Tag Archives: Government Regulations

Neutrality Matters

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Net Neutrality CNN dot com

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“WIRED”

“In a time when there are too few companies with too much power – we need net neutrality now more than ever.

Getting rid of Title II would lead to even more centralization, handing more power to the largest Internet companies while stifling competition and innovation.

Next month, Amazon, Netflix, and dozens of other companies and organizations will host a “day of action” aimed at saving net neutrality as we know it. The Federal Communications Commission, meanwhile, is on the verge of revoking its own authority to enforce net neutrality rules, and the country’s biggest telecommunications companies are cheering along. The future of the internet is on the line here, but it’s easy to be cynical about the conflict: What does it matter which set of giant corporations controls the internet?

Under the current net neutrality rules, broadband providers like Comcast and Charter, and wireless providers like AT&T and Verizon, can’t block or slow down your access to lawful content, nor can they create so-called “fast lanes” for content providers who are willing to pay extra. In other words, your internet provider can’t slow your Amazon Prime Video stream to a crawl so you’ll keep your Comcast cable plan, and your mobile carrier can’t stop you from using Microsoft’s Skype instead of your own Verizon cell phone minutes.

If the Trump administration gets its way and abolishes net neutrality, those broadband providers could privilege some content providers over others (for a price, of course). The broadband industry says it supports net neutrality in theory but opposes the FCC’s reclassification of internet providers as utility-like “Title II” providers, and that consumers have nothing to worry about. But it’s hard not to worry given that without Title II classification, the FCC wouldn’t actually be able to enforce its net neutrality rules. It might be less alarming if the internet were a level playing field with free and fair competition. But it’s not. At all.

If you want to search for anything online, you’ve got to go through Google or maybe Microsoft’s Bing. The updates your Facebook friends share are filtered through the company’s algorithms. The mobile apps you can find in your phone’s app store are selected by either Apple or Google. If you’re like most online shoppers, you’re mostly buying products sold by Amazon and its partners. Even with the current net neutrality laws there’s not enough competition—without them, there will be even less, which could stifle the growth and innovation that fuels the digital economy.

Fast lanes or other types of network discrimination could have a big impact on the countless independent websites and apps that already exist, many of which would have to cough up extra money to compete with the bigger competitors to reach audiences. Consider the examples of Netflix, Skype, and YouTube, all of which came of age during the mid-2000s when the FCC’s first net neutrality rules were in place. Had broadband providers been able to block videos streaming and internet-based phone calls in the early days, these companies may have seen their growth blocked by larger companies with deeper pockets. Instead, net neutrality rules allowed them to find their audiences and become the giants they are today, and without net neutrality, they could even potentially become the very start-up-killers that would’ve slowed or stopped their own earlier growth. Getting rid of net neutrality all but ensures that the next generation of internet companies won’t be able to compete with the internet giants.

The end of net neutrality could also have ranging implications for consumers. Amazon, Netflix, YouTube, and a handful of other services may dominate the online video market, but without net neutrality, broadband providers might try to make it more expensive to access popular streaming sites in an attempt to keep customers paying for expensive television packages. “[Net neutrality] protects consumers from having the cost of internet go up because they have to pay for fast lane tolls,” says Chris Lewis, vice president of the advocacy group Public Knowledge.

Lewis also points out that there are a few other consumer friendly protections in the FCC’s net neutrality rules. For example, the FCC rules require internet service providers to disclose information about the speed of their services, helping you find out whether you’re getting your money’s worth. They also force broadband providers to allow you to connect any device you like to your internet connection, so that your provider can’t force you to use a specific type of WiFi router, or tell you which Internet of Things gadgets you can or can’t use.

“The Internet is as awesome and diverse as it is thanks to the basic guiding principle of net neutrality,” says Evan Greer, campaign director for Fight for the Future, one of the main organizers of the net neutrality day of action, which will take place on July 12 and try to raise awareness about net neutrality across the web.”

https://www.wired.com/story/why-net-neutrality-matters-even-in-the-age-of-oligopoly/

Are You Prepared for a Contract Cancellation?

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nbmcwdot com 31949-Termination-of-Contract

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“WASHINGTON TECHNOLOGY”  By Darrell Hineman, Brian Courtney

“The possibility of a contract termination should be incorporated into every government contractor’s business continuity plan.

Implementing safeguards and procedures designed to mitigate the risk of a termination will limit the impact it has on your organization’s operations.

Preparing for the possibility of a contract termination is a defensive strategy that contractors should undertake now. Here are three key steps you should consider immediately:

  1. Plan ahead. Never consider your contract as “termination-proof.”
  2. Fully understand the contract termination process
  3. Learn how to calculate and submit your Request for Equitable Adjustment or settlement proposal.

The possibility of a contract termination should be incorporated into every government contractor’s business continuity plan. Implementing safeguards and procedures designed to mitigate the risk of a termination will limit the impact it has on your organization’s operations. Ask yourself, “Does my organization have procedures in place to deal with cure notices, customer complaints, and quality issues? What about monitoring subcontractors?”

If you are still reading this article, you probably are not as well prepared for a contract termination as you should be. Most contract terminations have a root cause and are not solely due to the government no longer requiring the items or services.

Here are some common contract termination causes and how to prevent them:

Failure to immediately address government concerns

Whether a complaint or “suggestion” is received verbally or in writing from the government, there should be a process in place to respond immediately. Often, we hear from clients that their program personnel were in the process of addressing a government issue (but apparently not in real-time). Now, they are dealing with a cure notice for many items to be corrected in two weeks.

