Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 1
DOING BUSINESS
WITH THE U.S. GOVERNMENT: Strategies for Being a Successful Federal Contractor
The Politics of the Federal
Government Process
Aaron Grau, Grau & Associates
Contracts vs. Grants
All grants are contracts, but not all contracts
are grants.
• Appropriations/Earmarks
• SBIRs/STTRs
• CRADAs
• Program Awards
• Sales - Goods & Services
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 2
pOLITICS & Procedure: The Playing Field
WHO to Pitch
….has money?
…has authority?
WHERE to Look
There are an estimated 1,300
federal agencies.
Which one needs you?
WHEN to Bother
Federal FY
Program dollars v. “new
money”
WHAT & WHY
MONEY
WE NEED IT
pOLITICS & Procedure: Contracting Art & Science
Science
Sales Target
1
Where
3
When
2
Who
Art
HOW?
How are you going
to hit your target?
pOLITICS & Procedure: Sealing the Deal
The General Services Agency (GSA) Schedules
Sub-Contracting (Small to Large or Large to Small)
Congressional Influence - Sometimes, But Don’t Count on It!
Small Business “Set-Asides” & The Rule of Two
Be Aware of Federal Agency Small Business Quotas
Spoon Feeding the Contract Officer
Indefinite Delivery Indefinite Quantity Contracts
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 3
Understanding
the GSA Schedule
Jennifer L. Schaus
20 yrs. govt. contracting experience
Washington, D.C.-based
Product & service customers
GSA Schedule & other govt.
contracting services
Agenda
• Facts
• Requirements
• Terms / Conditions
• Process & Timing
• Advantages
• Disadvantages
• Conclusions
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 4
GSA Schedule - FACTS
• 5 Year Contract Vehicle
• Marketing Tool ONLY
• 3 Five Year Renewable
Periods = 20 Yrs
• 39 Schedules Segmented by Product & Service
• MAS – Multiple Award Schedule – 20k Vendors
• Terms / Conditions
• Emphasis is on PRICE PRICE PRICE
Requirements
• 2 Full Years Balance
Sheet / Income Statement
• Relevant Past
Performance
• Invoices for EVERY item/service you are
providing
• Offer GSA lowest pricing
• $25/year in GSA Sales
Terms / Conditions
• Pre-Award
– Offer GSA equal to or better
than Most Favored Customer $
• Post-Award
– Price Reduction Clause
– Meet $25k/annual revenue
– Pay GSA .75% IFF Fee
– 2 CAV’s – Audits per 5 Years
– Limits on price increase
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 5
Process & Timing
• Administrative, Technical & Pricing =
Proposal
• Multiple Documents, Reports
& Disclosures Required
• 1 – 3 Months Proposal Prep
• 4 – 18 Months Wait for GSA
• 1 – 3 Months Clarifications, Negotiations,
Federal Procurement Regs, Award
Advantages
• Shows you are “worthy” serious competitor
• Opens up new buying
channels (state, local, int’l)
• Limit or exclude competition
• Dedicated RFP’s - GSA E-Buy
• Marketing Tool – GSA Advantage
• Decrease paperwork for the contracting
officer (CO)
Disadvantages
• 10% of Federal Purchases
• One of many contract
vehicles
• No Guarantees
• Lowest Price – Price Ceiling
• Price Limitations – Margins
• Sales Quota – Repercussions
• IFF Reporting, Audits – Back Office
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 6
Conclusions
• Not for everyone
• Know who your customer
is & HOW they purchase
• Build It & They Will Come = High Risk
• Measure ROI before jumping in – Price &
Margins
• Find partners on Schedule
• Asset or Liability
Government Contracting
Laws and Regulations
Steven D. Irwin, Partner
David E. Renner, Senior Associate
PRIME CONTRACTOR AND SUBCONTRACTOR
• A subcontractor is generally:
– “For the purchase, sale or use of personal
property or nonpersonal services which, in
whole or in part, is necessary to the
performance of any one or more contracts; or
– Under which any portion of the contractor’s
obligation under any one or more contracts is
performed, undertaken or assumed.” – Ex.
Order 11246 definition
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 7
The Acquisition Process
This chart is an example of the process from one agency. Extensive variations will exist.
Credit to Division of Acquisition Policy, Indian Health Service, DHHS
Office of Federal Procurement Policy - 41
U.S.C.A. §§ 1101 – 1131.
