Service Contractor Spring 2018

Spring 2018 / The Voice of the Government Services Industry

Building Better Business in an Uncertain Marketplace ALSO INSIDE: 6

IMPACT OF APPROPRIATIONS

13

SECURITY CLEARANCES

15

ACCELERATED PAYMENTS BILL

39

CONTRACTS VS. GRANTS

Can your government contracts stand up to the scrutiny of a DOL investigation?

Industry experts estimate that at least 50% of Contractors are currently out of compliance. Did you know that Contractors are also subject to fines and penalties if their subcontractors are out of compliance with the DOL requirements?

Not knowing your duties is not a defense against compliance deficiencies! With penalties and sanctions becoming more frequent and often substantial, now is the time to put a strategic partner to work for you and your bottom line.

GSA National understands the bid implications of SCA compliance and can help you navigate the ever changing and complex compliance landscape. Let our team of compliance experts be the asset that increases your ability to submit winning proposals.

Service Contract Act Coaching and Training Davis-Bacon Act Training Recordkeeping, Reporting and SCA Compliance Review Compliance and Audit Consulting GSA Online: Web-Based Benefits Administration Premium Reserve and Trust Accounting FML and Leave of Absence COBRA, FMLA Legal Support

Navigating the Government Contract Compliance LandscapeProfessional Since 1991 2 / Service Contractor / Spring 2018 Services Council

Spring 2018 T h e Vo i ce o f t h e G ove r n m e n t S e r v i ce s I n d u st r y

15 BILL ON THE HILL

6

17

Federal Services Contract Spending

Under FY18 Appropriations

THE FOUR HORSEMEN OF THE INCURRED COST AUDIT

38

4 President’s Letter 8 Sounding Board:

26 Bill Tracker 35 Healthcare Cybersecurity 39 Contracts vs. Grants Building Better Business 40 Adding Value to PSC Membership 13 Policy Spotlight 14 Working for You 41 Member News 21 Transforming Today for 43 Event Spotlight/Leadership Summit Tomorrow’s Challenges 44 Event Spotlight/CIDC on the Hill SALES AND MARKETING STRATEGIES FOR 2018 23 PSC By the Numbers 45 Event Happenings

Cover illustration: shutterstock.com/retrorocket. Thematic adaptations by Studio25/Ana Eastep

Service Contractor

is a publication of the Professional Services Council 4401 Wilson Blvd., Suite 1110 Arlington, VA 22203 Phone: 703-875-8059 Fax: 703-875-8922 Web: www.pscouncil.org All Rights Reserved For advertising or to submit articles or items for the Member News section, contact: Ashlei Stevens

P S C S TA F F David J. Berteau President & CEO berteau@pscouncil.org Alan Chvotkin, Esq. Executive Vice President & Counsel chvotkin@pscouncil.org Cate Benedetti Vice President, Government Relations benedetti@pscouncil.org Joe Carden, CAE Vice President, Marketing & Membership carden@pscouncil.org

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Kevin Cummins Vice President, Technology cummins@pscouncil.org Paul Foldi Vice President, International Development foldi@pscouncil.org Ryan McDermott Vice President, Defense & Intelligence mcdermott@pscouncil.org Melissa R. Phillips, CMP Vice President, Events & Operations phillips@pscouncil.org Robert Piening, CPA, CGMA Vice President, Accounting & Finance piening@pscouncil.org

Bradley Saull Vice President, Civilian Agencies saull@pscouncil.org Matthew Busby Director, Membership busby@pscouncil.org Michelle Jobse Director, Vision Forecast jobse@pscouncil.org Cassie Katz Director, Marketing katz@pscouncil.org Jeremy Madson Director, Public Policy madson@pscouncil.org

Andrea Ostrander Director, Events ostrander@pscouncil.org Ashlei Stevens Director, Media Relations stevens@pscouncil.org Jean Tarascio Senior Manager, Events tarascio@pscouncil.org Donald Baumgart Manager, Vision Forecast baumgart@pscouncil.org Karen Holmes Office Manager/Receptionist holmes@pscouncil.org

Natalie Johnson Associate, Digital Marketing johnson@pscouncil.org Amanda Swanson Associate, Research & Analysis swanson@pscouncil.org Tara Vilaychith Associate, Membership vilaychith@pscouncil.org Alexandra Gomez Executive Assistant gomez@pscouncil.org Dannia Salem Government Affairs & Public Policy Intern salem@pscouncil.org

Service Contractor / Spring 2018 / 3

PRESIDENT ’S LETTER

W

e are well into the month of April, and soon we can put away our winter coats for good. Spring this year seemed to start and stop more than in recent years past, and this year’s federal budget was just as unpredictable.

Several back-to-back continuing resolutions and no full year appropriations passed by Congress until fiscal year 2018 was half over placed the federal workforce—particularly contractors—in limbo.

In this edition of the Service Contractor, we’ll take a look at the impact of FY2018 appropriations on federal services contract spending. You can read more from me on this on page 6. A few of PSC’s board members, who are CEOs, weigh in on how they are building better businesses in an uncertain marketplace. Be sure to turn to page 8 to hear from Dave Dacquino of Serco, Kathleen Flanagan of Abt Associates, and John Heller of PAE in our “Sounding Board” feature.

Adding to the uncertainty of the federal marketplace this year is a federal policy that the Office of Management and Budget allowed to lapse at end of 2017, which would have ensured that small businesses will be paid on time for their work. In our “Bill on the Hill” feature on page 15, we hear directly from some of the members of Congress pushing for enactment of the Accelerated Payments for Small Businesses Act. Not receiving timely payments is one issue, and not receiving contracted work altogether is yet another. In March, several PSC member companies abruptly received stop work orders on their long-time technical assistance work in substance abuse and mental health from an agency in the Department of Health and Human Services. The rationale: the agency is moving from contracts to grants. Read more on page 39 in “Are some civilian agencies moving away from contracts?”

PSC leaders are actively working to get answers on the stop work orders and to promote the critical role that contractors play, particularly during the ongoing opioid epidemic.

This is just one of the many ways PSC is working for you.

To see the impact of our year-long advocacy work and our

4 / Service Contractor / Spring 2018

wins, check out “PSC By the Numbers” on page 23. Looking forward, our new VP of Defense and Intelligence, Ryan McDermott, lays out PSC’s advocacy roadmap for national security on page 14.

The spring edition of PSC’s magazine also highlights several topics impacting our members’ business and the contracting industry as a whole. On page 13, PSC’s Alan Chvotkin discusses the impact of security clearances, while Thomas Marcinko of Aronson takes a deep dive into incurred cost audits on page 17.

As PSC gears up for its largest member gathering of the year—the Annual Conference, held in late April—we take a look at the themes of the conference, which highlight growth and innovation issues that service contractors are facing today and in the near future, and how PSC is helping address these issues. Read more on this from Jeanine Callahan of Eagle Rayon page 21. Also, on page 38, our partners at Hinge Marketing outline sales and marketing strategies to help grow your business in 2018.

Last, but certainly not least, PSC wants to be sure our members get the most from membership. Hear from PSC’s Director of Membership, Matthew Busby, on page 40 on ways to maximize your membership, and our regular feature on “Member News” provides noteworthy items you might have missed. The photos from PSC’s Leadership Summit and our Council of International Development Companies’ “Day on the Hill” reflect the contentrich information we are providing to members and the advocacy we’re doing both on and off the Hill.

As always, I welcome your ideas on how we can improve PSC and help our federal customers, no matter what the federal market forecast may hold.

David J. Berteau

Professional Services Council

Professional Services Council

Service Contractor / Spring 2018 / 5

Federal Services Contract Spending Under FY18 Appropriations

by David J. Berteau, PSC president and CEO

T

he “Consolidated Appropriations Act of 2018� was signed by the President March 23 and fully funds the federal government for

Fiscal Year 2018 (FY18). What impact will this have on government services contractors?

6 / Service Contractor / Spring 2018

Professional Services Council

shutterstock.com/retrorocket. Thematic adaptations by Studio25/Ana Eastep

First, it provides substantial increases in funding for nearly every agency and most programs. The FY18 appropriations funds most of the increases enacted Feb. 9 in the Bipartisan Budget Agreement of 2018, which significantly raised the Budget Control Act caps for FY18 and FY19.

The Department of Defense (DoD) has the largest appropriations increase, $80 billion above the previous budget cap for FY18 and $26 billion above the president’s requested FY18 budget level. For non-defense agencies, the cap was raised by $63 billion for FY18, but the omnibus appropriations bill distributed that increase unevenly and incompletely across those agencies. Some departments and agencies saw an increase well above both their FY17 funding levels and above the president’s budget request for FY18, while other agencies saw funding levels below FY17.

Overall, these increases may turn the second half of FY18 into a very different market for contractors. To understand how it will change, let’s look back at government contract spending in the first half of FY18.

Public data for DoD contract obligations in the second quarter have not yet been released, but the first quarter showed a 6.5% increase in total contract obligations year-over-year.

Further, monthly DoD spending (as reflected in Treasury Department outlay data) for the first six months of FY18 show that DoD spending was up by more than $10 billion (nearly 5%) compared to the same period under the FY17 CR, even though FY18 CR funding was slightly less than FY17. It appears that DoD has been spending at a rate that anticipated an appropriations increase, one that proved to be true.

The total DoD increase is 15% above the previous caps, but it is only about 4% above the programmed budget that DoD had developed. For contractors, this likely means increased opportunities, but perhaps not as much as the numbers might indicate at first glance.

For non-defense agencies, the first half spending story is quite different. Comparing the first six months of FY18 CR contract obligations to the same period under the FY17 CR shows a drop of 13% year-over-year.

Obligations for services contracts in the same period declined only slightly less, 10% year-over-year. In some agencies, the decline has been even greater. You can see the overall comparisons in the accompanying graph.

While those are significant reductions, some agencies have constrained contract spending even more. For example, total contract obligations for the U.S. Agency for International Development saw a year-over-year decline of nearly 30%.

This pattern raises two important questions for services contractors: Why did that decline happen? Is it about to change?

First, why the decline in contract spending? It could be because the president’s proposed budget for FY18 had included significant funding reductions for many non-defense agencies. With CR spending levels unchanged from FY17 throughout the first half of FY18, and the chances that final funding would be even lower under the president’s budget, some agencies appear to have planned for and spent at rates equal to the lower numbers.

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Second, is that decline in contract spending about to change? Will it reverse itself under the significantly higher FY18 appropriations? Since the president’s FY19 proposed budget for many of these non-defense agencies does not include that increased spending, this can put agencies in a bind. Do they spend the money Congress appropriated for FY18 and anticipate similar levels of appropriations for FY19, or do they spend only to the president’s budget level while anticipating reductions for FY19?

While it’s too soon to tell, comments from Mick Mulvaney, director of the Office of Management and Budget (OMB), at the Feb. 12 release of the president’s FY19 budget may offer some insight. With regard to the $63 billion increase in the non-defense appropriations cap that the President had just signed three days before, Mulvaney stated1 several times that “we don’t need to spend all the money.”

Another indicator is the omnibus appropriations bill itself. It will be hard to spend that much additional funding in half a fiscal year. Congress expanded flexibility to permit more spending in the final two months of the fiscal year but only for the DoD operation and maintenance accounts. Year-end spending is typically limited, and nondefense agencies will have no greater flexibility to spend the additional funds than in the past, despite the late enactment of FY18 appropriations.

Finally, will OMB constrain non-defense agency spending?

If so, will it do so indirectly, or will it issue direct written guidance? How rapidly and fully will OMB and agency comptrollers apportion and allocate funds to program offices?

Independent of OMB guidance, will agencies be able to spend the additional FY18 funds in the remaining half of the fiscal year? The answers to these questions, but they will directly determine contract spending over the next few months.

Agencies and program offices themselves don’t know the answers yet, either. PSC advises its member companies to communicate frequently and comprehensively with their government customers. In addition, we will be tracking and reporting on this regularly in the coming months, so watch our web site for updates. 3 1

Feb. 12 OMB Press Briefing on FY18 Budget

Service Contractor / Spring 2018 / 7

Sounding Board

Building Better Business in an Uncertain Marketplace

Less than halfway through Fiscal Year 2018, we’ve already experienced government shutdowns, however brief, and several continuing resolutions, which ultimately impact how contractors do business with the federal government. If continuing resolutions and lack of budget—and market—stability are the norm, how do you build a better business in that environment? PSC reached out to member company leaders from our board of directors to get their take. Read more as Serco Inc. Chairman and CEO Dave Dacquino, Abt Associates President and CEO Kathleen Flanagan, and PAE CEO John Heller sound off on this topic in our “Sounding Board” feature.

Chairman & CEO of Serco Inc. It has now been more than two decades since Congress last passed all appropriations bills on time, and we have had nine straight years in which the Department of Defense has been subject to continuing resolutions. So budgetary uncertainty has become the norm, rather than the exception, for government contractors.

