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WIPP Advocacy Roundup - February 2020

Posted By WIPP Advocacy Team, Wednesday, February 26, 2020
Updated: Tuesday, February 25, 2020

WIPP-Supported Women’s History Museum Bill Passed the House

 

The Smithsonian Women's History Museum Act (H.R. 1980) passed the House and is now headed to the Senate. The bill establishes a council that will make recommendations to the Board of Regents of the Smithsonian Museum on the planning, design, and construction of the museum. The bill was sponsored by Rep. Carolyn B. Maloney (D-NY); Rep. Brian Fitzpatrick (R-PA); Rep. Brenda Lawrence (D-MI) and Del. Eleanor Holmes Norton (D-DC). Read WIPP’s March 2018 letter of support for the bill


Meeting with New SBA Administrator Jovita Carranza


Team WIPP Meets Administrator CarranzaOn Wednesday, February 19, WIPP President & CEO Candace Waterman and WIPP Chief Advocate Ann Sullivan met with new SBA Administrator Jovita Carranza. The Administrator knows WIPP’s work from her previous position at the Deputy SBA Administrator under the President George W. Bush’s administration. It was great to see an old friend and update her on our policy priorities. We were happy to hear that women entrepreneurs are a priority of Administrator Carranza. 

Participating in GSA’s Small Business Roundtable with the Federal Acquisition Service

 

Candace Waterman, Ann Sullivan and WIPP Advocacy Team member Elizabeth Sullivan were invited to participate in a roundtable held on Wednesday, February 19 at GSA with the Administrator Emily Murphy to discuss small business participation in Governmentwide Acquisition Contracts (GWACs) and new cybersecurity requirements. WIPP raised the issue of WOSB participation in GWACs and urged Administrator Murphy to consider including WOSBs in any new GWACs.  


WIPP Speaks on Behalf of Women Entrepreneurs at 2020 Small Business Forum Meeting

 

In January, WIPP attended the 2020 Small Business Forum Meeting to discuss the challenges of using the section § 199A deduction. The Tax Cuts and Jobs Act of 2017 included the new Internal Revenue Code § 199A to bring some parity for pass-through entities (S-Corps, LLCs, partnerships).

 

 WIPP advocated for the 20% deduction now afforded to pass-through entities during the 2017 tax reform and spoke at the roundtable, calling for the deduction to be extended to all pass-through entities, not just those in specific industries. 


Five-Year Lookback Not Yet Allowed in SAM

 

WIPP-advocated for the Small Business Extension Act, a change allowing WOSBs to utilize a five-year revenue average for the purposes of size determination, which went into effect in January 2020. However, this change has not yet been reflected in the System for Award Management (SAM). WOSBs have found that when renewing their size status in SAM.gov, the only option is to input a three-year average.

 

 We advise WOSBs seeking to re-certify size status under the new five-year rule to work with legal counsel to document their size until SAM is updated and asking for the ability to change to a five-year revenue average when SAM is updated. 

Tags:  Advocacy  GSA  legislation  regulatory  SBA  taxes 

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Four Steps Congress Should Take to Help WOSBs in the FY2021 NDAA

Posted By Elizabeth Sullivan, WIPP Advocacy Team, Wednesday, February 5, 2020
Updated: Tuesday, February 4, 2020

If you participate in the monthly WIPP Policy Update webinars, you will likely hear us reference the National Defense Authorization Act, or more lovingly known as the “NDAA.” As it remains one of the last “must pass” bills – due to the Constitutional requirement that Congress provides for a common defense – each year presents an opportunity to advocate for changes that will benefit women-owned businesses. So, here is what we think should be included this year: 

Elizabeth Sullivan
  1. Expand investment in women- and minority-owned companies.
    Currently, women-owned businesses receive around 2.8% of all venture dollars. Due to WIPP’s championship of this issue, Senators Marco Rubio (R-FL) and Maria Cantwell (D-WA) introduced the Women and Minority Equity Investment Act of 2019 (S. 1981), which would allow women-owned contracting firms to take investment by women-owned equity firms and still meet the “51% unconditionally owned and controlled” standard set by SBA to participate in the WOSB/EDWOSB program. Representative Robin Kelly (D-IL) introduced an identical bill in the House (H.R. 3633). The same barriers apply to minority-owned businesses. These bills allow minority-owned federal contracting firms to take investment by minority-owned equity firms.

