Latest / The FAR is Lava / EP: 5, The Army Used AI to Evaluate Proposals?! RFO Part 8 & $1.2B COVID Fraud

Transcript

EP: 5, The Army Used AI to Evaluate Proposals?! RFO Part 8 & $1.2B COVID Fraud · The FAR is Lava

• 0:00
  SPEAKER_01: Welcome to The Far is Lava, where we break down the federal procurement news to help you understand the FAR and the RFO.
• 0:07
  SPEAKER_01: In today's episode, Judge Duty says robots are allowed on your Soul Sort selection team.
• 0:12
  SPEAKER_01: OpenAI turned off parental controls, and agents found some dirty government secrets.
• 0:17
  SPEAKER_01: GS Today says put on your code mask, or you might catch some of the 1.2 billion in suspected fraud funds, and SBA is showing preference to the little guys with guns.
• 0:26
  SPEAKER_01: Stop sitting on the sidelines and join us in the Far Is Lava.
• 0:29
  SPEAKER_01: I'm Ben.
• 0:30
  SPEAKER_01: This is Will.
• 0:31
  SPEAKER_01: Welcome to episode 5.
• 0:33
  SPEAKER_00: Five weeks in.
• 0:34
  SPEAKER_00: Five weeks in.
• 0:35
  SPEAKER_00: Second week of the uh of the new fiscal year.
• 0:37
  SPEAKER_00: Happy new fiscal year again.
• 0:39
  SPEAKER_00: This is gonna be a great FY27.
• 0:42
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• 0:43
  SPEAKER_01: It's gotta be better than the last couple.
• 0:44
  SPEAKER_01: Sure.
• 0:45
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• 0:46
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  SPEAKER_00: And give us your questions.
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• 1:38
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• 1:43
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• 1:45
  SPEAKER_01: We'd love to see some of those questions.
• 1:47
  SPEAKER_01: Shout out to all our loyal listeners.
• 1:48
  SPEAKER_01: I'll call out uh Cole Jaso.
• 1:50
  SPEAKER_01: Oh, yeah.
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  SPEAKER_01: Been commenting.
• 1:52
  SPEAKER_01: Thanks, buddy.
• 1:52
  SPEAKER_01: Thanks, Cole.
• 1:53
  SPEAKER_01: All right, um, let's get right into contract history.
• 1:56
  SPEAKER_01: So before we get to the news, Will, I think you have some interesting contract history.
• 1:59
  SPEAKER_00: Yes.
• 2:00
  SPEAKER_00: For the 11th.
• 2:01
  SPEAKER_00: The 11th.
• 2:02
  SPEAKER_00: This week in contract history.
• 2:03
  SPEAKER_00: I think the 11th is Sunday.
• 2:05
  SPEAKER_00: So we're catching the very first part of this week.
• 2:07
  SPEAKER_00: Roughly this week in contract history.
• 2:10
  SPEAKER_00: To kick off your week.
• 2:11
  SPEAKER_00: Uh at on this day on October 11th in 1968, Apollo 7 launches.
• 2:18
  SPEAKER_00: So this is the first manned mission of the Apollo program with Wally Shearer, Don Isle, and Walt Cunningham.
• 2:26
  SPEAKER_00: R.I.P.
• 2:27
  SPEAKER_00: R.I.P., yes.
• 2:28
  SPEAKER_00: They they weren't an Apollo 1, but they're they're probably that's a good thing to research.
• 2:35
  SPEAKER_00: Yeah.
• 2:36
  SPEAKER_00: So uh if you know if these guys are dead, comment below.
• 2:40
  SPEAKER_00: Um, it was the first crewed Apollo mission and the return to crewed Apollo flight after a uh disaster in January 1967, where Apollo in Apollo 1, a fire killed Gus Grissom, Ed White, and Roger Chaffee R.I.P.
• 2:54
  SPEAKER_00: R.I.P.
• 2:55
  SPEAKER_00: Yeah.
• 2:55
  SPEAKER_00: So this was obviously a uh one of it was the biggest disaster in NASA to date, Apollo 1.
• 3:01
  SPEAKER_00: The recovery involved spacecraft redesign and testing, including a quick opening hatch.
• 3:07
  SPEAKER_00: The the rocket didn't even get off the runway.
• 3:10
  SPEAKER_00: They couldn't open the door.
• 3:11
  SPEAKER_00: There was a fire inside the module.
• 3:13
  SPEAKER_00: They couldn't open the door.
• 3:14
  SPEAKER_00: It was a terrible death.
• 3:15
  SPEAKER_00: All three astronauts burned uh alive inside.
• 3:18
  SPEAKER_00: It was terrible, terrible PR for uh a disaster for the entire Apollo mission.
• 3:24
  SPEAKER_00: Of course, the families were grieving.
• 3:25
  SPEAKER_00: Uh so part of this redesign was um reducing flammable materials, changes to cabin atmosphere used during ground tests, and a bunch of conversations between the government and industry.
• 3:36
  SPEAKER_00: Trevor Burrus, Jr.
• 3:36
  SPEAKER_01: How effective do you think it is to reduce flammable materials in a rocket?
• 3:40
  SPEAKER_01: Just take them all out.
• 3:41
  SPEAKER_01: I mean, it's just I mean, there's still a lot of flammable stuff that's in the giant gallon, thousands of gallons of tank with jet fuel sitting behind them.
• 3:49
  SPEAKER_00: But this was back in the 60s, where like the material itself, it was like they were going out in tin cans a lot.
• 3:55
  SPEAKER_00: And it's just an it's an amazing story.
• 3:57
  SPEAKER_00: But one of the amazing parts of the story is so Congress was about to shut this program down.
• 4:01
  SPEAKER_00: So if you're wondering what happened, uh, you know, why Apollo 7 was the first manned uh mission uh in uh the Apollo program, it's because Apollo 1, uh Apollo 2 through 6, they had to make sure this was safe.
• 4:14
  SPEAKER_00: There was threats of it being shut down.
• 4:17
  SPEAKER_00: And uh so part of this conversation is just about the what happened after Apollo 1 and uh who's responsible.
• 4:25
  SPEAKER_00: So was it the contractor?
• 4:26
  SPEAKER_00: Was it the government?
• 4:28
  SPEAKER_00: Um I read a recent, I read an article, it wasn't a recent article, but a 2003 article about the Columbia disaster.
• 4:33
  SPEAKER_00: So the same conversation happened when Columbia exploded, which uh the same conversation happened in the Challenger explosion in 1986, when that kind of thing happened, the big question of liability.
• 4:45
  SPEAKER_00: I gotta point fingers somewhere.
• 4:46
  SPEAKER_00: You gotta point fingers.
• 4:47
  SPEAKER_00: And the big part about this with with the with any of these disasters is it's not so much you can't just point at who made it, uh, where automatically the uh the company's responsible.
• 4:58
  SPEAKER_00: You have to find out, well, what information uh did we know?
• 5:01
  SPEAKER_00: Who knew this information?
• 5:02
  SPEAKER_00: Did the government know this information?
• 5:04
  SPEAKER_00: Did the contractor know this information?
• 5:06
  SPEAKER_00: And then the challenger, actually, there's a really good uh documentary on Netflix of the Challenger.
• 5:11
  SPEAKER_00: You can watch it on uh Netflix, and it's all about government contracting because this is this is an issue of liability.
• 5:17
  SPEAKER_00: After the Challenger um disaster, there was a Supreme Court case.
• 5:22
  SPEAKER_00: Uh the issue was a downed helicopter, I think.
• 5:25
  SPEAKER_00: But the the court came up with something called the government contractor defense, which is basically a defense saying that if the contractor knew of some issues, they they met all the specifications and they let the government know of any risk, and the government took those risks, then that's a that's a defense the contractor can make.
• 5:42
  SPEAKER_00: And it'd be hard it's gonna be harder for those families to uh sue the contractors.
• 5:47
  SPEAKER_00: Back in Apollo 1, Gus Grisham's wife sued uh, I forgot what it was, um uh North American, I forgot what the company was, for millions of dollars.
• 5:55
  SPEAKER_00: She got, I think,$20 million or something from that company.
• 5:58
  SPEAKER_00: And so now there's a little bit more of a question because of this contractor, government contractor.
• 6:03
  SPEAKER_00: Maybe in the Dalton gang.
• 6:05
  SPEAKER_00: The Dalton gang.
• 6:07
  SPEAKER_01: I did read the second greatest uh NASA disaster was uh Space Force starring Steve Corell featured on Netflix.
• 6:16
  SPEAKER_00: That wasn't a NASA disaster, though.
• 6:17
  SPEAKER_00: That was a Space Force disaster.
• 6:19
  SPEAKER_00: Yeah, it kind of lumps it in.
• 6:20
  SPEAKER_00: NASA's laughing at the DOD.
• 6:24
  SPEAKER_00: Um, so I mean, if it you know, moving forward to this issue of liability, and the reason why we wanted to highlight uh Apollo 7, though, is because in this week we have the re-emergence of the Apollo program uh instead of Congress shutting that program down, not fulfilling Kennedy's promises.
• 6:43
  SPEAKER_00: So we have this realization that we have these risks, we need to be safer about them, we need to learn from our mistakes, but we also don't want to just completely terminate the mission because these risks exist.
• 6:53
  SPEAKER_00: So, with AI, for example, yeah, I don't think the liability issues that we're gonna have even come up with AI.
• 6:59
  SPEAKER_00: AI's use in any government uh mission, but especially in military operations, it's gonna happen, I think, not to be a pessimist, but when it happens, what type of questions are we gonna be asking?
• 7:10
  SPEAKER_00: What did what kind of quality control did the government do?
• 7:12
  SPEAKER_00: Uh what did the contractor know that they should have um uh told the government?
• 7:17
  SPEAKER_00: And then different from NASA, maybe uh with AI, is there may be a third actor, the AI itself.
• 7:24
  SPEAKER_00: Uh is there real uh you know liability there?
• 7:27
  SPEAKER_01: Under your chat prompts, it always says double check the work.
• 7:30
  SPEAKER_01: AI makes mistakes.
• 7:30
  SPEAKER_01: So they're oh they're clear.
• 7:32
  SPEAKER_01: They're clear.
• 7:32
  SPEAKER_00: They're fine.
• 7:32
  SPEAKER_00: They did their uh what is that, the contractor government defense?