• A subdivision of the Office of Management
and Budget
Federal Acquisition Regulations System
• Title 48 of the Code of Federal
Regulations
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 8
The Federal Acquisition Regulation (The FAR)
• 48 C.F.R. § 1.101 – 1.707
• Offer guidance and mandatory provisions
for every type of contract the government
could award
The FAR
• The FAR relates to a three-step process
for federal contracting:
1. Need recognition and acquisition planning
2. Contract formation
3. Contract administration
The FAR
• Streamlined process for contracts less
than $150k
• Many agencies have own supplement to
the FAR – www.farsite.hill.af.mil/
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 9
The Government Needs Widgets
Cost Accounting Standards (CAS)
• 48 C.F.R. § 99
• 19 standards for uniform accounting, cost
tracking, and reporting
• Defense contracts are bound by CAS, but
also supplemented by the Defense
Contract Audit Agency (DCAA) and the
Defense Contract Management Agency
(DCMA)
CAS
• A contractor is either subject to:
– Full CAS coverage
– Modified CAS coverage – 4 of the CAS apply
(single contract of $7.5 million or more)
– Exemption from CAS coverage
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 10
Office of Federal Contract
Compliance Programs (OFCCP)
• Created under Executive Order 12086,
Regulations available at 41 C.F.R. § 60
• Administers and enforces Executive Order
11246, Section 503 of the Rehabilitation
Act, and VEVRAA
Non-Discrimination and Affirmative Action
• Ex. Order 11246 (1965, 1967, 2014)
• Federal contracts of $10,000 or more
• Cannot discriminate in employment
decisions
• Must take affirmative steps to ensure
equal opportunity
• Must conduct annual statistical analysis of
employment practices
Affirmative Action Plan
• Written Affirmative Action Plan
– Shows a good faith effort, and
– Goals and timetables for increasing minority
and female representation in the workforce
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 11
16 Construction Contract Requirements
• 41 CFR 60-4.3
• Federal construction contracts in excess of
$10,000
• 16 affirmative action steps
Construction Contract, continued…
• Examples
– Maintain work environment free of
harassment, intimidation, and coercion
– Contractors and subcontractors must
encourage current minority and female
employees to recruit other minority persons
and women
– Increased scrutiny (site visits) for Mega
Contracts
Non-Retaliation for Disclosure of
Compensation Information
• Ex. Order 12866 (Effective April 8, 2014)
• Adds disclosure of compensation
• Prohibits retaliation against employees
who disclose compensation to other
employees
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 12
Sexual Orientation and Gender Identity
• Prohibits discrimination for sexual
orientation and gender identity under
Executive Order 11246
• Exception for religious organizations
• Signed July 21, 2014; effective
immediately
Section 503 of Rehabilitation Act –
Non-Discrimination and Affirmative Action
• 29 U.S.C. § 794
• Federal contracts of at least $10,000
• Prohibits discrimination against and
imposes affirmative action obligations in
employment of individuals with disabilities
• Same requirements as ADA and ADAAA
Section 503 of Rehabilitation Act
Affirmative Action Plan
• 29 U.S.C. § 793 (1998)
• Federal contractors with 50 employees
and contract of $50,000
• Written Affirmative Action Plan
• Applicants and employees asked to self-
identify
• In 2013, DOL announced 7% utilization
goal aspirational; not a quota
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 13
Section 508 of Rehabilitation Act
• 29 U.S.C.A. § 794d (1998)
• Applies to federal contractors dealing with
Electronic Information Technology
• Examples:
– HealthCare.gov must be screen-reader
accessible
– electronic Army kiosk must include braille and
plug in for hearing impaired devices
Vietnam Era Veterans’ Readjustment
Assistance Act (VEVRAA)
• 38 U.S.C. § 4212 (1974)
• Federal contractors having contracts of at least $100,000
• Prohibits discrimination against and requires affirmative
action for protected veterans
• Openings must be listed with employment service
delivery system, and veterans receive priority in referrals
• Veterans invited to self-identify both pre-offer and post-
offer
• Complete VETS 100a report
Fair Pay and Safe Workplace
Executive Order
• Signed July 31, 2014
• Applies to procurement of goods and
services, and construction valued at
$500,000 or more
• Bidders must disclose any administrative
determination, arbitration award or civil
judgment, within preceding 3-year period
for violations of any labor law
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 14
