In a final series of directives issued by the Office of Management and Budget (OMB) on October 27, the Administration said that the civilian agencies should increase their acquisition workforce by at least five percent by 2014. In addition, the agency called for a limit on the use of noncompetitive and other "higher-risk" types of contracts.

According to the OMB Acquisition Workforce Strategic Plan, the Federal government's investment in the acquisition workforce has not kept pace with changes in Federal contracting. AGC has long advocated About one federal acquisition professional in eight already is eligible to retire, and that will rise to more than half the workforce by 2016. The average retirement eligibility for contracting professionals will increase from 29 percent in FY 2011 to 50 percent in FY 2016. Although the federal agencies have a variety of tools to help recruit and retain older workers, the agencies have not always been aware of the full range of options. Recruitment, retention and training of the government workforce should be a high priority for both government and industry.

A second memo on Increasing Competition and Structuring Contracts for the Best Results OMB released provide agencies with serues if guidelines to help Chief Acquisition Officers (CAOs) and Senior Procurement Executives (SPEs) evaluate the effectiveness of their agency's competition practices and processes for selecting contract types. The guidelines focus around three key questions:

1) How is the agency maximizing the effective use of competition and choosing the best contract type for the acquisition?

2) How is the agency mitigating risk when noncompetitive, cost-reimbursement, or T&M/LH contracts are used?

3) How is the agency creating opportunities to transition to more competitive and lower risk contracts?

These consideration are designed to help implement President Obama's March 5 Memo on Contracting also called upon OMB to issue guidance: (1) to govern the appropriate use and oversight of sole-source and other types of noncompetitive contracts and to maximize the use of full and open competition and other competitive procurement processes; and (2) to govern the appropriate use and oversight of all contract types, in full consideration of the agency's needs, and to minimize risk and maximize the value of Government contracts generally.

The White House on July 29 formally unveiled contracting and workforce reforms that are designed to save the taxpayers at least $40 billion a year. The reforms, released by the Office of Management and Budget (OMB), focus on three areas: improving acquisition, managing the multi-sector workforce and contractor performance information.

Previously, President Obama established in a March 4 memorandum his principles for contracting reform, and charged the OMB with identifying the best approaches to accomplish his goals.

For more information, contact Marco Giamberardino at (703) 837-5325 or giamberm@agc.org.

U.S. Small Business Administration on October 28, 2009 announced a notice of proposed rulemaking that would substantially revise contracting rules for firms benefiting from the 8(a) Business Development program . The proposed changes are the result of the first comprehensive review of the 8(a) program in several years. The rules cover a variety of areas of the program, ranging from providing further clarification on determining economic disadvantage to requirements on Joint Ventures and the Mentor-Protégé program. The public comment period on the proposed changes is open for 60 days.

The 8(a) program is a nine-year business development program for small businesses that fit the SBA's criteria of being socially and economically disadvantaged. The intent of the 8(a) program is to help these firms develop their business and provides them with access to government contracting opportunities, allowing them to become solid competitors in the federal marketplace. It also provides specialized business training, counseling, marketing assistance and high-level executive development to its participants. In FY08, small businesses received $16.1 billion in 8(a) contracts.

Some of the components of the 8(a) program that the proposed changes will affect include:

• Joint Ventures - qualifying that 8(a) firms are required to perform a significant portion of the work to ensure that these companies are able to build capacity;
• Economic Disadvantage - providing more clarification on economic disadvantage as it relates to total assets, gross income, retirement accounts and a spouse of an 8(a) company owner in determining the owner's access to capital and credit;
• Mentor-Protégé Program - requiring that assistance provided through the Mentor-Protégé relationship is directly tied to the protégé firm's business plan;
• Ownership and Control Requirements - providing flexibility in admitting individuals of immediate family members of current and former 8(a) participants;
• Tribally-Owned Firms - seeking public comments on the best way to determine whether a tribe meets the criteria of being economically disadvantaged for the 8(a) program;
• Excessive Withdrawals - amending regulations on what is considered excessive as a basis for termination or early graduation from the 8(a) program; and
• Business Size for Primary Industry - requiring that a firm's size status remain small for its primary industry code during its participation in the 8(a) program.

AGC is currently reviewing the proposed rule and will prepare formal comments to the SBA. In addition, AGC will work with SBA and Small Business Congressional Leaders on Capitol Hill to continue advocating common-sense contracting reforms that will benefit contracting for the construction industry.

Comments to this proposed rule are due on or before Dec. 28, 2009 and may be submitted to www.regulations.gov, where they will be posted or mailing them to 409 3rd St. SW, Mail Code: 6610, Washington, DC 20416 or via e-mail at: 8aBD2@sba.gov.