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By Nick Wakeman

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Nick Wakeman

STARS II changes drawing congressional scrutiny

The General Services Administration’s move to cut the 8(a) STARS II contract vehicle's duration by two years has sparked a backlash by small businesses and triggered a letter from several lawmakers.

They have written to GSA Administrator Emily Murphy and Small Business Administration Administrator Jovita Carranza asking for an explanation of why the period of performance was shortened. Carranza is included because SBA signed off on the shortening of the contracts period of performance.

Signing the letter to the administrators are Reps. Gerry Connolly, Donald Beyer Jr., Jennifer Wexton and Ben McAdams and Sens. Tim Kaine and Mark Warner. All are Virginia Democrats except for McAdams, who hails from Utah. Washington D.C. D.C. Delegate Eleanor Holmes Norton also sent a letter to Murphy asking for information.

James Fontana, an attorney with the Dempsey Fontana firm, has written a commentary critical of the decision and pointed out flaws he sees in GSA and SBA’s reasoning. His guest column is what brought the changes to my attention.

Fontana’s column and the letter from the legislators targets the Justification and Authorization document GSA issued explaining why they wanted to increase the ceiling for STARS II and why they needed to cut the period of performance short. They've pulled the end date for STARS II back from Aug. 30, 2024, to June 30, 2022. In essence, they are limiting new task orders to just two years, if they were awarded before July 1, 2020. So now the future task orders can’t even be for two years because we are less than two years away from June 30, 2022.

No one argues with the reasoning to raise the ceiling. GSA wants the extra room to give agencies a ready vehicle to respond to COVID-19 needs.

But the J&A document is largely silent on why they felt the need to cut back the period of performance.

Fontana explains that GSA later said it wanted to limit the work that graduated 8(a) companies on STARS II could receive. They didn’t want these companies to take work away from the new crop of 8(a) companies that will be on STARS III. Few of the current companies on STARS II are eligible for STARS III because 78 percent of the 787 companies on STARS II have graduated from the 8(a) program.

None of that reasoning (which many might argue isn’t convincing) is in the J&A document. That came out in a later industry zoom call.

The lawmakers want to know why and have listed eight areas for Murphy and Carranza to address. Questions include:

  • How and when agencies were informed of the change? Did anyone express concerns?
  • How many solicitations have been cancelled because of the shortened period of performance?
  • How many two-year task orders have been awarded?

They also question how quickly the STARS III with its new crop of 8(a)s will be in the field:

“In the last 5 years, how many IT GWACs, and which ones, have been awarded according to the original schedule announced by GSA? How many have had an award delay from GSA’s original award estimate and what was the duration of the delay?”

I don’t have to do any research and I can say pretty confidently that number is zero. They also experience delays, particularly because of pre- and post-award protests.

The letter asks for answers by Aug. 14, so we’ll see.

Some elements here remind me of when GSA announced the cancellation of the Alliant 2 Small Business contract. That announcement came late in the day on July 2, the last business day before the long July 4th holiday. An old-fashioned way of burying news in hopes to not garner too much attention, which almost never works.

In the case of STARS II, GSA announced the ceiling change on June 24 but does not mention the period of performance. The J&A document came out on July 9.

Fontana also related that on June 26, GSA send a modification notice to contractor holders tell them they had to sign by June 30 or they couldn’t accept new STARS II task orders.

June 26 was a Friday and the notice went out late that day, according to Fontana. Basically, companies had two business days to respond and GSA gave no advance warning of this change.

While everyone was celebrating the increase in the ceiling, GSA snuck through a dramatic change in the contract.

In addition to the legislators asking for answers, I wouldn’t be surprised if there are some more direct challenges from contract holders. I’m not sure if you’d call it a protest or something else, but some kind of litigation could happen.

The thing is GSA probably has good intentions here -- promoting 8(a) businesses -- but it seems their solutions is causing more problems than it solves.

Posted by Nick Wakeman on Aug 06, 2020 at 9:43 AM

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