Dear Colleagues,
As you all know from the news, the current U.S. Government (USG) operating budget expires 30 September, and we are facing the possibility of a government shutdown if Congress does not pass another Continuing Resolution allowing the government to remain open. Adding to the complexity is the fact that it is the end of the USG’s fiscal year. Needless to say, our U.S. Government contracting offices are already overwhelmed with end-of-the-year actions, so getting a Contracting Officer on the phone who may be able to provide guidance may not be feasible. Indeed, Contracting Officers more than likely would not be able to provide precise guidance since they, themselves, do not know what to expect yet.
Who Will Be Affected?
Generally staff directly working on a USG prime or as a subcontractor to another USG prime. Some contracts may not be permitted to continue, while others may not be able to continue. The trick is going to be to decide which contracts are which and to document, record, and segregate the costs to ensure the maximum recovery to which Abt may be entitled.
Which Contracts Will Be Affected?
If the government does shut down, these are the tests that will help us determine whether work under a contract is permitted or is able to continue:
1. If a contract is funded, productive work is possible, and no Stop Work Order has been issued by the Contracting Officer, Abt not only may continue work, it is required.
2. If funding is not available or has been exhausted, then a Government shutdown is moot. The contract clauses will determine whether contract performance may or may not continue.
3. If the Contracting Officer has issued a Stop Work Order, performance may not continue. While it is highly unlikely that Congress will authorize retroactive payments to contractors, certain costs associated with shutting down, standing by for a restart, and the restart itself are recoverable even in the event of a shutdown.
4. If funding is available and no Stop Work Order has been issued, then performance should continue. The genuinely problematic situations will be those where access to facilities, people, or tools and data is effectively denied as a result of the shutdown and continued performance is not possible. This should be considered a “constructive Stop Work Order” and costs should be identified and collected to facilitate recovery just as if a formal Stop Work Order had been issued.
What should I do next Tuesday, 1 October 2013?
If the Government shuts down, essential personnel will be allowed to continue to work. Any Abt employee assigned to work at a government facility should follow the guidance from their on-site supervisor and inform their Division Management what they are being told. In the event that Abt staff are not allowed to go to their government office, they should arrange to come to the nearest Abt office and check in with their Division Management. Please be assured that Abt will cover the salaries of these staff members.
In addition,
- Some projects rely on client feedback in order to proceed with the technical work. Where this is the case, we should try to execute all aspects of the Scope of Work that can be conducted, and if possible, accelerate some tasks while waiting for client feedback on other tasks.
- Projects overseas should not be directly affected and should plan to work as usual. Please let Division Management and Contract Operations know if you receive any particular instructions from your clients.
NOTE: Projects for clients other than the U.S. government should not be impacted. [This should not be a bullet in the list; it should be a new para, without a bullet; sorry I can’t format it.]
Next Steps
Should it be necessary, Contract Operations will work with the Finance and Accounting group to provide every contract under which performance cannot continue—in whole or in part—with a separate charge (task) number assigned for accumulation of the shutdown, standby, and restart costs for the eventual cost claims that will result. This will need to happen regardless of whether the stop work is pursuant to a formal order from the Contracting Officer or a constructive stop work as a result of a lockout or other lack of access to people, tools, or data.
As you know, this is a very fluid situation, and Contract Operations is actively monitoring news from Capitol Hill. As we get more concrete information, a more guided plan of action will be developed and communicated within Abt Associates. In the interim, please let your Contracts Representative know of any guidance you get from the COR or Contracting Officer. As with previous potential shutdowns, messages are often conveyed only at the last minute.
In closing, we will advise you as soon as we get more specific information from clients and ask that you be our eyes and ears as well. Our past experience tells us that we have to carry on, for now, as if no shutdown will occur because we can’t afford to be late on delivering on-going work.
Thank you,
Lisa Ashcraft | Vice President, Contract Operations | Abt Associates
4550 Montgomery Avenue, Suite 800 North | Bethesda, MD 20814-3343
O: 301-347-5915| F: 301-634-1801| lisa_ashcraft@abtassoc.com
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