Retreadfed

Many people do not have landlines at home. With so many people working from home, landlines are frequently not available.

This may be a symptom of a change in society as a whole. Texting seems to be the preferred method of communication among younger people today.

And the government has a duty to respond to such an inquiry. If there is an ambiguity that is brought to the government's attention and the government does not respond adequately and timely the contractor's reasonable interpretation of the contract will prevail. The fact that the time for asking questions may have passed does not relieve the government of this duty.

Does the RFP say anything about subcontractor travel? Does the RFP indicate that subcontractor travel costs are covered by the place holder amount stated in the RFP? If the RFP does not indicate that subcontractor travel costs are covered by the place holder amount, I think that you do not have to require subs not to include travel in their proposals. Are you showing subcontractor costs in your proposal? If so are they included in CLINs other than the travel CLIN? Travel costs incurred by a sub are a cost of providing whatever you are delivering to the government. If the RFP does not require subcontractor travel costs to be included in the travel CLIN, why not put all subcontractor costs in the FFP CLINs? If you do this, I would try to make the subcontracts FFP.

Fob, you mentioned a "commercial contract." Are you talking about a government contract for commercial products/services? If so, is FAR 52.212-4 in the contract? If 52.212-4 is in the contract, why can't you use (c) and possibly (f) to solve your problem?

What would be the nature of the termination, e.g., default, convenience, etc.? Does the documentation for the "contract" contain any language regarding termination? Finally, do you actually have a contract in place?

Generally not. Subcontractor fee/profit is a cost to the prime contractor. However, I have seen some contracts, particularly those awarded by Navy activities, where subcontractor fee is to come out of prime contractor fee. The clauses that require this are local clauses and are not from the FAR or DFARS. Therefore, read your contract to see if it says anything about subcontractor fee/profit. As an aside, fee is not a consideration in regard to T&M labor rates. Those rates contain a profit element that is a part of the overall hourly labor rate.

Compare the notice requirements in the language you quoted and those in 52.232-22. The language you quoted seems more appropriate for a fully funded contract. Also, in my opinion, 52.232-20 should be in the contract to cover the contract when it becomes fully funded.

Note that if the work the contractor is to do is reduced either through a change order or partial convenience termination, an equitable adjustment may be in order. Read the Changes clause and T4C clause that is in your contract.

Does the contract contain FAR 52.232-20? If so, how do you reconcile that clause with what is quoted above? Is the quoted language from a deviation to the FAR?

What do you mean by "requirements"? To me, that refers to the work the contractor is to do. Therefore, a change in the work the contractor is required to do could be implemented by a deductive change order or a partial termination.

There are two thoughts here. First, you seem to be saying that the cost or pricing data has to support the price proposed. I disagree with that premise. The price proposed does not have to be based on the cost or pricing data disclosed to the government, although contractors frequently do so. All the contractor has to do is disclose the data to the government in a manner that reveals the significance of the data to the particular procurement. That leads to the second thought concerning the format in which cost or pricing data is submitted. The solicitation provisions in the FAR and DFARS both refer to FAR Table 15-2 as the default format for submission of cost or pricing data. As an alternative, the contracting officer can permit another format to be used. As long as the contractor submits cost or pricing data in the format required by the solicitation, I think the contractor is good to go and the contracting officer should have no complaints because the contractor has done precisely what the contracting officer asked it to do.

I agree and that is done through fact finding and discussions with the contractor. The purpose of submitting cost or pricing data is to place the government on the same footing as the contractor in regard to what is a reasonable price. Nothing in the statute or FAR requires a contractor to base its price on the cost or pricing data the contractor submitted to the government. The fact that a contracting officer finds it difficult to determine what is a reasonable price based on an analysis of the same data the contractor has is not the contractor's problem. That is where support from DCAA, DCMA, cost/price analysts and technical folks comes into play. In many cases, the contracting officer should not try to analyze the cost or pricing data on his/her own, but should get help from people who specialize in such analysis.

On what basis? What says, the proposed price has to match cost or pricing data plus profit/fee? Isn't this what negotiations are for? Remember, you are generally dealing with a sole source.

I don't think you can go wrong by relying on the definition of "contractor" found in the CDA (41 U.S.C. 7101) that contractor "means a party to a Federal Government contract other than the Federal Government."

Z-Mil, note that FAR 44.101 starts "As used in this part." Thus, the definitions that follow only apply to Part 44. They do not apply to other FAR parts.

Joel, in this hypo, all the data the contractor has (e.g. time cards, production data, etc.) was disclosed to the government. The issue is that there are various ways that data can be analyzed. The contractor chose one way that leads to a specific result. However, the government has the same data as the contractor and can analyze it the way the contractor did or use another analytical method. In any event, the contractor's duty in regard to cost or pricing data ended when it disclosed all the data it had. The contractor is not responsible for what, if any, use the government makes of that data. The proposed cost is not cost or pricing data and a contractor does not certify its proposed price. Instead, the contractor certifies the cost or pricing data it disclosed to the government. For there to be defective pricing, the contractor must have failed to disclose current, complete and accurate cost or pricing data. Here the data disclosed met that test. Out of curiosity, if the contractor merely disclosed the lower quote and did not provide any explanation as to why that subcontractor was not going to be used, would defective pricing exist?