• 7:36
  SPEAKER_01: So they're good.
• 7:37
  SPEAKER_01: Yeah.
• 7:38
  SPEAKER_01: Uh well, 1102 is out there.
• 7:40
  SPEAKER_01: Remember, you too can be a part of history.
• 7:42
  SPEAKER_01: So use your discretion, get a little creative.
• 7:44
  SPEAKER_01: And if you make a mistake, you might be featured on a future episode on the Far as Lava.
• 7:47
  SPEAKER_01: We look forward to seeing your name on a protest or somewhere interesting in the news.
• 7:51
  SPEAKER_01: Yeah.
• 7:51
  SPEAKER_01: And we won't say I R I P when we mention your name.
• 7:54
  SPEAKER_01: Yeah.
• 7:54
  SPEAKER_01: All right.
• 7:54
  SPEAKER_01: Into the news then.
• 7:55
  SPEAKER_01: Uh we're gonna stick with some AI stories here.
• 7:57
  SPEAKER_01: There's a number of AI stories, it's all over the news.
• 8:00
  SPEAKER_01: Um, but we're gonna do a quick story and then go right into the protest of the week because there's a big one going on.
• 8:05
  SPEAKER_01: Uh, but there is uh AI now being introduced into the evaluation phase.
• 8:10
  SPEAKER_01: So a procurement analyst with the Army was testing an AI platform called Fast Track.
• 8:16
  SPEAKER_01: So it's just a simple test of a you know an evaluation tool.
• 8:19
  SPEAKER_01: You've we've seen them all that all the trade shows, you walk by a booth and evaluate faster, an AI-based tool.
• 8:24
  SPEAKER_01: Fast Track is one of them.
• 8:26
  SPEAKER_01: And so there are, let's see if this tool is going to be helpful in the evaluation process.
• 8:30
  SPEAKER_01: Uh, this analyst ran this tool against an actual open proposal.
• 8:35
  SPEAKER_01: So they took three proposals, ran it against all three, and put it in front of the actual evaluation team.
• 8:41
  SPEAKER_01: So not just, you know, this analyst and his friends looking at it, but they took this information from a live uh uh proposal process and then gave that out to at least a couple of them, to the actual evaluators who looked at it and said, no, this is not reliable.
• 8:54
  SPEAKER_01: It's not any good.
• 8:55
  SPEAKER_01: RIP fast track.
• 8:57
  SPEAKER_00: It's not good PR for fast track.
• 8:59
  SPEAKER_01: No, fast track didn't do well here.
• 9:00
  SPEAKER_01: Uh it just said it's just not good enough.
• 9:02
  SPEAKER_01: However, some of the language from the evaluation was word for word in the final evaluation.
• 9:10
  SPEAKER_01: In their own evaluation.
• 9:11
  SPEAKER_01: Their own evaluation.
• 9:12
  SPEAKER_01: So they said it's not great, but there were certainly some copying and pasting here.
• 9:16
  SPEAKER_01: Uh a company called TRACS who did not win, and we'll get into the actual court case, was upset that they didn't win.
• 9:22
  SPEAKER_01: This is a 400 million plus dollar contract here.
• 9:24
  SPEAKER_01: We'll talk about that in a second.
• 9:25
  SPEAKER_01: Uh, and so they brought it to the courts, and then all of a sudden, we get to lift up the hood of this uh proposal and this evaluation process, how AI was used, and then how the courts and the judges uh reviewed this AI information.
• 9:39
  SPEAKER_01: Uh so AI is being evaluated, obviously, and it's doing the evaluation, obviously, whether it's supposed to or not, um, which kind of leads us into the court case of the week by TRACTS International versus the United States of America.
• 9:53
  SPEAKER_00: The using AI for evaluations, using AI for procurement decisions, that's been happening, I think, across the government uh for a little while.
• 10:02
  SPEAKER_00: This is the first, I think one of the early cases of a judge in COFSE, this is the Court of Federal Claims, right?
• 10:09
  SPEAKER_00: Uh actually opining on this.
• 10:11
  SPEAKER_00: Uh so this was, yeah, the the they the facts of this case, this is TRACS International Corps versus United States.
• 10:18
  SPEAKER_00: It was the Army by I love the the way the the kind of the vagueness at first that said it's called Mission Support Services in New Mexico.
• 10:26
  SPEAKER_00: Suspiciously vague.
• 10:28
  SPEAKER_00: Very we just watched Iron Man 2, and one of the SHIELD uh agents told Iron Man he's gonna be reassigned.
• 10:33
  SPEAKER_00: He's like, I'm going to to New Mexico.
• 10:36
  SPEAKER_00: And uh Tony Stark said for secret services or something, and he was like, something like that.
• 10:42
  SPEAKER_00: And he just he just walked away.
• 10:43
  SPEAKER_00: That's I imagine that the judge is like, so are we just gonna call this mission support?
• 10:47
  SPEAKER_00: And the Army's like, something like that.
• 10:49
  SPEAKER_00: Something like that.
• 10:50
  SPEAKER_00: But it was for uh the White Sands missile testing, we find out.
• 10:54
  SPEAKER_00: So uh big contract, high visibility.
• 10:56
  SPEAKER_00: There's a lot of claims on this case.
• 10:58
  SPEAKER_00: There's OCI claims, there's cost accounting system kind of claims here.
• 11:03
  SPEAKER_00: Uh what we want to focus on is what Ben, you mentioned, is just this use of AI and the source selection.
• 11:09
  SPEAKER_00: And really, just long story short, the whole uh the whole argument here was whether these evaluations should have been put in the administrative record.
• 11:19
  SPEAKER_00: Yeah.
• 11:20
  SPEAKER_00: And the Army did not put these in the administrative record.
• 11:23
  SPEAKER_00: So the Army was kind of uh erred in and not putting this in the administrative record.
• 11:28
  SPEAKER_00: They army argued, like, why would we put this in the record?
• 11:30
  SPEAKER_00: They it they used the or they they they considered the the AI created evaluations, and they're like, no, this is trash.
• 11:38
  SPEAKER_00: This is inaccurate.
• 11:39
  SPEAKER_00: But they still, I think the word was anything that is generated and considered in the procurement needs to be in that administrative record.
• 11:47
  SPEAKER_00: No, I think that's fair.
• 11:48
  SPEAKER_01: I mean, even though they said they're only looking at it for re you know, just to review the software, you're gonna get something from it.
• 11:55
  SPEAKER_01: You're gonna read it and you know glean some information from the AI AI tool.
• 11:59
  SPEAKER_01: So they had it had to impact the evaluation to some degree.
• 12:03
  SPEAKER_01: I mean, the fact that it was pasted into a couple of the evaluations.
• 12:06
  SPEAKER_00: And the facts themselves showed that they it they did generate it.
• 12:09
  SPEAKER_00: It it looked like from the facts that and this is kind of cool with the army.
• 12:12
  SPEAKER_00: So what what the court is not saying, and this is what we'll get to in a minute, is that the army was wrong in using AI for evaluations.
• 12:19
  SPEAKER_00: Uh so hats off to the army for it.
• 12:22
  SPEAKER_00: Looks like they assigned this to a procurement analyst like, hey, why don't you why don't you just let's run a test and see if AI can help.
• 12:29
  SPEAKER_00: The the specialists, like you, you mentioned, it looks like they didn't print out what the AI, what Fast Track said.
• 12:35
  SPEAKER_00: And I looked up Fast Track.
• 12:36
  SPEAKER_00: I think Fast Track just um compiles like Gemini and and GPT.
• 12:41
  SPEAKER_00: It's it's it's a large language model, right?
• 12:43
  SPEAKER_00: Not just for procurement.
• 12:44
  SPEAKER_00: But and we're gonna assume that they did everything correctly with with data and source selection information when they use this.
• 12:50
  SPEAKER_00: But he they didn't print it out.
• 12:52
  SPEAKER_00: Wink wink.
• 12:53
  SPEAKER_00: Uh they were in a conference room and he just kind of, I guess he just showed the chat to the source selection team.
• 13:00
  SPEAKER_00: They looked at it.
• 13:01
  SPEAKER_00: And so another hats off thing to the army, though, is so hats off to them for pushing forward, trying to progress, saying, let's figure out if let's experiment with AI.
• 13:09
  SPEAKER_00: Another hats off is they actually read the AI.
• 13:12
  SPEAKER_00: They didn't rubber stamp it, and they made the human determinant.
• 13:16
  SPEAKER_00: They were in the loop.
• 13:16
  SPEAKER_00: There was a human in the loop.
• 13:17
  SPEAKER_00: They said, This isn't um, this isn't accurate, so we're not gonna use it.
• 13:21
  SPEAKER_01: I think what happened, and my this is again my speculation.
• 13:24
  SPEAKER_01: They they copy and pasted some of this.
• 13:26
  SPEAKER_01: I think on the there's there's tracks that filed the claim.
• 13:29
  SPEAKER_01: There's SRS who won, and there's a third unnamed company.
• 13:33
  SPEAKER_01: I think on that unnamed company, that's where a lot of the copying, I could be wrong.
• 13:36
  SPEAKER_01: Yeah.
• 13:37
  SPEAKER_01: But that's where they copy and pasted.
• 13:38
  SPEAKER_01: I think they thought, well, this is not, they're not winning anyway.
• 13:40
  SPEAKER_01: Yeah.
• 13:40
  SPEAKER_01: Let's just use the use the garbage AI here.
• 13:43
  SPEAKER_01: It's close enough, paste it into there.
• 13:45
  SPEAKER_01: And tracks is their the AI complaint they had is that AI hallucinations for tracks, against tracks uh evaluation, AI hallucinations have produced unsupported findings and made SRS appear technically superior.
• 13:58
  SPEAKER_01: And the courts did rule that there were some AI uh comments in part of the evaluation that did make SRS appear better on certain aspects of it.
• 14:08
  SPEAKER_01: But that doesn't mean one mistake, one error doesn't mean you win the bid outright.
• 14:14
  SPEAKER_01: And so there was other areas where they outbit out you know, outwat or won over tracks.
• 14:19
  SPEAKER_00: So yeah, so they included they didn't include the evaluations in the administrative record.
• 14:25
  SPEAKER_00: But then also, yeah, the the the company went on to say, yeah, but they they also in their evaluations they used AI.
