Pension and other post-retirement benefit expenses have long constituted a substantial obligation on the part of contractors under cost-type contracts and are often the subject to disputes with the government as to the calculation and allowability of such costs. While court and board decisions regarding pension-related disputes have tended to be a mixed bag, the decisions have more often sided with the government. However, the Armed Services Board of Contract Appeals’ (“ASBCA” or “Board”) July 13, 2017, decision in Northrop Grumman Corp., ASBCA No. 60190, may signal a more favorable trend for contractors in connection with such issues. In this case, Northrop filed a claim for $253 million in retiree health benefits over an 11-year period from 1995 to 2006, which the Defense Contract Management Agency (“DCMA”) disallowed because Northrop used an outdated accounting practice for accruing such costs under the relevant Federal Acquisition Regulation (“FAR”) cost accounting requirements. Continue reading “ASBCA Grants $253 Million Northrop Post-Retirement Benefits Claim”
Last month, the General Services Administration (“GSA”) finalized a rule marking what the agency describes as the most significant development to its Schedules program in over two decades. The rule completely changes how GSA will analyze vendor pricing for products and services.
Under the rule, vendors will eventually be required to submit monthly transactional data reports with information related to orders and prices under certain GSA Schedule contracts and other vehicles. Along with the implementation of the new Transactional Data Reporting (“TDR”) requirement, GSA will relieve vendors from two preexisting compliance burdens—eliminating the Commercial Sales Practices (“CSP”) and Price Reductions Clause (“PRC”) reporting requirements when vendors begin submitting transactional data.
While vendors should welcome the relief provided from the elimination of two burdensome regulations, the shift to TDR will not be without cost and risk; and, the eventual efficiencies promised by GSA remain to be seen. Indeed, the impact of the change will likely extend beyond compliance burdens, with potential effects varying from the nature of False Claims Act suits to the potential publication of competitive information.
We summarize these and other key takeaways from the new rule below, and answer questions important to vendors as GSA rolls out this significant development. Continue reading “GSA’s Transactional Data Reporting Rule Ushers in a New Era”