Monthly Archives: September 2024

Editor’s note: This story was updated on 9/4/2024 to incorporate comments from HomeSafe leadership.

The Defense Department is ready to start ramping up implementation of its long-planned overhaul of the military’s household goods moving system, including by conducting DoD’s first-ever long distance moves under the new contract structure, U.S. Transportation Command officials said Tuesday.

The expansion of work under the up-to-$17.9 billion Global Household Goods contract (GHC), set for September, will mark DoD’s first attempt to use GHC beyond the short-distance, local moves it has been using to test the new program since April. The first four long-distance routes involve large Navy population centers: they’ll run between Norfolk, Va., and the Seattle, Jacksonville and San Diego metro areas, plus another between San Diego and Seattle.

In addition, GHC and its prime contractor, HomeSafe Alliance, will add more short-distance moves from 16 additional bases next month. Those bases are located in nine states: Arizona, California, Colorado, Georgia, Maryland, North Dakota, Pennsylvania, South Carolina and Virginia.

GHC volume still small, but growing

In terms of total volume, the GHC program will remain relatively small in the near term: it will move only about 4% of DoD’s total household goods shipments in September. But officials said they would gradually add more moves to the program each month, and that for shipments within the continental U.S., they expect it to fully replace the current Defense Personal Property Program (DP3) by next spring.

“The positive feedback received from both customers and our transportation offices shows that we are headed in the right direction,” Andy Dawson, the director of TRANSCOM’s Defense Personal Property Management Office said in a statement. “This summer provided us the opportunity to validate new business processes and IT systems for GHC on a smaller scale while customers experience the new program. Overall, we are satisfied with how things have gone so far and anticipate continued progress as GHC volume increases this fall.”

There are some indications that HomeSafe’s processes are working well, at least in the low-volume short distance moves that have been conducted so far. The company and TRANSCOM said surveys showed 96% of military members involved in the initial moves were satisfied with the experience, though officials acknowledged the sample in that survey was too small to be statistically significant.

“In executing our historic first 100 moves, HomeSafe has refined our processes, enhanced our

technology, improved our training protocols and proven our program is a game changer for military

families,” Bobby Nicholson, HomeSafe’s CEO said in a statement. “We are elated about the

opportunity to deliver exceptional move experiences to more service members in more locations soon.”

Overseas moves will take longer to implement. Officials said they do not expect international moves to begin transitioning to GHC until September 2025.

And TRANSCOM officials emphasized that DoD’s phase-in plans for domestic moves were subject to change, depending on how the program continues to unfold. But the goal of fully implementing the program for domestic moves by next spring appears ambitious, considering the scale of the program so far.

Challenges and industry concerns

Between April and this week, only 100 moves have been conducted under GHC, all of them local, as TRANSCOM and HomeSafe work to prove out the program, and only 16 moving companies have conducted work under GHC so far. A HomeSafe spokeswoman declined to disclose the total number of companies that have committed to work under the program, saying that figure would not be a good indicator of the total moving capacity in the new system.

However, DoD and HomeSafe have had little success in convincing moving companies that conduct moves under the current DP3 system to take part in GHC. Those firms say the rates being offered are so low that in many cases, they would lose money, and that labor and payment rules in the new system are incompatible with how the moving industry does business, particularly for interstate moves.

Earlier this summer, industry groups, including the American Trucking Association’s Moving and Storage Conference succeeded in persuading members of the House to add language to its version of the 2025 Defense authorization bill that would mandate a Government Accountability Office review of the new contract. A newer coalition, called Movers for America, had also been calling for the GAO examination.

“TRANSCOM seems committed to throwing out a system that works, that’s continually improving, and that supports American competitiveness in favor of a monopolistic, untested new system with no backup plan,” Jack Griffin, the chairman and CEO of Atlas World Group, wrote in an op-ed last week. “I call on our Congressional leaders to give this high-stakes experiment the careful scrutiny it demands, and insist on a strategic pause of GHC implementation so a comprehensive evaluation of its feasibility can be conducted by GAO.”

Dawson said TRANSCOM would give moving companies a more detailed update on the GHC transition during an industry forum on Sept. 18.

“Industry partners who provide quality moving services have an opportunity to continue to work with DoD under GHC,” he said. “We welcome industry’s participation as we execute this historic transformation to improve the moving experience for our service members and their families. The GHC concept has been in the works for many years, and we are thrilled to finally begin offering it to our service members and their families. We hope they are excited to use all the new features and tools and are pleased with a much smoother, modern, and overall improved experience offered by GHC.”

The GHC contract is a dramatic departure from the way DoD currently procures household goods moves. Instead of hiring moving companies one-by-one for each household’s PCS shipment, the goal has long been to consolidate the government’s contracting relationship down to just one centralized service provider, who then subcontracts with individual moving companies.