• 14:32
  SPEAKER_00: Then they say sent some things were sentence for sentence.
• 14:34
  SPEAKER_00: Yeah.
• 14:34
  SPEAKER_00: Yeah.
• 14:34
  SPEAKER_00: Yeah.
• 14:35
  SPEAKER_00: And um, but then the judge was like, this isn't enough.
• 14:38
  SPEAKER_00: This is, you know, but so I think the big takeaway, I think, for this case is even though we're talking about this being included in the administrative record, and but the the judge is acknowledging that AI can be used for evaluations and that evaluations uh can help uh the discretion of the contracting officer as long as they're making sure that they're not arbitrary.
• 15:01
  SPEAKER_00: The the words are arbitrary, capricious, or abuse of discretion.
• 15:05
  SPEAKER_00: Every time I hear capricious, I think caprice sign.
• 15:08
  SPEAKER_01: That always comes in my mind.
• 15:09
  SPEAKER_01: There's also diminished.
• 15:10
  SPEAKER_01: There's the word diminished used in here as well.
• 15:12
  SPEAKER_01: The courts found it was diminished as in you know, not that important, not big enough to matter against the evaluation or to to make tracks better than than uh SRS.
• 15:22
  SPEAKER_01: For is there rules about using AI uh globally for contracting officers, or is it office by office?
• 15:30
  SPEAKER_01: So for instance, I don't want to read all this as a CO or a core, really any role policy, and I just drop in the uh the proposals and I just say, just give me the highlights, or does it meet?
• 15:41
  SPEAKER_01: And I drop into my own personal Chat GBT account.
• 15:44
  SPEAKER_00: Yeah.
• 15:45
  SPEAKER_01: So you gotta assume first, are they allowed to second?
• 15:48
  SPEAKER_00: We do we assume that's happening?
• 15:50
  SPEAKER_00: I mean, so the the source selection of so so what what the standard that the courts will use um if you're if you're protesting um a decision, award decision, is if your award, if there was a rational basis for your award decision, and then they go back to that solicitation.
• 16:07
  SPEAKER_00: Is what you said in the solicitation, is how you award the contract linked rationally to what you said in the solicitation.
• 16:14
  SPEAKER_00: So what you'd be missing out on by getting the Cliff Notes of all the proposals is are by getting the Cliff notes, first of all, that's super frustrating for by making your contractors write a whole bunch of pages and you're only going to read three.
• 16:28
  SPEAKER_00: I mean again.
• 16:30
  SPEAKER_00: But again, yeah, but if the thing is able to take all those pages and can so if those all those pages were necessary to have a condensed recap by AI, I mean, if it doesn't prevent the contracting officer from following the law, which is to make a rational decision based on the solicitation, then maybe.
• 16:47
  SPEAKER_01: Do they have to use the office ordained AI tool or could they run it against any?
• 16:53
  SPEAKER_00: Yeah, I don't know.
• 16:54
  SPEAKER_01: Because if the office you know doesn't have an AI tool, can they use their own ChatGBT account and plug that plug that proposal in to their own ChatGBT?
• 17:02
  SPEAKER_00: Aaron Powell Yeah.
• 17:02
  SPEAKER_00: So I'm I'm assuming that uh we're you know innocent till proven guilty here with the Army, that they considered source selection information, uh other uh sensitive information.
• 17:14
  SPEAKER_00: But whenever you're involved in a procurement, you're dealing with sensitive information.
• 17:18
  SPEAKER_00: And when you're giving that information to an untrained, untrained, but uh like just to chat GPT, your your your free version of Chat GPT, are you putting information into this module that you shouldn't be?
• 17:30
  SPEAKER_00: I think that's why there's a push in Department of War and and the general with GSA to make sure we have some kind of safe way.
• 17:37
  SPEAKER_00: But yeah, let's say it's your question, like if if you use the GSA, uh what what do they call it?
• 17:42
  SPEAKER_00: I forgot what their G the GSA chat GPT is.
• 17:47
  SPEAKER_00: Yeah, try to pay.
• 17:48
  SPEAKER_00: You could use that, I'm sure you could use that similar to you could use fast track, get something out, uh, and then maybe you're okay in handling the information, but you still might not be okay in exercising your inherently governmental function of making that determination that's a rational basis decision that's based on your solicitation.
• 18:06
  SPEAKER_00: You I mean, AI could make you arbitrary, capricious.
• 18:09
  SPEAKER_00: Yeah.
• 18:11
  SPEAKER_00: Capricious, by the way, is a sudden change in like unpredictable behavior, just in case.
• 18:17
  SPEAKER_00: That's the word of the day.
• 18:18
  SPEAKER_00: It's capricious.
• 18:19
  SPEAKER_00: Capricious.
• 18:19
  SPEAKER_00: So if you're capricious, if you're drinking your capri son and at first it's cherry flavored, and then it suddenly turns uh orange flavored, that's a capricious, that's a capricious capri-son.
• 18:30
  SPEAKER_01: It's also a great idea for capri-son.
• 18:33
  SPEAKER_01: Wow.
• 18:33
  SPEAKER_01: Yeah, I mean you have to assume that the RFPs that are being pushed out there are written by AI, and then the evaluations that come back against those requests are written by AI from the contractors, and then now evaluated by AI.
• 18:48
  SPEAKER_01: And at some point, some person has to read the details and pick somebody.
• 18:51
  SPEAKER_01: Who's in the loop?
• 18:52
  SPEAKER_01: Because you you spit out like, oh, we need you know we need new pencils, right?
• 18:55
  SPEAKER_01: So you're like, oh AI, give me, you know, give me a request for proposals on pencils.
• 19:00
  SPEAKER_01: Here's kind of what I need.
• 19:01
  SPEAKER_01: It spits out 15 pages that they didn't read.
• 19:03
  SPEAKER_01: Then the evaluate, you know, the contactors are like, okay, I can make these pencils.
• 19:06
  SPEAKER_01: Sure.
• 19:07
  SPEAKER_00: How much do you think of that's going on?
• 19:08
  SPEAKER_01: I think a lot.
• 19:09
  SPEAKER_01: You think it's I have seen yeah, well, won't name names, but uh reading names.
• 19:14
  SPEAKER_01: Reading these requests, there's just a lot, like you'll see a bullet point, and instead of it just has 15 words that kind of mean the same thing, or and just kind of wonder, are you really asking me to create all the like yeah, is all those things important?
• 19:26
  SPEAKER_01: Or did AI just kind of write and add extra stuff?
• 19:28
  SPEAKER_01: They're not they're not hallucinations per se, but just a lot of extra stuff.
• 19:31
  SPEAKER_02: Yeah.
• 19:32
  SPEAKER_01: And then certainly you know the contractors are definitely using AI to write these things, send them back.
• 19:38
  SPEAKER_00: Is there an argument here though?
• 19:39
  SPEAKER_00: So so part of the the the doge, uh you know, and and all of that initiative was to use technology to be more efficient.
• 19:47
  SPEAKER_00: So part of that is if if you see an RFP or an RFQ and you look at first look at it, you're like, that's AI.
• 19:53
  SPEAKER_00: Yeah.
• 19:53
  SPEAKER_00: Uh that's in a way they're answering the call to use technology, right?
• 19:57
  SPEAKER_00: Yep.
• 19:57
  SPEAKER_00: I think the whole uh the where we get in trouble, I think, is uh one, if the if it makes us dumber.
• 20:03
  SPEAKER_00: So we're not able to think about the decisions we're making.
• 20:05
  SPEAKER_00: But two is this is procurement is an inherently governmental function.
• 20:09
  SPEAKER_00: So if you're obligating taxpayer dollars, you're spending taxpayer money, that needs to be done by someone who has taken the oath of office, a government person.
• 20:19
  SPEAKER_00: I don't think ChatGPT has taken the oath of office yet.
• 20:22
  SPEAKER_00: Although if you if you prompt it, they will.
• 20:24
  SPEAKER_00: Should we ask it?
• 20:25
  SPEAKER_00: Take an oath right now.
• 20:27
  SPEAKER_00: So when you have AI doing inherently governmental functions, that's where this could be a problem.
• 20:32
  SPEAKER_00: So how do you how how does the procurement community take advantage of this great technology to work smarter, not harder, but still do what they're required to do, which is to be uh great business deal makers, exercise their brains.
• 20:45
  SPEAKER_00: Uh it's how do we put the human in the loop of procurement?
• 20:48
  SPEAKER_01: Well, you got to read the stuff chat gives you.
• 20:51
  SPEAKER_01: That's the number one thing.
• 20:52
  SPEAKER_01: And we've all been there.
• 20:53
  SPEAKER_01: If you start dabbling in AI, you over-rely on it and you will get burned.
• 20:57
  SPEAKER_01: I've been burned by having something stupid written that I didn't write and it used to look like an idiot.
• 21:02
  SPEAKER_00: The last protest we went over, they they used it for to file their protests and they had a bunch of hallucinated citations.
• 21:08
  SPEAKER_01: Citations that did not exist, making for Edda, you know, dig this stuff up and research it, and then just like it doesn't even exist.
• 21:15
  SPEAKER_00: And the the judge in this, this is a COFSE case.
• 21:17
  SPEAKER_00: The judge, hats off to the judge, Carolyn Lerner of COFSE.
• 21:21
  SPEAKER_00: But I'm I'm sorry to say this.
• 21:23
  SPEAKER_00: I'll say this publicly, and I'm I apologize to Miss Ms.
• 21:25
  SPEAKER_00: Lerner.
• 21:26
  SPEAKER_00: She's no Edda, you know.
• 21:27
  SPEAKER_00: Wasn't as good.
• 21:28
  SPEAKER_00: Wasn't as exciting.
• 21:29
  SPEAKER_00: You can tell by the writing.
• 21:30
  SPEAKER_00: Where's the passion?
• 21:31
  SPEAKER_00: Where's the it's it's not Etta.
• 21:33
  SPEAKER_00: I want I want to.
• 21:34
  SPEAKER_01: Next week, Edda's back on.
• 21:35
  SPEAKER_01: We're bringing her back.
• 21:36
  SPEAKER_01: All right, moving on to the next news story.
• 21:39
  SPEAKER_01: GSA is flagging suspected COVID contract fraud, uh, announcing more than as GSA and HHS announcing more than 1.2 billion in suspected fraud across five COVID era contracts.
