The General Services Administration re-released the solicitation on June 30 with updates to the mentor-protégé and joint venture experience submission requirements, the definition of relevant experience and the documents needed to establish the mentor-protégé or joint venture relationship.

Small businesses have until Aug. 10, to submit their bids, for this 10-year contract that could be worth tens of billions of dollars, but has no specific ceiling. Questions about the RFP are due to GSA by July 12.

“Overall, I think the RFP looks good. It is more in line with the original draft, with respect to mentor-protégé/join ventures, and seems to have clarified many of the ambiguous instructions,” said Courtney Fairchild, the president and CEO of Global Services, a proposal services firm, in an email to Federal News Network. “I think it strikes a good balance between small business prime/subcontractor teams and MPJV teams. Overall, I am not disappointed with the RFP. GSA listened to feedback before final release.”

The mentor-protégé and joint venture submission requirements have been at the heart of the concerns about Polaris over the last few months.

Relevant experience updates

GSA now is requiring mentees to provide at least one example of relevant experience and limits mentors to only three examples. Previously, there were no limits or minimums for either mentor or protégé. This experience can include task orders under the schedules or a blanket purchase agreement, a single contract or subcontract and, just added, other transaction agreements (OTAs).

“It seems like GSA is just following the NITAAC book with the protégé experience requirements — i.e., requiring one experience example from the protégé to show some experience. This is what I thought they were going to do,” said Cy Alba, an attorney with PilieroMazza in Washington, D.C. “The Small Business Administration regulations do not provide direct guidance on this question and so it does seem like agencies have some level of discretion in making the determination about how much experience the protégé would need to show. That said, they cannot discriminate against protégés as that would violate SBA regulations. Unfortunately, the law is not clear on where that boundary lies and, if protested, it will be up to GAO or the Court of Federal Claims to make that determination.  This is consistent with other compromises on the issue though, like CIO-SP4.”

Additionally, the new solicitation tells vendors to detail “the work done and qualifications held individually by each partner to the joint venture as well as any work done by the joint venture itself previously. If any partner or the joint venture itself has no previous work done or no qualifications held, this should be stated” in the submission forms.

A third change would let mentor-protégé teams and joint ventures can submit relevant experience of their subcontractors as part of their bid as long as the experience happened under the joint venture umbrella.

“I’m sure some of the experience requirements, like requiring at least 6-months of performance, or how IDIQ contract value is calculated, may bring the ire of some small businesses but I am not sure those requirements are legally objectionable,” Alba said.

Fairchild added the changes GSA made may still give mentor-protégé teams and joint ventures an advantage in the self-scoring system given the probability that large businesses will have more large value projects to offer.

“I like that they brought the minimum period of performance down from one year to 6 months — seems to be more friendly to small businesses,” she said.

Concerns remain about the RFP

Other industry experts were less certain about GSA’s changes.

Larry Allen, the president of Allen Federal Business Partners, said the three and one relevant experience requirement continues to favor large businesses in what is supposed to be a small business contract.

“GSA is really trying to balance the contract so that both experienced small businesses and less experienced, newer market entries can potentially participate on Polaris. The basic idea is to get new participants into the market,” he said. “Also, while offerors using companies that don’t have relevant prior experience must disclose that, I am not sure that such information will automatically disqualify a company. My belief is that GSA will look at the overall team submitting the offer. Again, they want to enable new company participation as much as possible.”

Lisa Mundt, co-founder of the Pulse of GovCon, said GSA may have caused additional confusion, specifically for women-owned small businesses (WOSB).

“The WOSB track RFP states, ‘A minimum of one primary relevant experience project or emerging technology relevant experience project must be from a WOSB.’ However The offeror must submit a MINIMUM OF THREE (3) and may submit a MAXIMUM OF FIVE (5) distinct primary relevant experience projects and a MAXIMUM of three (3) emerging technology relevant experience projects. Does this mean if a bidder submits a maximum of 8 Relevant Experience submissions, that only one needs to be from a WOSB?” Mundt said. “We’re all for minimizing barriers to entry, but if the purpose is to provide access to best-in-class women-owned small businesses, then shouldn’t the bidder’s submission reflect that? Otherwise, the WOSB becomes a front for other companies outside the classification. The WOSB set aside is already abused in the industry with men naming their wives as ‘CEO’ – this just further exploits women business owners as props.”

GSA came under fire when it released the original RFP in March, specifically for last-minute changes it made to the requirements for mentor-protégé and joint venture bidders. After BD Squared filed a protest with the Government Accountability, GSA paused the solicitation to re-look at the requirements and obtain feedback from contractors.

In May, GSA released draft changes to Polaris, seeking industry feedback and then incorporating that into the updated final solicitation.

Sonny Hashmi, the commissioner of GSA’s Federal Acquisition Service, said in May interview that the team was trying to find the best approach to create the most opportunities for small firms.

“There’s going to be a trade-off that we need to find and that’s just reality,” he said. “Depending on the feedback that we get, and then to what extent we need to completely change strategy will determine the timeline. I’m hoping that the adjustment that we’ve made or proposed in our updated criteria is it meets the expectations of industry.”

Roger Waldron, the president of the Coalition for Government Procurement, praised GSA’s approach to improving Polaris

“GSA’s process for addressing the challenges to the Polaris evaluation was transparent, providing interested small businesses and others the opportunity to provide feedback on the proposed changes. This approach was critical in demonstrating GSA’s commitment to developing a reasonable evaluation approach that balances the relative merits of small businesses, joint ventures and contractor teaming arrangements,” he said in an email to Federal News Network. “GSA clearly has moved the ball here, and now, potential offerors will have time to digest the changes and respond by Aug. 10.”

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It’s an old question. An agency awards a services contract because of specific people the contractor promised would work on the project. Then one of them quits. In the ensuing protest cases, the Government Accountability Office and the federal courts seem to be of differing minds. The Federal Drive with Tom Temin gets more now from Smith Pachter McWhorter procurement attorney Joe Petrillo.

Interview transcript:

Tom Temin: We had a protest case where the key personnel person left and this was known to the agency and they went ahead with the award anyway, what happened? Tell us more about this case.

Joseph Petrillo: All right. So here’s the the situation, as you mentioned, when the government’s buying services, it’s customary to evaluate offered key personnel. And it’s very clear that when a bidder proposes someone for work on the contract, the bidder has to have a good faith belief that that person is going to be available. But what happens when the person becomes unavailable after proposals are submitted? And there as you eluded the Government Accountability Office, in its bid protest decisions, say that the offeror needs to inform the government of the unavailability even after proposal submission. In a recent decision we discussed a few weeks ago, one judge on the Court of Federal Claims, said no, there’s no such obligation in the statute or the regulations. So we have this differing view. And it’s illustrated again, by this recent decision in the Sehlke Consulting case, a GAO bid protest decision, it arose from a contract competition by the National Reconnaissance Office, part of DoD, they were buying finance support services. They were looking to award a cost plus award fee contract, they did that through a best value, trade off acquisition, and had both cost and non-cost factors which were weighted equally. In the non-cost factors, the most important sub-factor of the most important factor was key personnel. The issue we’ve been talking about here, that was an extremely important part of the evaluation. And it became a subject to the protest. KPMG, the incumbent won the contract. Another bidder, Sehlke Consulting, protested to the GAO that evaluation showed that Sehlke’s evaluated cost was about you know, 4 or 5% lower than KPMG’s, but KPMG had higher ratings in the non-cost factors.

Tom Temin: And one of the non cost factors that weighed in favor of KPMG was this key personnel that worked for a subcontractor?

Joseph Petrillo: Right, that turned out to be pivotal. It was the only sub-factor where any offeror had received an exceptional ranking. And in the source selection decision, it was identified as the distinguishing factor that determined contract award. So it was crucial.

Tom Temin: Yeah, so what happened with that person?

Joseph Petrillo: Sure. So the person resigned while offerors were being evaluated. But after proposal submission, and NRO became aware of that, because KPMG is the incumbent contractor, notifed them that the person who’s also working on the contract was resigning. Even though NRO had received that information, it was after proposal submission, and so they did not take it into account in making the award decision or in evaluating the proposals. Where after Sehlke protested, however, GAO sustained the protest and held it was unreasonable for NRO not to consider the unavailability of the person that it knew about.

Tom Temin: We’re speaking with Joseph Petrillo. He’s a procurement attorney with Smith Pachter McWhorter. And earlier you said that in another case, the court had taken the opposite view that it was immaterial, basically, to the award that a key person on the bidding had left. Could the difference be the criteria of the agency? That is to say, in one case, could the key personnel have been more important in supplier selection than it was in the other case? And that’s why the GAO and the courts differed? Or is there some fundamental disagreement here?

Joseph Petrillo: That there was some discussion of the court case in the GAO decision. GAO pointed out one important difference between the two and that is that in the court decision, there was no indication the agency was aware of the unavailability. And here the agency was aware of the unavailability. So GAO felt that that was a sufficient difference to distinguish it but they also were very clear that they’re not obliged to follow the decisions of a single judge on the Court of Federal Claims, and so they’re going to be going their own way it seems.

Tom Temin: All right, so getting back to this particular case, then of NRO and Sehlke versus KPMG. Sehlke protested. It was sustained by GAO because of the departure of that person from KPMG’s team, what happens next?