Incorporate the handling and response to government communications and complaints/concerns into your program management policy and procedures. All complaints/concerns should be documented and tracked from the initial problem to the eventual solutions.

Regular communication with the government is also critical in staying ahead of potential contract issues and preventing a termination. The contractor program manager should routinely relay project status to the government in writing – even if not required under the contract terms. We recommend weekly communications but, depending on the project, monthly communications may suffice.

Failure to evaluate change orders for potential effect on cost or schedule

Sometimes, trying to fully please the client can actually lead to a termination. A contractor has only 30 days from the date of receipt of a written order to assert its right to an adjustment. Often, accepting changes without evaluating the impact on scope, cost, and/or schedule can lead to project delays and cost overruns. These may ultimately result in missed delivery/performance dates.

As a preventative measure, create a standard procedure to evaluate the impact of any change request on the scope, cost, and/or schedule of a project. Share this required procedure with the customer: “Yes, we can make changes, but we first need to evaluate the scope, cost, and schedule to identify any project impacts.”

Subcontractor performance issues

Many contractors focus on complying with the requirement to issue subcontracts and neglect their associated responsibility for managing subcontractors under FAR 42.202(e)(2), Assignment of Contract Administration. Prime contractors often assume, without oversight or verification, that their subcontractors will meet prescribed performance and deliverable requirements.

When a subcontractor fails to deliver, the prime contractor is ultimately responsible for addressing the issue, or may face termination. Therefore, you should ensure that you flow down the proper terms and conditions to your subcontractors, including the prime contract termination clauses and deliverable dates.

Another step we recommend is to create a post-award subcontract administration procedure to address the risk. Ensure that adequate and comprehensive subcontractor oversight is built in to your procurement and project management processes. Any issue that can affect contract performance/delivery must be escalated quickly for resolution.

Bidding on unprofitable work

Today, when lowest price, technically acceptable typically beats out best value (though recent legislation directs more limited use of LPTA procurements), contractors often estimate their cost to fit the price they want to bid and what they think the government is willing to pay. Instead, you should be focusing on the actual cost required to address the government’s mission-stated requirements.

Even though you may know that the “price to win” is too low to perform the work adequately, the proposal development organization might not want to deviate from that winning number.

To avoid bidding on unprofitable work, you should develop a comprehensive estimating manual and system so that your estimated costs are based on real costs/prices currently in the marketplace. As part of this, build and encourage a corporate culture that incentivizes employees for more profitable work as opposed to contract wins exclusively.

As no contract is termination proof, the key is to always be prepared and have a defense strategy in place at all times.”

About the Authors

Darrell Hineman is the director of the government compliance group at the accounting, tax and advisory firm CohnReznick LLP. https://www.cohnreznick.com/industries/government-contracting

Brian Courtney is a senior manager at the accounting, tax and advisory firm CohnReznick LLP. https://www.cohnreznick.com/industries/government-contracting

https://washingtontechnology.com/articles/2017/06/09/insights-contractor-termination.aspx

 

For more information on the types of contract terminations, preparing for them and managing them, please see the article linked below:

http://www.smalltofeds.com/2011/08/federal-government-contract.html

GAO: “Late Means Late for Contract Proposals”

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Image: National Defense Magazine

“NATIONAL DEFENSE MAGAZINE” By By Julia Lippman and Jason Workmaster

“GAO’s opinion should serve as a warning to contractors that a late proposal will not be considered.

Especially with the use of electronic submission processes, a matter of seconds can be the difference between a timely and late proposal.

The Government Accountability Office on Feb. 27 reiterated its long standing rule that, when it comes to proposal submissions, “late” means “late.”

GAO addressed a protest filed by Tele-Consultants Inc. in connection with a request for proposals issued by Naval Sea Systems Command. TCI’s protest argued that its proposal was improperly rejected by the agency for being submitted after the deadline.

Under the request for proposals, the Navy sought support services for the Naval Undersea Warfare Center through the issuance of a task order to a small business holder of the SeaPort-e multiple award indefinite-delivery/indefinite-quantity contract. The solicitation was issued Sept. 28, 2016 and proposals were to be submitted electronically through the SeaPort-e portal by Nov. 8 at 2:00 p.m. eastern time. The solicitation required compliance with the proposal submission instructions outlined in the SeaPort-e multiple award contract and the SeaPort Vendor Portal User Guide.

In using the portal, contractors were required to designate an “authorized user” who could confirm the intent to engage in a legally binding action, such as submitting a proposal. When a contractor was ready to submit its proposal, its authorized user was required to use the “submit signed proposal” button. The portal would then generate a confirmation prompt that would require the user to confirm his or her intent to electronically sign and submit the proposal.

The portal was set up so that contractors could store their proposals on the contractor side of the portal prior to submitting their proposal.

The agency received three proposals by the deadline. TCI’s proposal was not among them. Rather, TCI’s proposal remained in its draft form on the contractor side of the portal because it had not engaged the submit button.

Based on a review of the server logs, the agency determined that TCI’s representatives had unsuccessfully tried to engage the button 23 and 34 seconds after the proposal deadline. TCI reached out to the contracting officer by phone and email stating that the proposal button had not allowed it to submit its proposal but that “TCI’s proposal was timely submitted and it was intended to be binding on TCI.”

