GAO Confirms that Novations Work: Agency Properly Recognized Buyer of Contract as Awardee

The Anti-Assignment Act (41 U.S.C. § 6305) prohibits the transfer of a government contract or interest in a government contract to a third party. However, government agencies recognized that contractors are on occasion bought, sold, merged, or simply encounter circumstances upon which it becomes desirable or necessary for them to assign a government contract to a third party.  

To address this issue, the Federal Acquisition Regulation (FAR) provides for a novation process to give contractors a method to transfer government contracts and not run afoul of the prohibitions in the Anti-Assignment Act. The ultimate goal of the novation process is to successfully transfer the contract and have the government recognize a new contractor as the successor-in-interest to the transferred contract.

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Agency Properly Rejected Bidder for Listing COVID-19 as a “Force Majeure” Event

For government contractors, trying to predict how COVID-19 might affect a government project can be extraordinarily challenging task. One bidder recently attempted to provide some clarity by stating, in its bid, that COVID-19 was a “force majeure event” and that the bidder would be entitled to extra time if COVID-19 affected the project.

Unfortunately for the bidder, its effort failed: the agency rejected the bid for improperly exceeding the scope of a relevant FAR clause. The GAO then confirmed that the agency had acted properly.

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GAO Finds CIO-SP4 Unduly Restrictive; Recommends Amendment

For practically the entire summer of 2021, we observed (and commented on) NIH’s numerous amendments to its long-awaited CIO-SP4 solicitation after it was finally issued in May 2021. By the time the deadline for proposals finally came, it had been amended eleven (!) times. Even with all those amendments, however, it appears that at least one offeror still had serious concerns about the final version. As it turns out, at least some of their concerns were warranted, per GAO, and has recommended the agency to amend the solicitation or revise its evaluation criteria.

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Agencies May Rely on Offerors’ Buy American Act Certifications Unless “Reason to Believe” Non-Compliance

When an offeror submits a certification that its products qualify as domestic for purposes of the Buy American Act, an agency ordinarily may rely on that certification without further investigation, unless the agency has reason to believe that the products will not be compliant.

In a recent bid protest decision, the GAO held that an agency acted properly by relying on the offeror’s certification because the protester’s “unsupported allegations” were insufficient to trigger a requirement for further investigation.

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Key Personnel Unavailability Leads to Sustained GAO Protest

Key personnel are an important term in many proposals. Establishing the resume, experience, and availability of personnel that will perform major functions of a contract is a key (dad joke) aspect of a winning proposal. As one offeror found out, when key personnel become unavailable, the technical acceptability of the entire offer can be in jeopardy.

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GAO Affirms any Discussions During Evaluations Must be Meaningful

Evaluation of offers is a crucial point in the procurement process. During this time period, an agency may, in certain procurements, reach out with discussion questions meant to bring clarity to the decision-making process. However, any such discussions must be meaningful.

As one offeror recently found out, meaningful discussions even apply in so-called simplified acquisitions.

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GAO Affirms SBA Rule: Only Joint Venture Members, not the JV, Need Facility Clearance

For years, it had been difficult for joint ventures to get Facility Security Clearances to go after DoD contracts where a facility clearance was required. The DoD and many contracting officers had long required that the joint venture entity itself, rather than each individual joint venture member, have the FCL. SBA thought it had fixed this problem when it updated its joint venture rules in November 2020 to eliminate the need for the joint venture to have an FCL, as we wrote at that time. But DoD contracting officers had been ignoring this rule, setting up a showdown at GAO to decide if the SBA’s rule did actually apply to the DoD.

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