Joseph Petrillo: Well, under the GAO bid protest decision, the recommendation is that NRO has to choose one of two alternatives. One, either reevaluate the KPMG proposal without the person who’s become unavailable. And that’s one of four key personnel or reopen the procurement and allow all offerors to submit revised proposals.

Tom Temin: Or find out where that person went to work and then get them to bid.

Joseph Petrillo: Presumably, that’s not an option because the procurements ongoing and the number of offerors is set. But these cases raise really, really interesting policy decisions and policy implications. If you look at GAO’s position, their feeling is well, how can we have a good evaluation, rational evaluation of proposals, if one of the most important factors if not the most important factor is based on a situation that’s not true? That’s not valid. It will may have been true when proposals were submitted, but it’s no longer the case. But on the other hand, you’ve got a situation in the regulations, as the Court of Federal Claims pointed out, where there’s a deadline for the submission of proposals, proposals are submitted. And there is no real mechanism for one offeror to modify his proposal or substitute out an important aspect of performance, while the government’s doing the evaluation. If you set up this rule where you have to notify the agency of the unavailability of someone, well, you’ve got a situation there where the agency’s put into a very difficult position because it has to decide, well, are we going to kick this offeror out of the procurement or put it in a situation where it’s highly disadvantaged in the evaluation? Or are we going to reopen the procurement for amendments and modifications by all the offerors and the competitive range and potentially go through multiple rounds of bidding and evaluation? So it’s a difficult decision with no clear good answer under those circumstances.

Tom Temin: Joe Petrillo is a procurement attorney with Smith Pachter McWhorter again, no resolution, but we’ll see what happens. Thanks for joining me.

Joseph Petrillo: Thank you, Tom.

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The U.S. Patent and Trademark Office is taking a huge step to reduce the cyber risks from its employees.

Time and again, cybersecurity research finds the employee is the weakest cyber link. The fiscal 2020 Federal Information Security Management Act (FISMA) report to Congress said two of the top three risk and vulnerability assessments findings were directly related to employees, spear phishing weaknesses and easily, crack-able passwords. The Office of Management and Budget hasn’t released the 2021 FISMA report to Congress, which typically comes out at the end of May.

To that end, USPTO will be among the first agencies to implement a Secure Access Service Edge (SASE) architecture.

Jamie Holcombe, the chief information officer for USPTO, said SASE will accelerate USPTO’s journey to zero trust.

“I think it’s the first foundational piece of the zero trust architecture that we get to actually act upon. So with the executive order, and zero trust architecture, the fact is that it’s not one product, it’s more of a philosophy. I like SASE as that architectural philosophy to ensure that we can identify users and devices, and apply the policy-base security controls, delivering that secure access to the applications and ensuring that our data is secure,” Holcombe said in an interview with Federal News Network. “The fact that SASE addresses the architecture and that philosophy around that scope is providing us the first time that we can really concentrate on that architecture and the ability to actually go into it and use products, not just one product, but products in that philosophy for ensuring SASE and zero trust.”

SASE, which is one of the latest cyber buzzwords, attempts to converge multiple security technologies for web, cloud, data and threat protection into a platform the attempts to protect users, data and applications in the cloud and on-premise.

The move toward a SASE model will help eliminate perimeter-based tools and gives security operators a “single pane of glass” from which to ensure the safety users, data and devices and apply a consistent security policy.

USPTO awarded Netskope contract that could be worth $4 million and last as long as 19 months to implement the SASE architecture.

Holcombe said by implementing the SASE architecture, USPTO will drive security to the edge instead of just the network.

“What we’re talking about is the identification of users, the identification of devices and all the things in between the OSI layers [where computers communicate with each other] to put them all together in a secure way,” he said. “Netskope’s product actually provides the ability for that architecture. But there’s a lot of other things that you need to plug and play in order to be that secure. So that’s what the edge means to me going out and securing not just one part but all the parts in an architecture.”

Risk scores driving decisions

Beau Hutto, the vice president of federal at Netskope, said this approach lets agencies apply what they know about users, devices and other factors like location to create a risk profile and then apply to in a “least privileged” way.

“The user should have a risk score. The actual device should have a risk score. The data has a sensitivity score. So being able to bring a very basic layer all of that together and what access you give to that data because really the crown jewels is the data, it’s no longer the network,” Hutto said. “When you go to protect that data, you have to understand the context in which everything’s being accessed. That is truly where least privilege zero trust architectures come into play in a significant way.”

Through SASE, USPTO is putting the employee and data at the center of the security effort. Holcombe said if they can reduce the ability of the user from clicking a link or give up their network credentials, then the agency’s cyber posture will greatly improve.

“What I like about SASE is the fact that the machine-device control plane is in the realm of the user. I’m just doing a service and I don’t care what server it sits on. But when I create that cyber secure session, what I can do that is ensure that machine-device control plane actually has the right risk profile and it’s a two-way scoring. It’s just as important for the user to be secure as the device is to be secure, and everything in between the application, the data and the network,” he said. “What I’m really trying to do is pull that scope that surface area of the user and bring it down into the technical, such that the user doesn’t have to care and that it’s more of a machine-device control plane. That’s the way we get our security done.”

Hutto added creating that platform or single pane of glass breaks down the silos that have built up over the last few decades around security.

Accelerating the move to the cloud

Through SASE, USPTO, or any agency for that matter, will capture and analyze cyber information in a more standardized, scalable and agile way.

“We’ve had the opportunity to re-imagine how our security stack can look, should it be a security stack in the cloud or as-a-service? Where the first hit that your user makes is to the service and whether they go on-premise or back out to the cloud, it’s just in a very elegant, easy, very performant solution,” Hutto said.

Holcombe said it will take some time before USPTO fully implements a SASE architecture. He said he will start with the applications already in the cloud, about 17% of all applications the agency runs.

“We are staging for about the next 17% to 20%. So we’ll have around 35% to 40% of our applications in the cloud before the end of the year. That’s from almost 3% to 4% two years ago,” he said. “Some of the applications are not there. The ones that are going to be there are in the next 20% to 30%, we’re actually refactoring them with our product design teams. We’re actually including cybersecurity and testing, and doing the continuous integration and continuous deployment in these new applications. But there’s about 30% of our applications that will never go out in the cloud. They are just too old.”

Holcombe said the more USPTO puts applications and workloads in the cloud and use DevSecOps to continually modernize them, the more it can take advantage of SASE.

“One of my design philosophies besides pushing security to the edge is also the fact that I will not deploy something until I know I can rip it out in three years. I want to replace any tool that I put in, because that is the speed in which these tools are being rejuvenated, and there’s better tools in three years,” he said. “If you design something that lasts anywhere from 5 to 10 years, you’re wrong. Design it to do what you needed to do in three years, and then look to other things to replace it. The return on investment needs to be within three years or don’t do it.”

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The House Armed Services committee spent time last week marking up the defense authorization bill for 2023. As always, the NDAA has a lot to say about procurement and contractors. But it doesn’t say anything about whether they’re compensated for inflation. Joining the Federal Drive with Tom Temin with what the services contractor community is watching closely, Professional Services Council president David Berteau.

Interview transcript:

Tom Temin: David, do you listened in on this, and what do you see going on here with respect to contractors?

David Berteau: Yeah, Tom, there was a welcome change, you know, the entire House Armed Services Committee markup was done live on the web starting at 10 a.m. Last Thursday and lasting until midnight or later, I didn’t stay up all the way to the end, I confess, but we got to see hundreds of amendments disposed of the final bill, we’re waiting to see the actual language of the final bill. But it did add, you know, $37 billion to the DoD (Department of Defense) request. This is a little bit short of what the Senate added, they added 45 billion, but we haven’t seen the Senate’s language yet, either. They just put out a little bit of a press release that touted a couple of items. The big issue for companies, though, is how does this help them address the inflation that they’re experiencing today, particularly workforce inflation, the extra cost of workers, not only to recruit them, but to retain them?

Tom Temin: Right. And so contracts that might be ongoing, that have certain labor and rates built into them. You’d be stuck if those rates continue, but the labor costs are going up?

David Berteau: Right? Well, look, we’re living in fiscal year 22. Right now. Right? So the legislation is for FY 23, which doesn’t start until Oct. 1. And as we expect, won’t actually start until sometime well after that, because we’ll be under a continuing resolution for a while. This year’s budget FY 22, assumed an inflation rate of about 2.2%. It’s actually as we know, 8.6% or higher in many cases for government employees and government contractors. Well, that’s a difference of, you know, $50 billion right there across the board for the Defense Department. None of that is addressed in the NDAA. There’s a 4% assumption of inflation for FY 23, which is, again, is about $30 billion short, if you assume that today’s inflation goes on forward. They attempted to address that, but only in a couple of areas.

Tom Temin: All right. And what about procurement? I mean, so you’ll go broke trying to fulfill contracts on fixed prices that we can pretty much assume but often the NDAA has procurement provisions. What do you see shaping up here this time?