Not quite. While all reasonably available cost or pricing data needs to be submitted and certified, the contractor does not have to use any of that data in formulating its proposed price, although, in my experience, many do use that data and base their proposed price on that data. However, such use is not required. As a DCAA auditor once testified in a deposition, a contractor can base its proposed price on the square root of the distance from the Earth to the Moon if it wants to.

Fara, I think the issue goes deeper than profit. Two examples, in the first case, contractor X looks at the actual labor costs incurred to perform a previous contract for the same item being procured. X uses the actual cost data in developing its proposed price and discloses that data to the government. However, if a learning curve analysis is applied to the data, it would become apparent that the per unit cost for later procured items is less than the average unit cost computed using the actual labor costs. Using Joel's analysis, the contractor would be required to use the learning curve data to develop its proposed price instead of the actual labor cost data. Example 2, Y has used a particular subcontractor for a part for several years. When preparing a proposal for a government contract, Y discovers a potential new supplier for that part who can provide the part at a cheaper price. Y is not certain that the new supplier can provide and acceptable part within the time required by the potential contract. Y discloses the lower quote from the new vendor, but relies upon prices quoted by its usual supplier in developing Y's proposal. The way I understand Joel's position, Y would be required to base its proposal on the new and lower quote although Y does not intend on using that vendor.

I recall that OFPP memo. I'm glad you referenced it. Unfortunately, many contracting officers believe the government is always right and that certain contractors are bad actors. However, consider this real life incident. Years ago a clothing and textile contractor was lodging several complaints against the award of contracts to other contractors all of whom were small businesses. It turned out that the contracting officer was engaged in a pay to play scheme where he demanded kickbacks for the award of contracts. For example, the CO demanded $0.50 for each shirt awarded in a contract. When the contract called for millions of shirts, that added up. All the suppliers, except the complainer, were eventually debarred and many convicted. The CO got the longest sentence imposed on a Federal official for procurement fraud, 7 years in prison. This left only the complainant as the remaining supplier for military uniforms. Large businesses, such as Levi's did not want to pick up the slack because eventually the procurements would be set aside for small businesses. One CEO actually attempted suicide. Maybe sometimes contractors that the government considers whinners are actually correct.

You are. His interpretation is unreasonable. If it is to be used whenever a procurement is funded with appropriated funds, there would be no need to reference the ARRA.

" the complaint seems to allege that Martin-Baker's certificates of cost or pricing data were false because the company failed to use historical actual costs during negotiations with the government. Yet we have found no case or regulation — nor has Williams pointed to any — requiring the use of such data during negotiations. Instead, aiming to put negotiating parties on equal footing by mandating disclosure of cost data, the FAR and TINA only require that contractors identify and make the information available to the government. See, e.g., Hughes Aircraft Co., ASBCA No. 30144, 90-2 BCA ¶ 22,847, 1990 WL 42047 (1990) (stating that a contractor is not obligated to use cost data so long as the government has the option of analyzing the data). Having done so, negotiating parties need not reach agreement based on the disclosed data. Id." U.S. ex re. Richard Williams v. Martin-Baker Aircraft Co. LTD., et al., 389 F.3d 1291 (D.C. Cir. 2005). If you have access to the Hughes case, I suggest everyone read it as it is a good primer on cost or pricing data. Also, see United Technologies Corporation, ASBCA Nos. 51410, 53089, 53349 (Feb. 27, 2004), where the Board said "the government contends that appellant violated its obligations under TINA by failing to use certain cost or pricing data in its BAFO. We reject this contention for a number of reasons. The plain language of the Act does not obligate a contractor to use any particular cost or pricing data to put together its proposal. Indeed, TINA does not instruct a contractor in any manner regarding the manner or method of proposal preparation. TINA is a disclosure statute. It requires a contractor under certain circumstances to disclose and to furnish cost or pricing data to the government and to certify that the data are accurate, current and complete. . . . once a contractor has furnished accurate, current and complete data, it has fulfilled its TINA obligations. The statute does not require that all or any of that data be used to prepare the proposal. One would think that any contractor with the desire to obtain a contract award would use credible, historical cost data so as to demonstrate to the government that its proposed price is consistent therewith. However this is a matter for the contractor to decide, and for the Government to evaluate as part of the proposal review process, and is not a mandate under TINA." Atlas is dealing with a DoD contract. DFARS 215.408 states in part "When reasonably certain that the submission of certified cost or pricing data or data other than certified cost or pricing data will be required or when using the provision at 252.215-7008 -(i) Use the basic or alternate of the provision at 252.215-7010, Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data, in lieu of the provision at FAR 52.215-20." Despite this requirement, Atlas states that DFARS 252.215-7010 is not in the RFP. However, ATLAS stated DFARS 252.215-7008 is in the RFP. That provision requires submission of cost or pricing data in accordance with the version of DFARS 252.215-7010 incorporated in "this solicitation." Because 252.215-7010 is not in the solicitation, we don't know what the submission requirement actually is, if any. FAR 31.102 and 103 provide guidance to contracting officers. They do not apply to contractors or tell contractors how to prepare proposals. Also note there is an inconsistency between 31.102 and .103 and FAR 15.404-1(c)(2). Part 31 says the government shall apply the cost principles when conducting cost analysis while 15.404-1 makes such use discretionary. Proposed costs are not cost or pricing data. Nothing in 15-2 tells a contractor how to prepare a proposal. The purpose of TINA is to establish a level field for price negotiations by requiring a prospective contractor to furnish factual cost or pricing data significant to the price negotiations known to it so that the contracting officer will have the same knowledge during negotiations. M-R-S Manufacturing Company v. United States, 203 Ct. Cl. 551, 563-64, 492 F.2d 835, 842 (1974).

