Articles Posted in Government Contracts

For bid requests issued on or after July 1, 2016, California school districts, with approval of their governing board, may procure design-build contracts for projects in excess of $1M, awarding the contract to either the low bid or the best value. The threshold currently is $2.5M. The new threshold was enacted as part of Assembly Bill 1358 (Dababneh) and will remain in place until January 1, 2025, unless a later enacted statute deletes or extends that date. As those in the industry already familiar, “design-build” refers to “a project delivery process in which both the design and construction of a project are procured from a single entity.” Design-build contractors should also take note that the new law will require that certain information is verified under penalty of perjury.

Photo:  Alan Levine, School, Taken May 24, 2012 – Creative Commons

Public works contracts awarded on or after July 1, 2016 will be subject to the more expansive definition of public works added by California Assembly Bill 219 (Daly). For purposes of Article 2 of California’s Labor Code, commencing with Section 1770, the term “public works” will include “the hauling and delivery of ready-mixed concrete to carry out a public works contract, with respect to contracts involving any state agency, including the California State University and the University of California, or any political subdivision of the state.” Those who will be encompassed within the new definition will be required to pay the applicable prevailing wage rate, which will be the rate for the geographic area in which the concrete factory or batching plant is located, and to provide employee payroll and time records, as specified.

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In A New Cybersecurity Regime and a New Regulation to Mandate Secure Information Systems for Government Contractors, my colleague Travis Mullaney and I discuss Congress’ recent enactment of a wave of legislation to address ongoing cybersecurity threats, the Executive Branch’s recent adoption of new cybersecurity regulations, and other Federal initiatives that are underway and that will bring additional promised change requiring enhanced cybersecurity protections. In our Advisory, we discuss what government contractors need to do to prepare for these changes.

Photo:  Intel Free Press, Computer Security, Taken Sep. 4, 2012 – Creative Commons

On April 15, 2016, the Government Accountability Office (GAO) issued a proposed rule in the Federal Register that would amend its current bid protest regulations, codified at 4 C.F.R. Part 21. The proposed rule adds a degree of formality to the protest process, but overall the rule mainly codifies or clarifies existing protest practices. In Proposed Changes to GAO Bid Protest Rules: Greater Formality, Overall Familiarity, my colleagues John Jensen, Dick Oliver, Meghan Doherty and I summarize the key proposed amendments.

In False Claims Act “Implied Certification” Update: Supreme Court Oral Argument Forecasts Continued Vitality of Controversial Doctrine, we, along with our colleague Danielle Vrabie, report on the recent oral argument before SCOTUS, in Universal Health Services v. United States ex rel. Escobar, No. 15-7, a case expected to resolve the current split among federal courts of appeals on the so-called “implied certification” theory of liability under the federal False Claims Act (FCA). SCOTUS’ decision, whatever it is, will have an enormous impact on the federal contractor and subcontractor community. If SCOTUS follows the expansive interpretation of implied certification endorsed by the First Circuit in Escobar, then federal contractors and subcontractors will be vulnerable to the risk that the government will escalate any lack of contract compliance into an FCA investigation.

Additional Source: SCOTUS Expected To Resolve Circuit Split on Implied Certification Under FCA

Photo:  Ryan Wick, Supreme Court Room, Taken December 29, 2009 – Creative Commons

In Government Contractors Brace For Continuing Changes in Cybersecurity Regulations, my Pillsbury colleague Travis Mullaney and I caution that the federal government is making cybersecurity a top priority and government contractors should expect a number of new regulation’s, policies and standards aimed at protecting against increasingly sophisticated cyber-warfare. As the government invigorates its own cybersecurity, contractors are and will be subject to parallel requirements. All federal contractors need a cybersecurity strategy that aligns with their business strategy with the federal government that will make them more competitive as requirements are invigorated through ongoing federal regulatory changes.

As a result of California Senate Bill (SB) 854, all contractors have been required since April 1, 2015, to register with the California Department of Industrial Relations (DIR) to be awarded a public works contract, even if the project did not go out to bid.  A mandatory renewal deadline is approaching for licensees who work on public works projects. Contractors whose registration with the DIR expired June 30, 2015, and have ongoing public works projects or plan to bid on new ones, must pay a$300 renewal fee before October 1, 2015, or face an additional $2,000 late penalty after that date.  If you are not sure whether your public works registration with DIR is still active, you can check the active contractor registration search tool to locate and confirm your registration. And, the CSLB noted that if you were registered last year and have neither bid on nor worked on any public works projects on or after July 1, 2015, you can renew for this fiscal year without incurring a penalty.

Additional Source:  DIR, Public Works Contractor (PWC) Registration; CSLB Urges Public Works Contractors to Renew Dept. of Industrial Relations Registration before October 1 or Pay Hefty; DIR Frequently Asked Questions