David Berteau: It does in some of the procurement provisions. Of course, you know, we watch these very closely. A number of amendments were proposed that could add some value to this. A couple more proposed that would not. One that we were particularly pleased to see go down to defeat was a proposal to interfere with the e-commerce pilot project. You may remember a few years ago, the FY 18 National Defense Authorization Act created an e-commerce portal pilot project under the General Services Administration. And ultimately, GSA awarded contracts to three companies. And it’s a three year pilot. This is a real pilot, unlike some pilots, which are just designed to take care of an issue and put it on the shelf after the pilot is done. It’s a real pilot to see if we can have the government buy off the internet the same way you and I do every day. Well, not every day. But every day we buy, we buy something there, right? And this is now two years into it. This amendment would have kicked one of the current contractors off the contract. This is a major precedent, it would set up the Congress interfering legislatively in an ongoing contract by essentially forcing a termination for convenience by the government without any rationale or cause other than the fact that Congress decided it was time to do that.

Tom Temin: Which one did they want to get rid of?

David Berteau: They didn’t specify the name of the company. What the amendment did is it said, no company can be on this contract if their market cap, their actual stock value times the number of shares outstanding, is more than $600 billion. Well, there’s only one company of the three on the contract that meets that test, right? The three companies on this contract were Fisher Scientific, Home Depot and Amazon. And you can do the arithmetic in your head as to which one meets that test. So the amendment did not specify by name. But it’s not so much the company involved as it is the precedent that this would set if Congress interfering in an existing contract. The whole federal procurement system depends upon the integrity of the process. And the ability of contracting officers to exercise their want in the interest of the federal government and particularly something that’s already two years in of a three year contract made no sense whatsoever. So we were really pleased to see this go down to defeat in a roll call vote in the committee markup.

Tom Temin: Interesting somebody had it in for that company, I guess.

David Berteau: Well, it’s not the first time this has been proposed. It’s been brought up as amendments on the floor. It’s been brought up as separate bills, etc. So we continue to watch this sort of thing. And again, it’s not about the individual contractor company, it’s about the precedent that it sets for the government.

Tom Temin: We’re speaking with David Berteau. He’s president and CEO of the Professional Services Council. Well, that aside, then it gets us back to inflation as biggest concern going into next year and the dollars available. What do you think can be done to address this issue?

David Berteau: Well, this is not something really Congress can address, although there is the potential of a supplemental for FY 22 for inflation. But all the Congress can do is actually put money in specific line items and the NDAA did that put about $3 billion, $3.5 billion for fuel inflation, we all know about fuel inflation every time we put gas in our vehicles, right. And, military construction projects’ inflation, but this doesn’t address the contractors’ cost, particularly cost of workforce. What could be done, and what you’re seeing being done, is some agencies are opening the aperture for a request for an equitable adjustment, subject to the available funding, right. So no more money needed, just what funding is out there today. Other agencies are making it very hard for companies to submit such requests, what we probably need is a government wide set of guidance that says, if you’ve got the money, open up the door, let the contractor submit their requests, and adjudicate them positively so that the companies can stay in business. This is particularly true for small and mid-sized businesses that don’t have the resources necessary to ride this out for how long? How long will inflation keep going? I don’t know, do you?

Tom Temin: I wish I did, I would bet on it. But the issue of contractor labor costs, do contractors sometimes have the capability or the flexibility or the rights under the contract to reduce staffing for a given contract so that the costs remain stable. But there might be fewer people?

David Berteau: You’ve hit on something really key there, because ultimately, you can’t perform above the funding that’s there. And if your costs increase, and then somewhere along the way, you just have to fail to meet the requirements. That’s not in the company’s interest. That’s not in the government’s interest. That’s not in America’s interest. And so making adjustments to be able to cover those costs will be particularly useful here. I think, though, that there’s also the possibility that you could see some encouragement coming out of the Congress on this. But we haven’t seen any language along those lines, yet. There was one other bill, one other amendment put into place that could have major implications there. And that has to do with O&M, operation and maintenance accounts and readiness.

Tom Temin: And what do you see in the bill with respect to those accounts?

David Berteau: So it requires DoD to submit to Congress starting next year’s budget, right? Information about the operation and maintenance funding. And this is a particular line of funding that is one year money, that they need to keep weapons systems ready going forward. It’s kind of surprising that DoD doesn’t do this already. But I found when I was in the Pentagon as the assistant secretary for logistics, that it was very difficult to get those kinds of estimates going forward. So you know what you have for one year, but you don’t know whether you have the money in the out years for that as well. So this would be a huge step in the right direction. One of the lessons from Ukraine is how hard it is to support your forces once a war is underway. And it’s important for the U.S. to make sure we’ve got the funding necessary to do that going forward.

Tom Temin: When they say operations and maintenance, they don’t just mean facilities, they mean also operations, as in warfare operations?

David Berteau: It is, this is flying hours, this is steaming hours for ships, this is tank miles. This is both for practice and for supporting forces in operations.

Tom Temin: So it has to do with continuity, basically?

David Berteau: It has to do with continuity, it has to do with demonstrating to any potential adversary that we’re perfectly capable of supporting our forces in a combat environment, unlike some in Ukraine today.

Tom Temin: And just a final question, what are your members saying about the issue of retaining employees now, because you hear a lot of companies, different industries, where people say, well, unless I get what I want, with respect to telework, and this and that I’m out of here. And there’s this sort of employees in the driver’s seat situation we have now in a lot of industries.

David Berteau: It’s probably the number one issue that our member companies are facing, Tom, you know, we’ve got 11.5 million job vacancies in America today and only 6 million people looking for. That says it’s a seller’s market, right. And that’s true even in the federal government and for contractors where we’ve got way more job openings than we have individuals. And they kind of get to name their own tune right now. Right? You drive by offices, you go to federal offices, you don’t see a lot of people going into the offices yet, in many cases. And so it’s a real tough challenge in three ways. Number one, it’s hard to recruit. Number two, when you lose somebody, then all the others are saying, wow, he just got a big raise by going to work for another company, not a contractor. What are you going to give me so that I don’t go do the same thing? And then it’s a question of training and investing in that workforce for the future as well. It’s a triple challenge across the board. We really need addressing of this by both the executive branch and the Congress.

Tom Temin: David Berteau is President and CEO of the Professional Services Council. As always, thanks so much.

David Berteau: Thank you, Tom. Look forward to continuing this conversation down the road.

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Just when you thought government contracting was about to get fun, again, the General Services Administration decided boring is the right approach.

That’s right, I’m saying government procurement and fun in the same sentence because we had an upcoming contract that had so many possibilities intertwined with it. GSA has been planning the follow-on to its highly popular and successful OASIS contract for the past year. It started by calling the vehicle BIC MAC—best-in-class multiple award contract. Oh the possibilities there!

The agency moved to Services MAC for the last few months. And with both of those names, unlike its more traditional and unexciting names like Alliant or Millennial or 8(a) STARS, these names had so much potential for fun in headlines and leads and so much more.

But GSA decided — and I’ll blame the lawyers here, only because it’s always fun to blame lawyers — to pick the name OASIS+, or maybe Oasis-Plus, for the new governmentwide contract, ending any real chance of bringing fun back to federal procurement.

“The name echoes a successful brand that our customers have come to know and trust, reflects the expanded scope of services that will be available through the new program, and embodies the contract’s flexible domain-based structure,” wrote Tiffany Hixson, the assistant commissioner in GSA’s Office of Professional Services and Human Capital Categories in the Federal Acquisition Service, in a blog post from June 15. “The new program will have a broad scope. As their respective ordering periods conclude, the new program will be able to fulfill requirements currently met by GSA’s One Acquisition Solution for Integrated Services (OASIS); Human Capital and Training Solutions (HCaTS); and Building, Maintenance, and Operations (BMO) contracts. In addition, new scope areas include environmental, intelligence services, and large enterprise solutions. Plus, we’ll build-in the flexibility to expand scope as customers identify new federal services needs.”

All kidding aside to the good folks at GSA, the decision around OASIS+/Oasis-Plus is seems small, but important. It’s clear there is recognition in FAS that the current contract is popular, in part because GSA has spent the better part of a decade promoting, creating a brand and working with everyone from the Air Force to the Homeland Security Department to the Army to commit to putting hundreds of millions of dollars through OASIS.

Since 2015, agencies have spent $48.8 billion on OASIS, OASIS small business and OASIS 8(a) through more than 3,200 task orders.

The Air Force remains the largest user, issuing more than 1,000 task orders worth more than $28 billion. The Army is the largest user by total sales with more than $30 billion across 458 task orders.

The updated vision for OASIS+ also recognizes the struggles of the HCATS contract.

GSA awarded HCATS to 109 vendors in May 2016. The 10 1/2 year contract has a ceiling of $11.5 billion and replaced the Training and Management Assistance (TMA) contract run by the Office of Personnel Management for the last two decades. After a series of bid protests, GSA finally issued the notice to proceed for HCATS in September 2016. Over the last almost six years, agencies have not used the contract like may believed they would, awarding 300 task orders worth $764 million.

Six contracts with five for small business

Sheri Meadema, the acting assistant commissioner of GSA’s Office of Professional Services and Human Capital Categories in the Federal Acquisition Service, said during the Coalition for Government Procurement spring conference that the changes to OASIS-Plus also acknowledges what GSA’s customers have said about the draft details of the new contract over the last few months.