    This legislation is groundbreaking on both sides of the equation. It opens up a path for investment in women-owned businesses who are government contractors, as well as strengthens women investors. Women in investment firms tell us that this change in the law would strengthen their ability to secure greater equity positions within their companies and women-owned companies looking for investment will be incentivized to seek out women-owned investment firms. The same holds true for minority investments under this legislation.

  2. Increase the share of contracts awarded to small businesses


    WIPP fought and won sole source authority for the WOSB program in 2015—gaining parity with other federal contracting programs. While the fight has changed in 2019, the drumbeat is the same: parity. Currently, the sole source dollar limits for WOSBs are $4 million and $6.5 million (manufacturing) over the life of the contract. While this might sound like a lot of money, in the $550 billion federal marketplace, $4 million over 5 years is small potatoes. We have also heard from WOSBs that even though agencies are interested in awarding sole source contracts to them, these dollar limits are too small.

    A shift in government buying calls for a shift in rules for sole source contracts. As government buying continues to trend toward buying through large vehicles and moving away from direct contracts, the ability for small companies to win sole source awards is more crucial than ever. Increasing the award amounts for sole source contracts is extremely beneficial to the small business contracting community, however, it is equally as important to streamline and simplify rules for awarding these contracts. It is not uncommon to hear from small contractors that are told over and over again by the federal workforce the same thing – awarding a sole source contract is too confusing and/or time consuming. 

    WIPP supported H.R. 190, which passed the House and gives all small businesses including WOSBs greater opportunities through sole source contracting. This bill raises the dollar amounts for sole source contracts to $4 million and $7 million to be awarded each year, instead of over the life of the contract. A proposal in the Senate would also raise these thresholds to $8 and $10 million each year. 

    With respect to simplification, WOSBs, HUBZones and SDVOSBs require that a contracting officer must justify through market research that not two or more offers at a reasonable price are expected. The contracting community has interpreted this as “you are the only company in the world that performs this work,” leading to exceedingly few sole source awards. While the missions of these programs are all different, one thing is crystal clear – putting these contracting programs on equal footing with respect to this rule would ease the burden for the federal government and the businesses trying to meet its agencies missions. 

  3. Give small businesses more runway.
    You may be thinking you have heard this one before. That’s because a significant WIPP-supported legislative victory was achieved in 2018, giving small firms more “runway” to transition out of the small business set aside program and into full and open competition. The law allows businesses to average revenues over 5 years rather than the previous three years for purposes of determining size standards. In fact, the law finally went into effect earlier this month. Despite the expanded time this gives many small contractors, there are some that are still left in the lurch – businesses whose work falls under employee-based NAICS

    These companies face the same challenges – bumping out of their size standards and struggling to compete with billion-dollar companies in the full and open marketplace. Therefore, increasing the length of determination for industries measured based on annual average employees would give small companies a little more runway to succeed when they become midsize companies. Using a five-year standard for all industries this would create parity for small businesses in every industry and promote sustainable growth of small businesses.
  4. Share best practices for contracting with small businesses.

    WOSBs continue to find that agencies are reluctant to use small business programs. Recognizing this challenge, WIPP worked with the Homeland Security and Governmental Affairs Committee to introduce The Promoting Rigorous and Innovative Cost Efficiencies for Federal Procurement and Acquisitions (PRICE) Act of 2019 (S. 3038), which addresses agency utilization of small businesses in the federal marketplace.