With that said, there are still ample opportunities for growth in the government services sector. Contractors need to be nimble and flexible to align their strategy with shifting legislative priorities and be prepared to experience delays to the awards and starts of new programs.

Success in this environment requires a different mindset, including: • Come to the table with a deep understanding of customer pain points and a steady flow of innovative ideas. Going beyond a reactive, “business-as-usual” approach is essential if you want to be viewed as a partner, rather than simply another vendor. If you can help shape the customer’s thinking about a better approach to deliver essential services, you will be in a much stronger position to eventually win the business.

• Regularly revisit your business strategy to surface new opportunities and adjust your investment and approach as the legislative

8 / Service Contractor / Spring 2018

agenda shifts. This is not the era of the static five-year plan with a well-marked roadmap to the pot of gold. You need to be in the mix and part of the conversation in the areas where you have standout capabilities.

• Take an “ambi-partisan” stance (working with each side of the aisle) and seek to align with themes that both sides agree are important. It’s critical to be able to provide solutions that encompass very different approaches to achieve big goals like healthcare reform and defense modernization. Accept that there is more than one road to Mecca. Focusing on outcomes like improving the efficiency with which government services are delivered will position you for success.

• Take a portfolio approach to investing in new opportunities and avoid becoming overly reliant on one single program or thematic area. Given the potential for rapid changes in legislative and executive priorities, and the near certainty of programs “sliding to the right,” you need to be continuously seeking out new pockets of potential growth and be prepared to make lateral moves.

The one thing that has not changed is that exceptional execution continues to be a prerequisite to growth. If customers find that they can rely on you to deliver in challenging situations, to field great people, and to make them look good, they will generally find ways to continue to work with you and provide you the chance to solve new problems for them. Provide average service and you will be seen as a commodity vendor. You need first to earn your way to a place at the table and then you need to have something compelling to say. That’s how you find growth even in uncertain times. continued page 11

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Dave Dacquino

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Professional Services Council

from page 9

Kathleen Flanagan President and CEO Abt Associates

This is indeed an uncertain environment we are working in. And not just for us – it’s also tough for our clients who want to advance their agency’s mission. With budgets under scrutiny, it’s often hard for them to launch important new programs and plan the way they want to.

Having said that, it can also be an opportunity for us to show our clients we can be innovative and creative in how we help them.

Seizing the opportunity requires that we be proactive, forwardthinking, and able to anticipate unmet needs. We must be our clients’ trusted partner. That requires talking with them every day, equipping them with data on the impact and value of their programs, demonstrating our ability to bring new partners and staff talents to our work, and being agile in our work planning.

In this environment we must always be viewed as adding value.

At Abt, we are laser focused on showing clients in core markets such as health, workforce and economic development that we understand the issues that keep them up at night and can quickly offer solutions that address their needs in creative and cost effective ways.

Answering the questions, “How can we do this better?” and, “What if…?” is a priority in every proposal and project. We systematically work to fully leverage the knowledge and expertise of our worldwide staff of more than 3,000 by breaking down silos internally and incenting collaboration.

With our broad portfolio of work in the U.S. and around the world, we can apply lessons learned across disciplines, methods and geographies. One recent example involved applying our deep experience evaluating education programs in the U.S. to capturing an education evaluation project in Malawi. Clients have told us that they like this cross pollination of ideas.

Finally, in these times of tight budgets, we are integrating technology into our projects to increase speed, efficiency and impact.

We’ve implemented block chain in Papua New Guinea to promote financial inclusion and deployed drones for boundary mapping to resolve land ownership disputes in Indonesia. For EPA and HHS, we used machine learning and advanced analytics, data visualization, and dynamic dash boarding to provide decision makers with timely insights for decision-making. In Rwanda, a mobile tool we developed as part of a malaria control project enabled us to track spray coverage results in real time. This allowed the team to track houses that had been sprayed, not sprayed, or not yet visited, saving money and time.

This kind of market environment requires us to be nimble and smart as client business models and contract types shift. We have to be ready for whatever changes come our way. continued on page 22

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Professional Services Council

Policy Spotlight

Security Clearances

by Alan Chvotkin, PSC Executive Vice President and Counsel

Illustration: shutterstock.com/madpixblue

I

t is the dirty laundry of the federal and contractor workforce challenges. For almost three years, since the breach of the Office of Personnel Management (OPM) background investigation database in 2015, the backlog of both government and contractor personnel who require either a government security clearance or a suitability determination has grown unacceptably to over 700,000 cases, with about a third of those cases coming from contractor employees.

Interim actions have been taken to address both the causes of the breach and the growing backlog of cases. In 2016, OPM created the National Background Investigations Bureau (NBIB) to take primary responsibility for end-to-end background investigations and they have expanded their contractor support and their in-house resources. A new IT network backbone is being developed (albeit too slowly) by the Defense Information Systems Agency (DISA) under OPM’s direction. Finally, the Director of National Intelligence has expanded a significant pilot program to use a “continuous evaluation” of an individual’s background in lieu of the traditional “periodic reinvestigation” that generally waited for the calendar to turn for a fixed period before a reinvestigation was initiated.

“Will there be,” and “can there be,” and “shouldn’t there be” real corrective actions to both chop the current backlog and ensure procedures are in place to meet the continuous flow of requests for new approvals? We hope the answer is “yes” to those questions.

PSC is well positioned to contribute to both the identification of the root causes of the current challenges as well as the development of solutions for the future. In a repetition of the recommendations we made more than a decade ago, PSC is again recommending a “Four Ones” solution: one application; one investigation; one adjudication; and one clearance.1 PSC President and CEO David Berteau highlighted this approach in February 2018 testimony before a House Homeland Security subcommittee2 and again in March 2018 before the Senate Select Committee on Intelligence.3 In addition to conducting oversight of federal agencies, Congress has taken interim measures. As part of the fiscal year 2018 National Defense Authorization Act, Congress required the Executive Branch to submit extensive reports on key data elements and timelines of the security clearance process to congressional committees.4 However, that same legislation also directed that the Defense Department (DoD) take over the end-to-end processing of security clearances for government and contractor employees for covered DoD work.

In light of the questions raised about certain White House staff performing work with only temporary clearances, on Professional Services Council

Feb. 16, 2018, White House Chief of Staff John Kelly directed the creation of an interagency working group comprised of senior government officials with jurisdiction over clearances from the White House and the Executive Branch. This group is studying the clearance process generally and intends to take actions that will streamline, harmonize and modernize standards across the Executive Branch.

In addition, the 2018 President’s Management Agenda, issued on March 20, includes a cross-agency goal of ensuring “aligned, effective, efficient, secure, and reciprocal processes to support a trusted Federal workforce.” The agenda lays out how the government can better work across federal agencies to advance measures that will improve investigation and adjudication capabilities through innovation and technology— and calls for strengthening partnerships with industry to do so.

PSC is encouraged by these last two actions. However, we believe that the scope and scale of this problem requires a concerted, coordinated and sustained whole-of-government effort. In conjunction with the affected contractor community, PSC will continue to prioritize security clearance reform implementation by working with industry stakeholders, federal agencies and Congress to minimize the negative consequences for companies of all sizes and markets and reduce the risk to federal agencies. 3 Oct. 21, 2013 Senate Testimony Feb. 27, 2018 House testimony 3 March 7, 2018 Senate testimony 4 FY18 NDAA 1 2

Service Contractor / Spring 2018 / 13

Working for You:

PSC’s Approach to Pentagon Engagement

by Ryan McDermott, PSC Vice President of Defense & Intelligence

I

n the Winter edition of Service Contractor, PSC’s EVP and Counsel Alan Chvotkin provided a roadmap for our advocacy in 2018. The process begins with identifying specific areas of concern to our members. PSC exists, if for no other reason, to advocate on behalf of our members’ interests. Advocacy is the core of what we do.

To do so effectively, research and preparation are ongoing activities while we identify key relationships to influence various policy issues.

The process of identifying issues, researching and preparation, and leveraging key relationships continuously iterates as the advocacy plan executes across all branches of government. One of the key facets to PSC’s approach is how we engage the executive branch and, with respect to my position as the Vice President for Defense and Intel, how we engage with Department of Defense (DoD) leadership through our deep set of relationships in the Pentagon. The approach is defined by an understanding of executive branch priorities and of initiatives that may impact our members.

As the Trump Administration continues in its second year, PSC remains well positioned to advocate on behalf of our member companies. PSC’s ability to engage with the executive branch increases as new appointees fill their respective offices. While PSC has deep relationships with career government officials, each appointee comes into office with a new set of priorities and ideas on how to implement them. Some of these priorities have implications for our community.

Our key objective is to stay ahead of the curve with respect to initiatives that impact our member base. We not only know where policies and legislation are headed, we actively engage to shape the direction these initiatives inevitably take. PSC’s approach involves gathering information from direct interactions with government officials, research of relevant policy statements, and an active pursuit of how legislative proposals will evolve. With this approach, PSC can leverage our relationships for maximum effect in our advocacy work.

Research is essential to all advocacy efforts. Keys to understanding the administration’s defense priorities are in the President’s National Security Strategy (NSS) and the Defense Department’s National Defense Strategy (NDS) documents. First, these strategies indicate a shift in strategic priority from terrorism to inter-state competition with China and Russia. Second, there is a renewed focus to reform bureaucracy so that industry can deliver at “the speed of relevance.”

Third, both documents emphasize securing the National Security Innovation Base (NSIB) and maintaining technological advantage as a necessary component to staying ahead of U.S. adversaries. For PSC members, the strategies could drive a shift in both the types of services required and the way these services are contracted for and delivered. To gauge potential outcomes of the NDS, PSC engages directly with DoD to identify how the strategy will be operationalized through potential legislative actions, regulatory reform, investments, and contracts.

Engagement with DoD leaders also provides us with unique insights relevant to our members. The current Pentagon 14 / Service Contractor / Spring 2018

leadership’s policies support this approach. On March 2, Deputy Secretary of Defense Patrick Shanahan signed a memo that provides guidance to DoD employees regarding engagement with industry as a supporting component of the NDS. One line of the memo highlights the benefits offered by engagement through trade associations: “Events hosted by industry associations may provide opportunities to efficiently, effectively, and ethically connect the DoD with leaders from across a particular industry or segment.”

To this end, PSC is finding DoD receptive to a wide range of engagements—from formal meetings to informal listening sessions—all of which provide invaluable insights and opportunities to understand and, if necessary, influence ongoing regulatory reform and other initiatives. For example, PSC routinely collects member input on cybersecurity implementation concerns and relays feedback to DoD for consideration as the Pentagon works to balance industry concerns with the need to secure networks in its supply chain. Implementation remains an issue for DoD as it considers explicit guidance and training. PSC continues to engage with DoD as implementation considerations are weighed.

PSC also continually leverages every opportunity to advocate for its members, including through government-driven initiatives.

For example, PSC is an advocate for member interests in DoD’s “industrial base” assessment required by the July 21, 2017 Executive Order (EO) 13806: “Assessing and Strengthening the Manufacturing and Defense Industrial Base and Supply Chain Resiliency of the United States.” The EO directed DoD to submit a report to the President in mid-April of this year. In March, PSC provided input to DoD regarding risks to the industry workforce, specifically focusing on the concern that the security clearance backlog and processing delays could deter a future generation from wanting to (or being able to) work in this community. As DoD moves to Phase II of the assessment, PSC is actively engaged as an advocate for the inclusion of risk analyses relevant to services, sustainment, and support.

In conclusion, advocacy is the core of what we do and it all starts with PSC member interests in mind. Our priority is to get PSC member company feedback on core issues that cut across our member base so that we have an accurate understanding of the impact on our companies’ businesses and can effectively advocate on your behalf. From this foundation, PSC’s integrated staff researches, engages, and seeks influence through its relationships across government, while also looking for organic opportunities to engage. By seeking opportunities to advocate through DoDdriven initiatives, PSC both solidifies its relationships with government leaders while effectively advocating for our members’ interests. It is a formula for success for both government and PSC in 2018. 3 Professional Services Council

Bill on the Hill:

Accelerated Payments for Small Businesses

T

by Cate Benedetti, PSC Vice President of Government Relations

he contractor community plays a vital role in assisting the government in meeting daily mission needs and providing services to the American people. In return, companies of all sizes expect a level playing field, fair treatment, and prompt payment for the goods and services they provide. For small businesses in particular, prompt payments are a critical lifeline: a predictable and steady cash flow is necessary to finance day-to-day operations, while concurrently investing in growth and job creation.

Recognizing the impact of delays in payments and the constraints placed on businesses as a result, in 2011, the Office of Management and Budget (OMB) issued a policy directive to federal agencies that required the government to accelerate payments to small businesses and small business subcontractors. Unfortunately, OMB did not renew the subcontractor portion of the directive, and it lapsed on December 31, 2017.

On March 20 of this year, members of the House Small Business Committee introduced the Accelerated Payments for Small Businesses Act of 2018 (H.R. 5337), which will permanently and statutorily require accelerated payments for small businesses and small business subcontractors.

