GovCon Insights August 11, 2011: DOD Budget Impacts on Contractors; Procurement Work After Military Service; Contractor Cybersecurity

Moody’s may cut defense contractor ratings [Washington Business Journal] – Moody’s Investors Service indicates that it may cut the credit ratings of some defense contractors, especially those still dealing with substantially underfunded pension programs. Its report predicts that DOD cuts of ten percent or more will increase competition and scale back profit margins, leading to the cutting of payrolls and corporate restructuring.

Crowded market for defense dollars [Fayetteville Observer] – DOD spending cuts were a major topic of conversation at the North Carolina Defense Trade Show, with Sprint government sales rep Janet Thompson noting, “We just have to try to leverage our technologies to help (military customers) cut their costs.” Wallace Thompson, president of Fox Apparel, felt it was important to show samples of his firm’s military uniforms for exposure during tight budgetary times.

Procurement Work After Military Service
Veteran-owned businesses get deals. Finally! [CNN] – While the federal government has had set-asides for service-disabled, veteran-owned small businesses for a number of years, 18 states now have some sort of procurement legislation favorable to veteran-owned businesses and over 100 Fortune 1000 companies include veteran-owned businesses in their supplier diversity programs or have goals for using veteran-owned businesses. Eric Steele, founder of Blue Morpho Technologies, says his veteran status is “the first thing out of my mouth,” when discussing business with the Veterans Affairs Department.

Experts: Infantrymen have job skills that transfer to civilian market [ENCToday] – While Marines with public affairs or linguistics jobs can easily tap the contractor market, infantrymen have some of the biggest challenges finding work after the military because they themselves often assume their only skill is shooting people. Job counselor Larry Woods suggests transitioning troops emphasize their abilities in critical thinking, complex problem solving and judgment and decision making while on the job.

Contractor Cybersecurity
Booz Allen CEO says cyberattack won’t impact finances [Washington Technology] – Booz Allen Hamilton Chairman and CEO Ralph Shrader said during a conference call that the July hack it experienced will not materially impact financial results. Other hacked firms have reported remediation costs in the millions of dollars.

Anatomy of a cyberattack [Financial Times] – Nick Percoco, the leader of TrustWave’s SpiderLabs Research cybersecurity team, gives details of how he helped a defense contractor customer who experienced a cyberattack. He feels the intricacy in the structure and psychology of the attack means it had to come from industrial espionage or a state-sponsored actor.

Business Development Advice
4 steps to understanding your exit strategy [Washington Technology] – Government contracting financial advisor Jamie Waldren gives recommendations on creating an exit plan to ensure you maximize your business objectives and price when selling your firm. The plan should include trigger conditions for a sale, the sales steps, financial goals, tax planning strategies and potential contingencies.

The Easy Proposal [GovWin] – AOC Key Solutions vice president Carol Turpin explains how a structured process can make proposal writing easier. She feels proposal failures result from failure to plan, implement the plan or modify the plan when necessary.

Bid Protests
IBM files protest challenging VA’s awards on IT contract [Federal Times] – IBM has filed a bid protest with the Government Accountability Office because it feels the contract awards were improper on the Veterans Affairs Department Transformation Twenty-One Total Technology (T4) contract. The department does not feel the protest will impact its plans to move ahead with its 15 contractors on the $12 billion program.

GAO Says “DRT” on Bid Protest [GovWin] – A recent Government Accountability Office bid protest decision [PDF] held that when companies form joint ventures to pursue Service-Disabled, Veteran-Owned Small Business (SDVOSB) set-asides, the joint venture company itself must be listed in the VetBiz Veteran Information Page database in order to be eligible, and cannot simply rely on the SDVOSB status of one of the partnering companies for eligibility.

Video – BPAs In-Depth [WMG Wednesday Weekly] – A video recently posted to GSA Interact explains the difference between single award and multiple award blanket purchase agreements and highlights the importance of using contract vehicles already in place.

Procurement contests pooh-poohed by an unlikely source [Federal Computer Week] – Former Office of Federal Procurement Policy administrator Steve Kelman bemoans the Professional Services Council’s Alan Chvotkin suggestion that procurement contests should not be increased at the expense of traditional acquisition methods. He feels contracting officers should not be discouraged from seeking industry innovation.

Virgin Galactic gets NASA contract [CBC News] – NASA has given two-year contracts worth a total of $10 million to Virgin Galactic, Armadillo Aerospace, Near Space Corp., Masten Space Systems, Up Aerospace, Whittinghill Aerospace and XCOR. The contracts are for carrying technology and research equipment on suborbital flights.

White House Still Reviewing Plan for Disclosing Contractor Campaign Gifts [National Journal] – White House Associate Communications Director Eric Schultz said on Monday that the administration is still reviewing a draft executive order to require government contractors to disclose political donations. A letter from House Democrats and a New York Times editorial have recently urged President Obama to sign the order.

Vt. mayor firm on climate deal with defense firm [Beaumont Enterprise/AP] – Burlington, Vt., Mayor Bob Kiss asserts he is still holding discussions with Lockheed Martin concerning a partnership to reduce greenhouse gases despite the city council passing a measure opposing it. He feels the defense contractor can provide private money for public-private initiatives for energy and efficiency upgrades.

U.S. Relies on Contractors in Somalia Conflict [New York Times] – U.S. firm Bancroft Global Development is being indirectly financed by the State Department to train African soldiers to fight against the Shabab military group in Somalia, as top State Department official for Africa Johnnie Carson says the United States does not want its troops on the ground. Some groups are troubled by the lack of oversight from relying on contractors to fight a war America has no stomach for, as Congress cannot properly track money funneled through foreign governments.

Statue of Liberty to close for year to undergo $27.25M in repairs; island will remain open [Washington Post] – The National Park Service will close the Statue of Liberty for about a year after the 125th anniversary of its dedication on October 28. Contractor Joseph Constructionwill install “code-complaint” stairways and upgrade electrical and fire suppression systems, elevators and bathrooms.

DOD Contract Announcements
Contract Announcements for August 10, 2011 [Defense.gov] – The U.S. Transportation Command has given indefinite-delivery/indefinite-quantity (IDIQ), fixed-price contracts with a $2,500 minimum award to Federal Express, Polar Air Cargo and United Parcel Service for an international commercial express package service program with a five-year ceiling value of $853.3 million. Small business BRS Aerospace won a $9.6 million Defense Logistics Agency contract for high-velocity parachutes. See the full announcement for more details and other awards.

Federal Register Updates
Private Security Contractors (PSCs) Operating in Contingency Operations, Combat Operations or Other Significant Military Operations – DOD has issued a final rule authorizing the creation of a Federal Acquisition Regulation clause concerning the selection, training, equipping and conduct of personnel performing private security functions under a covered contract in an area of combat operations or other significant military operations.

Should Have Said “My Dog Ate It”
Virginia Contractor Facing Fines for Losing “Nuclear Item” [NBC Washington] – GeoConcepts Engineering is facing a $3,500 fine from the Nuclear Regulatory Commission after a portable nuclear gauge went missing from a construction site at Fort Meade. Base police found the device around ten days later.

It’s a Bird, It’s a Plane, It’s a Maple Seed?
Lockheed Martin developing drone based on the simple flight of maple seeds [Republic/AP] – Lockheed Martin‘s Intelligent Robotics Laboratories has spent the last five years developing a drone whose flight replicates the motion of a maple seed falling to the ground. The device, which the company feels would be useful to military and police, will be unveiled at the Association for Unmanned Vehicle Systems International conference next week.