Shuttering of the government (or parts of the government) following appropriations lapses has become an increasingly common phenomenon in recent years. Funding lapses interrupt the usual predictability of government operations, which is often to the detriment of both agencies and federal contractors that are left in proverbial limbo with stop work orders.
Unfortunately, unlike many other topics, the FAR does not substantively address procedures for contractors during or following a government shutdown. As such, recovering expenses incurred as a consequence of government shutdowns can be challenging.
Monday, the U.S. Supreme Court decided to hear a case that could have far reaching implications in agency law—including for government contractors. The Court granted certiorari to a case that could greatly diminish the amount of deference given to agencies interpreting their own regulations.
For contractors, a Supreme Court decision to curtail agency deference could lead to increased success rates in bid protests and other disputes.
In a strongly-worded opinion, a federal judge decried a “labyrinth of legal and regulatory hoops and hurdles” imposed on the VA as a result of the famous Kingdomware Supreme Court decision–and suggested that Congress could exercise a “kill switch” to curtail or even eliminate the SDVOSB and VOSB contracting preferences the Supreme Court unanimously affirmed.
While I have no reason to suspect that Kingdomware is in any danger of being overturned or curtailed by Congress, its certainly not great news for SDVOSBs and VOSBs that a federal judge seems to be pushing for that very thing.
An agency ordinarily enjoys very broad discretion in its procurement-related decisions. This includes whether an agency will award a contract or, instead, cancel a procurement.
Broad as this discretion is, however, an agency does not have carte blanche to cancel a procurement on a whim. As a recent Court of Federal Claims decision shows, an agency must support its decision with sufficient information, lest the cancellation decision itself be successfully protested.
An 8(a) joint venture agreement was ambiguous about whether the joint venturers intended to create a populated joint venture (which is no longer allowed) or an unpopulated joint venture–and the ambiguity cost the joint venture an 8(a) set-aside contract.
In a recent decision, the U.S. Court of Federal Claims upheld the SBA’s decision to reject a joint venture agreement that was ambiguous about whether the joint venture was populated or unpopulated.
The VA Center for Verification and Evaluation unreasonably decertified an SDVOSB based on the results of an SBA SDVOSB decision.
According to the U.S. Court of Federal Claims, it was improper for the VA to remove the SDVOSB from the VA’s database without evaluating whether the SBA’s determination was consistent with the VA’s separate SDVOSB requirements.
The SBA’s strict SDVOSB ownership rules can produce “draconian and perverse” results, but are nonetheless legal, according to a federal judge.
In a recent decision, the U.S. Court of Federal Claims condemned the SBA’s SDVOSB unconditional ownership requirements, while holding that the SBA was within its legal rights to impose those requirements on the company in question.
The Court’s decision emphasizes the important differences between the SBA and VA SDVOSB programs, because the Court held that although the company in question didn’t qualify as an SDVOSB under the SBA’s strict rules, it was eligible for VA SDVOSB verification under the VA’s separate eligibility rules.