“We had originally envisioned one contract with small business reserves, and working closely with the Small Business Administration and our Office of Small and Disadvantage Utilization Office and our customers, quite frankly, we ended up switching that strategy. So the plan is to now award six separate contracts, five of those being for small businesses and the six being unrestricted,” she said. “The second change is scope. Oasis will cover all of the scope areas in Oasis currently today, plus HCATS and building maintenance and operations as those contracts expire. In addition, in the initial stages of the contract, there are additional scope areas that we’re adding on to include environmental intelligence services and a domain we’re calling enterprise solutions, which will be unique to the unrestricted vehicle. That domain is for very large, complex, high-dollar value, non-commercial type work.”

The domains is another change for OASIS+. GSA will add or remove domains based on customer needs and usage throughout the life of the contract.

That gives us a lot more flexibility as things change and customers’ needs change to introduce new scope areas,” Meadema said. “We are trying to keep the solicitation open continuously after we initially close it to deal with solicitation protests. This is all about our ability to onboard industry partners at any time during the contracts life.”

The onramp for OASIS was far from a smooth process, beset by protests and delays.

Meadema said the new contract will make it easier for companies who grow out of the small business size standard to apply to get on the OASIS+ unrestricted version.

“The evaluation criteria will drive the highly qualified pool of vendors that we’re trying to attract. We’re not recreating the Multiple Award Schedules. We are setting the bar relatively high,” she said. “That being said, we are giving careful consideration to how high we set the bar for unrestricted. So again, we can allow companies who re-represent their size to move on to another vehicle.”

Price not a key evaluation factor

As part of the evaluation factors, GSA will be applying the authority it received under Section 876 of the 2018 Defense Authorization bill, where price is most important at the task order level, not at the main contract level.

GSA stated in recent answers to industry questions that OASIS-Plus will not have a total dollar ceiling attached to it, joining Polaris as the only other contract do deviate from the Federal Acquisition Regulations in the last nine years.

Meadema said GSA expects to release some new or updated draft sections of OASIS-Plus for industry comment over the summer and then release the full draft request for proposals in early fiscal 2023. GSA expects to issue the final solicitation in the second quarter of 2023.

The new name, scope and domain changes are important steps for GSA in this journey, but they still don’t necessarily answer all the questions about how OASIS+/OASIS-Plus isn’t just creating a new type of schedule contract. The Coalition has expressed concern over the last year about possible duplication with the schedules, cross-walking what OASIS+ will include and what the schedules already provide.

The next key stop in this journey is when GSA releases the draft RFP for industry comments to see how it differentiates from the schedules and whether it alleviates any concerns in industry about duplication. Most would agree that last thing industry or government needs is another contract that doesn’t add value and meet agency needs.

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Despite a lot of uncertainty in the broader economy, contractors have at least a somewhat optimistic view about the federal market. That’s thanks, in part, to a big influx of federal spending initiatives since the start of the pandemic. But vendors still see big challenges on the horizon, including increased competition and new demands to comply with federal regulatory requirements. Those are some of the findings from Deltek’s annual “Clarity” study, which surveys hundreds of government contracting leaders each year. Dan Firrincili is Senior Product Marketing Manager at Deltek. He joined the Federal Drive to talk more about the findings.

Interview transcript:

Jared Serbu: Dan, let’s start at the very high level view of what this year’s study actually tells us about how companies are feeling. Let’s start with your confidence index. What does that tell us about how companies are feeling about the market and compared to past years and some of the reasons behind that?

Dan Firrincili: Yeah, so this year’s confidence index, I’ll unpack a little bit of the methodology behind how we how we arrive at the that index score for you. But the index, essentially, it measures the overall confidence that contractors have that they can grow their public sector sales over the next 12 months. So for those out there who haven’t seen our index, it’s measured on a scale of zero to 200. And obviously, zero is indicating kind of the lowest confidence level. 100 reflects kind of neutral confidence, and then 200 would indicate the highest level of confidence. So for this year, our confidence index score is 141.7. And so that does represent a 1.1 percentage point increase compared to last year’s score. So last year, we were at 140.1. But it’s important to note a couple of things, this year’s score is actually not the confidence score is not as high as it had been in the pre-pandemic years. So just as a, for example, in 2019, the score we got was 143. So I think our read on this is that score for for for this year, reflects that contractors are kind of feeling cautiously optimistic, in the face of, you know, what, what’s a worldwide pandemic, a potential U.S. recession. And then, you know, with the ongoing conflicts overseas, and some of the some of the challenges attached to that. So there’s, I would say, there’s still a fair amount of optimism heading into the year but not quite, not quite as high as in previous years.

Jared Serbu: And let’s talk a bit about challenges what came across in this year’s survey as some of the biggest ones that companies are facing this year?

Dan Firrincili: Yeah. So in terms of the top challenges, I think it’s important just to say, I mean, the government contracting industry, and this is reflected in the, in some of the metrics in the report, has shown some pretty considerable resiliency, through the past two years you have, there’s new government initiatives, there’s legislation, there’s funding sources that are providing a pretty healthy business opportunity, despite overall turbulent economic conditions. So I’d say, you know, our survey always does look back in some ways it does, it looks back into performance for 2021, it also looks ahead to the rest of 2022. A lot of businesses told us that they outperform their financial expectations, and that they did better than they expected. So for as a for example, there, what was reported back to us was a 15%, median profit, profit margin, excuse me, and that’s across all contractors, which was actually the highest in 10 years. So there was there’s certainly a lot of positive things coming out of the report. But there’s definitely as you look through the results, some pretty key themes that are emerging, and I’ll just, I just want to mention three of those here right at the top, one of them being increased competition. So for example, one in three, respondents told us that they’re perceiving increased competition as a critical challenge in 2021. We’re also seeing labor and talent challenges that are, you know, talent shortages, the great resignation. These seem to be impacting nearly every department. And so when we go out, we survey a number of different personas, business development leads and project and risk management leaders, financial leaders, for a number of others, human capital leaders, IT leaders. And pretty much across the board, we’re hearing that those labor and talent challenges are showing up as major impacts. And then the final theme is just just like, complicating factors things like supply chain challenges, managing the distributed workforce and then, you know, new compliance requirements that have emerged are kind of becoming ingrained as kind of realities to doing business in 2022.

Jared Serbu: On that distributed workforce point, I found that a little bit interesting, even taking your point that some of this is a little bit backward looking. But it was interesting to me that companies, even a couple of years into the pandemic, are still kind of struggling to get their arms around how to manage the new realities of this workforce. Can you expand a little bit on what they told you the specific challenges they’re facing workforce wise are?

Dan Firrincili: Yeah, so I think on the talent side, what we’re seeing is those talent shortages popping up. Well, what does that mean? And what are they going to do about that? I think what the survey told us is that a lot of contractors are looking to update their hiring and their retention practices. On the IT side, for example, as a for example, we heard talent gaps are kind of a top challenge for coming into the year. You know, again, we’re seeing that across the board, but I think that it’s what we’re seeing is that contractors need to and are starting to get creative. I think this is good news about, you know, how they backfill, how they account for some of the departures that are happening. And so, you know, it’s pretty clear that companies are, they’re willing to invest in finding and acquiring top talent, but they’re trying to be selective about how they do so and how they deploy those funds to do so. So, as a, for example, human capital specialists indicated that one of the things they’re looking to do is actually increase incentives among their existing employee base. So just going tapping their existing employee base for referrals. 49% of those we surveyed told us that that’s a top initiative for them. There’s a lot of companies, 47% told us that they’re hiring new leadership, another 45% told us that they’re looking to hire more recruiters. And really fewer are outsourcing that recruitment, that number was down at like 33%, which is probably if you think about it a more costly way of going about doing it. In fact, the largest companies, it was really half of the largest companies told us that they’re more inclined to actually outsource that recruitment. So there’s, there’s definitely a lot, a lot going on in that area around, you know, kind of around hiring and around retention that a contractor should take note of.

Jared Serbu: Yeah. And one of the other things that came across in the report is finding new IT talent, specifically, as you kind of, as you mentioned briefly a second ago, is one of the biggest challenges in the IT space there, which I think is directly connected to another section of the report that talks about regulatory requirements, some of that challenge, and that demand to hire good IT folks is driven directly by requirements like CMMC, right?

Dan Firrincili: Yeah, absolutely. For sure. One of the things that we have in this year’s report is, you know, and the question there is like, well, you know, what do businesses need to do to implement those CMMC requirements, and to properly address all the new, all the new regulations. We actually heard in this year’s report, the majority of companies, it’s 59%, acknowledging that CMMC requirements do apply to their business, which is, which is good to hear, because it’s, it’s coming and contractors need to be prepared for that. And so 83% told us that they’re planning to achieve level two, or level three certification, which in the long run will be to their benefit, because it’s going to allow them to compete for more.

Jared Serbu: And we certainly won’t do justice to the full study here. But one other area I wanted to get into before we closed is how companies are responding to things like contract consolidation, which has obviously been a long, ongoing trend in the federal government. Seems to be a pretty big theme in this year’s report in terms of the challenges that companies are seeing, how are they responding to that challenge?