    Introduced by Senators Gary Peters (D-MI) and Joni Ernst (R-IA), this bipartisan bill requires the Director of the Office of Management and Budget (OMB) to convene the existing Chief Acquisition Officers Council (CAOC) to identify and disseminate best practices in non-defense small business contracting in the federal government. The PRICE Act would positively impact the way in which this valuable information is gathered and shared across the federal government, as well as provide increased opportunities for small businesses by educating the acquisition workforce on best practices for using small business programs. 


As we promote these changes, look for action alerts and other ways to engage from our team. Since it is an election year, there will be limited opportunity to advance this legislation – all the more reason why the NDAA is so important. These four changes would go a long way to help the government meet its 5% goal of contract awards to women-owned companies.

 

 

Tags:  Advocacy  Congress  legislation  regulatory 

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The Ugly Truth About the Cybersecurity Maturity Model Certification (CMMC)

Posted By Angela Dingle, President & CEO, Ex Nihilo; WIPP Board of Directors, Chair, Monday, January 27, 2020

WIPP was one of the first small business organizations to raise the red flag on the compliance standards lying in wait for not only Defense Department prime contractors, but also the thousands of subcontractors in the industrial base, as the Cybersecurity Maturity Model Certification (CMMC) began to roll out at its various agencies. 
Angela Dingle
The intent of the CMMC is to combine various cybersecurity control standards such as National Institute of Standards and Technology Special Publication 800-171, NIST SP 800-53, ISO 27001, ISO 27032, AIA NAS9933 and others into one unified standard for cybersecurity. Much like the Capability Maturity Model Integrated (CMMI), the CMMC is designed to measure the maturity of a company’s institutionalization of cybersecurity practices and processes. It will consist of five levels. 
 
All DOD contractors will be required to achieve a Level 1 certification, as reported in Bloomberg Government. Contractors that handle sensitive information up to classified data will be required to achieve a Level 5 certification. In the future, contractors that lack the desired CMMC level will become ineligible to compete for certain contracts and task orders.
 
Join us next month on February 18 for our first WIPP Member Webinar of the year, “The Ugly Truth About CMMC,” which will be a deeper dive into how CMMC will affect your business in the future, strategies for compliance, and how to manage the cost of implementation.

 

Tuesday, February 18 
2 PM ET / 1 PM ET / 11 AM PT
Register Today

 

Free to WIPP Members / $25 for Non-Members

 



This is a guest blog post from Ex Nihilo, a WIPP Member business. 
Ex Nihilio
Since 2002, Ex Nihilo has been a trusted advisor in the public and private sector, providing objective IT governance, risk management, and compliance services based on a thorough understanding of customer requirements and deep systems integration experience.

Tags:  cybersecurity  guest post  regulatory 

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Regulations & Rules Update - December 2019

Posted By Advocacy Team, Monday, December 23, 2019
Updated: Wednesday, December 18, 2019

Regulatory Recap: Flurry of Federal Contracting Regulations You Should Know About

 

In the past several months, SBA has taken significant actions on contracting policy that affect small government contractors. They are in various stages—some are proposed rules, some are finalized. WIPP Chief Advocate Ann Sullivan outlined the summaries and status of the actions federal contractors should be following. 



Wide-Reaching FAR Rule Touches Every Government Contractor


In the 2019 National Defense Authorization Act (NDAA), Congress directed federal agencies to stop using products and services from six Chinese companies in Section 889 of the bill, in order to combat national security and intellectual property threats that face the United States. Moving quickly, the FAR Council issued an interim final rule in August to implement this change, which has the potential of impacting all government contractors, large or small. Any government action that affects 139,730 small entities will have wide-reaching effects.


Learn more about how it will directly impact your business.

Tags:  federal contracting  regulatory 

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Regulatory Rigmarole: The Devil Is In The Details

Posted By Ann Sullivan, WIPP Chief Advocate, Wednesday, November 6, 2019
Updated: Tuesday, November 5, 2019

Advocacy comes in all forms. While the WIPP Advocacy Team focuses much of our attention on Congressional action, our work with agencies, especially SBA, is every bit as important. Staying vigilant on all fronts is critical to all businesses, large and small. 