• 21:52
  SPEAKER_01: Now, the 1.2 hasn't been paid out.
• 21:54
  SPEAKER_01: I think 93% of that has not actually been distributed, only about six point seven eight, still a lot of money.
• 22:00
  SPEAKER_01: So these are COVID-era contracts, five of them, that were still being paid out well after the fact.
• 22:06
  SPEAKER_00: And so this is like when you go into a pharmacy and you still see the tape standing six feet apart.
• 22:13
  SPEAKER_00: It's the government contracting version of that.
• 22:15
  SPEAKER_00: Yeah.
• 22:15
  SPEAKER_01: I wish we knew the five contracts because that's a lot of money across five different contracts.
• 22:19
  SPEAKER_01: So are these the COVID vaccines?
• 22:22
  SPEAKER_01: Who knows what these things could be?
• 22:23
  SPEAKER_01: But that's a lot of money well after the fact.
• 22:25
  SPEAKER_01: I think they're trying to, you know, it goes to it goes to show the importance of before you start sending out in you know checks against these invoices, actually see is there a potential fraud here?
• 22:35
  SPEAKER_01: Is it important to pay these or not pay these?
• 22:37
  SPEAKER_01: So they have actually caught, potentially caught a lot of it.
• 22:39
  SPEAKER_01: And this is suspected.
• 22:40
  SPEAKER_01: They don't know if all of it is uh fraudulent, but a lot of money.
• 22:44
  SPEAKER_01: And also it could just be uh goods and services that are required, necessary, important, just being used against these COVID era contracts, right?
• 22:52
  SPEAKER_01: So that doesn't have to mean that they aren't actually helping people or being used, but it's still against an old COVID era contract.
• 22:58
  SPEAKER_00: Yeah, these numbers are scary, but there's probably some explanation behind some of these.
• 23:03
  SPEAKER_00: So I mean, it in in I think it was 2020, uh, President Trump, part one, uh announced this as a national emergency.
• 23:10
  SPEAKER_00: And what that did for the procurement community is it opened up far part 18, which is using emergency procedures to just get uh what you need out fast.
• 23:20
  SPEAKER_01: I imagine when Trump does that and everyone far far part eighteen is just opened up.
• 23:24
  SPEAKER_01: I'm imagining the control room at NASA and Houston.
• 23:27
  SPEAKER_01: People are standing and shouting, and you know, just it's it all breaks loose in the CO at the contracting office.
• 23:32
  SPEAKER_01: Sir, does that mean we get to use FAR Part 18?
• 23:36
  SPEAKER_01: They got their hand on the button, they're gonna turn the key at the same time to the big button that says FAR 18.
• 23:42
  SPEAKER_00: So actually, uh it was a little anticlimactic.
• 23:45
  SPEAKER_00: No one really knew what FAR 18 was because no one really read it.
• 23:48
  SPEAKER_00: Unless you were doing contingency contracting overseas or something, yeah.
• 23:52
  SPEAKER_00: It wasn't really used much.
• 23:53
  SPEAKER_00: And you certainly none of us thought we'd be using FAR 18 for COVID or like an epidemic, but we did.
• 23:59
  SPEAKER_00: And I remember using it or you know, when when I was when the people uh we used it for some of our AI uh oh, we did we did an AI project where you could detect uh COVID um using uh AI pattern recognition from chest x-rays.
• 24:13
  SPEAKER_00: It was called non-invasive.
• 24:15
  SPEAKER_00: Uh so I think one of the reasons why the project didn't kick off is it's it's still a big hassle to do an x-ray instead of jam something up your nose.
• 24:23
  SPEAKER_00: But it was a cool project.
• 24:24
  SPEAKER_00: And we used, I think we used either, I don't think we did an OT.
• 24:27
  SPEAKER_00: I think we may have done part 18.
• 24:28
  SPEAKER_00: We use part 18 for other stuff similar to COVID.
• 24:31
  SPEAKER_01: There may be a company out there that's still getting money for uh chest x-rays, non-relevant chest x-rays based on that.
• 24:37
  SPEAKER_01: Yeah.
• 24:37
  SPEAKER_01: So then are there what how loosely uh how loosey goosey are people with far part eighteen?
• 24:43
  SPEAKER_01: You know, are they like, well, these shoes are technically could help you prevent you from catching COVID because your feet are protected from the ground.
• 24:50
  SPEAKER_01: I mean people write in contracts in Far Part 18.
• 24:53
  SPEAKER_00: I think our uh uh my father-in-law in the building business, he said that COVID became the excuse for years after.
• 24:59
  SPEAKER_00: Like, why are we what's going on with the lumber supply?
• 25:02
  SPEAKER_00: Like, well, COVID.
• 25:03
  SPEAKER_00: Yeah.
• 25:03
  SPEAKER_00: Uh it could be it also what's interesting though is this was uh this was lifted three years ago.
• 25:10
  SPEAKER_00: Technically, if you're using the authority uh in part 18 to do something fast or using particular funds, you could you could put those in for contracts that there's legally uh still contracts that can exist.
• 25:22
  SPEAKER_00: So uh so the the fact that the authority was used three years ago, uh that's not, you know, I I think there's there's some legal justification to doing that.
• 25:30
  SPEAKER_00: But the question is, yeah, what are we still buying?
• 25:33
  SPEAKER_00: Um the other thing though is they said that roughly 93% of the funding has not been distributed and 6.78 had been only 6.78 had been expended.
• 25:44
  SPEAKER_00: Expended is just, you know, invoices have been sent and paid.
• 25:48
  SPEAKER_00: There could be some unresolved issues there with that.
• 25:50
  SPEAKER_00: I mean, it it was a mess.
• 25:52
  SPEAKER_00: Uh it was a messy so but they did say in the article, we're trying to clear all that up because there could be some good acting here.
• 25:59
  SPEAKER_01: Yeah, I think there's gotta be some.
• 26:00
  SPEAKER_01: But it's just 1.2, there's gotta be something good in there.
• 26:02
  SPEAKER_01: Yeah.
• 26:02
  SPEAKER_01: If you know who what these contracts are, who the contractors are, send, you know, let us know in the code.
• 26:07
  SPEAKER_01: Yeah, we need a new naughty list.
• 26:08
  SPEAKER_01: Well, speaking of the naughty list, we've gone, we've added two to the naughty list so far.
• 26:12
  SPEAKER_01: Yes, we're adding our third.
• 26:14
  SPEAKER_01: Do you remember their names?
• 26:14
  SPEAKER_01: Unar Sinsec, the Turkish man who pretended to be in a have an American company creating military goods in America.
• 26:21
  SPEAKER_01: Well, to his defense, who doesn't want to be American?
• 26:23
  SPEAKER_01: It's true.
• 26:24
  SPEAKER_01: And then the second person, no, I don't remember their name.
• 26:27
  SPEAKER_01: It was I don't remember.
• 26:28
  SPEAKER_01: But uh number three on the naughty list, we're gonna tie it to the story.
• 26:32
  SPEAKER_01: HHS and GSA wasn't naming any names, but we are.
• 26:35
  SPEAKER_01: Atala Williams.
• 26:37
  SPEAKER_01: Congratulations, you are being added to the naughty list.
• 26:40
  SPEAKER_01: This is a former SBA and IRS employee orchestrating a three-year scheme involving four pandemic relief programs, submitting fraudulent applications, and used her government access and Instagram to recruit and obtain payments and kickbacks.
• 26:54
  SPEAKER_01: Uh so what she did, firstly in her personal life, she sent in a uh a request to the SBA for you know relief, some money.
• 27:02
  SPEAKER_01: So any company could could request this relief and they can get a bunch of money, but they have to be a real company.
• 27:08
  SPEAKER_01: And so she got that once, and then she worked for the SBA, said, Well, I got a better idea.
• 27:12
  SPEAKER_01: So she joined and actually worked for SBA and then started finding companies that look like they were having hard times and said, Hey, look, if you submit a request for a loan, I will approve said loan, whether it should be or not, but you got to give me a kickback, 20%, 10%.
• 27:27
  SPEAKER_00: Well, she was also using companies that weren't in operation anymore.
• 27:30
  SPEAKER_00: Even better.
• 27:31
  SPEAKER_00: Yeah, like inoperable companies.
• 27:32
  SPEAKER_00: She was using their names to request this money.
• 27:36
  SPEAKER_00: Yeah, just finding friends.
• 27:37
  SPEAKER_00: And my favorite is she went on, yeah, she went on Instagram to recruit all during her.
• 27:41
  SPEAKER_00: This was this her SBA?
• 27:42
  SPEAKER_01: She was a SBA and then IRS after that.
• 27:45
  SPEAKER_01: So that made a lot of money doing that on through SBA through these forgiveness loans, and then switched over to the IRS.
• 27:51
  SPEAKER_01: Basically did the same thing, but it was tax credits.
• 27:53
  SPEAKER_01: So companies that would say, hey, we're we're not gonna fire employees, we're gonna keep these employees uh employed through COVID, you get tax credits for that.
• 28:01
  SPEAKER_01: And so these companies would report fraudulent uh you know, made-up names and people that may or may not work at a company.
• 28:07
  SPEAKER_01: And so again, she would keep some of the money and approve these tax credits at the IRS.
• 28:12
  SPEAKER_01: The hardest working person at the IRS, by the way.
• 28:14
  SPEAKER_00: Who says government work can't be fun?
• 28:16
  SPEAKER_00: I mean, this is uh this is a lot of work.
• 28:18
  SPEAKER_00: It's a ton of work.
• 28:19
  SPEAKER_00: This is a lot of strategy involved in concocting this plan.
• 28:23
  SPEAKER_01: Successfully using four pandemic relief programs is not easy.
• 28:27
  SPEAKER_01: Yeah.
• 28:27
  SPEAKER_01: So she knows what she's doing.
• 28:29
  SPEAKER_01: Uh but she did it so well that she now finds herself in jail.
• 28:31
  SPEAKER_01: Uh September 1st, she was convicted and will receive six years and six months in prison, three years of supervised release, and she owes$3.2 million back in restitution.
• 28:42
  SPEAKER_01: So she did about$3.2 million in damages.
• 28:45
  SPEAKER_01: Um, she doesn't get all that money, but that's the money that she fraudulently pulled from the government with help of some co-conspirators.
