Government Contracts Update
News for the Week of June 11, 2018

Hot Topic:
Executive Order Seeks to Improve IT Effectiveness
Executive Order 13833, Enhancing the Effectiveness of Agency Chief Information Officers, calls on covered agencies to implement successful information technology management practices from the private sector, which would enable the government to reduce costs, mitigate cybersecurity risks, and deliver improved services to the American people.

The order also seeks to enhance the effectiveness of agency CIOs to better position agencies to modernize their IT systems and execute IT programs more efficiently.

The order directs agencies to eliminate unnecessary IT management functions; merge or reorganize IT functions to promote agency-wide consolidation of IT infrastructure, taking into account any recommendations of the agency CIO; and increase use of industry best practices, such as the shared use of IT solutions within agencies and across the executive branch.

With regard to cybersecurity, the order calls on CIOs to work closely with an integrated team of senior executives with expertise in IT, security, budgeting, acquisition, law, privacy, and human resources to implement appropriate risk management measures.
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Legal News:
Documents Did Not Establish JV Was "Unpopulated"
A challenge to the Small Business Administration's determination a protester was ineligible for a section 8(a) set-aside contract lacked merit because, according to the Court of Federal Claims, the SBA had a rational basis for concluding the protester did not demonstrate it was an "unpopulated" joint venture. To be eligible for set-aside contracts, a JV must be "unpopulated," which means the employees performing substantive work on the contract must be employed by the JV's members, not by the JV itself. (Senter, LLC v. U.S., FedCl, 62 CCF ¶81,392)
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After Remand, CFC Reverses SBA's Size Determination
The Small Business Administration's Office of Hearing and Appeals' reversal of an SBA area office size determination was reversed and vacated because, according to the Court of Federal Claims, the OHA's decision was arbitrary and capricious. After the government awarded a joint venture a small business set-aside contract for ballistic missile defense system strategic planning and financial management support, another offeror challenged the JV's small business status. (Veterans Technology, LLC v. U.S., et al., FedCl, 62 CCF ¶81,387)
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Court Reinstates Stay of Performance Pending Protest
The Court of Federal Claims overruled the government's override of a stay of contract performance because the government did not provide an acceptable rationale for its action. The government contended timing was crucial and a lapse in services was an "unacceptable risk," but it did not explain why the timing of performance of a new task order was crucial when a continuation of the order or a bridge contract would suffice. (Intelligent Waves, LLC v. U.S., et al., FedCl, 62 CCF ¶81,388)
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Government Didn't Sufficiently Document Evaluation or Adjustments
Protests of a $376 million contract award for engineering, research, and scientific support were sustained because the evaluation under the relevant experience and past performance factor was insufficiently documented and the government's cost realism adjustments were unreasonable. The only part of the contemporaneous evaluation record that discussed relevant experience and past performance was the source evaluation board's briefing to the source selection authority. However, the briefing lacked any discussion of the scope of the offerors' past performance contracts, and it did not provide any rationale for the assigned relevancy ratings. (Trident Vantage Systems, LLC, et al., 33 CGEN ¶115,961)
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Regulatory News:
Changes to Munitions List and Commerce Control List Proposed
The Department of State and the Bureau of Industry and Security have simultaneously issued proposed rules with regard to the control of firearms, guns, ammunition, and related articles the president determines no longer warrant control under the United States Munitions List (International Traffic in Arms Regulations 121.1) and instead will be controlled under the Commerce Control List (Supplement No. 1 to Export Administration Regulations Part 774). The ITAR rule would revise Categories I (firearms, close assault weapons and combat shotguns), II (guns and armament) and III (ammunition and ordnance) of the USML to describe more precisely the articles warranting export and temporary import control.
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Major Contract Awards:
Technical Support — $2.6 Billion
Defense Systems and Solutions, Huntsville, Alabama, was awarded a $2,560,000,000 hybrid (cost-plus-fixed-fee; cost-plus-incentive-fee; firm-fixed-price; and fixed-price-incentive) contract for technical support of the Aviation and Missile Research, Development, Engineering Center's Prototype Integration Facility. U.S. Army Contracting Command, Redstone Arsenal, Alabama, is the contracting activity.
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Aircraft Engines — $2 Billion
United Technologies Corp., Pratt & Whitney Military Engines, East Hartford, Connecticut, has been awarded $2,016,115,217 for a modification to a previously awarded contract in support of the F-35 Lightning II low-rate initial production Lot 11 aircraft. This modification provides additional funding for production non-recurring/tooling, administrative labor, partner unique items and Lot 11 production propulsion systems. The Naval Air Systems Command, Patuxent River, Maryland, is the contracting activity.
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Medical Support Services — $970 Million
Multiple contractors will share in a multiple-award, indefinite-delivery/indefinite-quantity contract with a maximum cumulative ceiling of $969,000,000 to provide medical support services to supplement staffing at Department of Defense military treatment facilities. The Defense Health Agency, Contracting Office - National Capital Region, Falls Church, Virginia, is the contracting activity.
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Radar Systems — $866 Million
Northrop Grumman Systems Corp., Chantilly, Virginia, has been awarded a not-to-exceed $866,000,000 indefinite-delivery/indefinite-quantity multiple contract line item contract for the sustainment and modification of radar sensors, providing depot-level sustainment services and modification projects for the Ballistic Missile Early Warning systems and PAVE Phased Array Warning system radars, and the Parameter Acquisition Radar Attack Characterization system. Air Force Life Cycle Management Center, Peterson Air Force Base, Colorado, is the contracting activity.
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Computer Systems — $842 Million
DRS Network & Imaging Systems LLC, Melbourne, Florida, was awarded a competitive, single award, indefinite-delivery/indefinite-quantity contract for an Army requirement known as Mounted Family of Computer Systems II. The MFOCS is a modular family of computing platforms which integrates networked-battle command information system capabilities onto a common computing platform. The Defense Information Technology Contracting Organization, Scott AFB, Illinois, is the procuring contracting activity.
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Sustainment Support — $559 Million
Lockheed Martin Corp., Lockheed Martin Aeronautics Co., Fort Worth, Texas, is being awarded a $558,276,346 cost-plus-incentive-fee, cost-plus-fixed-fee, fixed-price-incentive-firm, firm-fixed-price contract. This contract provides for sustainment support, including equipment, training devices, training facilities, non-aircraft spares, Autonomic Logistics Information System hardware and software, and facilities standup in support of low-rate initial production Lot 11 F-35 Lightning II aircraft. The Naval Air Systems Command, Patuxent River, Maryland, is the contracting activity.
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About this Newsletter

From Wolters Kluwer Legal & Regulatory's Government Contracts editors, here are summaries of the important recent developments in this practice area. Complete coverage of these issues, and more, appears in Government Contracts Reports, the Government Contracts Reporter, and related CCH products.

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Recent Developments in Government Contracts: Regulations and Legislation

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Federal Acquisition Regulation (FAR) & Department of Defense FAR Supplement (DFARS), January 2018 Combo