TCI received an email that evening from the SeaPort-e portal that noted that, “[a]n event for which you created a draft proposal has closed without you completing the final submission process. As a result, the draft will not be considered.” There was no indication that the portal had experienced any technical malfunction that would have prevented TCI from timely submitting its proposal.

TCI argued that its proposal should not have been rejected because, even though it did not receive notice that its proposal was timely submitted, its proposal was, in fact, submitted on time. Additionally, TCI argued that, even if its proposal was late, it was in the government’s control and was, thus, subject to the exception set forth in FAR 15.208. Under FAR 15.208, proposals that are submitted after the deadline are late unless, among other exceptions, there is evidence that the proposal “was received at the government installation designated for receipt of proposals and was under the government’s control prior to the time set for receipt of proposals[.]”

TCI argued that the archival lock on proposal files was acceptable evidence to establish that its proposal was received at the government installation designated for receipt of proposals and was under the government’s control prior to the time set for receipt of proposals.

The agency responded that TCI’s failure to engage the button meant that TCI had failed to submit its proposal either on time or after the deadline. The agency explained that proposals were not added to the government side of the portal until the submit button was selected. Thus, TCI’s proposal was never received by the government or under the government’s control. The agency also proffered that it could not know if TCI meant to be legally bound by its proposal in light of its failure to engage the button.

Although noting that it was not clear that FAR 15.208 even applied to this FAR Part 16 procurement, GAO nevertheless agreed with the agency and found that TCI failed to submit its proposal. GAO reiterated the well-established rule that an offeror is responsible for delivering its proposal to the designated place by the designated time and that an agency is not required to consider a proposal when there is no evidence that it was “actually received” by the agency.

GAO found that there was no evidence that TCI had actually submitted its proposal to the agency as the electronic submission of a legally binding offer was not completed. TCI did not dispute that it tried to use the submit button after the 2:00 p.m. EST deadline. And TCI never engaged the button even though it tried to do so. TCI’s failure to engage the button meant that it had never submitted a legally binding proposal. GAO concluded that it had “no basis to challenge the agency’s decision that it had not received, and could not consider, TCI’s draft proposal.”

Contractors should take extra care when submitting a proposal electronically to ensure that all proper submittal steps for the submission of a legally binding proposal have been completed well before a proposal deadline.

Additionally, a proposal stored on a government portal may not be sufficient to establish it was in the government’s control.”

Jason N. Workmaster is of counsel and Julia Lippman is an associate in the government contracts practice at Covington & Burling LLP.

http://www.nationaldefensemagazine.org/articles/2017/6/15/late-means-late-for-contract-proposals

 

 

Tight Government Agency Budgets Bring a Silver Lining

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“WASHINGTON TECHNOLOGY” By Stan Soloway

“Growing funding pressures and uncertainty place a growing onus on agencies to navigate the turbulence in new and innovative ways.

Thus, far from being a market killer, it actually presents opportunity.

For years, the question of when the government might return to “regular order” –that is, a “normal” process in which appropriations are essentially completed by the end of September—has been a prominent one.

Agency leaders, industry, and others, have continually and appropriately harped on the deleterious impacts of the funding yo-yo that has dominated the scene for far too long.
And if there was one thing many hoped for as a result of having one party in control of both the White House and Congress, it was a return to regular order.

Well, it’s probably not going to happen. As virtually all recent reports have indicated, the budget debate within the parties, let alone between the parties, remains fierce and the chances of getting a full year fiscal 2018 funding bill by Sept. 30th are slim indeed.

President Trump’s budget blueprint – the “skinny budget” — generated plenty of debate; the release of his full proposed budget will only turn up the heat further. No  budget resolutions have yet been proposed, let alone passed, and no spending instructions given to the appropriations committees.

Beyond that, consider what else Congress has to deal with over the next four months: the farm insurance bill; the children’s insurance program (CHIP); health care; possibly tax reform; and, of course, the debt ceiling. In other words, while a complex and many-layered debate is virtually certain, it has not yet really begun and one or more continuing resolutions appear almost certain.

To complicate matters further, the Senate cannot even take up the budget until after it finishes with health care, because as soon as a budget bill is passed the rules change previously instituted by the Democrats (requiring only a majority vote) will revert back to the standard rule under which 60 votes will be needed.

Thus, the betting is that another continuing resolution, or a series of them, will be needed.

And that is never a good thing for smart planning and program execution.

Nonetheless, it would appear that over the years most agencies have actually gotten pretty good at adjusting to the external dynamics and finding a way to do their jobs. Even as agencies struggled with the White House’s early budget instructions, most continued to operate relatively normally. And that has mostly carried over to the market as well.

Unlike what we saw with sequestration—the impacts of which were seen and felt months before it went into effect—the impacts of the potential or expected spending reductions are not reflected in a broad market slow-down. In fact, with the exception of State and EPA,  just the opposite seems to be happening.

Through the first two quarters of fiscal 2017, civilian agency spending on professional services and IT both grew by double digits over the same period last year. At the Defense Department, for which we only have data for the first quarter, the pattern was the same (16 percent for professional services; 10 percent for IT).

And while it may seem counter-intuitive, this is actually consistent with what we’ve seen in recent years. Often, those agencies under the toughest budgetary pressures have also been those in which the market has performed best.

Again, this is in part the result of agencies having learned to operate amidst the chaos. But more importantly, it appears to validate another key market dynamic: as agencies are forced to be more and more selective with their funding, their highest priority missions, and thus those most fully funded, tend to be highly tech-centric (cyber, analytics, automation, etc.).