After a protracted, multi-year series of bid protests, HomeSafe, a joint venture between KBR and Tier One Relocation, finally got the go-ahead to start performing work under the contract in late 2022. The implementation was later delayed even further by IT integration problems.

In a conference call last month, Stuart Bradie, KBR’s chairman and CEO told investors that HomeSafe’s subcontractor base of movers appears to be lined up well for what the company will need to deliver “for the next little while,” but expressed at least some caution about the notion that the company will be ready to handle all domestic moves by next year’s summer peak season.

“We’re testing the systems right now with a view that we’ll be doing full domestic moves in the busy season of 2025, but obviously the targets that we gave in our recent investor day are a bit more conservative than that, and rightfully so,” he said. “It’s a new program, but we’re doing all we can to achieve that and line up behind that expectation.”

Copyright © 2024 Federal News Network. All rights reserved. This website is not intended for users located within the European Economic Area.

Tom Temin

Larry, with all of the politics and everything going on September 30 has kind of crept up fast.

Larry Allen

Tom, it really has. We had the focus this summer on the two conventions, President Biden stepping down, so there have been a lot of potential distractions for people. But now we’re really in the home stretch with a little bit more than a month left in the fiscal year, and it’s time to focus.

Tom Temin

And so, as we speak, there’s only really five weeks left until September 30; not even five weeks, about a month left. And there’s some tried and true techniques for contractors to get those last-minute dollars.

Larry Allen

Tom, there are some tried and true techniques. And while I think some of them are obvious, some are not. What I’m telling people right now, the one that I think is probably more obvious but still worth mentioning, is the need to communicate. If you haven’t talked to your federal customer in a couple of weeks, or if you haven’t talked to that partner of yours in industry that you were talking with about pursuing a project together, it’s time to do that. You never want to take for granted that people remember the conversations you had even at the beginning of the month, and you want to make sure that you’re doing your part, to make sure to not only talk about your solutions, but how easy it is for that potential customer to do business with you, because the what and the how both matter.

Tom Temin

And contracting officers are busy, and you’re not going to be necessarily at the top of their minds, and so you have to find a contracting officer that you know and make sure that whatever projects you have going with that agency continue to process through that CO.

Larry Allen

That’s exactly right, and the sense of perspective really helps. We’ve talked before about the fact that your project is important to you, and I know mine is to me; that contracting office you’re dealing with has lots of projects. Yours may or may not be in the top three priority so it’s a good idea to keep touching base and make sure that that project you think is going to close by the end of the fiscal year does just that.

Tom Temin

And then you also have to ensure that what you say you’ll deliver by the end of the fiscal to get paid for it, make sure you can really deliver that and maybe don’t over promise.

Larry Allen

Yeah Tom. This is one of the things that I think we don’t talk enough about generally. And yet, when I talk to both current and former government officials, this keeps coming up as one of their top three issues with contractors, and that is the propensity to over promise and underperform, and nothing aggravates a federal buyer more, particularly at this time of year, than a contractor that says, “I can absolutely get it to you by a week from Tuesday.” But what she didn’t say is, “that’s a Tuesday in November or December.” Don’t promise more than you can deliver. Don’t bite off more than you can chew. One recent conversation I had with the Fed, Tom is that they believe that a member of the delivery team ought to be participating in at least some of the sales calls, so that the entire company, both sales and the delivery side, set common expectations and goals. That may be a best practice that companies want to consider, because it means you’re going to have satisfied customers that will come back to you.

Tom Temin

Yeah, and the sooner you get those delivery and finishing people involved, the less likely you’ll have to do some, I don’t know, panic expediting on September 29.

Larry Allen

Well, right. And you can only expedite so much. The government can only expedite so much. So if it’s going to take an extra couple of weeks, just be honest. Remember that your relationships and your reputation are on the line, and you don’t want to throw that away at year end or any other time of the year, for that matter.

Tom Temin

We’re speaking with Larry Allen. He’s president of Allen Federal Business Partners. And another issue you’ve been writing about is the continuous protests that seem to have the hit the governmentwide acquisition contract (GWAC) program, especially from [the General Services Administration (GSA)]. That seems to be going on unabated, doesn’t it?

Larry Allen

Tom, it really does. And I keep coming back to this issue about protests and governmentwide acquisition contracts, because I think that these types of protests, when you’re trying to set a new program up or continue an existing one, are probably the biggest threat to GWAC contracting generally. Once you get the contract in place, task orders are reasonably easy to fill, and you can really move at the speed of need, but it takes a long time — years, often — to get one of these major GWACs in place. And not just because of protests, but because protests are nevertheless part and parcel of this project, and we’re looking now not just at GSA programs, although Oasis, plus their services GWAC, now has seven [Government Accountability Office (GAO)] protests, but also [National Institutes of Health (NIH)] is no stranger to protests, unfortunately. And then going back to GSA, their Polaris IT program has been besieged by protests, and some of that time really gets into the venue in which contractors choose to protest. If you go to the Government Accountability Office, then you get a 100-day resolution window, and often things are disposed of much more quickly. But if you go to the Court of Federal Claims, which increasingly contractors are going to, they don’t have that timeline. It’s adjudicated when it’s adjudicated. And that’s one of the things that I think is really cropped up in Polaris as well as NIH’s [Chief Information Officer – Solutions and Partners (CIO-SP ) contract]. And we’re going to have to see what 2025 brings for these contracts.