PSC reached out to the sponsors of H.R. 5337— House Small Business Committee Ranking Member Nydia Velázquez, Subcommittee on Contracting and Workforce Chairman Steve Knight, and Rep. Adriano Espaillat—to hear more about the new legislation:

Illustration: shutterstock.com/Lightspring

What impact has OMB’s policy of accelerated payments to small businesses had on companies that participate—or are seeking to participate—in the federal market?

Knight: Small businesses are heavily dependent on a reliable cash flow to ensure their operations are uninterrupted and obligations are met. By accelerating payments to small business contractors, OMB removes a huge disadvantage small businesses have compared to their larger counterparts. This ultimately improves the competitive market by allowing contractors to focus their efforts on improving their production and services to fully utilize every taxpayer dollar.

Espaillat: In the grand scheme, it has inculcated a great deal of confidence in small businesses whose hard work and skills are being recognized and actively sought out by the Federal government. The result is increased access to vital capital and facilitating worth in the small business community. In the process and continuum of supply and procurement, the standard set by the OMB policy has made the federal market more robust and a welcome point of entry for small businesses success and proliferation.

Velázquez: When small businesses receive payments in a timely manner, everyone benefits. In Fiscal Year 2017, over $110 billion in federal contracts were awarded to small firms. Not only does OMB’s accelerated payments policy encourage small firms to apply for federal contracts by granting payments within 15 days, it also opens the doors for new businesses to enter the federal marketplace and create well-paying jobs. However, continued next page

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Steve Knight

Adriano Espaillat

OMB’s policy is not permanent and small businesses deserve a lasting commitment that they will be paid in a timely manner.

Furthermore, OMB has yet to renew the subcontract part of the accelerated payments policy, allowing it to lapse at the end of 2017. For this reason, it is especially timely for Congress to pass a bill I have proudly co-sponsored to codify OMB’s accelerated payments into law: the Accelerated Payments for Small Businesses Act of 2018 (H.R. 5337).

What would the Accelerated Payments for Small Businesses Act do and why is it important to prioritize this legislation now?

Knight: H.R. 5337 codifies OMB’s accelerated payment policy to ensure that it remains in place regardless of any potential administrative or leadership changes. This consistency will significantly reduce the risk speculation for small businesses and allow them to plan for the future in their business models.

Espaillat: H.R. 5337, Accelerated Payment for Small Businesses Act, would make it mandatory for the Federal government – that is, any agency or agency-led initiative – to pay prime small business contractors, and larger primes who subcontract with small business, within 15 days of receiving an invoice for services or supplies delivered. This legislation would codify recently lapsed OMB guidance that, since its original issuance in 2011 and later updated, would standardize into law a practice of prompt payment that we should meet as stewards of taxpayer monies and fairness for small businesses that we rely on. There is bipartisan support and drive to address numerous deficits in local, state, and federal infrastructure. The benefits of such an investment will yield micro and macro benefits; but we know, as members of Congress intimately familiar with our Congressional districts and constituents, that they want to be involved in the process because they have a stake in making their lives and communities better. If this process at the federal level is going to be a substantial and long-term commitment, we must ensure small businesses are in the best position possible to make this vision a reality.

Velázquez: By speeding up payments to small companies, this legislation will help small contractors meet payroll, reinvest in their operations, and create high-quality jobs along the way.

For small contractors who are keeping their venture afloat one paycheck at a time, this legislation is a vital lifeline. Moreover, this bipartisan bill came about after numerous firsthand 16 / Service Contractor / Spring 2018

Nydia Velázquez

conversations with entrepreneurs who were forced to suffer needless delays while trying to receive an earned payment for federal contracting work. It is incumbent upon Congress to pass this bill, which would codify OMB’s accelerated policy of ensuring that small businesses receive payments from the federal government within 15 days of receiving an invoice.

As Democrats on the Committee, we are constantly striving to help disadvantaged small businesses secure reliable capital and federal contracts. By guaranteeing a quick payment process, it is my hope that we can encourage women and minority-owned businesses—who may generally be more risk-adverse—to participate in greater numbers in the federal contracting marketplace.

What are the prospects for the enactment of the Accelerated Payments for Small Businesses Act this Congress?

Knight: This bill has received early bipartisan support from my colleagues here in Congress. Of note is the support of Chairman Steve Chabot and Ranking Member Nydia Velázquez of the House Small Business Committee. I am optimistic that we will be able to push this bill to the finish line and deliver this law to small business contractors across the country.

Espaillat: I will give you a direct and honest answer: enactment of this bill begins with Speaker Ryan. It is his prerogative to exercise Rule I, clause 6 of the Standing Rules of the House to allow for a vote on legislation. Period. What I can say is that if I were to take 533 meetings with each sitting U.S. Representative and U.S. Senator, I would not find any opposition to this bill. This is commonsense legislation that doesn’t require an advanced degree; some yet-to-be quantified “political skill,” or position as a member of Congress to see that this legislation stands on its intention, merits, and goal.

Velázquez: Well, the bill was introduced very recently and, therefore, will first have to pass in Committee before moving in the full House. That being said, this is a commonsense reform that enjoys bipartisan support. As Ranking Member of the House Committee on Small Business, I can say that members on both sides of the aisle are eager to come together and do what is best to grow and support America’s vast network of small businesses. 3 Professional Services Council

The Four Horsemen of the Incurred Cost Audit

by Thomas Marcinko, Principal Consultant, Government Contract Services Group, Aronson, LLC

Illustration: vecteezy.com

U

nder the Allowable Cost and Payment clause,1 contractors with flexibly priced contracts2 are required to submit an annual final indirect cost rate proposal, (known as an incurred cost submission), which is the precursor to the government’s incurred cost audit. One of the primary purposes of an incurred cost audit is to ensure the contractor has not included any unallowable costs in their indirect cost pools.

The noted sports journalist Grantland Rice once famously compared four Army football players to the four horsemen of the apocalypse. If Grantland were alive today and covering government contracting he might have used his colorful language to describe the four horsemen of the incurred cost audit: consulting fees, automobile expenses, executive compensation and bonuses. These cost elements, which are considered to be “low hanging fruit” by the Defense Contract Audit Agency (DCAA), represent the lion’s share of the indirect costs disallowed in the typical incurred cost audit. Though well short of apocalyptic, cost disallowances in these areas, occasionally reaching millions of dollars, can be financially traumatic for the contractor.

There is nothing wrong with incurring an unallowable cost.

Most large Department of Defense contractors knowingly exceed the executive compensation ceiling. These contractors book the amount in excess of the compensation ceiling to an unallowable account so those costs are not billed to the government.

The problem arises when contractors charge the government for costs that are deemed unallowable years later during the incurred cost audit. This introduces the risk of a Civil False Claims Act violation which will entail penalties and interest in addition to refunding the cost. In addition, the cost disallowances and any penalties and interest are reflected in the contractor’s books for the current year, which means the current management team is taking a financial hit for unallowable costs incurred and billed years ago. Conversely, the financial reports for the year in which the unallowable costs were incurred, based on the assumption they were allowable, presented an overly rosy picture of the contractor’s profitability.

1 2 3

In some cases, costs are without question unallowable.

However, in many cases otherwise allowable costs are disallowed because the contractor failed to prepare or retain adequate supporting documentation. This article provides practical tips contractors can use to ensure fees paid to consultants, automobile expenses, executive compensation, and employee bonuses will be deemed allowable. Or in the alternative, to make an informed decision to incur an unallowable, unbillable cost knowing it will result in a reduction to the company’s profit for the year.

Consulting Costs

The allowability of fees paid to a consultant is addressed in FAR 31.205-33 “Professional and Consultant service costs.”

Professional and consultant services are defined as services rendered by persons who are members of a particular profession or possess a special skill and who are not officers or employees of the contractor. Consulting services are generally acquired to obtain information, advice, opinions, alternatives, conclusions, recommendations, training, or direct assistance, such as studies, analyses, evaluations, liaison with Government officials, or other forms of representation3. continued next page

FAR 52.216-7 Cost reimbursement, time & materials or fixed price incentive fee contracts FAR 31.205-33 (a)

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Service Contractor / Spring 2018 / 17

from page 17

• An agreement with the consultant that includes a detailed scope of work, the rate of compensation and the amount of other expenses to be reimbursed; • Invoices submitted by the consultant with sufficient detail as to the time expended and the services provided; and • Consultant’s work product such as trip reports, meeting minutes and other deliverables.

Consulting costs are frequently deemed unallowable solely because the contractor did not produce or retain the required documentation. Consulting costs incurred under a verbal agreement will almost certainly be unallowable. Consulting agreements with abbreviated scopes of work such as “business development support” or invoices that merely state “for services rendered” are also problematic.

DCAA has changed their audit guidance to stress that it is the substance of the documentation that is important, not the title4. This change offers a contractor more flexibility in supporting consulting costs, though the safest approach is to develop the required supporting documentation exactly as described in the cost principle. Such documentation should include a fully executed consulting agreement featuring a detailed scope of work, a period of performance, rates of compensation and a termination provision.

To be considered allowable, payment of the consulting fees cannot be contingent on recovery of the costs from the Government.

Out-of-scope services, services performed outside the period of performance or fees in excess of the consulting agreement rates are unallowable. This means the consulting agreement may need to be amended as the work progresses to reflect any changes in scope, period or rates. Also, the costs of consulting services that violate a law or regulation will never be allowable.

A consultant’s invoice should describe the work accomplished for the period. In most cases, a descriptive paragraph on the invoice will suffice. Deliverables such as reports, presentations, meeting minutes, etc. can be included with the invoice or referenced on the invoice and submitted separately. The contractor should also have evidence the consultant was qualified to provide the services and the fees were reasonable.

In addition to generating documentation at the time the consulting services are obtained, the contractor must be able to produce it many years later during the incurred cost audit. To be able to consistently develop the required documentation, retain it, and then produce it during the incurred cost audit requires implementing a formal process backed by a written policy and procedure.

4 5

Automobile Expenses

It is common for contractors to provide their key executives with automobiles or at least an automobile allowance. It is almost as common to see automobile expenses questioned during an incurred cost audit. The allowability of automobile expenses is addressed in two cost principles. FAR 31.205-6, Compensation for Personal Services, states the “portion of the cost of companyfurnished automobiles that relates to personal use by employees (including transportation to and from work) is unallowable …”

FAR 31.205-46, Travel Costs, states the “Costs of contractorowned or leased automobiles …. include the costs of lease, operation, maintenance, depreciation, insurance, etc. These costs are allowable, if reasonable, to the extent that the automobiles are used for company business.”

These cost principles are easy to reconcile if the automobile expense is solely for business or personal use. However, in many cases the automobile is driven by the employee for both business and personal reasons. Therefore, the employee must maintain a log of all business use, including mileage and the business purpose or the trip. In addition, all related expenses such as maintenance must be documented. If at year-end the log shows that the automobile was used ½ for business and ½ for personal use, then ½ of the costs must be charged to an unallowable account. If a log is not maintained, DCAA will be within their rights to question the entire cost of the automobile even if is likely at least some of the use was for business.

However, demonstrating the extent of business use and maintaining records are not the only requirements for allowability of automobile expenses. The travel cost principle also limits the allowability to reasonable costs. Per the FAR, “A cost is reasonable if, in nature and amount, it does not exceed that which would be incurred by a prudent person in the conduct of competitive business.5” Though not reflected in any published audit program or guidance, DCAA has taken the position that automobile costs exceeding the cost of the best selling cars in the U.S. are Illustration: vecteezy.com

Consulting costs are generally allowable as long as they are supported by evidence of the nature and scope of the service furnished. The cost principle defines the required evidence to be:

Memorandum to Regional Directors No. 13-PAC-026R, “Audit Alert on Professional and Consultant Services Costs and Purchased Labor FAR 31.201-3 (a)

18 / Service Contractor / Spring 2018

Professional Services Council

unreasonable and therefore, unallowable. This position, though likely popular with the taxpayer, is inconsistent with the FAR’s definition of a reasonable cost. Based on the traffic in Washington D.C., few prudent businessmen in competitive businesses are driving Toyota Camrys or Ford Fusions. That said, when DCAA takes this position, it can be difficult to argue that the taxpayer should reimburse the contractor’s Mercedes or BMW. When a company car is to be provided to an employee, the company would be well advised to calculate the cost of providing a Fusion or Camry because the costs in excess of that might be disallowed.

Illustration: vecteezy.com

Executive Compensation

Contractors are required to report their executive compensation on Schedule B of the incurred cost submission.

The fact that executive compensation has its own schedule shows it is an important part of an incurred cost audit. This is especially true for principals in closely held firms.

The allowability of executive compensation is addressed in the “Compensation for Personal Services” cost principle. An analysis of all potential components of compensation is beyond the scope of this article but salary and bonus will be included. The cost principle holds that allowable executive compensation will be the lesser of the statutory ceiling, currently $487,000, or the amount that DCAA determines to be reasonable.