Dan Firrincili: Yeah, I agree. Absolutely consolidation to be kind of an imminent reality, both for last year, for this year, for the rest of the year, particularly as it pertains to those government wide contracts that are managed by the, managed by GSA. We actually did ask, specifically, around contract consolidation. We asked for firms to identify, you know, given all the consolidation that’s out there, what are your top, you know, kind of capture priorities, and we have some pretty interesting results around that. The most popular response there was actually focusing on strategic teaming initiatives, which applied to nearly 75% of the survey population told us that they’re going to be focusing there with another 50% telling us that they’re going to be investing even more in business development. What was notable there is that small and medium size companies were really driving the tendency to lean even more heavily on teaming, whereas the larger size companies told us that what they’re going to have more faith in is just making kind of broader investments overall to business development. So the contract consolidation is something that we’re going to continue to be, continuing to be tracking here.

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The impact of the Defense Innovation Unit shouldn’t be measured in the number of agreements awarded or the amount of dollars obligated. Both, by the way, are breaking new records each year.

Rather, the impact of DIU should be measured in number of problems it helps solve for the Defense Department.

Mike Madsen, the deputy director of Defense Innovation Unit, said one of the best examples came during the early days of the COVID-19 pandemic. DIU was overseeing the development of a new application called the rapid the assessment of the threat environment (RATE).

“It was a prototype used to predict when men and women in uniform are going to come down with an infectious disease like flu. This was pre-pandemic,” Madsen said on Ask the CIO. “Those kinds of things that would impact readiness and can spread potentially through your organization. Well, we were almost complete with that prototype when the COVID pandemic started. Instead of going back through a requirements process, we just pivoted, and applied it to COVID environment and ran the prototype of RATE in the COVID environment.”

Madsen said about 10,000 service members participated and the app collected data from devices like wearable watches and other on-person devices.

The application detects biometric measurements of various the service members and feeds the information into a database where it applies artificial intelligence to predict when folks would get sick.

“We were able to perfect it to the point where we were able to identify folks who are going to get sick with COVID 48 hours before testing or symptoms indicated that they actually had COVID,” Madsen said. “From a unit perspective, if I’m a commander, now I have awareness of someone who is potentially going to bring that into the larger unit and we can pull them out, isolate them before they’re even infectious. From our DIU operations perspective, [the pandemic] was relatively seamless, but there were opportunities to help leverage commercial technology to solve Defense Department problems.”

Record year in 2021

Solving those problems for warfighters is DIU’s ultimate goal, and that by which is the organization constantly is proving its value.

Madsen said this is why DIU is always looking for the companies that are on the leading edge and doing innovative work that could help some solve some of DoD’s biggest challenges.

Since 2016, when DoD launched the innovation office, it has awarded 279 contracts and brought in 240 non-traditional vendors, based on the definition in the law.

In 2021, DIU published 26 solicitations for commercial solutions for which it received 1,100 proposals. The solicitations on average received 43 proposals each.

DIU says 86% of companies that have received awards are considered nontraditional vendors with 73% being small businesses and 33% being first-time DoD vendors.

Madsen said 2022 also is looking strong. As of March, DIU has awarded $1.5 billion in total contract value. Between 2016 and 2021, DIU obligated $893 million.

“What that tells me is that we have proven our value to our DoD partners as a way to rapidly bring in that commercial technology to bear on DoD problems and provided our return on investment to them,” he said. “It also tells me that not only have we proven value to our DoD partners, but we’re proving value to our commercial partners as well as a way to simplify that process of working with the department. So we’re pretty excited about that.”

Madsen said DIU is seeking to continue to improve its process and prove its value. He said currently it takes about 100 days to award a prototype, but DIU would like to get that timeline down to as little as 60 days.

“We increase the transparency with a commercial partner. We increase competition for our DoD partners, lower the time the vendor has to obligate to the solicitation,” he said. “We’re able to get more solicitations in, which is great because we can cast a pretty wide net. We’re able to use our commercial engagement team to go out into the ecosystem and really understand where is that that large magnitude of commercial investment taking place in the technology ecosystem, who are the companies that are really on the leading edge and doing really some of the fantastic innovation and development in that areas that we think are going to help some solve some of DoD problems.”

Expanding DIU’s reach

DIU is expanding its reach with offices in Silicon Valley, in Mountain View, California, in Austin, Texas, Boston, Washington, D.C. and the newest regional office in Chicago.

The reason for the six regional offices is two-fold. First, DIU wants to search out companies that are outside the typical technology corridors. Second is to promote more competition.

“We also accelerate cooperation. In this era of the broader strategic competition, demands collective cooperation so we are shifting to a regional focus to align government innovation entities within those geographic regions to make sure we’re getting the best technology from across the country, not just the technology hubs,” Madsen said. “We want to find the best technology that the U.S. has to offer. We also want to demystify the complex procurement process. If we can get all the government innovation folks together and rowing in the same direction, and engaging with our commercial partners, in one voice that it’s going to help us demystify that.”

Over the last few years, DIU has moved several projects that are showing promising results in the prototype phase.

Madsen highlighted the development of a 5G tactical network for the California Air National Guard.

“We’re able to rapidly set up a secure 5G mesh network for humanitarian assistance, disaster relief and first responders. If you think about forest fires, now we’re able to set up a very rapidly a 5G network for cellular coverage for those folks that is discreet and secure for them to continue executing their activities,” he said. “We’re using AI for predictive maintenance. The commercial sector saw this a long time ago, not just the airline industry, but other industries that use very, very expensive machines with a lot of moving parts and failure of any of those parts would result in a catastrophic outcome. What we’ve been able to do is apply predictive maintenance using AI to multiple platforms across the Air Force. We’ve seen an increase in machine capable rates and a decrease in unscheduled maintenance time. We are looking to continue scaling that one across all the platforms.”

A third example is around drones and making sure they are both built securely from a cyber perspective and by American-owned companies.

“We’ve had several prototypes with the Army that resulted in CyberSecure drones,” he said. “We were able to field those in less than 48 hours in response to the humanitarian refugee situation in Germany when the US pulled out of Afghanistan.”

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When the government establishes a mandated source of supply, that means there’s no way around it. That’s what the Defense Logistics Agency found when it issued a solicitation for body armor parts. Smith Pachter McWhorter procurement attorney Joseph Petrillo shared more about the case on the Federal Drive with Tom Temin.

Interview transcript:

Joseph Petrillo: This case arises from a Defense Logistics Agency solicitation for a competitive procurement for something called Advanced Tactical Assault Panels or ATAPS and they’re apparently multipurpose vests worn by soldiers, which they can keep their equipment and protective plates or ballistics purposes. The Defense Logistics Agency issued the solicitation, but the bests in question these ATAPS were covered by a program set up many years ago in the 1930s by the Javits-Wagner-O’Day Act, it’s now called the AbilityOne program, the purpose is to promote employment among the blind and severely handicapped, and the severely handicapped portion of the program is administered by a nonprofit agency called Source America. And what happens under the program is that a nonprofit agency that employs severely handicapped people can become a mandatory source for items or services required by the federal government. And in this case, ATAPS was on that list of things that are covered. And the mandatory source was a company called SEKRI.

Tom Temin: And it turns out SEKRI felt that it didn’t need to bid on this because it is the sole mandated source.

Joseph Petrillo: Right. So why was DLA issuing a competitive solicitation? When SEKRI heard out about that it went to Source America. Source America went to DLA and said, Well, wait a minute, this is on our list. There’s a mandated source. And DLA went ahead and said no, we’re going to go for it with a competitive solicitation sector, you can submit a bid if you want to. But DLA did not seek an exception from Source America from the mandatory source program, which it could do, but it I guess, either didn’t qualify or didn’t bother. So in this instance, the procurement proceeded, offers were submitted. And at that point, SEKRI filed a protest with the Court of Federal Claims. Now, the court looked at the requirements for filing a protest. And the trial court at the Court of Federal Claims held that it had not met two of them. First of all, it was not an actual or prospective bidder. It didn’t submit a proposal, and that’s one of the requirements. Secondly, it had not objected to the solicitation before the close of the bidding process.

Tom Temin: The standard timeliness type of issue.

Joseph Petrillo: Exactly. And GAO, that’s covered by a rule and the Court of Federal Claims. It’s an appellate decision that set that up called the Blue and Gold rule. And in this case, the Court of Federal Claims said no, you you’re not going to be able to submit a protest here. But secondly, didn’t stop at that answer. It appealed to the U.S. Court of Appeals for the Federal Circuit, which then reversed the lower court. SEKRI was found out to be a prospective bidder. The failure to submit a bid or file a protest during the bidding period, didn’t bar its later protest to the Court of Federal Claims, because it was a mandatory source that gave it a special position. The Federal Circuit reason that Congress had set up this program specifically to avoid entities like SEKRI from having to participate in the competitive bidding process. It’s the other way round, the law imposes the obligation on federal agencies to acquire listed items from their mandatory sources unless they get an exception.

Tom Temin: We’re speaking with Joseph Petrillo. He’s a procurement attorney with Smith Pachter McWhorter. So then the solicitation was pretty much cancelled out and DLA would have to go through SEKRI. By the way, SEKRI stands for Southeastern Kentucky Rehabilitation Industries, Inc. And so they get bid period?