Tom Temin

So if things go to court, it could be years, whereas if they go to GAO, then it’s by statute, only months, right?

Larry Allen

Right, only months versus years. And I think one of the things that contractors have to keep in mind is that, look, the government’s patience is not infinite in this. The reason we have a Polaris is because we couldn’t get an Alliant II small business. These contracts are valuable, but they’re only valuable if they get to live to see the light of day. My sense is that patience may be running a little bit low at GSA. I can’t speak to NIH, but at GSA, with some of the constant protests, because they do cost the agency money and time, just as they cost industry time. And there are several people who’ve already started to say, myself being one of them, do you really need another small business, IT GWAC, particularly if you can’t get it out the door? So you don’t want to necessarily kill the goose that laid the golden egg. You want to keep things in perspective.

Tom Temin

And then finally, you are predicting a slowdown in defense spending, which is counterintuitive given what Congress wants to do, or what they’ve said they want to do in the budget proposals for DoD.

Larry Allen

Tom, I think we’re setting ourselves up for a late fall, early winter slog between the House and the Senate on both the Defense authorization bill and the Defense appropriations measure in DoD land. Both are equally important, and while appropriations must pass, technically, the authorization bill is one that usually does pass. It’s been several years since it hasn’t, but you know, it’s not 100% must pass. And if you’ve been looking at some of the signals coming off of Capitol Hill, you can see that there’s really no sense of urgency to move the Senate version of the authorization bill. Conversely, they passed their version of the appropriations spending measure before they left town for August recess, but they did so at a level that’s basically guaranteed to set up a debate with the House over funding levels. And while this is an election year, normally you like to see, or expect to see anyway, defense spending go up. There are defense hawks, many of whom are running on a platform of reigning in government spending. So it’s by no means a given. I think it’s going to cause some delays in getting both final appropriations and authorization work done.

Tom Temin

Yeah so, hurry up and wait.

Ellen Chang  So H4XLabs is a division that was started in 2019 to get at how do we help the government commercialize technology, often starting with [Small Business Innovation Research (SBIR)]? We started with the Navy, and we’ve grown into working with the Space Force back in 2021, where we really initially started with SpaceWorks. And that’s where we started to think about helping them define and think about what Orbital Prime could be. We weren’t exactly on contract at that time, but we were part of the whole effort of conceiving what Orbital Prime could be. Several of us were on some of the workshops. That later on translated into some of what we’re doing with the Space Force right now, which is with the SpaceWorks division, helping their Orbital Prime cohort of 41 companies develop in scale. The work breaks down into twofold. One is portfolio analysis. So looking across the 43 companies, what are they doing? What’s their technology maturation? All the way to how are they thinking about manufacturing for those hardware companies? To how are they thinking about funding? Not just government funding in terms of moving down the SBIR path, but some of these companies, about half of them actually have private capital in them. And how are they thinking about commercializing and returning to their investors. What markets are they attacking? How are they scaling? And so that’s been a very interesting effort. The other side of the coin of this work we’re doing is to support the companies themselves. So we have the assessments that we’ve been doing, and by understanding their pain points, we’re able to make the connections, or help inform how they should go about raising capital, for those that want to raise capital. How they should go about talking to different government entities who have similar requirements. And this moves into, or delves into, some of the other work we have with NASA, as well as now working with the Aerospace Corporation. But with NASA, we are working with their SBIR Ignite program, which is very similarly positioned. It’s focused on higher commercial impact. So within the SBIR program, NASA has their mainline program, which is their traditional program. Two years ago, they decided to start a pilot that gets at higher level technology readiness levels (TRL) – some of the companies that actually have already raised capital – so that they can commercialize technologies more quickly and be more intentional about where they’re funding, putting their investments. And so we’re involved in that, and we find that the synergies between these different space agencies are palpable. There can be domains where maybe there’s space control, which is more of a Space Force domain, yet there are some technologies that are useful for the civil space side. And because we’re seeing both sides, we’re able to make the connections and better inform both agencies.

Eric White  Yeah, we’ve spoken to NASA folks from their SBIR program, and I was hearing a lot of the same terms you were using on commercializing a lot of the technology. Because some of the challenges that I’ve heard from folks from the commercial and public sector is that, this is such a unique and niche technology, or such unique and niche technologies are needed in this sector that there’s not sometimes enough of an onus to create them. What do you say to both sides, when you hear the government say, hey, we need this. And the company say, well, where’s the money at for that, to make that?