However, setting executive compensation at less than the statutory ceiling is not necessarily a safe harbor as DCAA can still find the compensation to be unreasonably high. DCAA will make this determination by comparing the actual compensation to salary surveys. This comparison usually involves three salary surveys and at least three variables, the size, type and sometimes location of the company, mapping the contractor’s job title to the salary survey categories and the applicable percentile of the salary survey. DCAA will take the average total compensation derived from the salary continued next page

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Professional Services Council

Service Contractor / Spring 2018 / 19

Bonuses

Bonuses are part of executive compensation for the purpose of exceeding the overall statutory and reasonableness requirements.

However, even if the executive compensation is deemed to be allowable, the bonus element can still be questioned based on other requirements.

The Compensation for Personal Services cost principle states that bonuses are allowable provided the awards are based on an employment agreement entered into before the services were rendered or pursuant to an established plan or policy followed consistently by the contractor. Therefore, absent specific employment agreements, for bonuses to be allowable, contractors will need to have a written bonus plan. The bonus plan must address who is eligible to receive a bonus, when the bonus will be paid and how the amount will be calculated.

20 / Service Contractor / Spring 2018

The basis of the bonus award must be supported in writing for each employee receiving a bonus. Though some subjectivity is acceptable, to the greatest extent possible bonuses should be based on the achievement of measurable objectives. Contractors cannot turn profit into a cost by distributing it to employees.

While contractors may make bonuses contingent on the company turning a profit, contractors must be careful not to tie the actual bonus calculation too specifically to profitability.

DCAA will question the entire bonus if the contractor does not have a written bonus plan, or the basis of award is not documented, or if DCAA believes the bonus represents a distribution of profit. This is true even if DCAA has determined that the overall executive compensation, including the bonus, is reasonable.

Conclusion

Too often incurred costs audits are full of bad surprises and become a painful, money losing exercise for the contractor that could have easily avoided with a little foresight and preparation.

There is no good reason for having consulting costs and bonuses disallowed due to the lack of relatively easy to prepare documentation. On the other hand, there may be good business reasons, such as recruiting and retention, to incur unallowable automobile costs and executive compensation. The results of the incurred cost audit should not be a surprise to the contractor who plans and prepares. 3

Professional Services Council

Illustration: shutterstock.com/ProStockStudio

surveys and add a 10% “fudge factor.” Compensation that exceeds the average of the salary surveys plus 10% will be questioned.

This calculation is inherently subjective and contractors can push back. For instance, in some cases an argument can be made that, based on the job description instead of the position title, the position is not mapped correctly to the salary survey.

DCAA also defaults to the 50th percentile. DCAA will use the 75th or 90th percentile if the contractor can prove, through verifiable financial ratios, that their performance far exceeds the industry average. It is also possible the contractor can cite a salary survey not considered by DCAA that is more supportive of their position.

The weakness of this reactionary approach is the contractor has allowed DCAA to set the parameters of the debate and the contractor must prove DCAA is wrong. DCAA, like most organizations, does not like to be proved wrong. There is a better way to maximize the allowability of executive compensation.

During an incurred cost audit, the contractor will be asked to describe the process used to established the amount of executive compensation. A response like “Our HR Director is very experienced with the labor market in this area” is not a process.

Nor is it likely to be documented.

Ideally, contractors will mimic DCAA’s approach to justify their executive compensation. Prior to determining the compensation for the year, contractors should use salary surveys or compensation consultants and any other pertinent information to demonstrate the executive compensation is within industry norms. This analysis may show some semantic disconnects which can be resolved by revising job titles or descriptions to more accurately reflect the executive’s duties and more closely align with the pertinent, read desirable, salary survey position. This process and the resulting analysis should be documented and provided to DCAA when requested. This shifts the debate by 180 degrees. Now DCAA will have to prove the contractor’s analysis is wrong. Contractors have a much better chance of winning that argument.

Transforming Today For Tomorrow’s Challenges

by Jeanine Callahan, Chief Strategy Officer, Eagle Ray, Inc.

S

ervice contractor leadership must meet a broad range of challenges to successfully support the mission of their customers and sustain viable businesses over the long term.

This year’s Annual Conference sessions provide opportunities to gain the critical knowledge to “Transform Today for Tomorrow’s Challenges”. Here, we take a look at the themes presented at the 2018 conference, which highlight issues that service contractors are facing today and in the near future, and how PSC is helping lead efforts to address these issues.

Technology and Innovation

Science and technology are driving mission and operational changes across the federal government, providing exciting opportunities for service contractors to deliver innovative capabilities in new ways. What will the next technology wave bring? As we envision the future through science and technology, PSC member companies are well positioned with leaders who are looking into the future and can describe advances that fundamentally change operational models in both government and industry. How will digital transformation impact government and industry? Culture and workforce? Acquisition and sustainment?

How can we position ourselves to respond to the need for leading edge capabilities and how can we advance missions and operations through our own research and innovation? As we build better businesses, this forward-looking topic gives us a vision of the technology road ahead.

Illustration: vecteezy.com

Security Clearances

You only have to scan the headlines or watch the news to learn what we in the government contracting community have known for years: the personnel security clearance process is in dire need of transformation. Cleared personnel are the lifeblood of both government and contractor workforces. The 700,000-case backlog stymies agency mission objectives and corporate growth.

How will government leaders move this logjam and improve the process into the future? How can policies—such as reciprocity— and technologies—such as AI—improve the process without introducing vulnerabilities? How can the clearance timeline be shortened so that we can effectively hire in-demand technologists to deliver the capabilities needed today and into the future? As we position ourselves to meet tomorrow’s challenges, PSC is continuing to examining this key issue constraining contractors today.

Workforce & Culture

Tomorrow’s service contractor workforce sits at the complex intersection of customer mission needs, technological advances, generational shifts, and corporate growth. In a series of breakout sessions at the 2018 Annual Conference, we uncover strategies for building and maintaining the cadre of professionals essential to a better business. Employee stock ownership plan (ESOP) experts demonstrate how promoting an “ownership culture” through an ESOP is a powerful tool to improve corporate performance.

Beyond the conference, PSC members have the opportunity to learn from organizational development professionals about the importance of aligning all elements of your organization to your business strategy and how to change behavior to reinforce that strategy. Participants and proponents of government/industry exchange programs highlight the value as well as the challenges leveraging these models. However uncertain the professional services marketplace may be, the need for cleared, qualified, motivated people is a constant. continued next page

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Service Contractor / Spring 2018 / 21

How can we leverage PSC’s advocacy to promote the most effective innovations and push back practices that limit competition under the banner of innovation while delivering for our customers? As the government responds to demands to improve how they buy services, we seek to partner in the innovation process to ensure maximum opportunity to flourish in this uncertain market.

M&A

Acquisition Reform

The government has initiated numerous acquisition reforms, from embracing agile acquisition and Reverse Industry Days, to expanding the use of OTA and Acquisition Innovation Advocates. As PSC and its members examine coming attractions in acquisition, we look to adapt to the government’s changing buying patterns. How should companies set strategies to align with continuing contract vehicle consolidation, category management, and Shared Services initiatives that change the competitive landscape?

While the government embraces technology, enacts policies, and modernizes outdated processes, the service contractor community is changing as well. To succeed in today’s market, PSC’s members are diving into current trends to understand the benefits gained through M&A in addition to other levers for growth. Beyond consolidation, how can M&A be used as a transformative tool to recreate businesses that succeed with all the market changes? What are the most favorable conditions to pursue this avenue? What are the potential pitfalls and what lessons learned can help you avoid them? What effect does the political climate contribute? As PSC member companies strive to move beyond merely reacting to the uncertain nature of our market, M&A can be a powerful tool for creating your better company. 3

Interested to join PSC’s Annual Conference Committee for 2019-2020? Email tarascio@pscouncil.org

Building Better Business…from page 11

CEO of PAE

Markets are never stable. They are constantly changing and evolving and there is little we can do to impact their stability. Rather, we focus on what we can control and run our companies with speed and agility, thereby adapting to the needs and expectations of our customers.

In particular, what we can influence is how well we operate and the quality of service we deliver to our customers. To that end, one of PAE’s core values is continuous improvement, the relentless commitment to deliver operational excellence across all functions of the company and to our customers. It is a source of pride for us to add value to what we do for our customers every day.

We are never satisfied with last year’s results.

22 / Service Contractor / Spring 2018

Customer trust and confidence is non-negotiable and far outweighs the stability of the market. There is no doubt our customers must juggle their investments between readiness and modernization. We seek to build trust by providing the best value of services to achieve their readiness objectives. As we help our customers maintain and grow their capabilities through readiness and modernization, we simultaneously develop our reputation.

We can empower our employees to provide the best services, and to continuously improve our offerings by gaining a deep understanding of our customers’ needs. This results in flexibility and creativity in addressing those needs. By managing our workforce this way, we are introducing a level of stability into the market.

So, how do you build a business in an environment of uncertainty? You focus on your customers’ requirements and you provide a skilled workforce laser focused on continuous improvement. This is common practice at PAE in an environment that is far from predictable. 3 Illustration: vecteezy.com

John Heller

Professional Services Council

PSC BY THE NUMBERS Here's a look at PSC's impact across the organization from 2017:

MEMBERSHIP

56

OF REGULAR MEMBERS small businesses

16

mid-tier

NEW MEMBER COMPANIES JOINED OF ASSOCIATE MEMBERS

68%

%

other professional services

35

law firms

27%

16

%

large businesses

%

6

%

32%

trade associations financial institutions

NEARLY 400 MEMBERS COMPANIES TOTAL!

ADVOCACY 27

agency letters/regulatory comments

16

letters to capitol hill

3

testimonies and statements

VISION FEDER AL MARKET FORECAST 21

study teams

EVENTS

275

7

109 informative events and meetings

1,157

700+

volunteers

(75 companies)

impactful conferences

- Leadership Summit - Annual Conference - FedHealth - Acquisition - Tech Trends - Development - Vision Forecast

500+

MEDIA

amicus brief

1 9 350

3

media 588K+ social impressions

Professional Services Council

government speakers

“Reverse Industry Days” that PSC helped organize & participate in

4

interviews

RFI responses

(cloud computing, GSA audit guide, etc.)

educational trainings

4,600+

media citations

LIVE

program participants

29

radio & TV appearances

social media mentions gained followers

85

traditional media impressions

1.4B

$12.5M

total publicity value

Service Contractor / Spring 2018 / 23

UPCOMING EVENTS Federal Law Enforcement Conference June 13, 2018 • Arlington, VA FedHealth Conference June 25, 2018 • Silver Spring, MD Federal Acquisition Conference July 18, 2018 • Arlington, VA Tech Trends Conference Sept. 11, 2018 • Washington, DC PSC Golf Tournament Sept. 13, 2018 • Clifton, VA Vision Federal Market Forecast Conference Oct. 29-30, 2018 • Falls Church, VA 6th Annual Development Conference Dec. 4, 2018 • Arlington, VA Board of Directors/Membership Meeting & Holiday Reception Dec. 20, 2018 • Arlington, VA

Register at www.pscouncil.org/calendar 24 / Service Contractor / Spring 2018

Sponsorships are available for these events. Contact Jean Tarascio at tarascio@pscouncil.org for more information.

Professional Services Council

CONFERENCE Presented by

June 13, 2018 | 8:00 a.m. - 1 p.m.

NRECA Conference Center in Arlington, Virginia Given the administration’s focus on law enforcement and security, this is an opportunity for industry to engage with key government executives on law enforcement challenges. Speakers from DHS, DOJ, and other law enforcement agencies will discuss their priorities and industry leaders will discuss where the market is headed.

June 25, 2018 | 8:00 a.m. - 1 p.m.

Civic Center in Silver Spring, MD

Senior executives from the contracting community and government will discuss critical industry policy and acquisition priorities in civilian and military health. Speakers from HHS, VA, and DoD will discuss their needs and challenges so that industry can better determine where the federal health market is headed. This halfday conference will be your opportunity to share ideas with senior government and industry leaders in an extensive dialogue on federal health agencies, future policy and procurement trends and their implications on your company.

CONFERENCE Presented by

July 18, 2018 | 8:00 a.m. - 11:30 a.m.

NRECA Conference Center in Arlington, VA As we approach the midway mark of the first term of the Trump administration, the government contracting industry faces new policy developments with major implications for how it does business. Join government executives and industry leaders at PSC’s half-day Federal Acquisition Conference to explore the evolving trends shaping the industry and their effect on your business. You will learn the impact of FY18 acquisition legislation and what’s ahead for FY19, acquisition alternatives and trends on the rise, innovation in the acquisition practice, and much more.

Professional Services Council

Service Contractor / Spring 2018 / 25

Bill Tracker: 115th Congress-Second Session (2018) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

H.J. Res. 37

Disapproving the 8/25/16 FAR rule relating to Fair Pay and Safe Workplaces, Foxx (R-NC)

STATUS Signed into law 3/27/17; P.L. 115-11.

