Federal Aid To Veteran-Owned Small Businesses Grew 14% In FY23
Federal loans to veteran-owned small businesses were up 14% last year, continuing a recent trend in growth for entrepreneurs in the military community, officials from the Small Business Administration announced.”
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One thing that is often overlooked with federal student loan forgiveness is that for every outstanding loan, the federal government is giving taxpayer money to a massive private fintech contractor to service that loan. It actively costs the government money to have loans outstanding. It is more expensive for the government to have someone who is on a low or no-pay income driven plan sit on that debt for 20 years than it would be to just forgive it outright today.
So like. Your tax dollars could go to relieving the debt burden of some struggling millennial OR they can line the pockets of Aidvantage's CEO, but that money is being spent either way.
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Every year I know it's really spring when I open a window to enjoy some fresh air and this action immediately summons at least one landscaping truck full of guys armed with the Loudest Leafblowers And Lawnmowers In The World and two construction companies competing for the title of Slowest Home Renovations In The Whole Fucking City.
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This is specifically because of a fanfic I'm reading that's implying that a federal contractor is deliberately overcharging the government out of spite (and that this is a good thing), but I genuinely think for both a writing reason and a living in the world (or at least the U.S., which is the system I know about) reason that people should understand at least some degree of how federal procurement works.
I'm very far from an expert on how it works, but here's a very high level overview of how that process works*:
The government decides it needs something. It may or may not know what it needs
The government releases a Request for Information (RFI) where it lays out more or less what it needs and asks for answers on what that could look like and what kind of contract vehicle that should be on
Companies respond to the RFI. This is an opportunity to try to shape what the contract might look like, including what kind of companies can bid on it (i.e., is it open to big corporations or is it a small business set-aside, including potentially a specific type of small business set-aside like woman-owned or Native-owned)
The government decides what it actually needs (or what it thinks it needs) and releases a Request for Proposal (RFP) that outlines what they need and who can bid**
Companies respond to the RFP. The proposal generally includes a technical section (how the company will do what is needed), a management section (how they'll run the contract), a staffing section (how they'll staff it, including who they may staff it with), a past experience section (what the company has done before that's similar), and a pricing section (how much it will cost and why it will cost that much)
If it is a small business set-aside, big companies will often pair or "team" with small businesses. The big companies will get 49% or less of the contract
Once the proposals are in, the contracting shop of whoever released the RFP will review and select a company*** to award the contract to. This is based on a number of things, including compliance (did they literally follow the instructions), technical approach (does their way seem like the best way), and price. The cheapest doesn't always win, but there are rules about when the government can go with a more expensive bid
Once the contract is awarded, billing works however is laid out in the contract. There are a few common ways that this happens, including Firm Fixed Price (FFP) where individual deliverables have a price that can be billed once they're submitted and approved by the government, as well as Time and Materials (T&M) where each individual person on the contract has a specific bill rate based on their labor category
If something about that is going to change, whether it's deliverables or pricing, there needs to be an official contract modification****
Overcharging or falsely charging the government is super illegal. Booz Allen recently had to pay $377 million for doing this.
*This is true for services/tech systems/etc. I'm not as sure about procurement of stuff.
**There are an extremely limited number of sole-source or non-competitive contracts. They're also very complicated and there are rules about them.
***There are things called Indefinite Delivery, Indefinite Quantity (IDIQ) contracts where they basically narrow down to a few companies who can then bid on individual tasks. These are complicated and I'm super not an expert on these.
****Some contracts are weird.
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Common traits among the most successful small business federal government contractors and tips on how successful small companies developed them.
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