Almost by definition, those missions require more private sector support than other, more routine operations. Thus, market growth in a constrained environment is not only possible, it is likely.

Going forward, aside from major reductions in mission or service, agencies’ best hopes and strategies for dealing with the budget realities largely lie in aggressively expanding the degree to which they capitalize on opportunities to substantially reduce costs (and improve service) across the board, driven by the emergence of the digital economy.

It’s happening across the commercial sector; and this budget could well catalyze a similar transition in government.

This is not to say that predictability and stability should not still be a goal. It absolutely should be. Nor is it to suggest that some budget cuts won’t have very real negative impacts on segments of industry. They will.

But as the data and other trends suggest, stability may not be the holy grail it once appeared to be. ”

https://washingtontechnology.com/articles/2017/05/22/insights-soloway-budget-silverlining.aspx

About the Author

Stan Soloway

Stan Soloway is a former deputy undersecretary of Defense and former president and chief executive officer of the Professional Services Council. He is now the CEO of Celero Strategies.

First-ever Audit At The Department of Defense

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First Ever Audit at the Pentagon

“DEFENSE ONE”

“The Department of Defense is preparing for its first-ever audit.

The nation’s most sprawling and expensive bureaucracy and the world’s largest employer—has yet to undergo a formal, legally mandated review of its finances.

[It] has become a preoccupation for members of Congress intent on demonstrating their fiscal prudence even as they appropriate more than $600 billion annually to the Pentagon.

“Like Waiting for Godot,” one Democratic senator, Jack Reed of Rhode Island, quipped about the absent audit at a recent hearing. The lack of formal accountability has left unanswered basic questions about how the military spends taxpayer money, like the precise number of employees and contractors its various branches have hired. Cost overruns have become legendary, none more so than the F-35 fighter-jet program that has drawn the ire of President Trump. And partial reports suggest that the department has misspent or not accounted for anywhere from hundreds of billions to several trillion dollars.

After years of missed deadlines, the mounting political pressure and a renewed commitment from the Trump administration might finally result in an audit. For the first time last year, both major political parties called for auditing the Pentagon in their campaign platforms. That unites everyone from Hillary Clinton and Elizabeth Warren to Ted Cruz and the House Freedom Caucus. And last week, Trump’s nominee to serve as comptroller for the Pentagon, David Norquist, testified at his Senate confirmation hearing that he would insist on one whether the department could pass it or not. “It is time to audit the Pentagon,” Norquist told members of the Senate Armed Services Committee in his opening statement.

As comptroller for the Homeland Security Department a decade ago, Norquist, the brother of the anti-tax advocate Grover Norquist, undertook the first successful audits of that much younger federal agency. The Defense Department is unlikely to meet a statutory deadline to be “audit-ready” by the end of September. But Norquist said he would begin the process even if the Pentagon’s financial statements were not fully in order, and he committed to having the report completed by March 2019.

What has prevented the Pentagon from being examined this way before? The answer lies somewhere “between lethargy and complexity,” said Gordon Adams, a distinguished fellow at the Stimson Center who was the top budget official for national security in the Clinton White House. “It hasn’t been done ever,” he told me, “partly because it’s incredibly complicated to do and also because there’s not a great, powerful will in the building to do it.”

The complexity of the project dates back to the Civil War, Adams said, when the Army and the Navy set up their own separate accounting systems. The Air Force also went its own way after its creation following World War II, and the military build-ups of the last four decades scrambled the department’s financial records many times over. The explosion of military contractors since 9/11 has made scrubbing the books harder still. Adams estimated that an audit would have to account for 15 million to 20 million contracting transactions each year. The Pentagon has spent several billion dollars over the last seven years just trying to consolidate its accounting systems in preparation for a potential audit.

Despite the ramp-up costs, the project has never risen to be a top priority; the Pentagon has simply been too busy fighting wars. “The military has repeatedly argued that they need to focus on the war effort and accountability can come later,” said Kori Schake, a fellow at the Hoover Institution who previously served in a variety of national-security positions in the government. That excuse carried more weight with lawmakers in the years when the United States had hundreds of thousands of troops fighting in Iraq and Afghanistan.

Now, top Republicans like Senator John McCain of Arizona, chairman of the Armed Services Committee, are pressing for an audit with more urgency. “This has been a very public continuing failure for the Department of Defense, in large part due to the failure of senior management to make this a priority for the department and invest the necessary time and will to get it done,” McCain said at the outset of Norquist’s hearing. “This must end with you,” he told the president’s nominee.

Yet those fiscal hawks hoping that the long-awaited report will spur substantial reforms to defense spending are just as likely to be disappointed. An audit by itself won’t dismantle the “military industrial complex” that former President Dwight Eisenhower famously warned about, nor will it lead members of Congress to stop fighting to protect the bases and weapons systems that are manufactured in their districts—and the jobs that come with them. Several times in recent years, it has been congressional lobbying that has kept up production of weapons and equipment that the military no longer considers necessary.

“An audit does not raise the big issues,” Adams said. “It doesn’t tell you that we’re not getting the right bang for the buck. It doesn’t tell you anything about whether we’re getting the right forces for the threat. It doesn’t tell you how well the forces perform. It doesn’t tell you where we are wasting capability that we don’t need.”

“What it allows a member of Congress to do,” he continued, “is to look tough on defense and spend a lot on defense at the same time.”