Regulatory Accountability Act, Goodlatte (R-VA)

H.R. 5

Would reform the process by which federal agencies analyze and formulate new regulations, SUMMARY

clarify the nature of judicial review and ensure complete analysis of potential impacts on small business.

Would specifically repeal the so-called “Chevron deference” standard, require mandatory litigation stays for new rules, and strengthen the Regulatory Flexibility Act.

STATUS

Passed the House (238-183) on 1/11/17. Related bill: S. 951.

H.R. 26

Regulations from the Executive In Need of Scrutiny (REINS) Act, Collins (R-GA)

SUMMARY Provides that major executive branch rules shall have no force or effect unless a joint resolution of approval is enacted into law.

STATUS

Passed the House (237-187) on 1/5/17. Related bill: S. 21.

H.R. 39

Tested Ability to Leverage Exceptional National Talent (TALENT) Act, McCarthy (R-CA)

SUMMARY Would codify the Presidential Innovation Fellows Program.

STATUS Signed into law 1/20/17; P.L. 115-1.

Taxpayers Right-To-Know Act, Walberg (R-MI)

H.R. 71

SUMMARY Would require the Office of Management and Budget, beginning by 6/30/19, to provide an annual report disclosing the cost and performance of Government programs with budget authority greater than $1 million and areas of duplication among them.

STATUS Passed the House (voice vote) on 1/4/17. Related bill: S. 317.

GAO Access and Oversight Act, Carter (R-GA)

H.R. 72 SUMMARY

Would ensure the Government Accountability Office (GAO) has adequate access to information.

STATUS Signed into law 1/31/17; P.L. 115-3.

H.R. 239

Support for Rapid Innovation Act, Ratcliffe (R-TX)

SUMMARY Would require Department of Homeland Security to provide for innovative research and development.

STATUS Passed the House (voice vote) on 1/10/17. Related bill: S. 278.

H.R. 240

Leveraging Emerging Technologies Act, Ratcliffe (R-TX)

SUMMARY Would encourage engagement between Department of Homeland Security and technology innovators.

STATUS Passed the House (voice vote) on 1/10/17.

H.R. 321

Inspiring the Next Space Pioneers, Innovators, Researchers, and Explorers (INSPIRE) Women Act, Comstock (R-VA)

SUMMARY

STATUS

Requires the NASA Administrator to support women’s involvement in the fields of aerospace and space exploration and to develop a plan to best facilitate and support K-12 female STEM students to inspire the next generation of women.

Signed into law 2/28/17; P.L. 115-7.

26 / Service Contractor / Spring 2018

Professional Services Council

Bill Tracker: 115th Congress-Second Session (2018) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

H.R. 347

DHS Acquisition Documentation Integrity Act, Watson Coleman (D-NJ)

SUMMARY Would require DHS to maintain acquisition documentation that is complete, accurate, timely and valid for each major acquisition program (defined as having total expenditures of at least $300 million over its life-cycle).

STATUS Passed the House (voice vote) on 1/31/17.

H.R. 505 Border Security Technology Accountability Act, McSally (R-AZ)

SUMMARY

STATUS

Would strengthen accountability for the acquisition of border security technology at DHS by requiring major acquisition programs to have an approved baseline; requiring additional documentation of the cost, schedule, and performance thresholds; and requiring agencies to have a documented plan for implementation objectives.

Passed the House (voice vote) on 1/31/17. Related bill: S. 146.

H.R. 601

Continuing Appropriations and Supplemental Appropriations for Disaster

Relief Requirements Act, Lowey (D-NY)

SUMMARY Provided continuing appropriations for federal agencies through December 8, 2017 and

supplemental funding for hurricane relief.

STATUS Signed into law on 9/8/17; P.L. 115-56.

H.R. 666 DHS Insider Threat and Mitigation Act, King (R-NY)

SUMMARY

Would create a program at DHS to protect the department from threats by insiders.

STATUS Passed the House (voice vote) on 1/31/17.

H.R. 697 DHS Security Clearance Management and Administration Act,Thompson (D-MS)

SUMMARY

STATUS

Would require DHS to identify positions that warrant security clearances, how DHS investigates candidates for clearance, and how DHS administers adjudications, suspensions, revocations and appeals.

Passed the House (voice vote) on 1/31/17.

Lawsuit Abuse Reduction Act, Smith (R-TX)

H.R. 720

SUMMARY Would change Rule 11 of the Federal Rules of Civil Procedures to remove judicial discretion from

the decision to impose sanctions when a party makes a frivolous claim in court.

STATUS Passed the House (230-188) on 3/10/17. Related bill: S. 237.

H.R. 974 Boosting Rates of American Veteran Employment (BRAVE) Act, Rice (D-NY)

SUMMARY

STATUS

H.R. 998

Would allow the VA Secretary when awarding contracts to give preference to companies that employ veterans on a full-time basis. Any misrepresentation of status may result in debarment from VA contracting for not less than five years.

Passed the House (407-0) on 2/13/17. Related bill: S. 369.

Searching for and Cutting Regulations that are Unnecessarily Burdensome (SCRUB) Act, Smith (R-MO)

SUMMARY

STATUS

Would establish a Retrospective Regulatory Review Commission to identify rules, or sets of rules, that should be repealed to lower the cost of regulations on the economy. The Commission would have a goal of reducing the cumulative cost of regulations by 15%.

Passed the House (240-185) on 3/1/17.

Professional Services Council

Service Contractor / Spring 2018 / 27

Bill Tracker: 115th Congress-Second Session (2018) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

H.R. 1004 Regulatory Integrity Act, Walberg (R-MI)

SUMMARY Would require federal agencies to post in a central location all public comments the agency makes about a proposed rule during the proposed rule stage.

STATUS Passed the House (246-176) on 3/2/17.

H.R. 1009 OIRA Insight, Reform, and Accountability Act, Mitchell (R-MI)

SUMMARY Would codify current practices at the Office of Information and Regulatory Affairs for centralized

review of regulations and expand OIRA reviews to previously excluded agencies.

STATUS

Passed the House (241-184) on 3/1/17. Related bill: S. 676.

H.R. 1185 Retain Act, Ryan (D-OH)

SUMMARY Would provide a contracting preference for an offeror that certifies to retain jobs performed in the

U.S. and uses products substantially manufactured in the U.S.

STATUS

Referred to House Armed Services and Oversight and Government Reform Committees on 2/16/17.

H.R. 1249

DHS Multiyear Acquisition Strategy Act, Fitzpatrick (R-PA)

SUMMARY Would require the Department of Homeland Security to develop a Multiyear Acquisition Strategy

as part of each Future Years Homeland Security Program that addresses future priorities, capabilities, and funding.

STATUS

Passed the House (409-0) on 3/20/17. Related bill: S. 887.

H.R. 1252 DHS Acquisition Authorities Act, Higgins (R-LA)

SUMMARY Would establish the Under Secretary for Management as the Department’s Chief Acquisition

Officer to oversee the Department’s major programs to ensure they are affordable, or can be adequately funded, over the life cycle.

STATUS

Passed the House (407-1) on 3/20/17. Related bill: S. 902.

H.R. 1282

DHS Acquisition Review Board Act, Garrett (R-VA)

SUMMARY Would require the Secretary of Homeland Security to establish an Acquisition Review Board to

strengthen accountability and uniformity within the acquisition review process.

STATUS

Passed the House (voice vote) on 6/21/17. Related bill: S. 886.

H.R. 1294 Reducing DHS Acquisition Cost Growth Act, Rutherford (R-FL)

SUMMARY Would subject major acquisition programs at the Department of Homeland Security that do

not meet cost, schedule, or performance metrics to additional reporting requirements, and require the agency to establish remedial action plans.

STATUS

Passed the House (408-0) on 3/20/17. Related bill: S. 906.

H.R. 1365

Department of Homeland Security Acquisition Innovation Act, Correa (D-CA)

SUMMARY Would authorize the Under Secretary for Management to designate an official to manage acquisition

innovation activities and develop and distribute best practices throughout the Department.

STATUS

Passed the House (424-0) on 3/24/17.

28 / Service Contractor / Spring 2018

Professional Services Council

Bill Tracker: 115th Congress-Second Session (2018) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

H.R. 1625 Consolidated Appropriations Act of 2018, Royce (R-CA)

SUMMARY Provides full appropriations for federal agencies for fiscal year 2018 and includes substantial

increases in funding for certain agencies and programs.

STATUS

Signed into law on 3/23/17: P.L. 115-141.

H.R. 2006 VA Procurement Efficiency and Transparency Act, Coffman (R-CO)

SUMMARY Requires the Department of Veterans Affairs to record the amount of any cost or price savings

realized by using competitive procedures in awarding such contract.

STATUS Passed the House (voice vote) on 7/24/17.

H.R. 2200

Frederick Douglass Trafficking Victims Prevention and Protection Reauthorization Act, Smith (R-NJ)

SUMMARY Would reauthorize the Trafficking Victims Protection Act and require that federal agencies report

on actions they are taking to ensure contractors are educated on the applicable laws regarding human trafficking.

STATUS Passed the House (voice vote) on 7/12/17.

H.R. 2227 The Modernizing Government Technology Act, Hurd (R-TX)

SUMMARY

STATUS

Creates funds for agencies to invest in new, innovative information technology solutions that reduce costs and increase network security.

Passed the House (voice vote) on 5/17/17. Related bill: S. 990. Modified text included in H.R. 2810/FY18 NDAA, signed into law on 12/12/17; P.L. 115-91.

H.R. 2594 The Small Business Pay for Performance Act, Fitzpatrick (R-PA)

SUMMARY

STATUS

Would permit contractors to submit an invoice after a federal agency issues a unilateral change order on a construction projects and request the agency pay 50 percent of the billed costs when the change order is complete.

Ordered to be reported by the House Committee on Small Business on 6/15/17.

H.R. 2749 Protecting Business Opportunities for Veterans Act, Bergman (R-MI)

SUMMARY Would penalize violations of the limitations on subcontracting rule and require participants in the

Vets First Program to certify that they are performing the required percentage of work.

STATUS Passed the House (voice vote) on 7/24/17.

H.R. 2763

Small Business Innovation Research and Small Business Technology Transfer

Improvements Act, Knight (R-CA)

SUMMARY Would establish a Civilian Agency Commercialization Readiness Program and require DoD to

include more SBIR and STTR developed technology in larger programs of record.

STATUS Passed the House (voice vote) on 10/11/17.

Professional Services Council

Service Contractor / Spring 2018 / 29

Bill Tracker: 115th Congress-Second Session (2018) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

Ensuring Veteran Enterprise Participation in Strategic Sourcing Act, Dunn (R-FL)

H.R. 2781 Would expand the Department of Veterans Affairs policy to set aside contracts for small businesses

SUMMARY

owned by veterans or service-disabled veterans to include VA contracts run by the General Services Administration (GSA) under the Federal Strategic Sourcing Initiative.

STATUS Passed the House (voice vote) on 7/24/17.

Fiscal 2018 National Defense Authorization Act (NDAA), Thornberry (R-TX)

H.R. 2810 Authorizes appropriations for fiscal year 2018 for military activities of the Department of Defense,

SUMMARY

for military construction, and for defense activities of the Department of Energy, to prescribe military personnel strengths for such fiscal year, and for other purposes.

STATUS Signed into law on 12/12/17; P.L. 115-91.

DHS Authorization Act, McCaul (R-TX)

H.R. 2825 Would reauthorize the Department of Homeland Security.

SUMMARY

STATUS Passed the House (386-41) on 7/20/17. Ordered to be reported with an amendment by the Senate Committee on Homeland Security and Governmental Affairs on 3/7/18.

H.R. 3019 Promoting Value Based Procurement Act, Meadows (R-NC)

SUMMARY Would limit the use of lowest price technically acceptable (LPTA) source selection criteria for

certain service contracts in the civilian agencies.

STATUS Ordered to be reported by the House Committee on Oversight and Government Reform on 09/13/17.

H.R. 3210 SECRET Act, Knight (R-CA)

SUMMARY

STATUS

Would require the Office of Personnel Management’s National Background Investigations Bureau to report on the size of the backlog of security clearance investigations, and the average length of time to carry out an investigation.

Passed the House (voice vote) on 7/26/17. Passed the Senate with an amendment by Unanimous Consent on 3/15/18.

H.R. 3219 Make America Secure Appropriations Act, Granger (R-TX)

SUMMARY Would make appropriations for the Department of Defense, Veterans Affairs, energy-related

agencies and the legislative branch for the fiscal year ending September 30, 2018.

STATUS Passed the House (235-192) on 7/27/17.

H.R. 3243 FITARA Enhancement Act

SUMMARY

STATUS

Eliminates the five-year sunset clause for provisions relating to transparency and risk management of information technology investments included in the Federal IT Acquisition Reform Act of 2014, and extends the sunset of the Federal Data Center Consolidation Initiative from 2018 to 2020.

