Monday, January 11, 2016

Don't Over-Propose the Number of Available Hours

The Department of Justice recently issued a press release summarizing its prosecution of a university professor who didn't disclose all factual matters to various Government agencies when he applied for research grants and contracts. Here we have a case where a full-time research professor at the University of California at San Diego also owned a company that performed similar research effort. This professor took advantage of his trusted positions at the University and at his company to deceive Government agencies into awarding federal grants and contracts. Essentially, he didn't disclose to his potential Government customers (e.g. NASA and the Air Force) the full extent of his previous commitments. He would tell the Government that he had two or three months worth of work when all of his personal commitments added together totaled 19 months per year. Had the Government known the full extent of his commitments, it wouldn't have awarded the contracts that it ultimately awarded. As a result of his act of omission, the professor was awarded contracts totaling $6.4 million over a period of nine years of which $1.9 million was paid to him as salary.

The take-away from this case is that contractors, when proposing specific individuals (e.g. key persons) should be careful not to propose more hours than reasonably available from those persons. Its easy to do because often, contractors bid on contracts where there is no certainty of award, Knowing that you'll never get every solicitation you bid on, its probably okay to over-propose certain individuals. However, if the key individual is already committed to more hours than are available and contractors' continue to bid those individuals, there is going to be a problem.

Proposing specific individuals is not the same as proposing positions or skills. If the solicitation merely required a particular skill, contractors can hire off-the-street to fill those positions. That would not pose a problem. The problem arises when the Government believes it is hiring the services of a specific individual when ultimately, that individual is "booked out" for the contract period of performance.

You can read the Department of Justice press release concerning this case by clicking here.

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