Spending a lot on defense is what the Trump administration wants to do, even as it pledges its support for a Pentagon audit. The White House has asked Congress for a $54 billion increase in the military budget over the next year and secured about $15 billion of that in the recent spending deal. “It’s harder when there’s a big inflow of cash to focus on something like the audit,” said William Hartung, director of the arms and security project at the Center for International Policy. “There’s still that incentive to just push the money out the door.”

There’s some hope among audit advocates that the administration’s demand for more money will give congressional spending hawks leverage to insist on progress toward the accounting milestone in exchange for a budget increase. But they also don’t believe leverage should be necessary to demand that a department with a workforce pegged at more than 3 million people commit, at long last, to some basic bookkeeping. “We would never accept the argument that the Department of Education is too big and too complicated to be accountable,” Schake argued. “Why do we accept that for Defense?”

http://www.defenseone.com/politics/2017/05/white-house-vows-audit-pentagon-which-would-be-first/137928/?oref=d-channeltop

 

Navigating Defense Department Cyber Rules

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Cyber Rules

“NATIONAL DEFENSE MAGAZINE”

“Defense contractors by Dec. 31 are expected to provide “adequate security” to protect “covered defense information” using cyber safeguards.

Thousands of companies who sell directly to the Defense Department, and thousands more who sell to its suppliers, are or will be, subject to the rule.

This obligation arises from a Defense Acquisition Regulation System Supplement clause, “Network Penetration Reporting and Contracting For Cloud Services,” that was finalized last October and described in the National Institute of Standards and Technology (NIST) Special Publication 800-171.

The Pentagon is well-justified to seek improved cyber protection of sensitive but unclassified technical information. Hackers have exploited network vulnerabilities in the defense supply chain for the unauthorized exfiltration of valuable and sensitive defense information. Senior defense officials have expressed alarm at this persistent and pervasive economic espionage. 

Since 2013, the Defense Department has used acquisition regulations to protect controlled technical information significant to military or space. Other forms of information may not have direct military or space significance, but loss of confidentiality through a cyber breach can produce serious, even grave national injury. 

The Defense Department is the leader among federal agencies in using its contractual power to cause its vendors to improve their cybersecurity. The principal instruments are two contract clauses, DFARS 252.204-7008, “Compliance with Safeguarding Covered Defense Information Controls,” and DFARS 252.204-7012, “Safeguarding Covered Defense Information and Cyber Incident Reporting.” Both were the subject of final rulemaking released Oct. 21.

Where the -7008 “compliance” clause is included in a solicitation, the offeror commits to implement the SP 800-171 safeguards by the end of this year. Defense Department contracts will include the -7012 “safeguards” clause, which defines the types of information that must be protected, informs contractors of their obligation to deliver “adequate security” using SP 800-171 controls, and obligates reporting to the department of cyber incidents.  

Every responsible defense supplier supports the objectives of these cyber DFARS rules. But the requirements are complex and are not currently well-understood. Outside of a few of the largest, dedicated military suppliers, many companies in the defense supply chain view these rules with a mix of doubt, concern and alarm. This recipe serves neither the interests of the Defense Department nor its industrial base.

A technology trade association, the IT Alliance for Public Sector, released a white paper that examines the Defense Acquisition Regulation System Supplement and other federal initiatives to protect controlled unclassified information. The goal was to assist both government and industry to find effective, practical and affordable means to implement the new cyber requirements. The paper examines these five areas: designation, scope, methods, adoption and compliance.

As for designation, the department should accept that it is responsible to identify and designate the covered defense information that contractors are obliged to protect. It should confirm that contractors only have to protect information that it has designated as covered, and that such obligations are only prospective — newly received information — and not retrospective.

In regards to “scope,” the Defense Department should revise the rule to clarify that contractors must protect information that it has identified as covered and provided to the contractor in the course of performance of a contract that is subject to the rule. The definition of “covered defense information” should be revised to remove confusing language that can be interpreted to require protection of “background” business information and other data that has only a remote nexus to a Defense Department contract.

The October 2016 revision now allows defense contractors to use external cloud service providers, where covered information is involved, only if those vendors meet the security requirements of FedRAMP Moderate “or equivalent.” The Federal Risk and Authorization Management Program, or FedRAMP, is a government-wide program that provides a standardized approach to security assessment, authorization and continuous monitoring for cloud products and services.

The regulation fails to explain what is meant by “or equivalent” and who decides. The Defense Department needs to explain what it expects from cloud services to satisfy SP 800-171 and the DFARS rules. A security overlay should be prepared by NIST to add cloud-specific controls. But it is unnecessary to impose the whole of the FedRAMP process and federal-specific controls on commercial cloud providers.

The Defense Department continues to depend on small business for many needs, and seeks their innovative ideas. The supplements are an obstacle and burden on smaller businesses, and yet security is just as important at the lower levels of the supply chain as at the top. The department can improve the ability of small business to implement the required security controls. Several specific recommendations are made as to how it can reach and assist the small business community. One recommendation is to make increased use of the NIST voluntary cybersecurity framework.

As far as compliance, contractors are required to represent that they will deliver “adequate security” and fully implement the SP 800-171 controls by the year-end deadline. The Defense Department needs to better inform its contractors how they can be confident their security measures will satisfy the requirements should they come under scrutiny following a cyber incident. The white paper explores different ways to create a safe harbor for compliance. A key component is contractor documentation of a system security plan, which was added as a 110th requirement to SP 800-171.        

