stable. In 2007 and 2008, before the current economic slump, commodity prices escalated at rates few could have predicted. Many contractors found themselves under water, with fixed prices quoted to the government that failed to cover even their out-of-pocket costs. The options for many small businesses were bleak: either perform at the fixed prices and lose thousands of dollars or default on their contract obligations. Many contractors chose to default, and their contracts were terminated.
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GAO Rejects Allegation of Price Collusion
Although two competitors' technical proposals were prepared by the same large business subcontractor, the GAO did not believe the proposals should be rejected as being collusive. . . [more]