Redstone Government Consulting Blog | Contracts & Subcontracts Administration

Executive Order Impacting Funding on Contract or Grant Work

The President issued an Executive Order (EO) on January 20, 2025, to immediately pause the disbursement of funds appropriated through the Inflation Reduction Act of 2022 (Public Law 117-169) or the Infrastructure Investment and Jobs Act (Public Law 117058). This relates to programs for issuing grants, loans, contracts, or any other financial disbursements of such appropriated funds. The Office of Management and Budget issued a guidance memo on January 28 and rescinded the memorandum on January 29.

Topics: Contracts & Subcontracts Administration, DCAA Audit Support, Government Regulations, Federal Acquisition Regulation (FAR), Grants & Cooperative Agreements (2 CFR 200), REAs, Claims & Terminations

Why do contractors have to do market research? Simply put, you signed a contract with the US Government or a subcontract with a prime contractor that expects it – yes, it is contractually required. Plus, it is one of the most often reported contractor purchasing system review (CPSR) findings.

Topics: Proposal Cost Volume Development & Pricing, Contracts & Subcontracts Administration, Contractor Purchasing System Review (CPSR), Government Regulations, Federal Acquisition Regulation (FAR), Commercial Item Determination

The FAR Council issued a proposed rule on January 15, 2025, to expand the CUI requirements into FAR under Executive Order 13556 Controlled Unclassified Information. Controlled Unclassified Information is information that the government creates or possesses, or that an entity creates or possesses for or on behalf of the government, that a law, regulation, or governmentwide policy requires or permits an agency to handle using safeguarding or dissemination controls. CUI may not be released to the public.

Topics: Contracts & Subcontracts Administration, DFARS Business Systems, Contractor Purchasing System Review (CPSR), Government Regulations, Federal Acquisition Regulation (FAR), Cybersecurity

Let’s start with the basics. When is a commercial determination required in the Federal Acquisition Regulations (FAR)? The common belief is that only when the award of a subcontract exceeds the cost or pricing data threshold. This common belief is what we refer to as a too-often believed myth. The truth is that FAR 52.244-6, Subcontracts for Commercial Products and Commercial Services, specifically requires that “to the maximum extent practicable, the Contractor shall incorporate, and require its subcontractors at all tiers to incorporate, commercial products, commercial services, or non-developmental items as components of items to be supplied” to the Government. To comply with this requirement, as many as possible of your purchase orders issued under your U.S. Government contracts and subcontracts should have commercial determination regardless of the dollar value.

Topics: Proposal Cost Volume Development & Pricing, Contracts & Subcontracts Administration, Government Regulations, Federal Acquisition Regulation (FAR), Commercial Item Determination

While the cost principle is titled “Rental Costs,” it addresses the cost of renting and leasing real and personal property utilized in the performance of US Government procurement contracts and subcontracts. The way I read the cost principle, FAR 31.205-36(b) provides that rental and leasing costs are allowable with the following limitations:

Topics: Compliant Accounting Infrastructure, Litigation Consulting Support, Contracts & Subcontracts Administration, Government Regulations, Federal Acquisition Regulation (FAR)

On November 7, 2024, the Armed Services Board of Contract Appeals (ASBCA) issued a decision that every small business needs to read. ASBCA Case 62458 Left Hand Design Corporation Decision explains exactly how the Federal Acquisition Regulation (FAR) implements the statutorily required penalties through FAR 42.709-6, Waiver of the penalty, and provides a cautionary tale for small businesses or large businesses that are new to government contracting.

Topics: Compliant Accounting Infrastructure, Contracts & Subcontracts Administration, Government Regulations, Federal Acquisition Regulation (FAR)

As Kevin so aptly put it in Home Alone 2 – “Another Christmas in the trenches.”

Topics: Government Shutdown, Contracts & Subcontracts Administration

Both the Federal Acquisition Regulations (FAR) used by Federal Agencies to acquire products and services to support their operations and 2 Code of Federal Regulations (CFR) 200 used by Federal Agencies for grants to support Federal programs set forth requirements that the organizations awarded contracts or grants have an established purchasing/procurement systems. Before getting a procurement under a grant, you must determine if any lower-tier organization is either a subrecipient or a contractor (read more in this article, “Understanding your Lower-Tier Relationships with Subrecipient and Contractor Determinations under 2 CFR 200.” In this article, we are only dealing with contractors under 2 CFR 200 and subcontractors under the FAR.

Topics: Compliant Accounting Infrastructure, Contracts & Subcontracts Administration, Contractor Purchasing System Review (CPSR), Government Regulations, Federal Acquisition Regulation (FAR), Grants & Cooperative Agreements (2 CFR 200)

On October 15, 2024, the Department of Defense (“DoD”) published the final rule of the Cybersecurity Maturity Model Certification (“CMMC”) requirements in Title 32 of the Code of Federal Regulations, effective December 16, 2024. The Final Rule updates DoD national security regulations to ensure contractors have implemented cyber security measures to safeguard Federal Contract Information (FCI) and Controlled Unclassified Information (CUI). CMMC will be contractually required when the Defense Federal Acquisition Regulation (“DFARS”) clause has not been finalized (see our article, “DoD Issues CMMC Proposed Rule – Submit your comments by October 15, 2024”). We will refer to this DFARS clause throughout this blog as the DFARS CMMC Clause Final Rule.

Topics: Contracts & Subcontracts Administration, Government Regulations, Federal Acquisition Regulation (FAR), Cybersecurity

I wrote an article in 2022, “The Future Does Not Look Good For COVID-Related REAs.” Well, it looks like things may have changed. On October 2, 2024, the Armed Services Board of Contract Appeals (ASBCA) issued its decision in the Appeals of Chugach Federal Solutions, Inc. ASBCA Nos. 62712, 62713, and 62877. In this case, the Board “rule[d] the government … failed to carry its burden to establish the sovereign acts defense.”

Topics: Contracts & Subcontracts Administration, Government Regulations, COVID-19, Federal Acquisition Regulation (FAR), REAs, Claims & Terminations