Ellen Chang  Yeah, I think it really depends. So some of the small businesses, we’re on the small business side, really not on the large company side. Some of the small businesses probably should be asking more of those questions. Where I find this, the venture backed companies, interesting is that they’re targeting a market that probably the commercial world will start to pay for. And so, yes, they’re concerned about winning, maybe in Air Force parlance, a [Strategic Funding Increase (STRATFI)]. So long as there’s matching funds coming in, they see light at the end of the tunnel of hey, yes, they’re starting to actually gain some commercial traction. I think maybe the question is, will that commercial traction be large enough to sustain in whatever time frame? There’s lots of projections that commercial space, or space commerce, is going to be $3 trillion in the next 10 years. But it’s taking some time to get there. And I think these companies are looking to calculate, how do they sustain to the point where there is a tipping point where commercial revenues really do unlock more opportunity? I guess in answer to you, there’s really two sets of companies. The small businesses tend to continue to move forward and get other research contracts slowly commercializing. Then there’s the startups, which have some venture backed funding, are looking to the Space Force to fund some of it, but realize there’s other markets out there that they need to actually go address, otherwise they wouldn’t be able to raise venture. Most of the venture capitalists that are funding these companies have not yet bought into defense tech, they’re really funding space commerce.

Eric White First off, I want to ask Ellen Chang’s prediction: Where do you see the dollars really going? A lot of people get into space because it’s far away from, they think of it as, well, it’s not defense oriented, and it’s a way to work with the government that’s not providing any sort of lethal technology or anything like that. But now those lines are starting to blur a little bit there. What do you think about that? And is there going to be more folks who get into it just because of their love of space and exploration and all those good things? Are they going to maybe back off a little bit.

Ellen Chang  I think it’s near term, far term. So near, near term, I think some of the venture-ish types of investments will back off a bit, because the government just is coming in a little bit more strongly. But this government is also being influenced, at least in my world, the space portfolio is being influenced by the fact that venture has come in over the last 5-10 years, and they’re like, Oh, there’s another funding source. So therefore we might want to leverage it, and already thinking about how to change how they buy capability. So I think it’s near term, because of the environment and the security situation, I think there’s going to be more opportunities within the government side. But I do see light at the end of the tunnel. And for investors, this is the hardest thing, the timing element. Is it five years or is it 10 years away? But I already see opportunities with insurers, or if somebody does figure out what that standard is for refueling, there’s certainly business already being talked about on how a satellite can be refueled, and what is that cost? Because there’s there’s business cases, there’s business studies that have shown that, Hey, if I can refuel and extend my satellite another five years, this is how much more revenue I can have. They make that trade off, and it’s starting to close because the technology and the capability to do this is coming down. It’s fascinating, some of the talent coming out of these, like Space X actually generates a lot of talent. These young engineers go there, learn a lot, get worked really hard, and then they pop out and they start companies. So I’ve worked with several of these teams that are actually quite inventive, and are quite driven, and are at least being successful at not just getting some government contracts, but also raising capital and getting initial contracts from, like, Starlink, for example. Starlink actually has a problem with its satellites potentially getting hit or possibly running into something. And so if they actually know about a potential conjunction early enough, and they’re able to dodge the bullet, so to speak, they save their satellite, they save fuel, etc. And so those are the types of business cases that are being talked about, at least for that sort of activity. There’s others, like gas stations in space. Orbit Fab is a company I’m pretty familiar with, which is staging gas stations. And will they end up refueling satellites? I think so. I think it’s a time. Is it next five years? Is the next 10 years? We don’t know.

Eric White  We’re speaking with Ellen Chang, who is with H4X Labs, which is the space practice for BMNT. And so let’s talk innovation. What is the current state of the innovative practices being pushed through, and how is that going to affect those long term and short term investments? Because obviously, in no other sector of industry is innovation probably more at the forefront than in this realm.

Ellen Chang  Yeah, I guess if we use innovation as technical invention and kind of new products and new businesses being built up, I think within the space sector, there’s increasingly folks are just coming in, they’re starting all the time. There’s certainly some have,  the halo is off. A couple of years ago, a bunch of space startups went public, and they’re not doing that well on the public markets. Not to say that their businesses aren’t maturing, but it hasn’t really stopped the onslaught of companies being formed. March of 2022 the markets came down, interest rates went up. A lot of capital is sitting on the sidelines. And I think this year, 2023 was a challenging year to raise money, but we’re starting to see the venture markets open up for some of these space companies again in 2024. And so I think about in another couple of years, we’ll start to see some of these companies grow, mature their technology and actually close their business case. Why is this relevant to the federal market? What I see in the federal side is ideas around, how do we buy services and not own the systems? For example, I think the Air Force just did unveil their new strategy, their new organization. General Saltzman is looking at how to harness more commercial. And I believe that word commercial is not just kind of the large commercial companies, but also some of the startups that he’s been exposed to, because there’s probably a market that the government can buy from in the next five, 10, 15 years, where it doesn’t have to necessarily build and own and operate. And I think we’ll have to go through to talk through some of the policy issues that surface because of that. If a civil space thing is up there, doing something for the government, and something happens, whose fault is it, etc. Those are the things, those are the types of policy issues that we’re going to have to have conversations about, and already are starting to have conversations about.

