In This Issue

Federal Government

"Other Transactions" Are Government Contracts, and Why It Matters

The United States government is looking beyond its cohort of traditional contractors and seeks to build relationships with groundbreaking commercial firms in order to maintain technological and battlefield superiority.1 These relationships are unlikely to be built entirely through traditional procurement contracts, because the most innovative commercial firms often are not dependent on federal funds for revenue and will not accept the boilerplate terms and compliance obligations associated with federal procurement.2 As alternatives to traditional procurement, the U.S. government has recently encouraged use of various non-traditional methods to stimulate and obtain access to commercial innovation, including prize contests,3 public-private partnerships,4 and — the subject of this article — Other Transactions Authority.

Federal Government

Jurisdiction over Federal Procurement Disputes: The Puzzle of Other Transaction Agreements

Assume you are the CEO of a small biotech company. In the routine course of business, your company enters into contracts with other companies. However, you are reluctant to contract with the federal government due to what you perceive are burdensome laws and regulations governing federal procurement. But what if you could have a contract with the federal government that was not subject to most of these laws and regulations? Congress created authority for certain federal entities to use Other Transaction (OT) agreements for this purpose. OTs resemble commercial contracts, permitting the federal government and the contractor to define their relationship through flexible negotiation, without the usual constraints imposed by traditional procurement contracts.1 However, because OTs are exempt from most federal procurement laws and regulations, there is no guidance for what happens if a dispute arises under the OT agreement.

Big Data & Cloud Computing

When Artificial Intelligence Met Public Procurement : Improving the World Bank’s Suspension and Debarment System with Machine Learning

On February 1, 2017, the Sanctions Board of the World Bank Group1 (the Bank) debarred an undisclosed respondent and that entity’s affiliates2 for fourteen years due to corrupt and obstructive practices.3 This case arose from a Health Section Reform Project in Romania. Romania (borrower), the Bank (lender), and the European Investment Bank (additional lender) entered into a loan agreement worth $80 million to promote emergency medical care.4 Romania’s Ministry of Health issued a bid for medical, laboratory, and emergency care equipment.5 The undisclosed respondent was awarded nine out of the twenty-one bid lots available, totaling over $7 million in contracts.6

Employers

Responsible Responsibility: A Renewed Case for Considering a Prospective Contractor ’s Compliance with Labor and

Decades of privatization have precipitated tremendous growth in the federal government contracting industry.1 Since the year 2000, the federal contracting budget has nearly doubled,2 and present-day contract expenditures frequently exceed $500 billion annually.3 Contractors today employ approximately twenty-six million individuals or roughly twenty percent of the U.S. workforce.4 However, the panoply of labor and employment laws specifically protecting the welfare of contractor personnel have been, and continue to be, underenforced.5 As a result, labor and employment law violations are too common among contractors.6

Business & Corporate

Commercial E-Commerce Portals: The E-Marketplace Model Trumps the Others

In Fiscal Year (FY) 2016, the federal government spent approximately $53 billion on goods using commercial acquisition procedures,1 despite years of scrutiny for outrageous spending on commercial items.2 For example, as early as the 1960s, the Pentagon spent $640 per toilet seat on military airplanes.3 Due to the government’s inability to receive reasonable prices, it launched purchasing programs such as Government Purchase Cards in 19864 and Federal Supply Schedules in the mid-1990s.5 These programs were implemented to simplify and reduce the costs of the government’s acquisition process.6 However, per studies conducted by the Government Accountability Office (GAO), there were still cost savings to be made.7

Federal Government

Shepherd Away from Arbitration: Rethinking the Randolph-Sheppard Act’s Arbitration Scheme

The Randolph-Sheppard Act (RSA or “Act”) aims to increase economic opportunities for the blind, provide the blind remunerative employment, and increase efforts to help make the blind self-supporting.1 To achieve that objective, the Randolph-Sheppard Act requires priority be given to blind persons licensed by a designated state licensing agency whenever vending facilities are set up on any federal property.2 The state licensing agency licenses3 and trains blind vendors on how to operate vending facilities,4 and ensures licensed blind vendors have vending facility equipment and initial products to stock that equipment.5

In Memoriam: "Professor" Gilbert Jerome Ginsburg

Gilbert J. Ginsburg passed away on October 26, 2018, at age eighty-two, after a vigorous life. Beside his signature large cowboy hat, Gil wore many other hats: judge, professor, director of the George Washington University Law School (GW Law) Government Contracts Program, law school dean, senior partner, business owner of the A-76 Institute, public speaker, prolific author in the Government Contracts and Federal Labor Standards fields, father, grandfather, and great-grandfather. When asked about his various cow- boy hats, Gil would patiently explain the religious reasons he wore them, but would also note that he enjoyed standing out from the crowd and having folks remember him. He projected a larger than ordinary life personality — we shall not see his likes again in the government contracts profession.