While the Department of Defense’s review of the Pay Our Military Act (POMA) has put most furloughed DoD civilians back to work, the guidelines on paying defense contractors aren’t so clear.
A Congressional Research Service report outlines DoD operations during the government shutdown, noting that certain civilian and contractor personnel would continue to be paid on time as a result of POMA.
The report openly admits that the status for contractors is confusing, noting “While some new contract obligations to support “excepted” activities could be signed, monies could not be disbursed while other new contracts would be delayed.”
Multi-year contracts with already appropriated funds will continue. The Department of Defense is also able to sign new contracts for goods funded with FY2014 funds, but only for those deemed essential to military options. And no actual funds could be distributed (so Uncle Sam would basically be saying ‘ the check is in the mail’ – payable when the government is up and running again).
Appropriations that expire during the shutdown don’t mean a termination of the contract or even a stop-work order – unless a new obligation is required, in which case, the issuance of a stop-work order or a termination will be required.
The language concerning ‘excepted’ activities is in some eyes as arbitrary as the ruling as to which positions are ‘essential’ and ‘non-essential’ in the workforce. POMA leaves some discretion within military commanders to determine which activities are critical to national security, including the flexibility to add new programs if the security situation changes.
As the government moves toward its third week of a shutdown, it seems the landscape for the defense contracting community remains a bit murky. The good news is that contracts are still being awarded – even if the date of payment remains uncertain.