As a WIPP Member, you probably already know more than the average person about regulations that impact small business owners – regardless of whether they are proposed, interim-final, or final rules. But, you probably don’t know exactly what that means or how they get to those stages in the first place. 

AnnSullivan

The Process of Rulemaking

 

The first thing to know is that proposed regulations are known as “rules” and the rulemaking process is lengthier than you might expect. When Congress passes a law, the agency then gets to work to implement it. The final product is a new regulation. To get from the passage of a law to a new regulation involves a number of steps by the agencies.  


An agency’s first step is to develop a draft regulation known as a proposed rule. Then, the agency sends the draft to the Office of Information and Regulatory Affairs (OIRA) for review. OIRA is tasked with circulating this regulation among other government agencies, taking into account this feedback. OIRA is a federal office that was created by Congress in 1980. In 1991, an Executive Order directed that the office would formally review all draft proposed and final rules before they were published in the Federal Register.


OIRA makes suggested changes and sends the proposed rule back to the agency. The agency then issues a proposed rule which it publishes on www.regulations.gov for public comment. The comment period is usually open for 60 days, although some only accept comments for 30 days. Comments are not limited to organizations like WIPP – anyone or any entity can provide comments on a proposed rule. 


The agency reviews the public input to revise a final product which typically takes another 60 to 90 days and summarizes its findings and issues a final rule. Done, right? Not quite. The final rule once again goes to OIRA for review – only when this approval process is complete can the new regulation be published as a final rule.


Need more information on the process? Download the SBA’s Office of Advocacy Basic Guideline to Rulemaking and Small Businesses.  


What WIPP Comments On

 

WIPP has commented on a number of important proposed rules on a variety of issues. By commenting on proposed rules, WIPP has the ability to shape the outcome of the regulation. The devil is in the details, so this stage of advocacy is, in many cases, as important as passage of the law. 


In 2019, WIPP submitted comments to SBA on a number of small business contracting rules ranging from the proposed WOSB/EDWOSB certification rule, to the rule implementing the Small Business Runway Extension Act. WIPP also submitted comments to the Department of Defense (DoD) on its proposed Cybersecurity Maturity Model Certification—a far-reaching cyber certification, which will affect every federal contractor and subcontractor.


Just last month, the Federal Acquisition Regulation (FAR) Council recently proposed an interim final rule that will amend the FAR to prohibit the federal government from procuring or obtaining, or extending or renewing a contract to procure or obtain, “any equipment, system, or service that uses covered telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system” in order to combat the national security and intellectual property threats that face the United States. 


WIPP recognized the wide-reaching importance of this rule and jointly submitted comments in response. It is important to note that the interim rule impacts ALL contractors — not just those that offer information and communication technology. Each contractor is responsible for determining whether telecommunications equipment and services will be provided under both new and existing contracts and orders. 


Learn more about FAR Council


Take Action Now


As we noted in our Advocacy Update last month, the FAR Council has issued a proposed rule to avoid using Lowest Price Technically Acceptable (LPTA) source selection criteria in circumstances that would deny the government the benefits of cost and technical tradeoffs in the source selection process. LPTA has been a long-hated acquisition pricing policy in the small business community. This rule specifically states that LPTA source selection criteria should be avoided for procurements for IT services, cyber security, systems engineering services, and others. 


Submit a comment on this proposed rule by December 2, 2019


Note: One part of the regulatory process to note— when the FAR Council issues a proposed rule it is listed with a “FAR Case” number instead of a “Regulatory Identification Number” (RIN).


It’s tough to keep up with everything as a small business – I know – I am one. That’s why membership in WIPP is critical to your bottom line – we follow and initiate the actions important to women-owned businesses.


Tags:  Advocacy  FAR  regulatory 

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