Signed into law 11/21/17; P.L. 115-88.

H.R. 4038 DHS Accountability Enhancement Act

SUMMARY Would repeal the authority for DHS to reorganize its offices and components without

Congressional approval.

STATUS Passed the House (voice vote) on 10/23/17.

30 / Service Contractor / Spring 2018

Professional Services Council

Bill Tracker: 115th Congress-Second Session (2018) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

H.R. 4174 Foundations for Evidence-Based Policymaking Act of 2017

SUMMARY

STATUS

Would require each agency to name a chief data officer and a chief evaluation officer to establish a more secure, transparent, and efficient data system that will help federal agencies better assess the effectiveness of their programs.

Passed the House (voice vote) on 11/15/17.

H.R. 4191 HHS Cybersecurity Modernization Act

SUMMARY

STATUS

Would authorize the HHS CISO to coordinate healthcare sector cybersecurity, remove the CISO from the Office of the Chief Information Officer, and elevate the position as a direct report to the HHS Secretary.

Referred to the House Committee on Energy and Commerce on 10/31/17.

H.R. 4747 Defending U.S. Government Communications Act, Conaway (R-TX)

NEW

SUMMARY Would prohibit the government from contracting with entities that use telecommunications

services or equipment produced or provided by Huawei Technologies Company or ZTE Corporation.

STATUS Referred to the House Committee on Oversight and Government Reform on 1/9/18. Related bill: S. 2391.

H.R. 4995 Due Diligence for FEMA Disaster Contractors Act, Thompson (D-MS)

NEW

H.R. 5105 The BUILD Act, Yoho (R-FL)

NEW

H.R. 5113 Federal Contractor Anti-Harassment Training Act, Barragan (D-CA)

NEW

H.R. 5144 Contracting Compliance Act, Blum (R-IA)

NEW

H.R. 5177 Encouraging Veteran Employment Act, Knight (R-CA)

NEW

SUMMARY Would direct FEMA to establish a contractor review process for major disaster-related contracts

over $1M. FEMA would assess the past experience and resources of the potential contractor in five areas.

STATUS Referred to the House Committee on Transportation and Infrastructure on 2/8/18.

SUMMARY

STATUS

Would establish the United States International Development Finance Corporation to mobilize and facilitate the participation of private sector capital and skills in the economic development of less developed countries.

Referred to the House Committee on Foreign Affairs on 2/27/18.

SUMMARY Would require mandatory sexual harassment training for the employees of federal contractors and

subcontractors.

STATUS Referred to the House Committee on Oversight and Government Reform on 2/27/18.

SUMMARY

STATUS

Would require GAO to report on compliance of contracting agencies with subcontracting plans and subcontracting goals under the Small Business Act and make recommendations to strengthen oversight of compliance standards.

Referred to the House Committee on Small Business on 3/1/18.

SUMMARY Would allow the Secretary of Defense to give preference to contractors that employ veterans on a

full-time basis.

STATUS Referred to the House Committee on Armed Services on 3/6/18.

Professional Services Council

Service Contractor / Spring 2018 / 31

Bill Tracker: 115th Congress-Second Session (2018) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

H.R. 5337 Accelerated Payments for Small Businesses Act, Knight (R-CA)

SUMMARY

STATUS

NEW

Would permanently restore prompt payments to small businesses and small business subcontractors. This policy was originally established by OMB Memo M-11-32 and portions lapsed on December 31, 2017.

Referred to the House Committee on Oversight and Government Reform on 3/20/18.

S.J. Res. 12 Disapproving the FAR rule relating to Fair Pay and Safe Workplaces, Johnson (R-WI)

STATUS Referred to the Senate Committee on Homeland Security and Governmental Affairs Committee.

Related bill: H. J. Res. 37, signed into law 3/27/17; P.L. 115-11.

S. 21 Regulations from the Executive In Need of Scrutiny (REINS) Act, Paul (R-KY)

SUMMARY

STATUS

Provides that major executive branch rules shall have no force or effect unless a joint resolution of approval is enacted into law.

Reported by the Senate Committee on Homeland Security and Governmental Affairs on 10/16/17.

Related bill: H.R. 26.

Providing an exception to a limitation against appointment of a person as Secretary

of Defense, McCain (R-AZ)

SUMMARY Changed the requirements that an individual must be retired from active duty, from seven years to three years, to serve as Secretary of Defense. Applies to Secretary Mattis only.

S. 84

STATUS

Signed into law 1/20/17; P.L. 115-2.

S. 146

Border Security Technology Accountability Act, McCain (R-AZ)

SUMMARY Would strengthen accountability for the acquisition of border security technology at the

Department of Homeland Security by requiring major acquisition programs to have an approved baseline; requiring additional documentation of the cost, schedule, and performance thresholds; and requiring agencies to have a documented plan for implementation objectives.

STATUS Ordered to be reported by the Committee on Homeland Security and Governmental Affairs on 10/4/17.

Related bill: H.R. 505.

Lawsuit Abuse Reduction Act, Grassley (R-IA)

S. 237

SUMMARY Would change Rule 11 of the Federal Rules of Civil Procedures to remove judicial discretion from the decision to impose sanctions when a party makes a frivolous claim in court.

STATUS Referred to the Senate Committee on the Judiciary on 1/30/17. Related bill: H.R. 720.

Support for Rapid Innovation Act, Daines (R-MT)

SUMMARY Would require DHS to provide for innovative research and development.

STATUS Referred to the Senate Committee on Homeland Security and Governmental Affairs on 2/2/17.

Related bill: H.R. 239.

S. 278

S. 317

Taxpayers Right-To-Know Act, Lankford (R-OK)

SUMMARY Would require OMB, beginning by 6/30/19, to provide an annual report disclosing the cost and

performance of Government programs with budget authority greater than $1 million and areas of duplication among them.

STATUS Reported by the Senate Committee on Homeland Security and Governmental Affairs on 5/1/17.

Related bill: H.R. 71.

32 / Service Contractor / Spring 2018

Professional Services Council

Bill Tracker: 115th Congress-Second Session (2018) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

S. 369 Boosting Rates of American Veteran Employment (BRAVE) Act, Baldwin (D-WI)

SUMMARY Would allow the VA Secretary, when awarding contracts, to give preference to companies that employ veterans on a full-time basis. Any misrepresentation of status may result in debarment from VA contracting for not less than five years.

STATUS

Referred to the Senate Committee on Veterans Affairs on 2/14/17. Related bill: H.R. 974.

S. 442

National Aeronautics and Space Administration Transition Authorization Act,

Cruz (R-TX)

SUMMARY Authorizes $19.5 billion for NASA for fiscal year 2017.

STATUS Signed into law on 3/21/17; P.L. 115-10.

HUBZone Investment Protection Act, Cardin (D-MD)

SUMMARY Would extend the eligibility of redesignated areas as HUBZones from 3 years to 7 years.

STATUS Reported by the Senate Committee on Small Business and Entrepreneurship on 8/2/17.

Related bill: H.R. 2013.

S. 690

S. 842 Fair Chance Act, Booker (D-NJ)

SUMMARY

STATUS

Would prohibit Federal agencies and contractors from requesting that an applicant for employment disclose criminal history record information before the applicant has received a conditional offer.

Reported by the Senate Committee on Homeland Security and Governmental Affairs on 9/25/17.

Related bill: H.R. 1905.

S. 886 DHS Acquisition Review Board Act of 2017, Daines (R-MT)

SUMMARY Would require the Secretary of Homeland Security to establish an Acquisition Review Board to strengthen accountability and uniformity within the acquisition review process.

STATUS Passed Senate with an amendment by Unanimous Consent on 11/9/17. Related bill: H.R. 1282.

S. 887 DHS Multiyear Acquisition Strategy Act, Daines (R-MT)

SUMMARY

STATUS

Would require the Department of Homeland Security to develop a Multiyear Acquisition Strategy as part of each Future Years Homeland Security Program that addresses future priorities, capabilities and funding.

Referred to the Senate Committee on Homeland Security and Governmental Affairs on 4/6/17.

Related bill: H.R. 1249.

S. 906 Reducing DHS Acquisition Cost Growth Act, McCaskill (D-MO)

SUMMARY

STATUS

Would subject major acquisition programs at the Department of Homeland Security that do not meet cost, schedule, or performance metrics to additional reporting requirements and require the agency to establish remedial action plans.

Passed Senate with an amendment by Unanimous Consent on 11/9/17. Related bill: H.R. 1294.

S. 951

Regulatory Accountability Act, Portman (R-OH)

SUMMARY Would reform the process by which federal agencies analyze and formulate new regulations, require effective cost-benefit analysis and allow courts to review agencies’ compliance with rule writing procedural requirements, while allowing courts to remand rules to agencies where appropriate.

STATUS Reported from the Senate Committee on Homeland Security and Governmental Affairs on 2/14/18 .

Related bill: H.R. 5.

Professional Services Council

Service Contractor / Spring 2018 / 33

Bill Tracker: 115th Congress-Second Session (2018) NEW

Newly introduced since last issue

Major action taken since last issue

Bill became law since last issue

S. 990 The Modernizing Government Technology Act, Moran (R-KS)

SUMMARY Creates funds for agencies to invest in new, innovative information technology

solutions that reduce costs and increase network security.

STATUS Modified text included in H.R. 2810/FY18 NDAA, signed into law on 12/12/17; P.L. 115-91.

S. 1038

A bill to require the Administrator of the Small Business Administration to submit to Congress a report on the utilization of small businesses with respect to certain Federal contracts, Ernst (R-IA)

SUMMARY Would require the SBA Administrator to submit a report to Congress that includes a determination

as to whether small business concerns are being utilized in a significant portion on multiple award contracts.

STATUS Text included in H.R. 2810/FY18 NDAA, signed into law on 12/12/17; P.L. 115-91.

S. 1519 National Defense Authorization Act, McCain (R-AZ)

SUMMARY

STATUS

Authorizes FY18 appropriations and sets forth policies regarding the military activities of the Department of Defense. Contains a number of acquisition reform policies impacting competition, GAO protests, and commercial items, among other provisions.

Placed on Senate Legislative Calendar on 7/10/17. Related bill: H.R. 2810/FY18 NDAA, signed into law on 12/12/17; P.L. 115-91.

S. 1691

Internet of Things (IoT) Cybersecurity Improvement Act, Warner (D-VA)

SUMMARY Would require contractors who supply the Government with IoT devices to meet certain

cyber security requirements, including that the devices are patchable, do not contain hard-coded passwords or known vulnerabilities and rely on standard protocols.

STATUS Referred to the Senate Committee on Homeland Security and Governmental Affairs on 8/1/17.

Ensuring Protections for Intelligence Community Contractor Whistleblowers Act,

McCaskill (D-MO)

SUMMARY Would provide whistleblower protections for certain contractors within elements of the

intelligence community for the lawful disclosure of information.

STATUS Similar text included in S. 139, FISA Amendments Reauthorization Act, signed into law on

1/19/18; P.L. 115-118.

Defending U.S. Government Communications Act, Cotton (R-AK)

NEW

SUMMARY Would prohibit the government from contracting with entities that use telecommunications

services or equipment produced or provided by Huawei Technologies Company or ZTE Corporation.

STATUS Referred to the Senate Committee on Homeland Security and Governmental Affairs on 2/7/18.

Related bill: H.R. 4747.

NEW Bridge Contract Transparency and Accountability Act, McCaskill (D-MO)

SUMMARY Would require the Administrator for Federal Procurement Policy to report to Congress on

governmentwide policies, practices, and uses of bridge contracts and require the head of each executive agency to develop procedures that seek to minimize the use of bridge contracts.

STATUS Order to be reported by the Senate Committee on Homeland Security and Governmental Affairs

on 2/14/18.

S. 2002

S. 2391

S. 2431

34 / Service Contractor / Spring 2018

Professional Services Council

A Prescription for HHS Cybersecurity

by Bradley Saull, PSC Vice President for Civilian Agencies

and Safeguarding the Healthcare Sector

C

ybersecurity is an essential underpinning to our interconnected world today. Organizations and individuals need to be vigilant with their cybersecurity practices, whether on a mobile device, office computer, or systems connected to critical infrastructure. This particularly extends to the healthcare sector, where issues from patient privacy to modern medical devices connected to the internet raise significant cybersecurity concerns—with potential life or death implications. Currently, the Chief Information Security Officer (CISO) at the Department of Health and Human Services (HHS) is coordinating cybersecurity information sharing in the healthcare sector. But what should the federal government’s role be in cybersecurity of the healthcare sector, and who should oversee it?

Photo: shutterstock.com/Panchenko Vladimir

Who Owns Healthcare Sector Cyber?