Joseph Petrillo: Well, not quite yet. I mean, the issue here was whether SEKRI can bring a protest and the protest was dismissed before it was really heard. And as they mentioned, the Federal Circuit decided on the question of being as prospective bidder. It didn’t make sense to require sources under the Source America program to monitor all solicitations and file protests with the agency. The other issue on appeal was whether it needed to object to the solicitation before award. And the Federal Circuit thought in this case that it was sufficient that SEKRI went to Source America which went to DLA and said, hey, you’re getting this mandatory source item in the wrong way. The court also stated that it hadn’t previously extended this rule this Blue and Gold Rule to the AbilityOne program, so it leaves open the possibility that the rule doesn’t apply here at all. But now since the appeal was granted, the case goes back to the Court of Federal Claims which now must adjudicate the bid protest. It will determine whether or not SEKRI should have received to this contract instead of having it go through the competitive bidding process.

Tom Temin: Right. So we don’t know the final disposition of this.

Joseph Petrillo: No, we don’t. But the lesson here for federal agencies is that if you’re ignoring a mandatory source of supply, you’ve got to be diligent about following the rules getting an exception or you’re leaving yourself open for a protest even after bids and proposals are due.

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Clarification: Several smart readers pointed out that GSA’s OASIS multiple award contract was actually the first governmentwide contract not to have a total dollar ceiling. GSA issued a FAR deviation for that vehicle in 2013. 

For most of the past 18 months, the federal contracting community has expected the Polaris small business governmentwide acquisition contract to have a ceiling of $50 billion. It’s unclear whether it was an estimate from a market research firm like Deltek or Bloomberg Government, or just a rumor that took off on its own, but for much of the past year, every story and every discussion about Polaris by multiple media organizations highlighted this $50 billion number.

Then a few weeks ago, the General Services Administration suddenly asked for a correction on a story about Polaris that says it has this $50 billion ceiling. The request was a bit surprising given the 18 months of stories and discussion, and never a request for a correction previously.

Well like any good journalist, I put on my investigative hat and found out why.

GSA quietly issued a class deviation to the Federal Acquisition Regulations in March removing the requirement for Polaris to have a minimum or maximum quantity under the indefinite delivery, indefinite quantity (IDIQ) type contract. By the way, and to be clear, FAR deviations are rarely big news items that deserve big fanfare and press releases. But you’d think that with Polaris being in the news and garnering attention like it has, GSA may have wanted to alert folks of the significant change.

A GSA official said in an email to Federal News Network that while they issued the deviation in March, it was planning for some time to remove the ceiling requirement.

“GSA incorporated a number of good-for-government key features in the Polaris GWAC program. An important one that we’ve seen misrepresented in the media is the mention of a contract ceiling on Polaris,” said the official, who requested anonymity in order to talk about an active procurement. “In fact, designed to ensure ongoing availability for customers and maximum opportunity for vendors, Polaris will not have a contract ceiling at the master contract level.”

This is the first time  in nearly a decade that GSA, or any agency for that matter, created a multiple award, IDIQ type contract that didn’t have a ceiling.

Sonny Hashmi, the commissioner of the Federal Acquisition Service, said GSA is using the authorities Congress granted them under Section 876 of the 2018 National Defense Authorization Act where costs only matter at each individual task order level and not at the master contract level.

“The two or three things that historically have defined how we’ve done large, multi agency or governmentwide vehicles, there’s always been a ceiling, on-ramps have been very few and far between and typically we’ve always had price negotiation at the master contract level. All three of those things are done for the right reason and they follow well-trodden paths and the Federal Acquisition Regulation. But all those three things, many times come together to cause unnecessary friction and heartburn for the industry,” Hashmi said in an interview with Federal News Network. “For our customers, ceilings are great when you can have perfect predictability, what the future is going to look like. We’re living in a world where we can’t predict what the future looks like. Digital is going to be a more central part of how the government operates. Organizations at state local tribal level are going to be going through digital modernizations and that is going to continue to accelerate. So we don’t know what the number looks like. So why come up with an artificial boundary that requires people to do artificial work at some point in the arbitrary future?”

Hashmi said GSA wants Polaris, and really all its acquisition vehicles, to solve problems.

“If it’s highly adopted, that’s a great thing because it means that it’s solving real business problems for people,” he said.

Jeff Koses, GSA’s senior procurement executive, signed the deviation because the Federal Acquisition Streamlining Act (FASA), now codified at 41 USC § 4103, says a solicitation for a task or delivery order contract “shall include [among other things] the maximum quantity or dollar value of the services or property to be procured under the contract.”

In the memo, Koses wrote that the authority to issue the FAR deviation is based on the IT Category’s plan to “on-ramp” new contractors to the Polaris program at least every three years.

“Such on-ramping opportunities do not need to cover all pools, but ITC is encouraged to consider an annual on-ramp, opening a different pool each year,” the memo stated.

Top-line ceilings going away

Polaris isn’t the only contract GSA is planning not to have a ceiling for.

In its response to industry questions about the Services MAC, GSA says it will issue a FAR deviation to remove the minimum and maximum requirements.

Hashmi added that these two will not be the last ones where GSA will seek the FAR deviation.

While he didn’t specifically call it out, it’s easy to see the Ascend cloud blanket purchase agreement fall into the similar category as Polaris and the Services MAC.

Federal procurement experts were surprised about the FAR deviation for Polaris or for any of the other vehicles.

As one federal procurement attorney said, “In light of this [FASA and USC code language], I don’t see how GSA can waive the maximum quantity/dollar value requirement.”

Another said, the Office of Federal Procurement Policy (OFPP) may want to consider asking GSA for a business case as a contract with no ceiling may harm small businesses by reducing other means for competition. The expert added that the agency also is taking on increased risk of protest by unsuccessful bidders.

The other reason for removing the ceiling of Polaris likely is related to the challenges GSA faced with the 8(a) Stars II program. In May 2020, GSA announced the popular contract would reach its $15 billion ceiling 16 months before the end of the contract. GSA had to increase the ceiling size by $7 billion but had to limit the period of performance for contracts as a result.

Polaris update

By not having a ceiling with Polaris, GSA can avoid this potential problem over the life of the contract.

And speaking of Polaris, Hashmi offered a bit of an update. GSA just started reviewing industry feedback on its suggested updates to the evaluation criteria that came out in May.

“You can’t solve for every single use case, so we’re going to try to find the best approach that creates opportunity for the most small businesses that we can,” Hashmi said. “There’s going to be a trade-off that we need to find and that’s just reality. Depending on the feedback that we get, and then to what extent we need to completely change strategy will determine the timeline. I’m hoping that the adjustment that we’ve made or proposed in our updated criteria is it meets the expectations of industry. If that’s the case then we should be able to release the RFP for official response by the end of June timeframe but although don’t hold me to that because all of that depends on the feedback that we get and what adjustments we have to make.”

There are a lot of eyes on Polaris already so it’s understandable why GSA didn’t play up the FAR deviation for Polaris, but at the same time finding out “by accident” because of a request for a correction also makes one wonder whether GSA was trying to downplay another way Polaris is breaking many of the old rules for GWACs.

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The General Services Administration is still in the process of consolidating its Schedules program into a single procurement vehicle. And although it’s undoubtedly one of the biggest changes in the program’s history, there’s a lot else going on with the Schedules that vendors need to be paying attention to. To talk more about it, we’re joined by Larry Allen, president of Allen Federal Business Partners.

Interview transcript:

Jared Serbu: All right, Larry, and as you point out in the newsletter, there’s a lot going on with schedules right now beyond consolidation. Let’s go through the three things that you mentioned. One is the schedules roadmap that they have now published. Talk us through what that is, and why you think it’s helpful.

Larry Allen: Jared, I think that the roadmap in and of itself is important. But I also think it’s indicative of the larger efforts that GSA is making, to try to make it easier for first time companies to get on the schedule. The roadmap is basically what it says it is. It’s like a non-digital GPS, if we can go back and use reverse technology. It lets companies know what’s going to be required of them so they have an idea of what they need to do when they’re putting an offer together for GSA. And then it tells them what’s going to happen in basic steps. Once they submit their offer, you know how they’re going to negotiate the fact that GSA will negotiate. I think that the roadmap is a useful piece of information for companies to have, it goes some way towards demystifying the schedules process. And that’s really been a priority for GSA’s current leadership.

Jared Serbu: And how does that fold in with the consolidation itself? Does it do a reasonable job of letting folks know how the consolidation has changed the process to the extent it has, maybe it hasn’t changed the entrance process all that much?

Larry Allen: Consolidations changed the entrance process in that the company responds to one unified solicitation. I think the roadmap comes in handy. Because even though you might have a company that’s a first time applicant for the schedules, Jared, people, the actual people probably have worked or may have worked on a scheduled contract before or may have heard about a scheduled contract number like the IT-70 schedule. And of course, that’s all been done away with via consolidation. The roadmap kind of makes that clear, doesn’t come right out and say, hey, we did away with everything. But what it does say is, this is what you have to go do. And this is where you have to go in order to get started on your journey.

Jared Serbu: And the other thing you mentioned that they’re doing is expanding the Startup Springboard option. What is that and why is it helpful?