The White Paper is available here. The Defense Department is hosting an industry day on the cyber DFARS, June 23 at the Mark Center in Alexandria, Virginia. Information and registration details available here. ”     

http://www.nationaldefensemagazine.org/articles/2017/4/21/navigating-defense-department-cyber-rules

Revolving Door Picking Up Speed at the Pentagon and Homeland Security

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Pentagon Revolving Door

“THE INTERCEPT”

“Defense firms have eagerly watched as Trump recently unveiled a budget calling for $54 billion in additional military spending next year.

President Trump has weaponized the revolving door by appointing defense contractors and their lobbyists to key government positions as he seeks to rapidly expand the military budget and homeland security programs.”


“The spending spree will provide a brand new opportunity for defense lobbyists to get business for their clients. And the most effective lobbying generally involves contacting former colleagues in positions of power.

Two Department of Homeland Security appointments Trump announced Tuesday morning are perfect examples.

Benjamin Cassidy, installed by Trump as assistant secretary for legislative affairs, previously worked as a senior executive at Boeing’s international business sector, marketing Boeing military products abroad. Jonathan Rath Hoffman, named assistant secretary for public affairs, previously worked as a consultant to the Chertoff Group, the sprawling homeland security consulting firm founded by former Secretary of Homeland Security Michael Chertoff. The firm has come under fire for advising a variety of firms seeking government contracts, including for full-body scanners deemed invasive by privacy activists. Hoffman also led a state chapter of a neoconservative military-contractor advocacy organization during the 2016 presidential campaign. Neither position requires Senate confirmation.

Personnel from major defense companies now occupy the highest ranks of the administration including cabinet members and political appointees charged with implementing the Trump agenda. At least 15 officials with financial ties to defense contractors have been either nominated or appointed so far, with potentially more industry names on the way as Trump has yet to nominate a variety of roles in the government, including Army and Navy secretaries.

Before their confirmations, Jim Mattis and John Kelly, the secretaries of the departments of Defense and Homeland Security, were primarily paid by defense firms.

Mattis was paid $242,000, along with up to $500,000 in vested stock options, as director of General Dynamics, a company that produces submarines, tanks, and a range of munitions for the military. Mattis also received speaking fees from several firms, including Northrop Grumman. Kelly previously served in a number of roles at defense contracting consulting and lobbying firms and worked directly as an adviser to Dyncorp, a company that contracts with the Immigrations and Customs Enforcement.

Major lobbying groups for the arms companies, including the National Defense Industrial Association and the Aerospace Industries Association, welcomed the selection of Secretary Mattis, who has already scheduled meetings with industry executives. Secretary Kelly has pledged to work more closely with the private sector, promising greater collaboration with private firms to accomplish his agency’s goals.

To carry out this private-sector friendly agenda, defense officials have taken major roles throughout Trump’s administration.

Pat Shanahan, nominated last week by Trump to serve as deputy secretary of defense, is a vice president at Boeing who formerly led the company’s missile defense subsidiary. Disclosures show that Elaine Duke, the nominee for deputy secretary of homeland security, previously consulted for Booz Allen Hamilton, General Dynamics, and the Columbia Group, a small contractor that builds unmanned naval drones.

The nominee to lead the Air Force, former New Mexico Congresswoman Heather Wilson, worked as a consultant to a Lockheed Martin subsidiary after retiring from public office. The company sought Wilson’s help to maintain a $2.4 billion a year contract to manage Sandia National Laboratories, the premiere nuclear weapons research facility, and to keep the contract closed to competition. “Lockheed Martin should aggressively lobby Congress, but keep a low profile,” Wilson urged the company in a memo revealed later by an inspector general report.

Trump’s pick for national security council chief of staff, retired Lt. Gen. Keith Kellogg, has worked at a variety of defense contracting companies. After serving in senior roles in Iraq’s provisional government after the 2003 invasion, Kellogg left the government for the private sector. He told the Washington Post in 2005 that he joined Oracle to “establish a homeland security business unit” at the firm, and later joined CACI International, a company with major contracts in the wars in Iraq and Afghanistan. Following CACI, Kellogg joined Cubic Defense in 2009 to develop the company’s combat training business.

A list of temporary political appointees recently published by ProPublica reveals a number of less-known influence peddlers who have taken senior roles in the administration.

Chad Wolf and Lora Ries, two recently appointed advisers at the Department of Homeland Security, are formerly registered defense lobbyists. Wolf lobbied for Harris Corp. and the United Launch Alliance, a partnership between Boeing and Lockheed Martin. Ries previously lobbied for a range of defense and homeland security contractors, including Altegrity, Boeing, Implant Sciences Corp., General Dynamics, L1 Identity Solutions, and TASC Inc.

In the White House, one of the newest members of the National Economic Council staff is Michael Catanzaro, formerly a registered lobbyist working for both Boeing and Halliburton.

Palanatir Technology’s Justin Mikolay, formerly a chief in-house lobbyist for the company who worked to win over billions of dollars in Army contracts, was quietly appointed to serve as a special assistant in the Office of the Secretary of Defense.

Several appointees are associated with SBD Advisors, a consulting that firm that advertises its ability to facilitate “engagements between the technology and defense sectors,” and is advised by a high profile team of former government leaders, including former Chairman of the Joint Chiefs of Staff retired Adm. Mike Mullen and former National Security Agency Director of Operations Ron Moultrie.

SBD Advisors’d Sally Donnelly and Tony DeMartino work as temporary political appointees at the Office of the Defense Secretary, according to the list assembled by ProPublica. Kristan King Nevins, recently appointed as chief of staff to Second Lady Karen Pence, also previously worked at SBD Advisors as the director of communications.

