Government Contracts

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Small Business Technical Transfer Program

Although similar in structure to SBIR, the Small Business Technical Transfer Program (STTR) funds cooperative R projects involving a small business and a non-profit research institution (i.e., a university, federally funded R center, or non-profit research institution). Established by Congress in 1992, the purpose of STTR was to create an effective vehicle for moving ideas from the nation's research institutions to the market, where they can benefit both private sector and government customers. The government STTR program was funded for $130 million in Fiscal Year 2006.

Small Business Set-Aside Program

This first program is probably one of the oldest, if not the original, program set up to help small businesses win government contracts. The Small Business Set-Aside Program (SBSA) helps assure that small businesses are awarded a fair proportion of government contracts by reserving (i.e., "setting aside") certain government purchases exclusively for participation by small business concerns.

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Special Small Business Programs

Traditionally, the government has used the federal acquisition process as a tool to implement and further its programs and initiatives for social and economic change, and this trend continues.

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Very Small Business Pilot Program

The purpose of the Very Small Business (VSB) Pilot Program is to improve access to government contract opportunities for "very small business concerns" by reserving certain acquisitions for competition among such concerns. (Unless this currently expired initiative is extended by Congress, VSB contracts under this program must have been awarded before September 30, 2006.)

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Commercial Counseling Services

Hiring a private commercial counseling service is another way to get help in doing business with the government. The good ones can offer great personalized assistance, but will cost you some kind of money, flat fee, percentage of contract, retainer plus costs, or some combination.

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National Contracts Management Association

The National Contracts Management Association (NCMA) is a government-supported organization that was started years ago (1959) because of the lack of good help for companies doing business with the federal government.

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Procurement Technical Assistance Centers

The Procurement Technical Assistance Program started in 1985 to help the Department of Defense place contracts in areas of the country that needed an influx of federal dollars. Although it has never been called an economic development program, it works like one to some extent.

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Government Publications

The government issues a large number of publications to assist small businesses, but we're only going to mention the most useful ones. You can order these from the Government Printing Office for a fee or you can go to a government web site and read or print it. If you go to a web site, try looking under "publications" or "help" to see what they have to offer.

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Help from Counseling Services

If you need more personalized, ongoing assistance and advice, you can get it through government-sponsored or commercial counseling services. You can also get answers to questions and problems your business may be facing by joining a professional association.

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Specialized Government Personnel

There are several types of government employees whose main job is to help you do business with the government.

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Procurement Conferences

The government, as well as other non-government sponsors, hold conferences to help you in your quest. Procurement conferences are a good way to meet and speak with government buyers and large prime contractors. Some areas of the country have several conferences per year; other parts have only a few.

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Government Web Sites

The federal government has more than 4,300 web sites, according to a recent GAO report. Fortunately, if you're looking for contract opportunities, you don't have to cover all of those sites.

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EFT Includes Government Credit Card

Under recent legislative requirements, the term "electronic funds transfer" now includes a government-wide commercial purchase card. Under the law, the government purchase may be used as a means to meet the requirement to pay by EFT.

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Help from the Government

There are several ways in which the federal government tries to assist you in finding opportunities and doing business with it:

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Who Can Help?

Firms, both large and small, interested in doing business with the federal government must help themselves by learning how the federal government conducts its business and by identifying and seeking out those purchasing offices that buy the products and services they can supply.

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Electronic Funds Transfer

It is now government policy to pay all contractors by EFT, electronic funds transfer, whenever feasible. In making EFT payments, the government uses the information contained in the Central Contractor Registration (CCR) database.

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Government Invoice Form

You may use your own invoice to bill the government, but you must make sure that it meets all of the requirements previously discussed. If it doesn't, you will only slow up payment. Sometimes you might find it easier to use a government form. One common form that is used with military contracts is the DD Form 250, Material Inspection and Receiving Report.

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Interest Penalty

The law requires the government to pay a small business within 30 days after receipt of a proper invoice. Payment is considered as being made on the day a check is dated or on the date of an electronic funds transfer. An interest penalty will automatically be paid to the contractor if payment is not made by the due date and if the following conditions are met:

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Conflict Resolution: Other Options

While we want to let you know about your right to dispute and appeal, we also want to make you aware that the government's stated policy is to try to resolve all contractual issues in controversy by mutual agreement at the contracting officer's level. Government rules state that reasonable efforts should be made to resolve controversies, prior to the submission of a claim. And where appropriate, agencies are encouraged to use ADR procedures to the maximum extent.

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Prompt Payment and a Proper Invoice

The Prompt Payment Act, which was enacted in the mid-'80s, requires the government to pay a small business within 30 days after receipt of the invoice, if the business completes its end of the contract. However, as you might expect, there is an important catch. The clock on this Act starts only if your invoice, as received, is deemed "proper" under the law.

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Case Study: From Dispute to Court Action

For a deeper understanding of the complete disputes process, we provide a description of a protest undertaken by a company under a solicitation issued by a contracting agency, in this case the United States Army's Tank-automotive and Armaments Command (TACOM), a contracting agency for the United States Army. This study will not only present the facts of what occurred in this particular protest, but will also include the reasoning why the company chose the venue it did.

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Getting Paid

Now we turn to every business owner's favorite topic: getting paid. After you have delivered, and the government has accepted, the contracted product or service, all you have to do is submit a proper invoice to the billing office specified in your contract. Under law, the government is required to pay you within 30 days.

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Termination for Default

A termination for default (T for D) means that the government believes that you, the contractor, have not performed in accordance with the terms of the contract.

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Protesting a Bid or Award

By law, a protest must be filed by an "interested party," which means an actual or prospective bidder whose direct economic interest would be affected by the award of a contract or by the failure to award a contract. In challenges to the government's evaluation of proposals and the award of contracts, this generally means a bidder that would potentially be in line for award if the protest were sustained.

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Your Right To Protest and Dispute

What if the contracting officer or buying agency makes a decision that you (the contractor) don't agree with or that you believe is incorrect? Government contracting regulations provide contractors with several remedies, all the way from filing a simple protest or dispute to taking the government to court.

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