Eric White  Finishing up here. We talked about the uniqueness of a lot of these venture capital companies and small businesses that are making little parts of the technology that is needed to actually operate things up in space. I want to talk about your industry in particular. Do you all have a lot of competition in the field of being the go-between between the government and some of these smaller entities that they’re looking to work with. I don’t want to force you to name your competitors or anything like that, give them a shout out. But just how big is that, specifically in the space sector? How big has your industry itself become?

Ellen Chang  I would say, yes, there’s competition, and it’s across the board. If one would want to say, who accelerates companies as kind of the universe of market, Y Combinator would be a competitor. But then we’re also competi-mates, because they’re funding companies that we would then help. And then within this sector, there’s a couple like Starburst, which is quite well known within this sector, and we were, I would say, competi-mates, frenemies, just like the whole industry is. It’s that they’re pretty competent at attracting and advising companies as well. TechStars itself has a mini-space practice. And then there’s a few others. So like even plug-and-play. I think it ranges from very, very commercial players to those that are familiar with the government. I feel that what sets us apart is that we’re pretty well networked with the defense side, the national security side. A lot of BMNT’s heritage is DoD. And so we know how the DoD operates. We think national security, we have hacking for defense that sources problems from across the different military organizations. And so that’s our heritage, and so we’re ending up playing to our strengths. I don’t know that the market is growing in leaps and bounds. It is a services oriented type of a business. And how we like to think, is not necessarily going to capture another contract, which is helpful. But I’m always thoughtful about what problem are we solving for the government? How are we solving that? Where can because of our heritage, and we have one foot in commercial, where can commercial actually add value without adding risk? And that’s that can be hard to think through. For example, just was it last year, Silicon Valley Bank imploded, and I think the DoD was pretty concerned about the number of companies that it had already funded that was dependent on venture capital, and Silicon Valley Bank, where that might go, to the tune where Janet Yellen had to step in and actually say, hey, we will, essentially, we’ll make sure the bank doesn’t fail. I guess since then, JP Morgan has bought them and bought First Republic, and has provided a pretty stable backing for a lot of the startup financing that these two banks were providing. So hopefully I answered the question where there is quite a bit of competition within this accelerated world, but we like to play a role where we lean into national security. We believe we can help companies understand the commercial side and the government side, and help them make the decision on what type of company they want to be. I will say I personally am not just defense tech-oriented. I’m not necessarily saying everyone needs to be an Anduril, where the government and the DoD will be your customer. I think many within the space sector, most companies are going to be dual use, where they’re going to be building for commercial they can actually support the government, and they need to be successful at both, because just the market is larger.