With the passage of the Cybersecurity Act of 2015, Congress took an important first step in creating processes and resources to assist all critical infrastructure sectors in identifying and defending against cyber threats. For many of these critical infrastructure sectors, the Department of Homeland Security (DHS) is the lead coordinating agency. However, in other sectors, a sectorspecific agency (SSA) has the lead in cyber coordination while DHS plays a supporting role. Examples of this structure include the Treasury Department for the financial sector, the Department of Energy for the energy sector, the Environmental Protection Agency for the water sector, and HHS for the healthcare sector.

Since before the law was passed, and continuing today, each of the critical infrastructure sectors are at different levels of maturity in combatting cyber threats as various private entities within each sector have chosen to invest in cybersecurity as a business imperative to their success. The financial services sector has long been the gold standard in cybersecurity coordination as many private companies have invested in cybersecurity protections and sharing mechanisms based on how interconnected financial transactions are and the economic consequences of a major breach. As the SSA for the healthcare sector, it was natural for HHS to rely on a place where the HHS workforce had cybersecurity expertise – the CISO. However, is that the right answer long-term?

What is the HHS CISO’s primary job?

For years, the HHS CISO within the HHS Office of the Chief Information Officer has been the lead for information security, duties formalized under the Federal Information

Security Management Act (FISMA). Enacted in 2002, FISMA was updated in 2014, and sets a comprehensive framework to protect government information, operations, and assets against natural or man-made threats.

The CISO should be a key deputy to the CIO, within a single chain of command. This should enable agency heads to avoid the lack of accountability and finger pointing that ensues when multiple independent actors are responsible for parts of the technology agenda, and instead, ensure a unified team is working together, with clear accountability, to deliver results.

Given the organization of federal agencies, the CIO must continue to be the business leader for all aspects of IT management and delivery, accountable for an agency’s IT operations, and making business decisions impacting those IT operations. Given this reality, IT project success is dependent on the synchronization of agendas among all key stakeholders.

How is critical infrastructure cybersecurity supposed to work?

Government coordinating councils and a sector specific coordinating council are in place for the critical infrastructure sectors. All sector councils should work with DHS and the National Cybersecurity and Communications Integration Center (NCCIC) to share cyber threat information among all sectors as Congress authorized in the Cybersecurity Act of 2015. Each continued next page

Professional Services Council

Service Contractor / Spring 2018 / 35

industry sector is to have representatives on the operations center floor who know and understand sector specific challenges.

The sectors also have non-governmental Information Sharing and Analysis Centers (ISACs) and Information Sharing and Analysis Organizations (ISAOs) sharing information among willing participants.

HHS CISO’s primary role is to be the lead for information security under the Federal Information Security Management Act (FISMA), but additional duties have been added to coordinate cybersecurity for the healthcare sector.

How has HHS approached their sector role?

There are two main cyber organizations developed by the healthcare sector: The National Health Information Sharing and Analysis Center (NH-ISAC) and the Health Information Trust Alliance, or HITRUST. Congress intended for there to be many of these types of organizations, not just one, so that various business models and perspectives within each sector could thrive. However, HHS decided to pick one – NH-ISAC, a fundamental mistake. HHS should not have picked a preferred provider, but let multiple sharing mechanisms thrive within the existing structures instead, like other sectors.

HHS, at the behest of a sector-specific industry task force created by Congress, has been pushing for some time to create a Health Cybersecurity and Communications Integration Center (HCCIC), a cyber operations center solely for the healthcare sector. Other sectors do not have such an arrangement and use the DHS NCCIC. Some say the HCCIC is unnecessary, is duplicative of the NCCIC, and would balkanize cyber information sharing within government. How could the HCCIC bring unique skills or capabilities and integrate those capabilities with existing structures? Would HCCIC be able to compete for cyber talent among the government and private sector?

Despite notable improvements across the healthcare sector, progress is not where nearly everyone would like it to be. Numerous watchdog reports from the Government Accountability Office (GAO), the HHS Inspector General, and the House Energy & Commerce Committee have pointed out deficiencies.

Other sector-specific agencies have given broader sector cybersecurity reponsibility to another entity within their Department, not to the CISO. These sectors have government coordinating councils and sector-specific coordinating councils as governance structures supporting them. For instance, the CISO at DHS has FISMA responsibility for DHS networks, but is not responsible

36 / Service Contractor / Spring 2018

for securing government systems government-wide. Another office (NPPD) within DHS has that role, with various governance structures supporting them. In February 2018, U.S. Secretary of Energy Rick Perry announced the establishment of a new Office of Cybersecurity, Energy Security, and Emergency Response (CESER) at the U.S. Department of Energy (DOE) to bolster DOE’s efforts in energy sector cybersecurity. Nearly $100 million in funding for the office was included in President Trump’s FY19 budget request. HHS should look to these other SSAs as a model to follow.

If this is government led, does HHS have the workforce to take it on?

If HHS takes on a greater role through something like the Health Cybersecurity and Communications Integration Center, would an existing HHS officer (other than the CISO) take on this role or would another office be created? If the healthcare system moves to a single-payer system, a greater HHS role would likely be necessary. These questions are fundamental to the central question America faces today: how much government do we want and how are we going to pay for it?

HHS has a 30 percent vacancy rate for cyber positions and a quarter of its cyber workforce is eligible for retirement. This is daunting. The government and the private sector are always competing for talent. But the government is also competing with itself for this scarce talent. This is an opportunity for technology and professional services contractors to provide the detailed expertise HHS needs with the flexibility and scalability that the contractor workforce can provide.

There’s been much debate about how much healthcarespecific knowledge is necessary to coordinate the cybersecurity of the healthcare sector. Some say a great degree of clinical knowledge is needed, while others differ. How many people in the HHS CISO’s office work there because it works on cybersecurity matters, and how many work there because it’s HHS or health focused?

If the CISO does not coordinate across the healthcare sector, are there staff from the CISO’s office performing healthcare sector duties that could be split away from the HHS-centered CISO role to join another office within HHS? If so, where? Perhaps the Office of the National Coordinator for Health IT (ONC), which is tapped to be the principal federal entity charged with coordination of nationwide efforts to implement and use the most advanced health information technology and the electronic exchange of health information. However, the current administration has not completely agreed with the previous administration’s work in this area and is attempting to limit the role of the National Coordinator’s office and consolidate functions into two areas: 1) pushing interoperability and data sharing, including technical issues; and 2) lowering physician IT burdens. Another potential office to lead healthcare cybersecurity might be the HHS Office of the Assistant Secretary for Preparedness and Response (ASPR), but that organization has experienced growing pains of its own amid conflicting visions of what that office should become and the type of workforce needed to carry out the office’s current functions.

Professional Services Council

Cybersecurity is a team sport and not everyone has to be the coach or quarterback. ONC and ASPR should work extensively with the government coordinating council, healthcare coordinating council, the DHS NCCIC, and ISAOs like both NH-ISAC and HITRUST. HHS should name a leader from either ONC or ASPR to lead these efforts for the healthcare sector.

with her current dual assignment protecting HHS systems and coordinating across the sector.

As the healthcare sector builds out its own information sharing capabilities to fill gaps, Congress is considering various remedies, including a bipartisan bill introduced in October by Rep. Billy Long (R-MO) and Rep. Doris Matsui (D-CA), H.R. 4191, the HHS Cybersecurity Modernization Act. This legislation, an updated version of the HHS Data Protection Act (H.R. 5068) introduced in the last Congress, would authorize the HHS CISO to coordinate healthcare sector cybersecurity, remove the CISO from the Office of the Chief Information Officer, and “elevate” the position to be a direct report to the HHS Secretary. This bill is not the solution. The person protecting systems and networks should not be separate from the person in charge of running them.

The lawmakers note that they want to ensure that cybersecurity remains of utmost priority. We can hope that they would follow the Hippocratic Oath: “first, do no harm.”

If Congress and the administration want HHS more involved in healthcare cybersecurity, let’s have that debate. But if HHS does more, don’t put the HHS CISO in charge of healthcare sector cybersecurity: they already have a full-time job.

If you have ideas about the composition and structure of the HHS cyber workforce, please contact us to share your perspective. 3

HHS has a 30 percent vacancy rate for cyber positions and a quarter of its cyber workforce is eligible for retirement.

What’s in store for the future?

Numerous HHS cyber officials have left or resigned in recent months. In March 2018, Janet Vogel from the Centers for Medicare and Medicaid Services (CMS) has been named the HHS CISO. She should do a review of the people, processes, and technologies across HHS in this area, examine how they plug-in to the healthcare sector and the DHS NCCIC, and make a recommendation to the Secretary on how to proceed

Welcome Board!

PSC would like to recognize and welcome the following member-company executives, elected as new members to our Board of Directors for 2018.

Andy Green

Kim Hayes

President Technical Solutions Group Huntington Ingalls Industries

CEO & Co-Founder Ambit Group

Robert Olsen

Al Thompson

CEO WBB

Deputy to the President Operations & Eternal Relations KBRWyle

Professional Services Council

John Heller

Dennis Kelly

Michael Niggel

CEO PAE

President & CEO Buchanan and Edwards

CEO Advanced Concepts and Technologies International, LLC (ACT I)

Bill Weber

George Wilson

Eric Wolking

President & CEO KeyW

President & CEO ECS Federal

CEO GAP Solutions, Inc.

Service Contractor / Spring 2018 / 37

Three Sales and Marketing Strategies to Drive Growth in 2018

by Elizabeth Harr, Partner, Hinge Marketing

W

ith Q2 in full effect, now is a good time to do a health check on your current marketing strategies, and plan your marketing roadmap for success over the rest of 2018. Here are three powerful strategies to build upon as you get started.

1. Get Inside Your Buyer’s Mind

2. Know How You are Different — and Lead with It

As you’ve probably experienced, most professional services firms tend to look and sound like their competitors. In fact, they often are the same — providing essentially the same services to the same audiences.

Why? Because many firms are founded when practitioners leave their old firms to launch their own ventures. These new entrepreneurs generally model their businesses on what they are familiar with. The result: a multitude of lookalike companies.

So how does a buyer choose whom to hire? The answer is differentiation, a topic I have written about before. If a firm can uncover (or create) unique qualities about itself, it can use them to separate itself from the pack. Usually this takes the form of specialization — and that means sacrificing one part of your market to create traction and opportunity in another.

But even more important is to find those qualities your potential clients actually want to hear about. Identify an attribute you can “own” in your market. It does not need to be unique, as long as it is something your competitors are not already claiming about themselves. Once you know your key

38 / Service Contractor / Spring 2018

differentiator, focus on making it the one thing that clients think of when they hear your firm’s name. That’s the power of differentiation.

3. Increase the Visibility of Your Expertise

Boosting the visibility of your firm and its experts is one of the most effective marketing investments you can make.

Visible Expertise relies heavily on content marketing — in which a firm’s experts share their knowledge by publishing and speaking to target audiences. Over time, the firm builds trust with the audience … and when the moment comes that a member of your audience is ready to purchase services or make a referral, your firm will be on the top of their mind.

For many firms, this strategy is quite different from how they are used to marketing. For others, it is more about sharpening their focus on activities they do already, and turning up the volume.

What Will Drive Your Sales and Marketing in 2018?

No one knows what the future will bring, so it is smart business to periodically reevaluate your sales and marketing strategy. Which strategies make the most sense for you?

By adopting these three strategies, built on marketing fundamentals, you’ll be able to adapt to whatever market changes may come. 3

Elizabeth Harr is an accomplished entrepreneur and experienced executive who heads the technology services team at Hinge. Elizabeth brings over 15 years experience in strategic planning, brand management and communications to her role as Partner.

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Illustration: vecteezy.com

In Theodore Levitt’s brilliant 1960 Harvard Business Review article, “Marketing Myopia,” he wrote, “Selling focuses on the needs of the seller, marketing on the needs of the buyer.” He made a strong case that businesses were not really seeing the buyer’s perspective, needs and motivations.

More than half a century later — thanks to Levitt and other marketing thought leaders — most of us know that it is our clients who drive the marketplace. Even so, most companies are complacent. Because they work with their clients every day, they assume they understand the pressures their clients face. In most cases, they could not be more wrong.

Your buyers’ needs and priorities change continually. If you do not have a system for monitoring clients’ changing priorities, you have a big blind spot.

Research is the answer. It gives you new insights about your clients — and data that can help you make better decisions about what services you sell to whom, and how.

Are Some Civilian Agencies Moving Away From Contracts?

by Bradley Saull, PSC Vice President for Civilian Agencies

W

hile some agencies and contracting offices are scrambling to spend more money in half the time than they typically have, other agencies — specifically at two civilian agencies — are looking to reduce their contract spend and potentially fundamentally change their relationship with their professional services contractors.

Substance Abuse and Mental Health Services Administration (SAMHSA)

Illustration: shutterstock.com/hvostik

PSC has received a few inquiries from member companies in recent months that the SAMHSA within the Department of Health and Human Services (HHS) is moving away from contracts toward grants. Early indications were that SAMHSA has acted on this preference in two ways: 1) Released a $12.5M, two-year opioid Technical Assistance grant to a consortium of medical professional associations; 2) Stipulated in recent Requests for Assistances that each successful grantee will be given $25,000 to purchase their own Technical Assistance (as a way of letting grantees decide how to spend Technical Assistance funds).