Minimum Wage Exec. Order
• Executive Order 13658 (2014)
• Applies to all government contractors and sub-
contractors with contracts in 2015 and beyond that are
covered by:
– The Davis-Bacon Act
– The McNamara-O’Hara Service Contract Act
– Concessions contracts, such as contracts to furnish food and
lodging on federal property
– And contracts to provide services, such as child care or dry
cleaning, in federal buildings
Minimum Wage Exec. Order
• Effective January 1, 2015, the minimum wage allowed
for employees working under a government contract or
sub-contract anywhere in the nation is $10.10 – this is
not retroactive and only applies to contracts that are
issued on or after January 1, 2015
• Beginning January 1, 2016, the Secretary of Labor is
empowered to raise the wage as is deemed necessary
Davis-Bacon Act
• 40 U.S.C. §§ 3141-3148 (1931)
• Federal contracts for public works over
$2000
• Local prevailing wage for laborers and
mechanics
• Wage Determination by Dept. of Labor
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 15
Copeland “Anti-kickback” Act (1934)
• Supplements Davis-Bacon
• Prohibits federal contractor or
subcontractor from inducing employee to
give up any compensation for employment
Walsh-Healey Public Contracts Act
• 41 U.S.C. § 35 (1936)
• Manufacturing or furnishing of materials,
supplies or equipment to the U.S. government
worth $10,000 or more
• Overtime for supplier’s employees working more
than 8 hrs./day or 40 hrs./week, and sets the
minimum wage equal to prevailing wage
• Prohibits employment of youths, convicted
prisoners
• Does not apply to “commercial” items
McNamara-O-Hara Service Contract Act
• 41 U.S.C. §§ 351–358 (1965)
• Performance of services on prime
contracts over $2,500
• Service employees entitled to prevailing
wages and fringe benefits
• Wage Determination by Dept. of Labor
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 16
Contract Work Hours and
Safety Standards Act
• 40 U.S.C. §§ 3701 – 3708 (1986)
• Federal service contracts and construction
contracts over $100,000
• Time-and-a-half pay for all mechanics and
laborers working over 40 hours in week
• Applies OSHA
Mascaro Construction Company, LP
DOING BUSINESS WITH A GENERAL
CONTRACTOR
---------
LEECH TISHMAN
“Doing Business with the
U.S. Government”
9/19/2014 © 2014 mascaro construction company, lp
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 17
© 2014 mascaro construction company, lp
Introduction
• Kathy Agostino
– Small and Disadvantaged Business Coordinator
and SBLO during estimating and preconstruction
– Maintain Database
– Active with Small Business Organizations
– Typically first contact for
• What we are bidding
• Is your scope of work on that project
• Where to view bid documents
© 2014 mascaro construction company, lp
Overview
• Founded in 1988
• Growth attributed to basic principles
– Integrity, Quality, Cost Efficiency
– Customer Service
• Delivery methods:
GC, CM, DB
• Self-Perform: concrete, earthwork,
roads, buildings
© 2014 mascaro construction company, lp
Wide Range of Projects
• Industrial
• Power/Piping
• Buildings
• Highway
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 18
© 2014 mascaro construction company, lp
How to Get Work
• Introduce yourself –
tell us what you do
• Get on subcontractor /
supplier bid lists
• Follow-up with your contacts
• Join trade organizations
• Attend networking events
• Attend pre-bid meetings
© 2014 mascaro construction company, lp
Register with Government Agencies
• PA Unified Certification Program (PA UCP) – Allegheny County M/W/DBE Department
– Port Authority of Allegheny County
– Pennsylvania Department of Transportation (PennDOT)
– Allegheny County Dept. of Public Works
– Pennsylvania Turnpike Commission
• Pennsylvania Department of General Services (DGS)
• Small Business Administration (www.sba.gov)
• Federal Contractor Registration (www.sam.gov)
System for Award Management
** KEEP THESE CURRENT **
© 2014 mascaro construction company, lp
Track Projects
• Newspaper (Legal Ads Section)
• F. W. Dodge (McGraw-Hill)
• Construction Data Company
News (CDC)
• Reed Construction Data
• Pittsburgh Builder’s Exchange
(pbe.org)
• Minority Business Opportunity
Committee (MBOC)
• Chamber of Commerce
• Pittsburgh Business Times
(Book of Lists)
• Diversity Business Resource
Center (DBRC)
• Bureau of Minority & Women
Business Opportunities, PA DGS
• Veteran Business Outreach
Centers & VetBiz.gov
• Small Business Development
Centers (SBDC)
• SBA: SubNet
• Procurement Technical
Assistance Centers (PTAC)
• Government Agency
Coordination Office (GACO)
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 19
© 2014 mascaro construction company, lp
Be Prepared to Bid
• Bonding and insurance in place?