Larry Allen: Jared, Startup Springboard is a program that allows companies with fewer than two years and in some cases, they had required three years of experience depending on the contract you’re applying for. And even though they have a lot of experience, because their companies had been in business for, say 18 months, they couldn’t apply for a schedule contract. Well, now they can Startup Springboard was started on the IT schedule several years ago, as a way to give those newer companies a way to enter the schedules program, a lower barrier to market entry, if you will. And the idea was that GSA should be able to take these largely small businesses, particularly if they’re offering innovative products and solutions. Have them obtain the schedule contracts so that federal agencies would be able to more easily access those companies. And the companies themselves would have an easier access to government business.

Jared Serbu: And in your experience, what does GSA actually want to see from a company or a company’s leadership to decide whether they’re the right fit for the Springboard?

Larry Allen: I think there are a couple of basic things, Jared, they’re not all that different from a company that’s been in business for longer than a couple of years. I think they want to see what type of experience or expertise does this company have? Does it have something significant that’s new? Are there people associated with a company that have done government contract business before? That type of thing. They definitely also want to see evidence of financial stability. Everybody gets a financial review, Jared, before you get a schedule contract. No different here with Startup Springboard, you would want to make sure that if you’re awarding a contract to a company that, you know, they’re not going to just close up shop six months later and not be able to serve a government customer. So it’s those types of things: stability, any type of experience as broadly defined, previous experience with other ventures, that type of thing. That’s what GSA is really looking to see.

Jared Serbu: And then the third sort of reform you talk about here is the expansion of the ability to use the transactional data reporting method to get on the schedules in the first place? How does that work? And you mentioned you were skeptical of that early on, why?

Larry Allen: Jared, I was a big skeptic of transitional data reporting or TDR, as you mentioned, originally, and that was because I’m always concerned about the type of data company provides to the government, and whether or not it’s being deemed accurate, current and complete, which is a requirement through the traditional schedules process. But TDR has proven itself to be a very flexible way through which companies can either obtain or renew their GSA schedule contract without having to supply reams of commercial sales transaction information.

Transactional data reporting is kind of another lane on the schedules highway. And that lane allows companies to propose for a scheduled contract without having to collect information on all their commercial sales practices. It allows the contracting officer at GSA to conduct market research use some of the price comparison tools that GSA now makes use of and then maybe ask for a small amount of information if they need it. In order to validate the reasonableness of the prices being offered by companies that use the TDR route. One of the neat things is with consolidation, GSA is gradually expanding the scope of TDR so that more contracts and more contractors will be eligible for that program that still retains some part of the schedules price reductions, pause, Jared. So I want to make that clear. Any data that a contractor provides still has to be accurate and current. But there’s no trigger for most favorite customer pricing, a real schedule compliance issue that has been bedeviling contractors for at least as long as I’ve been with the program.

Jared Serbu: Does that market research process put more of the burden on GSA and lengthen a decision process? Or is it roughly, roughly the same on the agency side?

Larry Allen: You know, I think Jared when GSA first launched TDR, the probably was a slightly longer process, because contracting officers who had been used to awarding contracts the traditional way, suddenly add this new option. Over time, we’ve seen the requests for contractor provided sales information be reduced. I don’t think they’re eliminated, I would never go that far. But at the same time, GSA itself has created new price comparison programs. Now industry can talk about just how accurate they think those programs are. But the fact is, these are new tools that GSA has at its disposal. And additionally, contracting officers now have a few years of experience awarding TDR contracts. And they know that they’re not going so long as they do all the things that they’re supposed to do and exercise their due diligence, that they’re not going to get called on the carpet for making a bad decision.

Jared Serbu: All right, lots of interesting stuff going on in the schedules program. Larry Allen, president of Allen Federal Business Partners, thanks for taking us through it.

Larry Allen: Jared, thank you very much for your time, and I wish your listeners happy selling.

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Shelby Oakley, a director with the Contracting and National Security Acquisitions Team in the Government Accountability Office, joined host Roger Waldron on this week’s Off the Shelf for a wide ranging discussion highlighting GAO’s oversight role and its engagement with the executive branch.

Oakley shared how GAO engages with executive agencies when conducting reviews — emphasizing the importance of communication and building trust. She walked through the process, addressing her role as a director, how GAO puts together a review team, and how GAO conducts reviews.

One of Oakley’s main areas of focus is VA Acquisition Management. She discussed the key findings and recommendations across a services of GAO reports focusing on key programs in VA acquisition, including the VA’s Federal Supply Schedule (FSS) program and the Med-Surg Prime Vendor (MSPV)program. Among the topics addressed include the overlap between FSS and MSPV, supply chain modernization, role of clinical input, and the DLA-VA partnership.

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This week on Off the Shelf, Jason Miller, executive editor of Federal News Network, provided insights and analysis on the spring’s key procurement developments and the implications for government-wide contracting.

Miller highlighted the recent decision by  the General Services Administration’s Federal Acquisition Service (FAS) not to apply the Section 876 to the Multiple Award Schedules (MAS) program. Section 876 authorizes GSA to award MAS contracts without having to negotiate fair and reasonable pricing, thereby leaving pricing to agency specific competitions at the task order level. The decision not to extend the authority to the MAS program is a missed opportunity that will especially impact small businesses and non-traditional commercial firms seeking to enter the federal market.

Miller also tackled GSA’s management of Economic Price Adjustments (EPAs) in response to current inflationary pressures and the impact on contractors.

Finally, Miller shared his thoughts on a host of issues, including the OFPP Administrator vacancy, new e-tools at GSA, suspension and debarment trends, and the shrinking industrial base.

Alan Thomas, chief operating officer at IntelliBridge, joins Off the Shelf for an in-depth discussion of key trends and developments impacting IT GWACs, MACs, Schedules, and eCommerce.

Thomas shares his thoughts regarding the current state of play with regard to GSA’s eCommerce pilot and the potential for a follow-on procurement. In particular, he discusses the status of GSA’s three eCommerce “models” and their potential role in a follow-on eCommerce contract program.

Thomas also comments on the potential eCommerce fit with the Schedules program. With the challenges continuing with NIH’s CIO-SP4 procurement and GSA’s revisions to POLARIS, the discussion turns to the role of IT GWACs and whether, as currently structured, they are meeting customer and industry expectations. The discussion turns to whether the blurring of lines between IT GWACs, Services MAC and Schedules is increasing performance costs and risks across government.

Finally, Thomas highlights the potential for a reorganization of FAS and the Technology Transformation Service.

CAMBRIDGE, MD — The General Services Administration is trying, once again, to remove the complexities that agencies face when buying cloud services.

This has been a long-standing goal across multiple administrations and multiple attempts that have struggled to gain traction across government.

But the draft statement of work for the latest effort, called Ascend, which GSA released last week, is the culmination of months of research and discussion with agencies and industry experts.

Sonny Hashmi, the commissioner of the Federal Acquisition Service in the GSA, said he believes Ascend will be different than previous attempts to create big cloud procurement vehicles.

“I don’t want to make the presumption that we’ve figured it out. The process to get to an endpoint on Ascend is going to require a lot of dialogue, and I don’t want to us to move forward without it,” Hashmi said after his speech at the Emerging Technology and Innovation conference sponsored by ACT-IAC. “It goes back to how we were talking about user centric design. There’s got to be a user need, and in this case, it’s got to be an agency need that Ascend will address. That will dictate what the vehicle looks like how it’s going to be designed because without it, it is not going to be successful.”

Hashmi, who served as GSA’s chief information officer and worked in industry before taking over as commissioner, is familiar with the previous attempts to create cloud vehicles. He said one reason for the lack of adoption is the vehicles didn’t take an agency mission-need first approach.

“At this point, we’re being very deliberate about making sure that there is an actual need on the other side of this. Adoption is going to happen not just because it’s going to be a forcing function, but because there’s actually a need that we’re solving. If we’re not, if it turns out that we’re behind and agencies don’t have a need, then I would rather actually not do this,” he said. “While we’re excited about this program, ultimately, its job is to solve a problem and help agencies to deliver on mission. If there’s a better way or a different way to solve for the problems that we are facing, we’re happy to change tactics on it.”

The current thinking for Ascend, as outlined in the draft statement of work is to create three separate pools of vendors to deliver infrastructure- and platform-as-a-service, software-as-a-service and cloud professional services.

“The Ascend BPA is part of the GSA’s cloud marketplace vision of empowering agencies to develop and implement enterprise-level cloud acquisition strategies through a modernized and simplified approach to meet their IT and cybersecurity requirements,” the draft solicitation states. “The BPA will emphasize cloud smart/security smart objectives, and establish minimum baseline requirements for the acquisition, business, operations, reporting and technology capabilities provided by commercial cloud service providers (CSPs) and cloud-focused labor service providers that are not currently accessible under other GSA Multiple Award Schedule (MAS) or governmentwide acquisition contracts (GWACs). The Ascend BPA will focus on enabling support for both vertical (e.g., IaaS, PaaS, SaaS) and horizontal capabilities across the ecosystem and will provide more effective system integration and managed support services for the delivery of flexible, diverse, and secure cloud solutions.”

Feedback on Ascend is due to GSA by June 6.