• There’s a criminal investigation underway into what appears to have been an attempt to disrupt the Army’s annual TechNet conference in Augusta, Georgia. Attendees arriving at the conference Tuesday morning were greeted by a foul odor in the venue’s main ballroom. Susan Lawrence, the president of AFCEA — the group that organizes the conference — said local authorities tested the facility for hazardous materials and deemed it safe for the conference to continue. But she said the investigation so far shows the smell was the result of a “willful act,” and that local authorities are investigating.
• Employees at the Federal Deposit Insurance Corporation say they’re still fearful of retaliation for coming forward about mistreatment in the workplace. The sentiment comes months after reports of pervasive harassment and bullying at the FDIC. The National Treasury Employees Union, which represents FDIC workers, said it continues to hear from feds who say they still see improper behavior going unpunished. NTEU is now calling for FDIC leadership to implement more stringent anti-harassment training, as well as more transparency on how and when workplace incidents are resolved.
• The Equal Employment Opportunity Commission is pushing agencies to improve how they handle workplace disputes. The EEOC said the Alternative Dispute Resolution (ADR) process can lead to more successful results. ADRs bring in a neutral third party to help settle a workplace dispute before it reaches the point of litigation. But the process is still far from perfect. About two-thirds of employees that EEOC surveyed said they were dissatisfied with the fairness of the process. In a new report, EEOC recommends how agencies can improve the dispute resolution process, for instance by providing more training and education to staff. Ultimately, EEOC said the earlier agencies can resolve workplace disputes, the better.
• The Treasury Department is on the cusp of finalizing its updated Evidence and Evaluation Policy. It also is close to finishing up a new scientific integrity policy. These are two of steps the agency is taking to fully implement the Evidence Based Policymaking Act, which became law in 2018. A new report from the Government Accountability Office detailed Treasury and 22 other civilian agencies’ actions across six topics and 12 common themes to fulfill the law’s requirements. Auditors also analyzed the Office of Management and Budget’s guidance and oversight of the legislation. Among the progress GAO found was a majority of the civilian agencies hired or trained staff to have evidence-building skillsets and identified evidence building activities. GAO made two recommendations, including for OMB to do more to make sure the Evidence Officer Council shares lessons learned and best practices.
• Top Republicans on the House Homeland Security Committee are raising alarms about cases of so-called “Havana Syndrome” among federal employees. Hundreds of people, most of them State Department or intelligence community employees, have reported anomalous health incidents since 2016. Symptoms include brain injuries, headaches and dizziness. The HAVANA Act passed by Congress is providing financial support to federal employees suffering from these brain injuries. But lawmakers said the Defense Department and the Defense Health Agency have not yet fully spent the funds set aside for this purpose. The committee is requesting an update on the issue from the National Security Council.
• The Federal Aviation Administration is proposing new cybersecurity rules for airplanes. The FAA said aviation equipment is increasingly interconnected and susceptible to potential cyber attack. The proposed rules would require aircraft manufacturers to take steps to protect airplanes and associated equipment from cyber threats. The FAA released the proposed rules this week. Comments are due by October 21.
• The National Institute of Standards and Technology is out with new digital identity guidelines. The draft NIST guidelines add more detail around the use of emerging technologies, like mobile drivers licenses and digital passkeys. NIST’s National Cybersecurity Center of Excellence is also planning to test out the use of mobile licenses for accessing government services. NIST officials said they want to balance security and access when it comes to proving your identity online. Comments on the draft guidelines are due by Oct. 7.
• The Defense Information Systems agency is ready to migrate the next group of users to DoDNet. Eight defense agencies, including the Defense Contract Management Agency and Defense Contract Audit Agency, are set to begin their migration to DoDNet soon, with the first migration expected to start in October. An additional six agencies and field activities are expected to begin their discovery phase by the end of 2024, bringing the total number of DAFAs involved in this migration process to 14. DISA plans to add 100,000 users to DoDNet within the next 18 months.
• The Air Force takes the next step in modernizing the infrastructure of its bases. The Air Force awarded 23 companies a spot on its Base Infrastructure Modernization contract vehicle as the second piece to its enterprise IT-as-a-service (EITaaS) program. The 10-year contract has a total ceiling of $12.5 billion. Under the BIM vehicle, the Air Force will upgrade the wired and wireless networks on its bases to bring capabilities from buildings to flight lines. The Base Infrastructure Modernization program follows Wave 1 of EITaaS, which the Air Force rolled out to nine installations as a pilot. The service received 47 bids under the BIM vehicle and unsuccessful vendors have until late August to file a protest.
• The IRS is rolling out its free, online tax-filing platform to yet another state. More than 600,000 taxpayers in Wisconsin will get to use Direct File next filing season. It’s the seventh state to opt in since the IRS made it a permanent program. The agency expects at least half of all states will opt into Direct File before the next filing season. More than 140,000 taxpayers in a dozen states piloted Direct File earlier this year.

Copyright © 2024 Federal News Network. All rights reserved. This website is not intended for users located within the European Economic Area.

The success of the Mentor-Protégé Program is a major accomplishment for SBA, and you’d think the agency would be working hard to keep the momentum going.

The General Services Administration recently announced the first round of awards for Oasis+, with the Total Small Business Pool recognizing 1,383 awardees. Notably, 180 of these were joint ventures from the SBA Mentor-Protégé Program (MPP), providing more evidence that companies leveraging combined capabilities, resources and past performance are well positioned to win federal contracts. 

The success of the Mentor-Protégé Program is a major accomplishment for SBA, and you’d think the agency would be working hard to keep the momentum going. Curiously, however, it seems to be doing the opposite. Instead of looking for ways to ensure the program continues to flourish, it’s now proposing rules that could actually make it harder for MPP participants to win government work moving forward.

First, SBA is contemplating a rule that would prevent SBA-approved mentor-protégé joint ventures from bidding on multiple award contracts. While these joint ventures could still apply for and win single award small business set-aside contracts, this restriction could significantly reduce the program’s effectiveness.

The potential rule change is baffling. At a time when many agencies are moving more contracts to best-in-class and large vehicles, SBA is considering dismantling a proven pathway for small businesses to successfully compete in that environment.

But that’s not all.

SBA is also contemplating eliminating the HUBZone price evaluation preference to HUBZone joint ventures formed under the Mentor-Protégé Program. Currently, this preference allows a certified HUBZone small business concern (including a HUBZone joint venture) to have a 10% price preference when competing in a full and open competition.

The agency is seeking comments on whether it is appropriate for a HUBZone mentor-protégé joint venture to benefit from the HUBZone price evaluation preference “when the joint venture already benefits from its large business mentor’s lower cost structures and pricing.” From our point of view, SBA’s apparent concerns are unfounded for a few reasons. 