You don't have to prove that it is complete. The government has to prove that it is incomplete. As stated before, "complete" simply means you provide the government with the cost or pricing data you have. There is no other standard for determining completeness. You seem to be worried that there is some data that you are required to have. There isn't. You have policies and procedures that state what data you accumulate. If that data meets the definition of cost or pricing data, that is what you submit. Some people have the misperception that contractors have to base their proposed prices on the cost or pricing data they submit to the government. As a general rule, contractors can base their proposed prices on whatever they choose. The proposed price can merely be what the contractor feels is a reasonable price. That price does not have to have any correlation to the cost or pricing data submitted to the government.

Atlas, Joel is giving you some good information. You need to understand that you do not have to base your proposal on the cost or pricing data you have and submit to the government. Your only obligation is to submit that data to the government in a meaningful way, i.e., in a way so that the government is placed on an essentially equal footing with the contractor in regard to making judgments as to what would be a reasonable price. Also, look at the definition of cost or pricing data. It only involves facts that could reasonably be expected to have a significant impact on price negotiations. For example, the B-52 has been around since the 1950's. It is obvious that cost data from the 1950's would not be relevant in regard to a contract to be awarded today and would not be considered cost or pricing data. Finally, you do not certify your proposed price (your proposal is not cost or pricing data) nor do you certify the price you agree upon with the government. Instead, you certify the data that relates to the acquisition.

Atlas, you are misreading this provision. It clearly does not exempt any potential contractor from being required to submit certified cost or pricing data. Note that this sentence states that an offeror "may submit a written request for exception" from the requirement to submit such data. This sentence identifies some of the information that is to be included in any such request. One of the bits of information that an NTDC is required to submit is a statement by an NTDC that it meets the criteria to be considered an NTDC. However, as a condition precedent to an NTDC being able to request an exception under DFARS 252.215-7010, the government must have first determined that the supply or service to be provided by the NTDC is considered to be a commercial product or service as described in DFARS 252.215-7013. Note that this clause references 10 U.SC. 3457. That statute states " products and services provided by nontraditional defense contractors (as that term is defined in section 3014 of this title) may be treated by the head of an agency as commercial products and commercial services, respectively, for purposes of" the requirement to submit certified cost or pricing data. Also, see DFARS 212.102 which says that contracting officers "may treat supplies and services provided by nontraditional defense contractors as commercial products or commercial services." Thus, there can be no doubt that the decision to treat supplies or services provided by an NTDC as commercial rests with the government and not the contractor. By permitting an offeror to submit a request, the clear implication is that the government may deny the request and require the submission of certified cost or pricing data. Again, this is an inaccurate statement. The exceptions to the submission of certified cost or pricing data are set forth in 10 U.S.C. 3703. These statutory exceptions are restated in FAR 15.403-1. Notably, there are more exceptions listed in the statute and FAR than are mentioned in 252.215-7010. Neither the statute nor the FAR mentions an exception for NTDCs. Further, neither provides an exception for any contractor that is not performing or has not performed a CAS covered contract. Because the exceptions from the requirement to submit certified cost or pricing data are statutory, the DFARS cannot create an additional exception without statutory authority. DFARS 252.215-7010 does not create an exception for NTDCs. Instead, it allows the government to apply the commercial product/service exception to items provided by NTDCs when DoD has decided to treat such items as commercial in accordance with 10 U.S.C. 3457 and DFARS 212.102. You meet this requirement by giving the government everything you have relating to a proposed contract. If you don't have something, you don't have it. You merely have to give the government what you have in the form you have it. You do not have to create anything for the government in this regard.