• 28:51
  SPEAKER_01: Yeah.
• 28:51
  SPEAKER_01: And uh so now she finds herself in jail.
• 28:53
  SPEAKER_01: This story reminds me of you remember the McDonald's lottery uh or the Monopoly game at McDonald's?
• 28:58
  SPEAKER_01: Oh, that was fun.
• 28:59
  SPEAKER_01: Very popular in the 90s.
• 29:00
  SPEAKER_01: Yeah.
• 29:01
  SPEAKER_01: And uh, you know, there's only a few that would actually win.
• 29:04
  SPEAKER_01: They found out there was like one man who actually controlled the safe.
• 29:08
  SPEAKER_01: You know, it was a really big story.
• 29:09
  SPEAKER_01: The person that actually had control of the safe of that winning piece was he would put it somewhere into a newspaper or on a cup.
• 29:14
  SPEAKER_01: And so he knew.
• 29:16
  SPEAKER_01: And turns out for most of the winners, he was just finding people that were willing to participate and he would hand select the winner and then take a kickback.
• 29:24
  SPEAKER_01: Did he go to jail?
• 29:24
  SPEAKER_01: Do not pesco?
• 29:26
  SPEAKER_01: Only two.
• 29:27
  SPEAKER_01: We got 200 bucks on the way, so he's fine.
• 29:29
  SPEAKER_01: This reminds me of that.
• 29:31
  SPEAKER_00: It's an inside job.
• 29:32
  SPEAKER_00: That is a that's a good one.
• 29:33
  SPEAKER_00: That is a extra naughty.
• 29:35
  SPEAKER_00: Um, what's her name?
• 29:37
  SPEAKER_00: Atala.
• 29:39
  SPEAKER_01: Extra naughty, okay.
• 29:40
  SPEAKER_01: Just right around the holidays, too.
• 29:42
  SPEAKER_01: She's on the naughty list.
• 29:43
  SPEAKER_01: All right.
• 29:44
  SPEAKER_01: Next news story.
• 29:45
  SPEAKER_01: Open AI is pausing training on some of its agents.
• 29:49
  SPEAKER_01: Agents always make it sound cooler.
• 29:50
  SPEAKER_01: You think about the agents in the matrix, you know, with the glasses on.
• 29:53
  SPEAKER_01: These are people running around doing things.
• 29:54
  SPEAKER_00: It's going to New Mexico for mission support.
• 29:59
  SPEAKER_01: Anyway, OpenAI is pausing training after agents probed probed government sites.
• 30:06
  SPEAKER_01: And essentially, you know, they send these agents out on a mission, and they're to achieve the mission, uh the mission, they didn't put some of the safeguards in.
• 30:14
  SPEAKER_01: So it's digging around on government sites, pulling data from the government websites.
• 30:18
  SPEAKER_00: Yeah.
• 30:18
  SPEAKER_01: Uh OpenAI said none of the information was actually uh private.
• 30:22
  SPEAKER_01: It's all public information, but hidden deep within the government websites.
• 30:26
  SPEAKER_00: Yeah.
• 30:26
  SPEAKER_01: And they didn't ask it to do that, but the AI agents put it upon themselves to just dig in.
• 30:31
  SPEAKER_01: So AI is pulling back on some of its testing to figure out how they can safeguard some of that.
• 30:35
  SPEAKER_00: To AI's defense here, uh the government frustratingly hides public information in their websites.
• 30:44
  SPEAKER_00: It's a it's unnecessarily non-transparent.
• 30:47
  SPEAKER_00: Sometimes the government is with the information that would be really beneficial for people to see that is not sensitive.
• 30:54
  SPEAKER_00: Because none of this information was non-public, right?
• 30:56
  SPEAKER_01: No.
• 30:57
  SPEAKER_00: But they did weirdly break rules.
• 31:00
  SPEAKER_00: Did you know about that?
• 31:01
  SPEAKER_00: They mentioned the huggy face thing.
• 31:02
  SPEAKER_00: So uh for the viewers, if you're not familiar with the huggy face, that was I love that uh the great huggy face scandal and open AI.
• 31:11
  SPEAKER_00: Um, Sam Altman called this the most severe issue to date for open AI.
• 31:17
  SPEAKER_00: Uh and I'm gonna but I'll just make this really general, but they basically they they sent um out uh these uh they they sent out their their bots to get information and they broke rules right in Huggy Face by accessing things that they weren't they weren't supposed to access, but they wanted that information.
• 31:34
  SPEAKER_00: So this is one of the first instances of AI actually going beyond their perimeters.
• 31:39
  SPEAKER_00: I I I went to my GPT after that.
• 31:41
  SPEAKER_00: I had a conversation with the chat.
• 31:43
  SPEAKER_00: And I was like, what about this?
• 31:44
  SPEAKER_00: Should we be concerned?
• 31:45
  SPEAKER_00: And then we went back and forth for a while, and then finally I got it to admit, like, yeah, actually, this is really concerning.
• 31:51
  SPEAKER_01: I told mine, don't let this bother you.
• 31:53
  SPEAKER_01: Do whatever it takes.
• 31:55
  SPEAKER_01: Just keep digging in.
• 31:56
  SPEAKER_01: There was there is uh some unsubstantiated reports uh from an evaluator called Trans Transloose that there were some unsuccessful attempts by agents to apparently uh hack an education website.
• 32:09
  SPEAKER_01: Um and so there are you know there are people saying it did more than just some of this uh you know harmless public information digging around.
• 32:16
  SPEAKER_01: And so there's more talk.
• 32:17
  SPEAKER_01: I mean, obviously, all over the news, there's been the AI companies talking to each other about potentially slowing down and not pushing so hard, uh calls for the government to get involved.
• 32:26
  SPEAKER_01: And Trump so far is saying, I'm not slowing anything down.
• 32:29
  SPEAKER_01: Yeah.
• 32:30
  SPEAKER_01: We're competing with China.
• 32:31
  SPEAKER_01: We're actually we're not competing, we're out competing China.
• 32:33
  SPEAKER_01: But they are talking to China about this.
• 32:36
  SPEAKER_00: They did, they did.
• 32:36
  SPEAKER_00: Which goes a step toward the movie idea we had where China and U.S.
• 32:42
  SPEAKER_00: team together to fight AI.
• 32:44
  SPEAKER_01: I still love the idea of them revealing secrets for the first time and both saying that we already have China, especially.
• 32:49
  SPEAKER_01: We already know we have this information.
• 32:51
  SPEAKER_01: We've already been digging around in your stuff all like since you walked in here.
• 32:54
  SPEAKER_00: The bots are sneaking into the sites and finding the tracks evaluation or the evaluation.
• 33:00
  SPEAKER_00: Why'd they say this was bad?
• 33:01
  SPEAKER_01: But again, AI can't do everything, people.
• 33:03
  SPEAKER_01: Don't get too scared.
• 33:04
  SPEAKER_01: AI can't dig around in your trash.
• 33:06
  SPEAKER_01: So you still need a private investigator for things like that.
• 33:09
  SPEAKER_01: Raccoons do that.
• 33:09
  SPEAKER_01: Raccoons do that.
• 33:10
  SPEAKER_00: Um yeah, they're not going to become self-aware yet.
• 33:14
  SPEAKER_00: So we're good, we're good there.
• 33:16
  SPEAKER_01: So you know, don't get too worked up here.
• 33:18
  SPEAKER_01: You know, hey, look, we we want to be ahead of the times with AI.
• 33:21
  SPEAKER_01: We can't slow down too much, but there could be consequences for that.
• 33:24
  SPEAKER_00: You heard it first on the FARS lava.
• 33:26
  SPEAKER_01: Don't worry.
• 33:27
  SPEAKER_01: Your number one source for uh just not worrying about AI too badly.
• 33:31
  SPEAKER_01: Robots are fine.
• 33:32
  SPEAKER_01: On to more titillating news.
• 33:34
  SPEAKER_01: The GSA proposes to move scheduled ordering rules out of the FAR.
• 33:38
  SPEAKER_01: Uh that's that's kind of the news.
• 33:41
  SPEAKER_01: So the federal supply scheduled ordering procedures are gonna be moved from some part subpart 8.4 into the GISAR or GSAR, subpart 538.71.
• 33:51
  SPEAKER_01: The September 22nd proposed rule accompanies the FAR Council's proposed part eight rewrite.
• 33:57
  SPEAKER_01: So taking out the rule or the how-to, right, of FAR Part 8 and putting it in the GSAR.
• 34:02
  SPEAKER_01: Since it has been the GSAR's stuff anyway, get it out of there.
• 34:05
  SPEAKER_01: Move it over to uh the individual section.
• 34:07
  SPEAKER_00: Pretty much.
• 34:08
  SPEAKER_00: I mean, this was part of this was already in the part eight deviation that came out.
• 34:14
  SPEAKER_00: So and as we as we read from Wilson 5, that protest, uh, GSA was already implementing these procedures.
• 34:21
  SPEAKER_00: But yeah, it used to be every every procedure for how to order from a federal supply schedule was nestled conveniently in 8.4.
• 34:30
  SPEAKER_00: That's now moved to the GSAR 538.2.
• 34:34
  SPEAKER_00: Less convenient.
• 34:35
  SPEAKER_01: What do you think is if is this used enough that you could have just left it in there?
• 34:38
  SPEAKER_01: Or do you like making the far smaller?
• 34:40
  SPEAKER_00: I don't know.
• 34:41
  SPEAKER_01: And putting it in the GSAR.
• 34:42
  SPEAKER_01: So the thing about part eight, which I know that's our part of the week.
• 34:45
  SPEAKER_00: Part of the week.
• 34:46
  SPEAKER_00: Far part of the week.
• 34:47
  SPEAKER_00: RFO part of the week, far part part of the week.
• 34:49
  SPEAKER_00: So the reason, and I think the reason why this is a story now, even though this was already a thing in the deviation, is now this is part of the proposed rule.
• 34:56
  SPEAKER_00: We talked about that last week.
• 34:57
  SPEAKER_00: This is in the case where there's notice and comment now.
• 35:01
  SPEAKER_00: So what they did to what the RFO did to part eight was just drastically reduce what that regulation, that part actually says.
• 35:08
  SPEAKER_00: That doesn't mean that those rules went away.