First, it is rare that the large business serving as the mentor in the arrangement has lower cost structures and pricing than its smaller counterpart. Many large businesses have difficulty fitting under small business rates, so this rationale is very strange.

Second, the HUBZone price evaluation preference is a critical tool that helps HUBZone businesses compete on a level playing field with larger firms. Removing this benefit from HUBZone mentor-protégé joint ventures would strip away a vital advantage that helps these small businesses win contracts and grow. It overlooks the unique challenges HUBZone firms face and undermines the very purpose of the HUBZone program, which is to spur economic development in historically underutilized business zones. 

Third, the government as a whole rarely hits its HUBZone goals. Now SBA is considering eliminating the one advantage that HUBZone companies have in this space? If the intent is to address concerns about equity or fairness in the awarding process, there must be more effective ways to achieve these goals without undermining the benefits of the Mentor-Protégé Program. Removing the ability to bid on multiple award contracts and altering the HUBZone price evaluation preference could inadvertently stifle the very innovation and growth the program seeks to promote.

Let’s be clear here: SBA’s MPP has been a game-changer for a lot of small businesses. By partnering with more experienced firms, they’re able to access the mentorship, resources and past performance credentials necessary to compete for and secure significant contracts. The recent round of Oasis+ awards is just the latest example of how effective this program is in terms of fostering small business growth and innovation in the federal marketplace.

As these policy proposals progress, it is crucial for stakeholders to voice their concerns and highlight the tangible benefits the MPP has delivered. SBA must consider the real-world impacts the proposed changes could have on small businesses that rely on these partnerships to navigate and succeed in the federal contracting landscape.

We will be closely monitoring this situation and urge SBA to reconsider these changes. Maintaining the ability for joint ventures to bid on multiple award contracts and preserving the HUBZone price evaluation preference are essential for sustaining the momentum of small business growth and innovation in federal contracting. The Oasis+ awards and many other success stories that have emerged from the MPP in recent years should  serve as a powerful testament to its effectiveness, and we’re committed to helping many more companies reap the rewards of the program for years to come. By keeping the existing rules intact, SBA can underscore its own commitment to American small businesses and shift its focus to making this exemplary program even better. 

Tommy Benz is a principal at GrowthLab and works with professional service firms on their growth strategies in the federal market.

Copyright © 2024 Federal News Network. All rights reserved. This website is not intended for users located within the European Economic Area.

Mentor-protégé arrangements provide a great way for small businesses to win federal work along with their larger business mentors. The popular program goes back decades. But mentor-protégés aren’t guaranteed to win. In one recent protest case, the problem was the buying agency wasn’t convinced the protégé could actually do the work. Haynes Boone procurement attorney Dan Ramish joined the Federal Drive with Tom Temin for more details.

Interview transcript: 

Tom Temin  I guess the context or background of this is SBA is looking to kind of put a penny on the governor with mentor protégés, because they win an outsized number of contracts. In this case, though they lost and the protest was sustained. Tell us more.

Dan Ramish  Sure, Tom. So in this case, this was a procurement under GSA stars three GWAC vehicle and the task order RFP sought a range of technology support services for the Air Force Civil Engineering Center, and it was structured as a primarily fixed price task order with a one year base period and four one year options and an optional six month extension. The RFP, in this case, provided for a two phase evaluation process with the agency evaluating the most important non price evaluation factor in the first phase, which was past performance, experience and team structure. And the offerors were instructed to submit past performance and relevant experience examples and to complete a template and narrative describing the team structure.

Tom Temin  And that’s the phase at which this particular mentor-protégé team didn’t make it.

Dan Ramish  That’s right. So Tygrove was a mentor-protégé joint venture between a large business Inserso and an eight day program participant, Potomac Haven. Inserso, in this case, was actually the incumbent contractor, which also is not an uncommon scenario for mentor-protégé joint ventures, where a large business incumbent faces a follow on contract that will be set aside. A fairly common approach to staying in the running for the follow on, even though it’s set aside, is to use these mentor-protégé joint venture vehicles. So that’s what happened here. Of course, the catch is that the protégé firm has to actually contribute, and you can’t rely completely on the mentor incumbents ability to perform the work, right?

Tom Temin  So in that sense, then a small business, even in a mentor-protégé, is obligated to perform a certain amount of work, just as if they were a regular subcontractor as a small business.

Dan Ramish  Yes. So there’s a performance of work requirement for the protégé firm and a mentor-protégé joint venture, they have to perform a minimum of 40% of the work that’s performed by the joint venture. So that’s always a consideration, and there’s also a consideration to ensure that the protégé is contributing meaningfully to the work that will be performed under the contract. And so here, the government did the first phase assessment. Tygrove had submitted seven different past performance and experience examples, two from the large business partner Inserso, two from the protégé Potomac Haven, one from the joint venture itself, something you don’t often have. In many cases, the joint venture will have been formed and won’t necessarily have its own experience to draw from or past performance. But in this case, they did have one example and then a couple of examples. From a subcontractor. And so put all of this together to address this first factor, and the technical evaluation team came back and assigned an adjectival rating of marginal and a risk rating of high risk. And on that basis, Tygrove didn’t go on the next phase of the procurement, and when they were notified of that, they submitted this protest, right?

