JFCOM contractors await closure details

Tuesday - 2/22/2011, 7:53am EST

WFED's Jared Serbu

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By Jared Serbu
Reporter
Federal News Radio

Leaders of the Joint Forces Command (JFCOM) in southern Virginia will meet with vendors Wednesday as they begin to lay out the process of ending service support contracts in preparation for the command's eventual closure next March.

The industry day will focus on the "transition of remaining missions as well as the associated approach to ending or transitioning support contracts," according to a notice posted on the command's website.

Contractors will be hit especially hard when the command closes as part of Defense Secretary Robert Gates' efficiency initiative. Although military and federal civilian jobs will mostly be protected - either transferred to a new, smaller command that will replace JFCOM or moved into other parts of DoD - the Pentagon plans to eliminate approximately 80 percent of the contracting workforce. Of the 2,300 jobs the department is eliminating as part of the closure, 2,000 are held by contractors, JFCOM commander Gen. Raymond Odierno said in early February.

Up to this point, vendors have been frustrated because DoD has not given specifics about which jobs will be on the chopping block, said Butch Bondoc, a consultant who works with contractors in the Hampton Roads community around JFCOM. Contractors and members of Congress have complained that precious few details have emerged about the command's closure since Gates first announced his intent to shut it down last August.

"The contractors know the numbers, they know the percentages, but every single one of them want to know, 'which chair are you going to empty?'" Bondoc said. "Like any good company, you'd like to be able to say to your people that you're going to follow up and give you a job after this one goes away. But you don't know that when you don't know which people you're losing. If you employ 10,000 people and you don't know if you're affected, you don't know what to promise. You don't know what to plan for. Nobody can make a plan until the general announces who's losing their job. It's causing a lot of anxiety and a lot of frustration in the area."

Bondoc helped organize a job fair for contractors last week. He's hopeful that most of the soon-to-be-former JFCOM workers can find other jobs. DoD has set aside $500,000 that it will give to the commonwealth of Virginia to help with job transition programs.

Bondoc said the firms that provide services at Joint Forces Command are both large and small companies, including some of the world's largest, most recognizable corporate names as well as small, specialized companies with only a handful of contracts.

"The jobs are anywhere from top secret jobs for analysts, scientists, top secret and secret jobs for engineers, technicians, even down to administrative functions," he said. "All these jobs are filled by contractors who thought they had a secure contract with Joint Forces."

Other big questions swirl around the termination of contracts, both the timing and the terms.

Terry Murphy, who leads the government contracts practice group at the Hampton Roads law firm Kaufman and Canoles said he's already getting questions from clients who are worried they'll be on the termination list.

"We've been getting calls saying 'what do I do with this lease now? How do I get out of this lease?' And at the same time some of our real estate clients are being presented with tenants that say, 'yes I'll lease the space, but I want an out, because if the funding for this JFCOM contract doesn't come through I don't want to be on the hook for a lease,'" he said. "I'm hopeful that our contractors can adapt and find business in the remaining sections of JFCOM or in the other variety of DoD components that we're fortunate enough to have here in Hampton Roads."

Murphy said a great deal of effort will be expended in the coming months figuring out how the contracts will come to an end. JFCOM will have to wind down each of the contracts it is terminating, and negotiate terms with each vendor, he said.

"Unlike a private contractor, a government contractor has to sign up to the federal acquisition provisions that allow the federal government to terminate a contract at the government's convenience," he said. "That's a termination without cause. The applicable regulations in the federal acquisition regulations provide that there will be a termination of convenience settlement negotiated between the government and the contractor so the contractor will be made whole for what he's expended. But he's not going to get paid for work that he doesn't do. I anticipate we'll see a lot of terminations for convenience coming down the line."