The Trump administration is the “military-industrial complex personified,” said William Hartung, director of the Arms & Security Project at the Center for International Policy. Hartung noted that while the administration is bringing arms industry officials into government, it is also demanding a massive increase in military spending and appears to be escalating conflicts in Syria and Yemen.

In short, the Trump proposals are an armsmaker’s dream come true,” he said. “

https://theintercept.com/2017/03/21/revolving-door-military/

 

 

Want to Reform Government? Start with the Basics.

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government collaboration

Image:  “IP Dimensions”

“WASHINGTON TECHNOLOGY” By Stan Soloway

“The principal, and ultimately most impactful, evolution that needs to take place has little to do with law and everything to do with culture and people.

The generally poor quality of cross-sector communications and collaboration suggests, the workforce entering government today is being trained and developed in much the same way as multiple generations before them.”


“The email was most unexpected. In the midst of what had been a series of substantive discussions with a Defense Department command about the potential application of a new capability that might help address one of the command’s most pressing concerns, a command attorney effectively directed that the conversations cease. Because no “requirement” exists for the capability being discussed, he said, the conversations had to end.

Of course there is no “requirement” in place; they had only recently become aware of the technology. Our conversations were about whether and how it might be applicable. In other words, one can’t have a requirement for something one doesn’t even know about.

And let’s not even get started on why an attorney even stepped in. One would think the relevant program office could decide when and if their time was being wasted.

As I’ve relayed this story to friends and colleagues in both government and industry, it became clear that it is far from uncommon.

More than 20 years after the passage of acquisition reforms that, among other things, were designed to improve the government’s access to and communications with the private sector, and a half dozen years since the Office of Management and Budget issued its “Mythbusters” memo that was designed to make clear the importance of open communications, the problem remains all too present.

That is not to say there are no good examples of agencies and components swimming against the tide. There most certainly are. The Special Operations Command has created SofWerx, which invites companies of all sizes to demonstrate their capabilities and explore with the command possible applications. SOCOM acquisition executive Jim Geurts says his hope is that SofWerx will become a kind of “mosh pit” of ideas.

And then there is the Defense Innovation Unit Experimental, innovation labs in a range of agencies including Homeland Security, HHS and USAID. Beyond that, there have been more than 500 procurement contests and challenges, which by design invite any interested party to propose a solution to an identified problem.

For each of these activities, communications and collaboration are a core operating principle. But the reach of each also remains quite limited and each operates, to one extent or another, outside of the traditional acquisition process.

As the Trump Administration launches its new Office of American Innovation, focused on bringing smart business acumen to government, these examples also provide something of a framework from which to start.

First, whether acquisition is high on their target list or not today, it needs to be. After all, it is a critical engine upon which the government runs. And yes, there are a number of regulatory barriers that need to be eliminated to make that process work as it should.

Changing that paradigm in government requires that the workforce be given the tools, the training and the support to both understand and incorporate smart business concepts in the execution of their work. It requires that the workforce understand, far more than most do now, how businesses identify, manage and mitigate risk.

And it requires that they recognize that communications can be both appropriately limited and significantly more open than they might think.

Simply put, while the government is not a business, there are a wide array of best business practices from which the government would greatly benefit. And none is more important than the degree to which successful businesses have adapted and changed their approach to people and collaboration.

Every day I see examples where clients are engaged with their commercial customers at levels and depths that are exceptionally rare in the government arena.

As some have suggested, most of the business world has moved from the information age to the collaboration age. It’s past time for the government to embrace that shift as well. Finding new ways to make that happen would be a terrific first step to really changing and moving the government forward.”

About the Author

Stan Soloway is a former deputy undersecretary of Defense and former president and chief executive officer of the Professional Services Council. He is now the CEO of Celero Strategies.

https://washingtontechnology.com/articles/2017/03/27/insights-soloway-kushner-message.aspx

 

 

 

Army Vet: “Disgraceful Gun Bill Endangers Veterans”

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Vets Suicide and Guns

(Photo: M. Spencer Green, AP)

“USA TODAY”  By Lindsey Donovan

“Every day, 20 veterans take their lives — not surprisingly, two-thirds of them use a gun.

Yet in the midst of this crisis, our elected officials voted to remove from the background check system nearly 170,000 records of veterans with severe mental illnesses.

These veterans will now be able to purchase and possess firearms, even if they have been determined to be incapable of managing their own affairs.

I am a proud veteran of the Army. The seven Army Values are a part of my moral DNA. Loyalty, duty, respect, selfless service, honor, integrity and personal courage are at the heart of who I am today.

These values serve as the backbone to every servicemember who has served or is still serving in our armed forces, and they deserve better than what our federal lawmakers have given them. Instead of protecting our most vulnerable veterans — men and women with severe mental illness — the House recently passed a bill that made it easier for them to get guns.

Our veteran population is facing a devastating suicide crisis

How did we get to a point where the gun lobby’s bottom line means more to our lawmakers than the health and safety of those who have bravely served this country?

This issue hits the raw nerve of individuals who have lost their husbands, wives, children and friends to suicide. For me, it’s personal. Though I am a proud veteran, I am also the proud wife of a U.S. soldier. My husband has completed three combat tours in Iraq and a fourth in Afghanistan. Anyone who has been a witness to what multiple wars and deployments can do to soldiers and their families knows that war is hell. We send them over to do a mission and welcome them back expecting them to go on as usual. But it never works that way. Transitioning back to “normal” is sometimes too much to endure and for some, in the blink of an eye, it can seem like the only way out is through the barrel of a gun.