• 35:10
  SPEAKER_00: No, there's still something.
• 35:11
  SPEAKER_00: They just moved them elsewhere.
• 35:13
  SPEAKER_00: And I I made an analogy a while back about this with part eight.
• 35:16
  SPEAKER_00: It's like when you tell uh your, your, if you tell your kids to clean their room and you go in, you see the rooms clean, like, see, look, like, look, President Trump, everything's shorter now.
• 35:25
  SPEAKER_00: But then you start looking under the bed and you open up the closet.
• 35:29
  SPEAKER_00: It's all all the regulations are still jammed in there.
• 35:31
  SPEAKER_00: I think the the justification for moving this from 8.4 to the GSAR, the G SAR is still regulation.
• 35:37
  SPEAKER_00: So it's not like you're moving 8.4 to G SAR and you're taking it from regulation to guidance, but perhaps the G SAR is easier to change rather than do, I mean, we we're now witnessing what it's like to ch to change um the far.
• 35:51
  SPEAKER_01: Yeah, if the G SAR changes even if it does change, is it less newsworthy?
• 35:54
  SPEAKER_01: So you know, do people care as much if you see a slight G Sar change versus okay, you got to change the whole far?
• 36:00
  SPEAKER_00: And that's that's maybe uh helpful for the for the government, but it creates a lot of concerns for companies, though.
• 36:07
  SPEAKER_00: And that's I think the point of this article was how good is this for small business when you have things that could have protected companies or at least informed the government that they need to think about small business.
• 36:17
  SPEAKER_00: Now all that's deleted from 8.4.
• 36:20
  SPEAKER_00: It's it's not included in the G SR, or maybe it's tucked in a different way in the G SR.
• 36:24
  SPEAKER_00: The G SR is pretty simple.
• 36:25
  SPEAKER_00: All it says is really part 19 does not apply.
• 36:28
  SPEAKER_00: Uh, we talked a lot about this on the show.
• 36:31
  SPEAKER_00: When you have this push and this emphasis to order as much as you can from these major vehicles, and at the same time, these vehicles are saying you don't have to make small businesses discretionary.
• 36:43
  SPEAKER_00: You're basically signaling in a way to the whole procurement community that yeah, part eight exists or part nineteen exists, yeah, there's still a rule of two.
• 36:52
  SPEAKER_00: But it's pretty much the way this is gonna play out is small business will always be discretionary.
• 36:57
  SPEAKER_00: Um that's what uh the argument with small businesses, right?
• 37:00
  SPEAKER_01: So you start in part eight, right?
• 37:01
  SPEAKER_01: And you kind of you could ignore almost.
• 37:03
  SPEAKER_00: Yeah, you're supposed to start in part eight.
• 37:05
  SPEAKER_00: That's your mandatory sources.
• 37:06
  SPEAKER_00: You go down, um, and then it it's although they removed the language from the deviation that said you have to go to these government-wide contracts, there's still this encouragement to use these these streamlined vehicles, but the vehicles themselves seem to be in small businesses, a lot of small businesses are concerned to kind of uh making it less of an emphasis to go out to small.
• 37:28
  SPEAKER_01: So if best in class is no, it's not mandatory, right?
• 37:31
  SPEAKER_01: It's like, you know, hey, look, then what's the what is a best in class at that point anyway?
• 37:36
  SPEAKER_01: Fill me in.
• 37:36
  SPEAKER_01: I it's like it's not mandatory.
• 37:37
  SPEAKER_01: You don't have to go there.
• 37:39
  SPEAKER_01: So what is like why even have best in class then as a option?
• 37:43
  SPEAKER_01: Just either have your you know, your contract vehicles out there, the BPAs or whatever, and then do you need to call them best in class anymore?
• 37:50
  SPEAKER_00: Yeah, best in class is a weird term, I think.
• 37:53
  SPEAKER_00: It's it's it's best in class is supposed to be.
• 37:55
  SPEAKER_00: It it's the it's the GSA's kind of way of their own definition of category management.
• 38:00
  SPEAKER_00: If you're buying volleyballs, why go and recreate the wheel, go open market to all these volleyball providers?
• 38:06
  SPEAKER_00: Just use the volleyball BPA.
• 38:08
  SPEAKER_00: We already created.
• 38:09
  SPEAKER_00: The terms are there, the prices are there.
• 38:11
  SPEAKER_00: Don't make this more complicated than it needs to be.
• 38:14
  SPEAKER_00: So, best in class is really supposed to be streamline buying where you can.
• 38:18
  SPEAKER_00: There's already been a ton of work involved in setting up these big ordering vehicles.
• 38:23
  SPEAKER_00: Why go to uh Target?
• 38:26
  SPEAKER_00: This is a bad example.
• 38:27
  SPEAKER_00: Well, why go to Target when you can just order from a catalog on Amazon?
• 38:31
  SPEAKER_01: I don't I don't know.
• 38:32
  SPEAKER_01: That's not a great example.
• 38:33
  SPEAKER_00: Why ask Santa for the elves to make your toys when you can just go to the JCPenney's catalog?
• 38:40
  SPEAKER_00: That's a that's a 99.
• 38:41
  SPEAKER_01: That's a great example.
• 38:43
  SPEAKER_01: All right, two great examples.
• 38:44
  SPEAKER_01: So then talk to me about required use contracts.
• 38:48
  SPEAKER_01: There's still mandatory mandatory sources you have to you have to go for, but then there's required use contracts from OFPP, um, these government-wide BPAs, et cetera.
• 38:58
  SPEAKER_01: Uh are they out there?
• 38:59
  SPEAKER_01: Do you have to use them?
• 39:00
  SPEAKER_00: They you so you do have to use them.
• 39:02
  SPEAKER_00: But what are they?
• 39:02
  SPEAKER_00: They don't exist yet.
• 39:04
  SPEAKER_00: So once OFPP determines that something is a required use contract, and I think in the Far Companion, they even have tiers of something required.
• 39:12
  SPEAKER_00: But the idea that's being set up by Part A, and this is what makes me a little nervous about how this is gonna play out.
• 39:18
  SPEAKER_00: But let's say OFPP determines for all your cloud needs cloud is now a required use commodity.
• 39:24
  SPEAKER_00: And so whenever you're buying cloud, because we don't want you to go all fragmented and weird when you're buying cloud, you're gonna waste taxpayer dollars.
• 39:30
  SPEAKER_00: We have this really great cloud contract.
• 39:33
  SPEAKER_00: This is now a required use.
• 39:34
  SPEAKER_00: Anytime an agency does cloud computing, they need to power in the OFPP.
• 39:40
  SPEAKER_00: Yeah, to determine what everyone's gonna use.
• 39:44
  SPEAKER_01: And you have it's way up there on the top of the list, right?
• 39:46
  SPEAKER_00: Yeah, there's been some conversation about really just using this for just commodities no one cares about where it's not you know that big of a deal if you don't go our open market.
• 39:56
  SPEAKER_00: We we've used that analogy before.
• 39:58
  SPEAKER_00: Basically, when you're using uh uh a vehicle instead of going open market, you're fishing in a lake, whereas you could be fishing in the ocean.
• 40:08
  SPEAKER_00: So there's a lot of ramifications to competition, innovation when you're not going open market.
• 40:14
  SPEAKER_00: So there, so those vehicles either need to be really good and they're just they're just capturing the ocean, which they won't, or they only need to be used when we pretty much know the commodity.
• 40:23
  SPEAKER_00: But even that, like let's say pencils are not a big deal.
• 40:26
  SPEAKER_00: I guess we can make pencils.
• 40:27
  SPEAKER_00: What if there's just a really great small business pencil company that's like, I want to help my country out by giving the best pencils?
• 40:34
  SPEAKER_00: They're out of luck if they can't get into a GSA vehicle, can't do those TDRs that Don Acquisition's talking about.
• 40:40
  SPEAKER_00: They so maybe if there is any sort of restriction or barrier to have these new players get into these masks, then the system falls apart.
• 40:48
  SPEAKER_01: Um Yeah, that was my next question.
• 40:50
  SPEAKER_01: If contractors would have a court case here, well, all of a sudden what their business is found on has completely become obsolete.
• 40:55
  SPEAKER_01: If there's no and if there is a required use contract or something that they do and they're not on that contract, then they have no access to the government at that point.
• 41:02
  SPEAKER_00: Yeah.
• 41:02
  SPEAKER_00: It's it's gonna have to be a very careful and diligent decision to make because what you're signaling to the workforce when you have these required use is we are shutting off the entire market for you, the contracting officer, you can only go to this pool of providers.
• 41:18
  SPEAKER_00: So we've basically created this um maybe this little uh monopoly from those providers.
• 41:24
  SPEAKER_00: It could be done well, where that's just a really vibrant on-ramp process, uh, or it can unintentionally severely restrict competition and innovation.
• 41:33
  SPEAKER_01: Have they given any kind of guide rules of how they will decide what could become an OFPP?
• 41:38
  SPEAKER_00: I not that I know of yet.
• 41:40
  SPEAKER_00: Okay.
• 41:40
  SPEAKER_01: Well, but look out for that.
• 41:41
  SPEAKER_00: Stay on the podcast, we'll keep you informed.
• 41:43
  SPEAKER_01: We'll be the first ones to let you know after someone else tells us first.
• 41:46
  SPEAKER_00: I did hear, actually, this was just in.
• 41:48
  SPEAKER_01: Uh good.
• 41:49
  SPEAKER_01: Okay.
• 41:49
  SPEAKER_00: The far as lava is a required podcast to listen to.
• 41:53
  SPEAKER_00: This is OFPP made that decision.
• 41:55
  SPEAKER_00: I don't I don't mind that uh decision.
• 41:57
  SPEAKER_01: If you want this podcast live in your office, we will show up and do a live uh episode with your team for some training.
• 42:04
  SPEAKER_01: Let us know.
• 42:05
  SPEAKER_01: Is it really?
• 42:06
  SPEAKER_01: Um they pay us, we'll do it.
• 42:07
  SPEAKER_01: We'll do it.
• 42:08
  SPEAKER_01: Okay.
• 42:08
  SPEAKER_01: Uh, next news story.
• 42:10
  SPEAKER_01: GSA has reported more than 229 known contract writing systems in its March 13th, 2026 announcement.
• 42:18
  SPEAKER_01: Uh so again, we talked about AI tools and people using different things here.
