Regulatory Rigmarole: Advocacy Comes in All Forms

By: Ann Sullivan 

As a member of WIPP, you already know more than the average person about regulations that impact small business owners – regardless of whether they are proposed, interim-final, or final rules. But, you probably don’t know exactly what that means or how they get to those stages in the first place.

The first thing to know is that proposed regulations are known as “rules” and the rulemaking process is lengthier than you might expect. When Congress passes a law, the agency then gets to work to implement it. The final product is a new regulation. To get from passage of a law to a new regulation involves a number of steps by the agencies. 

An agency’s first step is to develop a draft regulation known as a proposed rule. Then, the agency sends the draft to the Office of Information and Regulatory Affairs (OIRA) for review. OIRA is tasked with circulating this regulation among other government agencies, taking into account this feedback. OIRA is a Federal office that was created by Congress 1980. In 1991, an Executive Order directed that the office would formally review all draft proposed and final rules before they were published in the Federal Register.

OIRA makes suggested changes and sends the proposed rule back to the agency. The agency then issues a proposed rule which it publishes on www.regulations.gov  for public comment. The comment period is usually open for 60 days, although some only accept comments for 30 days. Comments are not limited to organizations like WIPP – anyone or any entity can provide comments on a proposed rule.

The agency reviews the public input to revise a final product which typically takes another 60 –90 days and summarizes its findings and issues a final rule. Done, right? Not quite. The final rule once again goes to OIRA for review – only when this approval process is complete can the new regulation be published as a final rule.

Given this process, you now know why WIPP is very active in the regulatory space. By commenting on proposed rules, we have the ability to shape the outcome of the regulation. The devil is in the details, so this stage of advocacy is, in many cases, as important as passage of the law. WIPP has commented on a number of important proposed rules on a variety of issues. In 2019, WIPP submitted comments to SBA on a number of small business contracting rules ranging from the proposed WOSB/EDWOSB certification rule, to the rule implementing the Small Business Runway Extension Act. WIPP also submitted comments to the Department of Defense (DoD) on its proposed Cybersecurity Maturity Model Certification—a far reaching cyber certification which will affect every federal contractor and subcontractor.

The Federal Acquisition Regulation (FAR) Council recently proposed an interim final rule that will amend the FAR to prohibit the federal government from procuring or obtaining, or extending or renewing a contract to procure or obtain, “any equipment, system, or service that uses covered telecommunications equipment or services as a substantial or essential component of any system, or as critical technology as part of any system” in order to combat the national security and intellectual property threats that face the United States. The definition of “covered telecommunications equipment or services” are components from: Huawei, ZTE Corporation, Hytera Communications Corporation, Hangzhou Hikvision Digital Technology Company, and Dahua Technology Company. 

The rule prohibits contractors from providing covered telecommunications equipment or services unless the agency confirms that an exception applies or a waiver is granted; requires every offeror for a contract or order to represent whether or not it will provide covered telecommunications equipment or services as part of its offer and, if so, to furnish additional detail about the covered equipment or services; and mandates that contractors report any covered equipment or services if discovered during the course of contract performance. 

It is important to note that the interim rule impacts ALL contractors — not just those that offer information and communication technology. Each contractor is responsible for determining whether telecommunications equipment and services will be provided under both new and existing contracts and orders. WIPP recognized the wide-reaching importance of this rule and jointly submitted comments in response.

On another note, Lowest Price Technically Acceptable (LPTA) has been a long hated acquisition pricing policy in the small business community. Seen as a “race to the bottom,” the FAR Council has issued a proposed rule to avoid using Lowest Price Technically Acceptable (LPTA) source selection criteria in circumstances that would deny the government the benefits of cost and technical tradeoffs in the source selection process. This rule also states specifically that LPTA source selection criteria should be avoided for procurements for IT services, cyber security, systems engineering services, and others. One part of the regulatory process to note— when the FAR Council issues a proposed rule it is listed with a “FAR Case” number instead of a “Regulatory Identification Number” (RIN).

Advocacy comes in all forms. While our team focuses much of our attention on Congressional action, our work with agencies, especially SBA, is every bit as important. Staying vigilant on all fronts is critical to all businesses, large and small. It’s tough to keep up with everything as a small business – I know – I am one.  That’s why membership in WIPP is critical to your bottom line – we follow and initiate the actions important to women-owned businesses. Your job is to get active.