My own experience is what fuels me to speak out and urge our lawmakers to take a stand against this very dangerous bill. Shortly after my husband’s last deployment, a soldier who served in his unit died by suicide with a gun. It happened a few days after we saw that soldier. The shock I felt was indescribable. And the pain and sorrow I felt for those left behind, I hope to never feel again. To this day I still think about that individual. I don’t so much concentrate on the why, but the how. It was the gun, a deadly means to a tragic end.

In basic training, I was assigned a “battle buddy.” We were each other’s keeper; we had a duty to one another, a bond cemented by a shared experience. I look at my fellow veterans in the same terms, staying true to the Warrior Ethos of “I will always place the mission first, I will never accept defeat, I will never quit and I will never leave a fallen comrade.” Granting access to firearms to veterans who have been deemed mentally incompetent by the Department of Veterans Affairs is not looking out for the men and women who so courageously served our country. It is a disgrace, and it is far from patriotic.

As a gun owner, a veteran and a volunteer with Moms Demand Action for Gun Sense in America, I know this is not a Second Amendment issue. This is an issue about common sense. This is an issue about moral courage and fortitude to stand up and fight to keep our most vulnerable veterans safe from gun violence. The House bill on veterans is the second attempt to roll back gun laws in Congress. Just last month, President Trump signed a law reversing a requirement that the Social Security Administration submit records of mentally impaired recipients to the gun background-check system.

I won’t sit idly by and watch this latest affront to our safety. Our veterans deserve better, our active-duty military deserves better, than lawmakers who cater to the gun lobby and ignore the crisis of veterans and suicide. The well-being of our veterans should be the priority, and our lawmakers should reject this dangerous legislation.”

“Lindsey Donovan, an Army veteran married to an active-duty soldier, is a volunteer leader for the Georgia chapter of Moms Demand Action for Gun Sense in America, part of Everytown for Gun Safety.”

http://www.usatoday.com/story/opinion/2017/03/29/gun-bill-endangers-mentally-ill-veterans-suicide-army-vet-column/99740790/

Federal Government Contracts Need to Be Posted Online

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Open Contracting

“THE PROJECT ON GOVERNMENT OVERSIGHT’

“Last Week Senator Claire McCaskill (D-MO) introduced the “Contractor Accountability and Transparency Act of 2017” (S. 651), which POGO and eight other bipartisan groups supported.

The bill will expand the contracting information available on USASpending.gov (which now only offers summaries of contracts), make the contract information more accessible and readable, and help reduce Freedom of Information Act backlogs.

In fiscal year 2016, the federal government spent $472 billion for the acquisition of goods and services. In order to rein in spending and regain public faith in the contracting system, the government must provide public access to information on the contracting process. Posting copies of contracts—rather than summary data that offers little, if any, insights into the goods and services being purchased—is essential to learning about government activities and eliminating waste, fraud, abuse, and substandard performance.

When contract information is publicly accessible, genuine competition will increase, and the government will be better situated to get better deals, especially as budget constraints take hold. Simply stated, the government will be in a much improved position to leverage its robust buying power.

Despite concerns some have voiced about posting contracts, it can be accomplished without compromising national security information or contractors’ proprietary commercial or financial information.

In fact, many states have already adopted a more transparent contracting system without negatively impacting their ability to do business with contractors. According to a recent Project On Government Oversight report, at least 33 states proactively post some contracts online. That means two-thirds of the states are ahead of the federal government when it comes to contract transparency.

For many years, groups and Members of Congress have worked in a bipartisan manner to enhance transparency in the area of federal contract spending. In 2006, Senator Tom Coburn (R-OK), with the support of Senators John McCain (R-AZ), Tom Carper (D-DE), and Barack Obama (D-IL), introduced a bill that brought federal spending out of the Dark Ages—the Federal Funding Accountability and Transparency Act of 2006 (FFATA). That bill was signed into law (see the Notes section) by President George W. Bush, and it provided the foundation for USASpending.org and learning more about federal spending.

In 2008, all four Senators teamed up again to introduce the Strengthening Transparency and Accountability in Federal Spending Act of 2008, which proposed to enhance federal spending transparency. The new bill was intended to expand the scope of information that would become publicly available, including details about the contract bids and the award’s financial terms. Additionally, the bill would have posted searchable copies of “all contracts, subcontracts, purchase orders, task orders, lease agreements and assignments, and delivery orders.”

The 2008 election, pitting Senator Obama against Senator McCain, essentially caused the bill to die in the Senate Committee on Homeland Security and Governmental Affairs. But that wasn’t the last we heard about posting contracts online.

In addition to Senator McCaskill, Senator Jon Tester (D-MT) has also been working on the issue.  He not only cosponsored the McCaskill bill, but since 2010 and most recently on March 14, 2017, has also introduced the Public Online Information Act, which will make information from all three branches of government available on the internet, including contracts.

With annual contract spending bouncing back up to nearly $500 billion, oversight of that spending is crucial. Groups from across the political spectrum support efforts to increase disclosure of federal contracts to improve transparency and accountability in federal spending. Posting contracts online should have happened years ago. We will see if the 115th Congress is serious about transparency and accountability in federal spending. If it is, passing Senator McCaskill’s and Senator Tester’s bills will be a good start.”

http://www.pogo.org/blog/2017/03/contracts-need-to-be-posted-online-mccaskill-sunshine-transparency.html