Government Contracts Monitor

Short Take: You Can’t Buy a Federal Contract

August 31, 2015

Sandia Corporation, a wholly-owned subsidiary of Lockheed Martin, has agreed to pay $4.8 million to resolve allegations that it violated the Byrd Amendment and the False Claims Act by using federal funds for activities related to lobbying Congress and federal agencies to obtain a renewal of its Management and Operating contract with the Department of Energy (DOE) to operate the Sandia National Laboratories. Justice Department Announcement.

Between 1993 and the present, DOE contracted with Sandia to manage and operate the Sandia National Laboratories, a government-owned, contractor-operated facility. Between 2008 and 2012, Sandia allegedly used federal funds to lobby Congress and other federal officials to receive a non-competitive extension of its Management and Operations Contract in violation of a federal law known as the Byrd Amendment, which prohibits the use of federal funds for lobbying.

The Byrd Amendment provides that “None of the funds appropriated by any Act may be expended by the recipient of a Federal contract, grant, loan, or cooperative agreement to pay any person for influencing or attempting to influence an officer or employee of any agency, a Member of Congress, an officer or employee of Congress, or an employee of a Member of Congress in connection with any Federal action” such as “The awarding of any Federal contract… The making of any Federal grant …The making of any Federal loan … The entering into of any cooperative agreement … [or] The extension, continuation, renewal, amendment, or modification of any Federal contract, grant, loan, or cooperative agreement.”

As stated by the head of the Justice Department’s Civil Division, “The money allocated by Congress for the Sandia National Laboratories is designed to fund the important mission carried out by our national laboratories, not to lobby Congress for more funding.”

This case, as mentioned by a DOE official, reminds us that “Using public funds to lobby for a non-competitive extension of a contract is simply unacceptable.”

Attorneys

Lindsay Simmons