On March 22, 2018, SAMHSA Assistant Secretary, Dr. Elinore McCance-Katz published a blog post entitled “SAMHSA Revamping TA-Contractors Model to Deliver More Support to American Communities.” The post notes a negative experience McCance-Katz had with a SAMHSA contractor while she was a grantee, how she views contractors as a waste of resources, and how she is changing the business model for accomplishing training and technical assistance at her agency.

Later that day, and in the days following, numerous SAMHSA contractors received stop-work orders on current contracts, or notices of intent that future contract option years would not be exercised. On April 5, PSC sent a letter to SAMHSA requesting a meeting with Dr. McCance-Katz, to include several of our member companies who have a record of achievement working with SAMHSA—some spanning three decades. PSC aims to discuss these actions along with the potential of improving the delivery of technical assistance and professional services contracts within current contract mechanisms.

Environmental Protection Agency (EPA) too?

We have heard reports that the EPA’s Office of Research and Development (ORD) has put a mandate to reduce contractor support significantly. In fact, ORD is being held to performance

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goals that include a goal about reducing contractor support.

Even with the higher budget for EPA at omnibus level funding, there is reason to believe that any expenditures on contractors (at least in ORD) will be highly scrutinized.

What’s in store for the future?

PSC’s top priority is demonstrating the value of government contracting and contractors. We will continue to engage with these agencies and consider the use of various advocacy tools at our disposal. PSC strongly encourages these agencies to share as much information publicly as possible, so that those companies who are dedicated to delivering high-quality capabilities can best understand the dynamics of the government’s actions, and plan for any disruption on their workers.

If you have similar concerns about these agencies or experiencing dynamics that devalue the critical role government contractors play in helping the government achieve its mission, please let us know. 3

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Adding Value to PSC Membership

by Matthew Busby, PSC Director of Membership

PSC Market & Policy Briefing If you’re looking for deeper insight into the market and political drivers impacting your success in the federal agencies, then sign up for a PSC Market & Policy Briefing. This unique presentation is a member-exclusive benefit, designed to provide executive PSC perspectives on key policy issues and trends to you and your team. To sign up, contact the PSC team at policy@pscouncil.org or membership@pscouncil.org.

Member Orientation

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Photographs: (Top) shutterstock.com, (Bottom) shutterstock.com/Rawpixel.com

Success with PSC begins with understanding the ways you can engage. A PSC Membership Orientation is a great way to learn about our value proposition and the key engagement channels and benefits available with your membership. Let us help identify the combination of offerings most valuable to you. If you’re looking for ways to get involved or engage others on your team, a Membership Orientation is a great place to start. To schedule an orientation, contact membership@pscouncil.org.

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MEMBER NEWS Westat Acquires JEN Associates, Inc. Westat, a leading research organization, and JEN Associates, Inc., a nationally recognized health care data analytics firm, have combined their capabilities with Westat’s acquisition of JEN. This brings together the skills and experience of health policy researchers, analysts, programmers, and system architects and engineers in providing data-driven health care analyses to Federal, state, and local government agencies; foundations; and the life sciences industry.

SOSi Adds New Cyber Security and Software Development Capabilities with Acquisition of STG Group Holdings, Inc. SOS International LLC (SOSi) on April 11 announced the acquisition of STG Group Holdings, Inc. (STG), a leading provider of mission-critical technology, cyber, and data solutions to the U.S. defense, diplomatic and intelligence communities. The acquisition expands SOSi’s current contract and customer base and adds new technical capabilities in cyber security, information assurance, software development, and data analytics to its portfolio. STG is SOSi’s third and largest acquisition since 2016, and the two companies, together, employ 1,300 employees worldwide. “SOSi and STG have thirty-year legacies serving the national security community. We have complementary missions, customers and competencies” said Julian Setian, SOSi President and CEO. “Our goal is to be the leading middle-market company in the federal technology services sector, differentiated by our private ownership structure and mission focus.”

ACT I Announces Neil F. Albert as President Advanced Concepts and Technologies International, LLC (ACT I) announced the addition of Neil Albert as the company’s President. In this role, he will oversee ACT I’s growth strategy, business development, and financial performance.

Most recently, Albert served as President and CEO of MCR, LLC where he transformed the company from a cost and financial services firm to become a market leader in Integrated Program Management support services; growing the company from $25 million to $150 million in revenue. “ACT I is honored to have Mr. Albert as its President and a critical addition to our executive leadership team. With his arrival, ACT I will achieve its corporate strategic growth goals and continue to provide exceptional customer support Professional Services Council

across our Department of Defense, Department of Homeland Security, Defense Health, and Foreign Military Sales and International markets,” said Mr. Michael Niggel, ACT I CEO.

Fors Marsh Group Achieves B Corporation Certification Fors Marsh Group (FMG) has been named the first Washington, D.C.-area research company to earn the B Corporation Certification, joining a community of Certified B Corporations committed to a higher standard of overall social and environmental performance, transparency, and accountability. FMG commits to ensuring business practices benefit its clients as well as its own employees, community, and environment. By meeting comprehensive requirements, B Lab, a nonprofit that provides the B Corp certification, verified FMG’s commitment to its clients and its overall social and environmental performance, public transparency, and legal accountability. “The B Corp Certification is a natural fit for us, as the purpose of our business has never been to simply maximize profit,” said Ben Garthwaite, Senior Vice President.

“Earning the B Corp Certification affirms our commitment to ‘be better,’ which in turn has, year-after-year, returned innovative solutions and lasting relationships with our clients.”

FedScoop Names Top Women in Tech for 2018 Each year, FedScoop seeks out a diverse list of women — from Capitol Hill and the White House to Fortune 500 technology firms — who each have a passion for driving digital transformation to better serve the American citizenry.

PSC is pleased to recognize several women from our member companies who were named among FedScoop’s Top Women in Technology for 2018. They are: Susie Adams, Chief Technology Officer, Microsoft Federal; Teresa Carlson, VP, Global Public Sector, Amazon Web Services; Marilyn Crouther, Senior Vice President and General Manager of U.S. Public Sector, DXC Technology; Karen Dahut, Group Leader, Civil Agency and Commercial Business Portfolio, Booz Allen Hamilton; and Amy Gilliland, President, General Dynamics IT.

Congratulations to the PSC-Member Fed100 Winners!

PSC would like to congratulate our members on the 2018 Fed100. Federal Computer Week’s list of Annual Federal 100 Award winners are exceptional individuals—both industry and government—who drive federal IT. PSC’s members on continued next page the 2018 Fed100 list are: Service Contractor / Spring 2018 / 41

MEMBER NEWS Lee Ann Anderson, Unisys Federal; Vera Ashworth, CGI Federal; V. Joseph Broadwater, Vencore, Inc.; Dan Helfrich, Deloitte; Karina L. Homme, Microsoft; Kay Kapoor, AT&T Global Government Services; Yogesh Khanna, CSRA; Roger Krone, Leidos; Brett McMillen, Amazon Web Services; John Mengucci, CACI; Cynthia Shelton, CenturyLink; Kyle Tuberson, ICF; Susan Wedge, IBM Services.

digital and technology solutions to clients. He is developing the company’s technology-based service lines, focusing on data management strategy and analytics, and business process architecture design and development. He is applying his digital and technology acumen to help clients predict and respond to challenges and opportunities while strengthening their brand, reputation, and influence in the marketplace.

Atlas Research Adds John O. Boochever as Chief Digital Strategy and Innovation Officer Atlas Research, a management consulting organization focused on federal health markets, announced the addition of John O. Boochever as Chief Digital Strategy and Innovation Officer. With more than 30 years of experience, Mr. Boochever is leading the strategy to digitally enable Atlas Research’s service lines and develop staff to deliver world-class

Have a story for Service Contractor’s Member News section?

E-mail stevens@pscouncil.org

Welcome New First-Quarter Members!

Anstead Consulting

IQ-Int

For questions and more information, contact membership@pscouncil.org, or visit our website at www.pscouncil.org.

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Event Spotlight

2018 Leadership Summit PSC hosted board members and 100 C-level executives from member companies for two days of impactful sessions at the 2018 Leadership Summit at the Willard Hotel. On Sunday, Feb. 27, attendees heard from (2) LTG (r) James Clapper, Former Director of National Intelligence. On Feb. 28, (4) Ret. LTG Keith Kellogg, Assistant to the President and Chief of Staff, Executive Director National Security Council, gave an overview of the president’s national security strategy.

(3) Eric Chewning, Deputy Assistant Secretary of Defense for Manufacturing and Industrial Base Policy, U.S. Department of Defense, discussed harnessing and protecting the national security innovation base.

(1) Elaine Duke, Deputy Secretary, Department of Homeland Security (DHS), touched on border security and the importance of contractors working side-by-side with DHS. Attendees also discussed the industry’s priorities for 2018. Thanks again to sponsors Unanet, Huntington Ingalls Industries, Westat and StellarPeak Corp!

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Event Spotlight

CIDC on The Hill PSC held its second annual #CIDConTheHill Day on Feb. 15. Nineteen CIDC member companies staffed tables in the Rayburn House foyer to meet and greet members of Congress and their staff to discuss their important work in foreign assistance. Three members of Congress stopped by – including the Chairman of the House Small Business Committee, Rep. Steve Chabot (R-OH) (pictured bottom right), who spent considerable time at our Small Business tables and with members. Additionally, Representatives Billy Long (R-MO) of the Energy and Commerce Committee, and Joe Wilson (R-SC), who serves on both the Armed Services and Foreign Affairs Committees.

More than 150 staffers from key offices engaged with our member companies, many of whom had never interacted with implementing partners or appreciated their work before. Special thanks to our member companies and all those who helped make our event not only memorable and effective, but also far-reaching. In fact, this year’s event even took social media by storm, with our hashtag trending on Twitter across D.C. As a result, nearly 60,000 accounts were reached with more than 290,000 impressions. As we continue making a successful, lasting impression with this event, we expect our 2019 CIDC on the Hill will hold even more record-breaking stats and quality engagement with members of Congress.

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Event Happenings

1 1. Hundreds of PSC members gathered for the Annual Board Meeting and Holiday Reception on December 14. PSC celebrated the many accomplishments of 2017 and welcomed new PSC Chair, PV Puvvada.

2. During the December Board Meeting, outgoing PSC Chair John Goodman awarded Lisa Ashcraft of Abt Associates a 2017 Leadership Award. Other members to receive the award were Rich McFarland of Parsons and John Roman of Huntington Ingalls Industries.

3. On January 17, PSC hosted NAVSEA executives to discuss the acquisition strategies for the SeaPort-NxG due out next year. Susan Tomaiko (R), the Seaport Program Manager, and Sharon Rustemier (L), the Services Acquisition Strategy Manager, presented an overview of the next generation SeaPort program.

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4. Industry strategists offered their views on how to hone corporate strategy during a period of uncertainty at PSC’s Federal Strategic Planning Forum on Feb. 5. Attendees heard an executive-level discussion on the major challenges facing the industry and the longer-term market impact on defense, services and technology companies. David Mosher, Assistant Director for National Security, Congressional Budget Office, provided the keynote address.

5. The House Small Business Committee’s majority and minority procurement policy experts were the featured speakers at the February Government Affairs Committee (GAC) meeting. Vivian Ling, Counsel for the Republicans (second from right) and Halimah Najieb-Locke, Professional Staff Member for the Democrats (second from left), discussed policy changes for small business in the 115th Congress and provided a preview of the Committee’s priorities for 2018.

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Event Happenings

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6. On February 23, John Tenaglia, Head of the Contracting Activity (HCA) at the Defense Health Agency (DHA), discussed his priorities and how the changes from the recent National Defense Authorization Act (NDAA) are shaping the professional services and health IT market at DHA. 7. On Feb. 27, PSC testified before a House Homeland Security subcommittee on the impact of security clearance and contractor vetting processes on Department of Homeland Security (DHS) contractors. PSC President and CEO David J. Berteau appeared at the Oversight and Management Efficiency subcommittee’s hearing on “Doing Business with DHS: Industry Recommendations to Improve Contractor Employee Vetting.”

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8. The 2018 Vision Federal Market Forecast process kicked off on March 12. The kickoff provided valuable information about the study for veterans and newcomers alike, and marked the beginning of preparations for the conference taking place October 29-30, 2018. PSC Chair PV Puvvada (9) explained the benefits of Vision participation from a CEO standpoint, as well as the value of being involved in PSC. Federal IT Budget and seasoned NASA team participant, Steve Vetter, (10) explained what a team forecast looks like.

11. Lee Frederiksen, Ph.D., Managing Partner, Hinge Marketing was the featured speaker at PSC’s Communications Network quarterly meeting on March 20. He discussed impactful marketing strategies that government tech and professional services firms can implement.

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