• Dunn & Bradstreet Number?
• Pre-qualification to be completed?
• Federal Document Security Form required to
view doc’s on most Federal projects.
© 2014 mascaro construction company, lp
Be Prepared to Bid
• Training for yourself and employees?
• Know how to view/download bid doc’s from
websites and plan rooms?
• Website, email and contact information up to
date and current?
© 2014 mascaro construction company, lp
Safety and Construction
• Written Company Safety Plan
• On-going Safety Training
• Up to date OSHA Logs
• Lead by Example
• Poor safety record results in
- loss of work
- higher insurance costs
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 20
© 2014 mascaro construction company, lp
Estimating & Bidding is fundamental to obtaining work
• Bid per the specifications for your scope.
• Prepare your bid accurately and clearly
• Acknowledge addenda
• Review the Bid Form
- (unit prices, alternates, etc.)
• Find out who to submit your quote to and
submit on time.
© 2014 mascaro construction company, lp
General Conditions
• Read and understand the impact of the
General Requirements:
– Contract and Payment Terms
– Schedule
– Safety Requirements
– Wage Rates
– Tax Requirements
– Insurance / Bond Requirements
© 2014 mascaro construction company, lp
Wrong Reasons to be the Low Bidder
• To enter a new market
• To retain field personnel
• To get prestigious jobs
• To beat the competition
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 21
© 2014 mascaro construction company, lp
Right Reasons to be the Low Bidder
• You know the scope of work
• You know the subs
• You know the owner
• You have the best people
• To make a profit & grow your business
© 2014 mascaro construction company, lp
After the bid
• Follow-up
– When will results be available?
– Were you competitive?
• When you get a contract
– Do what you say you are going to do
– Staff knowledge and responsiveness –
field and office
– Make a great first impression
– Ask others how you are doing
© 2014 mascaro construction company, lp
QUOTE
Quote Often
Quote Early
Quote Complete
Doing Business with the U.S. Government:
Strategies for Being a Successful Federal Contractor
Page 22
© 2014 mascaro construction company, lp
Mascaro Construction Company, LP 1720 Metropolitan Street
Pittsburgh, Pennsylvania 15233 412/321-4901
Kathy Agostino: [email protected] Small & Disadvantaged Business Coordinator
SUPPORT SMALL BUSINESS!
Thank You for Attending
Kathleen Agostino, Estimating and Small Business
Coordinator, Mascaro Construction Company, LP
1720 Metropolitan Street; Pittsburgh, PA 15233
4 1 2.321.4901; mascaroconstruction.com
Linda Ambroso, Government Relations Professional, Leech Tishman
525 William Penn Place, 28th Floor; Pittsburgh, Pennsylvania
15219
4 1 2.2 6 1.1 6 0 0; leechtishman.com
Aaron Grau, Principal, Grau & Associates
1023 15th St, NW #200; Washington, DC 20005
4 1 2.4 8 0.1 8 0 9; grauandassociates.com
Steve Irwin, Partner, Leech Tishman
525 William Penn Place, 28th Floor; Pittsburgh, Pennsylvania
15219
4 1 2.2 6 1.1 6 0 0; leechtishman.com
David Renner, Senior Associate, Leech Tishman
525 William Penn Place, 28th Floor; Pittsburgh, Pennsylvania
15219
4 1 2.2 6 1.1 6 0 0; leechtishman.com
Jennifer Schaus, Principal, Schaus & Associates
1717 Pennsylvania Ave, NW #1025; Washington, DC 20006
2 0 2.3 6 5.0 5 9 8; jenniferschaus.com
Steve Shivak, President, SMC Business Councils
201 Penn Center Blvd., Suite 400; Pittsburgh, PA 15235-5068
412-371-1500, X1603; Toll Free: 800-553-3260; smc.org/
Kevin White, District Director, U.S. Small Business
Administration
411 Seventh Avenue Suite 1450; Pittsburgh, PA 15219
Phone: 412-395-6560; sba.gov/offices/district/pa/pittsburgh