Bass, Berry & Sims attorney Richard Arnholt discussed various COVID-19-related contracting policies that will impact federal contractors during the pandemic. The article in Law360 examined the following four policies: CARES Act Section 3160, contractual change clauses, accelerated progress payments, and the Paycheck Protection Program (PPP).
According to Richard, Section 3160 of the CARES Act is “a recognition that we need to keep liquidity flowing into the government contracts space, and we need to have them ready when that work gets switched back on, we need people to be able to resume activity immediately in order to get our economy back on the right track. Many of these contractors are providing mission-critical support to the government.”
However, Richard added that “Section 3610 is a great safety valve where there isn’t [alternatives] available on a contract. [But] if there’s a possibility for a negotiated arrangement that contracting officer can enter into using his or her existing authorities, and they’ve got the money, why are you relying on 3610? It seems unnecessary and overly complicated.”
Related to the impact of the PPP, Richard stated “The PPP program is hugely important. There’s a lot of negative press right now about some larger publicly-traded companies that got money, but I think the important thing to remember is that 1.66 million companies received money under that program. Out of that, 1.6 million companies received less than $1 million, and the average loan was around $250,000.”
The full article, “4 Ways Contractors Can Get Federal Relief During COVID-19,” was published by Law360 on April 24 and is available online.