Tom Temin  Okay, and this was a GAO protest?

Dan Ramish  That’s right.

Tom Temin  We’re speaking with Haynes Boone procurement attorney Dan Ramish. And so the protest, just to be clear, was filed by the main contractor, the mentor, but it was the protégé evaluation that got them knocked off.

Dan Ramish  Actually, Tom, the way that these work, it was, it’s the joint venture that itself, the joint venture is a separate entity.

Tom Temin  All right, so joint venture filed, but the issue was performance capability of the protégé in this case.

Dan Ramish  Right. So the technical evaluation team looked at the examples that were submitted in response to this first factor, and they found that Tygrove didn’t provide compelling or applicable examples to demonstrate that the joint venture and the protégé and not just Inserso, the incumbent, could perform the work successfully. And the TED evaluated both the joint venture itself and the joint venture members, and found that, well, Inserso established that it had the capability to perform. Of course, it did, as the incumbent. The protégé Potomac Haven did not demonstrate that it could perform the 40% of the work that was required under SBA regulations. And the TED also questioned Potomac Haven’s ability to serve as the managing partner of the joint venture, which is another requirement under SBA regulations, Potomac Haven had a small number of individual task requirements that it was assigned, and that raised some concern for the agency as to whether it would be able to function as the managing partner of the joint venture.

Tom Temin  And by the way, as incumbent, Potomac Haven wasn’t there. They were going to be there for the follow on.

Dan Ramish  That’s right, it was actually the large business partner, the incumbent. Exactly.

Tom Temin  Right? So Inserso maybe erred in picking the wrong protégé for the follow on under a joint venture.

Dan Ramish  That’s right, and it may be a natural assumption for the incumbent to assume that their joint venture would obviously be qualified and have ample capabilities to perform the follow on contract, because it performed it on its own under the predecessor contract, but both JV members have to be involved and demonstrate that they’ll be able to contribute. And the agency here questioned whether that was the case and found that there was risk that there would be a problem with the protégé’s performance.

Tom Temin  And the GAO then, in evaluating the protest, sided with the agency.

Dan Ramish  Yes. So the agency, also, I should mention, assigned an additional risk, because it found that the team structure was poorly blended and that it conveyed low value on collaboration and new idea exchange within the task and overall on the contract. And also, more broadly, concluded that the 8A protégé participant, Potomac Haven brought very little to the proposal, other than its 8A status, which is always a big problem for a joint venture, if the 8A that’s supposed to be benefiting isn’t really bringing anything other than its status.

Tom Temin  All right, other than the fact that Potomac Haven sounds like an old age home, what were some of the takeaways from this case for the mentor-protégé program, do you think?

Dan Ramish  So GAO looked here in its decision at the SBA rules, and it concluded that the agency didn’t do anything that ran afoul of those rules, and it also got SBA to weigh in on this. Now, the rules and GAO case law don’t assign a specific degree of consideration for the mentor member or the protégé member, but they require that the criteria can’t be exactly the same for the protégé as for the mentor. And they found, GAO found, in this case that the consideration of the 40% requirement under SBA regulations was appropriate and didn’t cut against the SBA rules. And more broadly, again, the issue that the protégé couldn’t really contribute anything beyond its status on the face of the proposal was a big problem. So the agency had acted reasonably in looking at the ability of the protégé to perform the requirements under the SBA regulations. That’s helpful guidance for agencies, because they often run up against this rule that they can’t consider the protege and hold the protege to the same standards as every offer or but then finding a way to appropriately consider the proteges contributions is sometimes a struggle, and so in this case, this demonstrates one approach that an agency can take to look at what the requirements are under the SBA regulations and how the proteges proposed role stacks up against those.

Tom Temin  And more importantly, on the contractor side, pick your protégé carefully. Protégé really is not maybe the most accurate word for it, because protégé sounds like beginner or learner. And in this case, the agency didn’t want a beginner company. They wanted someone that could do 40% of this work under an incumbency that they were pleased with for several years, and they found that that protégé was a little bit too proto.

Dan Ramish  That’s exactly right. The protégé has to have some existing past performance and experience as a baseline to be able to provide something of value on the contract. They can’t just have their name listed there with their status as part of the proposal.

Tom Temin  We’d all be protégés. Exactly.

Eric White  That’s Dan Ramish, a procurement attorney with Haynes Boone, speaking with Federal Drive host Tom Temin. We’ll post this interview at federalnewsnetwork.com/federaldrive. Hear the Federal Drive on demand. Subscribe wherever you get your podcasts.

Copyright © 2024 Federal News Network. All rights reserved. This website is not intended for users located within the European Economic Area.