New level of maturity to cloud buying

“We’ve been thinking about this challenge for some time, at least a year of internal deliberations. But now it’s time to really get industry engaged, and that’s why we released the draft work statement. We look forward to robust conversations, both from cloud service providers, services companies, system integrators and others, to really help us think about not only the purchasing method, mechanism, the methods, but really help us help shape our thinking around the future of digital transformation will look like,” he said. “We’re hoping this will be one mechanism, or the primary and most usable mechanism for agencies to think about when they’re thinking about modernizing their digital stacks.”

More broadly, Hashmi said, Ascend is trying to bring the “next level of maturity” to agencies as they adopt cloud services.

He said Ascend will let agencies buy cloud services “by the drink” or under a consumption based model. It will let GSA on-ramp new cloud service providers as they become available as well as contract holders bring innovation to the federal sector as required and necessary.

“We have flexibilities and ability that we haven’t exercised at scale before,” Hashmi said. “The other thing for me is creating a marketplace that is competitive. It can’t just be a small number of highly capable cloud companies. If you don’t create continuous opportunities for new companies to join the marketplace, then we have failed because this market is changing very rapidly.”

GSA has tried similar cloud acquisition vehicles previously for email-as-a-service and IaaS back in the early days of cloud buying. It found agencies didn’t want just a contract to buy cloud services, but wanted the full range of support from the cloud itself to integration services to ongoing support.

Gray areas still need to be worked out

Nearly 10 years later and as agencies spent about $8.6 billion on cloud services last year, with GSA acquisition vehicles accounting for $1.6 billion in 2020 and almost as much in 2021, Hashmi believes the time is right for this new approach.

“I think too many people talk about cloud as a thing that is different, unique and we need to buy it specially. Cloud is just part of how we modernize and how we deploy technology. So yes, when you use the Alliant vehicle to modernize, and the primary focus would be to buy professional services to help you modernize your solutions and technologies. Cloud is going to be a component of that,” he said. “Similarly when you want to just buy a discrete number have licenses and it’s easy and fairly straightforward for buyers to use the schedule contract. But there’s a huge opportunity and challenge right now between those two extremes. There’s more and more agencies who are going to multi-cloud environments. These require agencies to think about how these cloud technologies work with each other and integrate with each other, and then how to secure them. There are specialized services and it’s also highly complex licensing models that are becoming challenging for agencies to procure through a straightforward vehicle like the schedule. So Ascend is designed to solve for that problem.”

He added FAS also recognizes that Ascend may overlap or even have some gray areas with Alliant 2 or the schedule contract.

“We do think that if we hadn’t heard, loud and clear, from our customer base about the need to have a flexible, agile way to engage with cloud providers, we would not be pursuing down this road,” he said. “But we’ve seen that over and over again, we’re seeing a lot of agency-level, BPAs, which I think adds complexity and frustration to the industrial base. No company wants to bet on a Department of Commerce, BPA, Department of Homeland Security BPA and a Defense Department BPA, we do want to make sure that we also reduce friction and burden for the industry, and this is one way to do it.”

Early versions of Ascend also have come under scrutiny by industry associations. The Coalition for Government Procurement wrote a letter to GSA last fall expressing concerns that another cloud BPA will be duplicative and wasteful.

Hashmi said these concerns and other questions that have come up over the last six months is why GSA is putting out the draft statement of work. The feedback from large and small companies, from agencies, from associations and from anyone is critical to Ascend’s success.

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The fact that government spends more on services than it does on stuff isn’t exactly new. But even within that services portfolio, federal contracts are increasingly consolidated within a relative handful of market segments. According to a new analysis by Bloomberg Government, about a quarter of all federal contract spending goes toward just six categories. AI, Cloud Computing and operations and logistics lead the pack. Larry Allen is President of Allen Federal Business Partners. He joined the Federal Drive as he does often to discuss federal market trends

Interview transcript:

Jared Serbu: Larry, let’s start with that BGOV of analysis, I guess it’s not just our imaginations, there really is a lot of money in AI, cloud, digital services and a few other areas. They’re not just buzzwords. What jumped out at you most about this BGOV analysis?

Larry Allen: Jared, probably the biggest thing that jumped out about this Bloomberg analysis was talking about customer experience, we’ve written a lot about it, you’ve seen some in trade press about emphasis on customer experience, and here it is backing it up with actual money going to it. This is part of one of the top six areas that Bloomberg Government said, can control as much as 25% of federal spending. So that really puts customer experience right up there on the same level with AI, cloud and some of the other more established priorities we know about. That provides contractors with another conversation they can have with their customers or would be customers, it also tells them look, we need to be expanding our portfolio and expressing our solutions in terms of these types of missions agencies want to meet.

Jared Serbu: And as far as getting that work, would you envision that CX stuff in particular getting folded into some of the usual contracts that things like cloud and AI are already on?

Larry Allen: I absolutely would expect to see Jared, you’ll find CX solutions from things like GSA’s Alliant program probably near the top of the list. Also from GSA schedules, some of the other standing IDIQ contracts that allow for services. So we have an NIH (National Institutes of Health) contract that has IT solutions on it, that would be a possible vehicle. There are also ones in some of the military branches. I don’t know that we need brand new CX focused government acquisition vehicles, but I can guarantee you the conversation about that is already taking place inside certain federal agencies. But for right now, Jared, what it really means is, if you’re a contractor that would like to provide CX solutions, it’s just one more reason why having one of the established well known indefinite delivery, indefinite quantity contracts, is an important part of your government business.

Jared Serbu: And besides this work going largely to established contracts, as you point out in your newsletter, Bloomberg is also explicitly predicting that a lot of this work is going to go toward more established contractors, is that just an artifact of the continued trend toward contract consolidation?

Larry Allen: Jared, I think it’s two things. One is contract consolidation. For your contractors, more established contractors getting the work, you know, the Bloomberg article talked about getting rid of a number of contractors or leaving the government market. The other thing that I think we’re seeing here is trust. We know that the government writ large is kind of a risk averse customer. Customer experience spending is a new area for many agencies. It’s an area where they’re going to want to have an established trusted partner work with them on something new. Very few agencies, in my experience, are going to want to have a new, a new priority with a set of new providers, that’s just too much new for them, potentially too much risk. That gives a leg up I think, to established companies.

Jared Serbu: And along the same lines, you’re also pointing out in the newsletter this week, GAO recommendations, in part. as part of their annual report that OMB press agencies more toward category management and best in class contracts. And as you highlight there’s a tension there, between existing OMB guidance that says you got to balance these best in class contracts with the need to bring on new market entrants. How does that tension get resolved to the extent there is a tension?

Larry Allen: Well, I do think there is tension, Jared, and the tension relies ironically, in this case, primarily inside the Office of Management Budget. You have one part of OMB that has historically promoted category management, a key component of which is best in class contracting. And now you have another part of the Office of Management Budget saying, wait, we want to make sure that we are diversifying our supplier base, not necessarily looking only at best in class contracts, but looking at other suppliers that are newer to the market, particularly socioeconomically disadvantaged businesses. That to me, Jared, though, doesn’t have to be a dichotomy. I think that there are ways to achieve both. That’s looking for ways to ensure that these socioeconomic class contractors, particularly newer market entries have a path to participate on some of the best in class vehicles that we have out there, the ones that are coming up for re-compete, maybe some have an on ramp. So looking for ways to team up those companies with more established contractors that have the specific experience, looking for ways to encourage those contractors to team together with themselves and with each other, to pull their experience as a way to get on some of these best in class contracts. I think we can expect to see OMB work with agencies to use these best in class contracts as a vehicle for increased small and small disadvantaged business participation. So they can meet the GAO recommendation, and also the administration priority of making more use of those companies.

Jared Serbu: And I guess another avenue would be outside of not just establish multiple award contracts, but outside the traditional acquisition system using things like OTAs and commercial solutions openings, which are kind of seems like trying to, creeping their way more into the civilian side of government after really taking off on the defense side, how much how big a role could alternative approaches like that play in bringing some of these new entrants on board and avoiding the whole contract consolidation conundrum?

Larry Allen: Jared, I think that these nontraditional acquisition methods are going to play a much larger role. And it’s not just OTAs other transaction authority, that we’ve heard a lot about, and many people may already be looking at OTAs as a way to approach their government business. That makes a lot of sense. It’s not far based so on the face of it, there are fewer rules and regulations that these new market entries have to deal with. But we’ve been hearing about commercial solutions openings, for oh, at least a half a dozen years now, which is kind of the commercial, I wouldn’t say alternative, maybe stablemate is a good word, to other transaction authority. But up until now, we really haven’t seen CSOs getting a lot of press, there certainly have been one off commercial solutions, opening projects at GSA or DHS, two agencies that make a lot of use of this type of vehicle. But now GSA itself was in headlines last week saying we’re going to use CSO authority to bring DoD prototypes on to our contracts as a way to speed up research and development and get promising technologies into current production. That’s a new way to use an established, but not often heard of program, the commercial solutions opening. And again, it’s one that sets itself up very nicely for new market entrants.

Jared Serbu: All right, Larry Allen, president of Allen Federal Business Partners, thanks as always, Larry.

Larry Allen: Jared, thank you very much, and I wish your listeners happy selling.