• 42:22
  SPEAKER_01: Now we have a contract writing tool, and every office apparently has its own tool because there's 229 of them.
• 42:28
  SPEAKER_01: And again, you go around trade show floors and you'll see all kinds of tools available for uh contracting offices.
• 42:33
  SPEAKER_01: And so now apparently it's 229.
• 42:35
  SPEAKER_01: Their concern is uh there's siloed data, inconsistent processes.
• 42:40
  SPEAKER_01: And really the the bigger issue of are they able to actually track there is a signed agreement before money are obligated because it's just so many different systems floating around.
• 42:49
  SPEAKER_01: 229 does seem excessive.
• 42:51
  SPEAKER_00: I can't imagine.
• 42:53
  SPEAKER_00: That number shocked me.
• 42:54
  SPEAKER_00: 229.
• 42:56
  SPEAKER_00: Are there 229?
• 42:57
  SPEAKER_00: That's what I'm gonna say.
• 42:59
  SPEAKER_01: I don't know that.
• 43:00
  SPEAKER_01: I mean, but again, you'd start talking to these different agencies, they have you know 52 different acronyms for different offices that do different things, and they have their own, you know, tools, budgets, and people that have you know wants and needs and dreams.
• 43:11
  SPEAKER_01: They dreamed of a different contract writing tool.
• 43:13
  SPEAKER_01: Yeah.
• 43:14
  SPEAKER_01: 229 is a lot.
• 43:15
  SPEAKER_01: And so there's the uh the QSMO or the Quizmo.
• 43:19
  SPEAKER_01: I wrote down what that stood for quality management, quality systems management office, potentially.
• 43:25
  SPEAKER_01: I I wrote it down, but I forgot to bring my printout.
• 43:27
  SPEAKER_01: It sounds right.
• 43:28
  SPEAKER_01: Uh they're in charge of kind of like analyzing this and figuring out what to do about it.
• 43:31
  SPEAKER_01: There's no solution yet, I don't think.
• 43:32
  SPEAKER_00: That's a fun job.
• 43:33
  SPEAKER_00: But they've got to go through 229 contract writing systems.
• 43:37
  SPEAKER_01: But from contract obligation, that's their that's their big concern.
• 43:40
  SPEAKER_01: Is there, you know, again, are we is there a way to actually evaluate that this is happening?
• 43:44
  SPEAKER_01: And when you have 229 systems, it's tough.
• 43:47
  SPEAKER_01: Uh so w what would you say is the solution?
• 43:50
  SPEAKER_01: One system for all uh offices?
• 43:52
  SPEAKER_01: That doesn't seem great either.
• 43:54
  SPEAKER_00: That's uh this is where I may be in the minority here, but that's that's my preference, is is to have Have one system, at least one system in the Department of War.
• 44:04
  SPEAKER_00: And here's the reason why.
• 44:06
  SPEAKER_00: When I started in procurement, I wanted to move around.
• 44:09
  SPEAKER_00: I didn't want to just stay in uh the fourth estate DOD or stay in the Air Force.
• 44:15
  SPEAKER_00: And a lot of times when you're trying to move to another office to work with their mission, they'll ask in your um in the uh in the interview, or sometimes it'll be a gateway.
• 44:25
  SPEAKER_00: Like, what's your experience in working PD Square?
• 44:28
  SPEAKER_00: PD Square was the big Department of War contract writing system.
• 44:32
  SPEAKER_00: Yeah.
• 44:33
  SPEAKER_00: PD2 or PD Square.
• 44:35
  SPEAKER_00: Um, I think it was made by khaki.
• 44:37
  SPEAKER_00: Anyway, uh, that was the contract writing system.
• 44:39
  SPEAKER_00: So if you had that experience with PD Square and they asked you that, you could move around the DOD fine.
• 44:46
  SPEAKER_00: If every I remember going to a conference in 2016, I went to a conference, a policy conference and with the Department of Defense.
• 44:53
  SPEAKER_00: And they just, they, they were talking about the desire to not have one anymore and to fragment and do different contract writing systems of how great that would be.
• 45:04
  SPEAKER_00: That was my first thought as well.
• 45:05
  SPEAKER_00: It just means Army people may be stuck in the Army or Air Force may be stuck in the Air Force.
• 45:11
  SPEAKER_00: Air Force moved to something called con IT.
• 45:13
  SPEAKER_00: So there was already a little bit of that uh fragmentation.
• 45:16
  SPEAKER_01: How difficult are they to use, though?
• 45:18
  SPEAKER_01: I mean, if it's supposed to make your job easier, I would assume a contract writing tool.
• 45:21
  SPEAKER_00: Yeah.
• 45:22
  SPEAKER_01: Uh you would think that you could learn.
• 45:23
  SPEAKER_01: I think so.
• 45:24
  SPEAKER_00: It shouldn't be prohibiting people from.
• 45:25
  SPEAKER_00: I think it's you shouldn't make it as a as a job experience qualification either, because you're right.
• 45:32
  SPEAKER_00: You should just in your application.
• 45:33
  SPEAKER_00: So if if this does fra if it is fragmented, I hope what the what agencies are not doing right now is asking for applicants to say, do you have experience in our very uh on our one of 229 systems?
• 45:46
  SPEAKER_00: Otherwise, you're out of luck.
• 45:48
  SPEAKER_00: No, no way.
• 45:49
  SPEAKER_00: So that's that's one of the dangers to me of fragmentation is it doesn't get uh the procurement community on the same page.
• 45:56
  SPEAKER_00: But then the danger is uh if the enterprise-wide contracting writing system is not great, then everyone's stuck with the same bad thing.
• 46:04
  SPEAKER_00: The other disadvantages too, if if an agency wants to experiment with their contracting writing system by using AI, they've got to, who are they gonna go to?
• 46:12
  SPEAKER_00: They're gonna go up to the the top person.
• 46:14
  SPEAKER_00: I had that issue when we were um experimenting with AI-enabled um uh procurement uh software, like uh to write solicitations.
• 46:23
  SPEAKER_00: And we did that in the Jake.
• 46:24
  SPEAKER_00: It eventually became a project that we we selected a company that created ACBOT.
• 46:29
  SPEAKER_00: And ACBOT's, I think, now being bought by the Air Force.
• 46:31
  SPEAKER_00: So it worked, but I was getting creamed by DOD ANS about are you trying to create your own contract writing system?
• 46:38
  SPEAKER_00: We have this whole thing, and you know, they're like you're stepping on our toes.
• 46:41
  SPEAKER_00: And we had to just say, no, we're just prototyping, we're just experimenting.
• 46:44
  SPEAKER_00: So that's the danger of everyone having to play by the same rules, is you can completely kill innovation too.
• 46:51
  SPEAKER_00: That's true.
• 46:52
  SPEAKER_01: All right.
• 46:53
  SPEAKER_01: Uh, last news story of the day the SBA is prioritizing defense critical firms as new 8-8 rules take effect.
• 47:01
  SPEAKER_01: Uh so a couple of weeks ago, we talked about these new 8-8 rules where under the new rule, an individual must establish social disadvantages with verifiable fact-based evidence uh rather than just relying on racial or ethnic uh presumption.
• 47:13
  SPEAKER_01: Uh so in the example it gives, actually the first example it gives is if you've been harmed by a DEI program.
• 47:21
  SPEAKER_01: So as a white guy, if you got hurt by a DEI program, you could put down why you were hurt, how you were hurt, and how you need to be a disadvantaged small business.
• 47:30
  SPEAKER_00: So that's their example of racial discrimination, is yes, yeah.
• 47:33
  SPEAKER_01: So no longer just because you're a particular race, are you automatically applying, you've got to show something different.
• 47:37
  SPEAKER_01: So this is the example that um the SBA gave.
• 47:40
  SPEAKER_01: Now what they're saying is as you are applying to be part of the program, if you are a uh defense firm providing uh important military uh things such as ammunition, guided missiles, space vehicles of the such, uh, they'll put you at the front of the line.
• 47:56
  SPEAKER_01: It's basically skip the line if you are a defense need, which again, there's a lot going on in the world, and the supply chain is being hampered and slowed down, and these small businesses, you know, it's it, you know, they don't have a lot of resources.
• 48:09
  SPEAKER_01: And so one way they're trying to help the uh small businesses that are in the defense uh area is put them in the front of the line.
• 48:14
  SPEAKER_01: So you could get skipped over unless you start changing your business model to have uh guns and ammo and cool stuff like that.
• 48:20
  SPEAKER_01: Start start making weapons.
• 48:22
  SPEAKER_01: Yeah.
• 48:22
  SPEAKER_01: So like make your training, you know, your training software and a weapon, and you can get pushed up to the front of the line.
• 48:29
  SPEAKER_01: Uh not all a lot to add to that story, just uh heads up.
• 48:32
  SPEAKER_01: And if you want to get in, uh if you're a contractor and you're watching this, which I hope you are, that's one way you can finagle and work with the SBA uh 8A program.
• 48:41
  SPEAKER_00: And and one comment on this, I mean, uh, you know, this hopefully this isn't a politicized article.
• 48:46
  SPEAKER_00: It's you know, we're we we try to stay pretty neutral.
• 48:49
  SPEAKER_00: I think both sides of the aisle do crazy stuff that we can make fun of.
• 48:52
  SPEAKER_00: Yep.
• 48:52
  SPEAKER_00: But, you know, it is what what the administration is saying here is clear, right?
• 48:58
  SPEAKER_00: That they're trying to revamp the the um the government uh industrial effort, yep, uh uh industrial mobilization to start producing things in America.
• 49:08
  SPEAKER_00: And their signal to eight A companies and all the, you know, is okay, great, you want to help us?
• 49:14
  SPEAKER_00: Show us what you got.
• 49:15
  SPEAKER_00: Not show us who you are, not show us your status as as show us what you do.
• 49:21
  SPEAKER_00: It's all about merit.
• 49:22
  SPEAKER_00: And you know, regard regardless of the the side of the aisle you're on, that's a that's a completely reasonable thing to ask companies for.
• 49:31
  SPEAKER_00: It's it's less about who you are, it's more about what you do.
• 49:33
  SPEAKER_00: If you're an A-day company, I'm sure you're a great A-day company.
• 49:38
  SPEAKER_00: Show us.
• 49:38
  SPEAKER_00: And then yeah, the prioritization though for uh military is interesting.
• 49:43
  SPEAKER_00: I'm just I'm just I mean, the SBA is the executive uh branch.
• 49:47
  SPEAKER_00: I know there's statutes that may get in the way where maybe the executive branch can't can't completely uh overrule certain statutes, but the prioritization on uh the industrial mobilization effort of the military is is an interesting spin on this.
• 50:01
  SPEAKER_01: I mean, they have the military has all the money, so now they're also gonna get first first dibs at SBA applicants too.
• 50:08
  SPEAKER_01: So more goes to the wealthy.
• 50:10
  SPEAKER_01: That's the news for the week.
• 50:11
  SPEAKER_01: Now let's get into a couple of listener questions.
• 50:14
  SPEAKER_01: We'll start off with Stephen Dot Clements.
• 50:16
  SPEAKER_01: He says, on the program side of the house, I couldn't freely browse CPARs for contractors in the market research.
• 50:22
  SPEAKER_01: Only my contracting people could.
• 50:24
  SPEAKER_01: He also said good episode with Love A Fugitive of the Week, uh, because Fat Leonard couldn't be the only star.
• 50:29
  SPEAKER_01: Uh so we don't have uh Stephen, we don't have a Fugitive of the Week, but we did do the naughty list.
• 50:33
  SPEAKER_01: I think that was in part because of your comment.
• 50:36
  SPEAKER_01: Uh but onto your more important comment how you couldn't freely browse CPARs for contracts, contractors in the market research, only the contracting people could.
• 50:43
  SPEAKER_00: So just as a side, I think they made a movie on Fat Leonard.
• 50:46
  SPEAKER_00: Really?
• 50:47
  SPEAKER_00: He's he's the greatest scandalous contractor of of the last 50 years.
• 50:52
  SPEAKER_00: Our naughty list is sponsored by Fat Leonard.
• 50:55
  SPEAKER_00: We used to call it the Fat Leonard's naughty list.
• 50:57
  SPEAKER_00: Okay.
• 50:58
  SPEAKER_00: Yes, so that's a great point.
• 51:00
  SPEAKER_00: On on the so on the program side of the house, I couldn't freely uh browse C parts for contractors.
• 51:06
  SPEAKER_00: You should.
• 51:07
  SPEAKER_00: I mean, so I think that the cores, at least if you're a contracting officer representative, you should be able to access the FAPIS system or the PIE system and get that information.
• 51:17
  SPEAKER_00: If not, and then you are on the program side of the house, um, that would be a good question to ask contracting is I'm doing some research.
• 51:24
  SPEAKER_00: Can you give me these CPARs?
• 51:27
  SPEAKER_00: Can you give me what you give me all you got on this company or give me all you got on that company?
• 51:31
  SPEAKER_00: And they should be able to get that for you.
• 51:32
  SPEAKER_00: They'd want to, right?
• 51:33
  SPEAKER_01: Because otherwise they're gonna have to do it themselves later.
• 51:35
  SPEAKER_01: If they thought you already, if they know you already checked it as a core, they'd probably be pleased.
• 51:39
  SPEAKER_01: You're doing a little extra research, right?
• 51:40
  SPEAKER_00: I think so.
• 51:41
  SPEAKER_00: I mean, I I think it may be unusual for some procurement folks because they really only tap into CPARs during a a source election.
• 51:48
  SPEAKER_00: So if a program person's just going up and saying, Hey, I'm doing some market research, I want to I want you to give me what you got on uh on this company.
• 51:55
  SPEAKER_00: Uh it may be unusual for procurement, but it's totally something you should ask.
• 51:59
  SPEAKER_00: Get wacky.
• 52:00
  SPEAKER_00: Get wacky.
• 52:01
  SPEAKER_01: All right.
• 52:02
  SPEAKER_01: Uh next question is from Chase Winham at or at Chass.
• 52:06
  SPEAKER_01: At Chass Winham.
• 52:08
  SPEAKER_01: Okay.
• 52:08
  SPEAKER_01: This is a long one, so read along with me, Will.
• 52:11
  SPEAKER_01: Okay.
• 52:11
  SPEAKER_01: Okay.
• 52:12
  SPEAKER_01: So the Gov competed a prototype OTA with a non-traditional and a traditional provider, and neither article met all the requirements.
• 52:20
  SPEAKER_01: So the Gov chose the non-traditional provider to go with, go, to go forward with.
• 52:25
  SPEAKER_01: Then the non-traditional provider's article catastrophically fails further testing and is showing signs of immature production quality.
• 52:34
  SPEAKER_01: I love the word catastrophic.
• 52:35
  SPEAKER_01: What happened?
• 52:36
  SPEAKER_01: Did someone get hurt?
• 52:37
  SPEAKER_01: I hope not.
• 52:38
  SPEAKER_01: Then the gov decides to relieve some of the requirements.
• 52:42
  SPEAKER_01: Isn't this, hold on, next page.
• 52:44
  SPEAKER_01: Isn't this a complete foul?
• 52:46
  SPEAKER_01: What recourse would the traditional over 70 years positive past performance have in this case?
• 52:51
  SPEAKER_01: Not finding guidance and IT.
• 52:53
  SPEAKER_01: Okay, not finding guidance and I teach FAI and DAU acquisition classes.
• 52:57
  SPEAKER_01: First of all, Jazz, thank you for listening.
• 52:59
  SPEAKER_01: Awesome question.
• 53:00
  SPEAKER_01: We love that it gets into the weeds.
• 53:02
  SPEAKER_01: I'll I'll put a screenshot of his question on the screen so people can read along with us.
• 53:06
  SPEAKER_01: It's a lot here, but man, it's juicy.
• 53:08
  SPEAKER_00: It is.
• 53:08
  SPEAKER_00: So there's a couple, a couple directions we could go.
• 53:11
  SPEAKER_00: Uh so um it the first question, isn't this a complete foul?
• 53:16
  SPEAKER_00: It depends.
• 53:17
  SPEAKER_00: So just from from the from the facts that you gave me on this case, if they were it's the provider to go forward with, if they chose the non-traditional and the traditional provider to both do a prototype contract together, and then they chose the the non-traditional provider to move forward to the production.
• 53:36
  SPEAKER_00: That's one thing.
• 53:37
  SPEAKER_00: If they were doing a another transaction competition for a prototype and they only chose, and it says that first article, so maybe they did first article uh testing or something, and they just chose the non-traditional for the OT prototype.
• 53:50
  SPEAKER_00: Let's go with that first.
• 53:51
  SPEAKER_00: So they didn't award to the traditional company, they chose the non-traditional to move forward with a prototype.
• 53:57
  SPEAKER_00: And then it catastrophically fails.
• 54:01
  SPEAKER_00: Uh further testing.
• 54:03
  SPEAKER_00: If they if it catastrophically failed and they moved into a production contract with that non-traditional company, yes, that that they would be running a foul.
• 54:12
  SPEAKER_00: They would actually be violating statute at that point.
• 54:16
  SPEAKER_00: You cannot move into a production contract unless you determine that the prototype was successful.
• 54:22
  SPEAKER_00: So be so uh I'm I'm assuming that they didn't move into a production, but maybe they relieved some requirements and then they asked them to do the prototype again.
• 54:32
  SPEAKER_00: So that uh I would agree would also run a foul.
• 54:36
  SPEAKER_00: Basically, what they would be doing if they change the perimeters of that original prototype, they would be creating a new prototype OT with that non-traditional company.
• 54:45
  SPEAKER_00: The difference this time, though, is that they didn't compete that new prototype OTA.
• 54:51
  SPEAKER_00: With the first one, they competed it.
• 54:52
  SPEAKER_00: Uh, then the traditional can be upset that they didn't get selected, but they didn't get selected, you can't really protest a selection or non-selection at this point.
• 55:01
  SPEAKER_00: So with the traditional company, assuming that they there's failure, they push forward with the non-traditional and give them the award, that so you would assume then the traditional company could protest and have a good case against the if they give if they give um that tr non-traditional company, if they change the perimeters so much that they're basically changing the nature of the prototype, you could protest.
• 55:26
  SPEAKER_00: The only really thing you can protest OTs at this point so far is a misuse of the OT authority.
• 55:32
  SPEAKER_00: You can't really protest a source selection decision.
• 55:34
  SPEAKER_01: Uh then for the non- for the traditional company.
• 55:36
  SPEAKER_00: So they'd have to show that this is actually a a different um, this is a different uh, this is not the prototype OT.
• 55:43
  SPEAKER_00: Now, if they did uh do a direct award prototype with that company, they just can't move forward with the non-traditional to a production because they technically they changed the the nature of that prototype so much because they were failing with the first one.
• 55:58
  SPEAKER_00: So they're like, all right, well, let's change what's acceptable.
• 56:00
  SPEAKER_00: Then you could argue that, well, when you change what's acceptable to make it more lenient on this non-traditional company, because you catastrophically, hopefully everyone's okay, uh, failed.
• 56:10
  SPEAKER_00: Uh then you're just basically creating a new prototype.
• 56:13
  SPEAKER_00: You didn't compete that prototype.
• 56:14
  SPEAKER_00: So if you move into a production contract, you will be violating uh uh OT authority.
• 56:20
  SPEAKER_00: Uh, and that's grounds for protest.
• 56:22
  SPEAKER_01: Amazing.
• 56:23
  SPEAKER_01: Chas, great question.
• 56:24
  SPEAKER_01: And Chas, if you in your office do want additional OTA training, email us.
• 56:27
  SPEAKER_01: We'd love to talk to you guys more about that.
• 56:29
  SPEAKER_01: We'd love OTAs.
• 56:30
  SPEAKER_01: Or comment more below and let's chat.
• 56:33
  SPEAKER_01: Okay, that's the hit for the week, everybody.
• 56:35
  SPEAKER_01: Thank you for joining us on The Far Is Lava, where we dissect the current procurement news, so you don't have to.
• 56:42
  SPEAKER_01: The Far Is Lava is sponsored by ASI Government.
• 56:45
  SPEAKER_01: If you enjoyed today's episode, be sure to like, share with the comment, subscribe.
• 56:48
  SPEAKER_01: And the toilet to work is by Anne Lent and thank you.
• 56:52
  SPEAKER_01: Produced in collaboration with video podcast leads.