Retreadfed

3 hours ago, Krimz said:

(a) The Contracting Officer may, at any time,

I would say that the FAR coverage  in this regard is poorly written and interpreting "at any time" literally produces an absurd result in that such an interpretation permits the government to issue change orders in regard to the work until infinity even after the work becomes government property.  Obviously, this is not what was intended.  Further, such an interpretation would allow the government to ignore statutes like CICA, by simply issuing change orders to a completed contract in perpetuity to obtain work that should be accomplished under a new contract.  Also, hanging your hat on these works ignores the effect acceptance has on the contract.  Once the work becomes government property, the contractor no longer has any responsibility for the work unless there is a clause in the contract, such as a warranty clause, specifically imposing such responsibility.

If I refuse to perform, what are you gong to do to me, issue a T4D?  A T4D is a government claim and you would have the burden of showing that the contractor was in default and the T4D is justified.  

Also, how would you defend a protest by a third party that the change order is an illegal sole source contract?

22 hours ago, Krimz said:

I do not know of anything that explicitly prohibits changes (of any kind) after final payment/acceptance.  

Maybe you need to take the issue of final payment up with Jamaal.

22 hours ago, Krimz said:

To be more specific, there are plenty of things that might preclude a change, but I don't know of anything that prohibits it.

If you were the contracting officer and received an objection to a proposed change order, such as what I provided, what would your response be other than "I don't know of anything that specifically prohibits the change order"?

23 minutes ago, Krimz said:

You mentioned change order, so that's what I was replying to, but the same goes for general contract modification.

You conditioned your assertion on the change being within the general scope of the contract.  So let's explore that.  For both fixed price and cost reimbursement supply contracts, the respective clauses allow for the following changes  

(1) Drawings, designs, or specifications when the supplies to be furnished are to be specially manufactured for the Government in accordance with the drawings, designs, or specifications.

(2) Method of shipment or packing.

(3) Place of delivery.

Under (1) the government is permitted to change the specs for supplies if the supplies "are to be" produced in accordance with those specs.  This language is prospective.  This is significant because acceptance of supplies transfers title to the government.  Thus, once the government has title to the supplies, w are no longer talking about manufacturing those supplies.  Instead, if something is to be done to those supplies, it seems the government would want to be modifying its property.  This would be a new requirement, i.e., modification vice manufacture, that needs to be accomplished under a new contract. 

 On the other hand, if the supplies are not to be manufactured in accordance with specified specs, those specs cannot be changed.  What can be changed is the item to be delivered.  Again, if you are substituting one item for another, i.e., a Ford for a Chevy, it seems this would be a new procurement.

Turning to (2) and (3) once the accepted supplies have been delivered, how is the government going to make the changes described there?  Again, if the government wants to move its property from point A to point B, it seems this is a new procurement.

In regard to services, similar considerations apply.  Once the services have all been performed satisfactorily, it seems if the government wants more or different services from the contractor, a new contract or order would have to be issued.  In other words, the government could not use a change order to a completed contract to acquire new services.

As regards, mods in general, I would say there is no absolute answer.  Some mods, such as final cost determinations under cost reimbursement contracts could be permissible, but others such as a T4C may not be.

52 minutes ago, Krimz said:

A counterquestion:  what prohibits a CO from modifying a contract after final acceptance and delivery/performance of a contract?  As long as the change is within scope, I'm not sure it's prohibited.

Are you asking about modifying a contract or issuing a change order under the Changes clause?  These are not necessarily the same thing.  

On 4/30/2024 at 3:56 PM, BlaineTheMono said:

Considering OHA’s apparent disinterest in entertaining a NAICs code selection on a TO, what options are available to industry to potentially prevent the OCO from selecting an inappropriate NAICS and Pool unrelated to the work simply because it has a larger Small Business size standard?

In addition to what others have written, you can still file a NAICS protest with OHA and if unsuccessful, file an "appeal" with the Court of Federal Claims asserting the proposed order is outside the scope of the contract.

Jamaal, lets back up a little.  Birdsong asked "Can an extension be done after the PoP of the delivery order has ended?" to which you replied "yes."  I have no problem with that answer.  Later you stated "Keep in mind, changes may be made to a contract at anytime before final payment on the contract."  I then asked about the timing of issuing "change orders."  Thus, we may be talking past each other.  Your statement is rather broad and could include changes that are not change orders under the Changes clause.  My question relates specifically to change orders under the Changes clause although I did not mention the Changes clause in my earlier post.

1 hour ago, REA'n Maker said:

Are you talking about modifications citing the Changes clause as the authority, or any modification? 

Change orders under the Changes clause.

1 hour ago, REA'n Maker said:

Other Than Firm Fixed Price (CPFF, etc.).  Also see FAR 42.705.

Can you be more specific?  There are several contract types that are not FFP that do not require the establishment of final indirect cost rates.  However, in regard to cost reimbursement contracts, I don't see anything that ties the establishment of final rates to the government's ability to issue a change order to a contract.  FAR 52.216-7 doesn't mention change orders.  Similarly, 52.243-2, the cost reimbursement Changes clause doesn't mention final indirect cost rates, although it does state that any request for an equitable adjustment resulting from a change order must be submitted before final payment on the contract.  Further, the Changes clause does not specifically address when a change order can be issued.  It uses the phrase "at any time" which implies until infinity which I hope no one would argue for.

1 hour ago, REA'n Maker said:

How do you handle a final rate determination on a physically complete OTFFP contract

What do you mean by OTFFP contract?  That is a new one on me.

3 hours ago, Vern Edwards said:

What will you accept as "authority"--statute, regulation, policy, case law, expert opinion? Any of those? Some of those?

Ideally, case law.  I learned a long time ago that statutes, regulations and contracts mean what the courts say they mean.  Absent case, law, a statute or regulation.

7 hours ago, Jamaal Valentine said:

Keep in mind, changes may be made to a contract at anytime before final payment on the contract.

Do you have authority for this statement?  I have always contended that the government cannot issue a change order after final acceptance and delivery/performance of the contract.

21 hours ago, RJ_Walther said:

if the Government maybe just doesn't need the widgets until 12 months from now and then will only need 250 per month thereafter (which would seem to make it a need for future fiscal years). 

Maybe maybe not.  The issue is when does the need arise not when it will be met.  In any event, we don't know what Birdsong's concern is with the order crossing 2 fiscal years.  It might be a valid concern or it might not.  We just don't know.

2 hours ago, Voyager said:

I'm not arguing - I'm inquiring.  I'd like to know your answers to my questions.

Your "questions" were directed toward H2H.  Maybe he knows what you are asking, but I don't, because I don't see a question.  You wrote "what if" and "or say" then set out facts, but don't say what the question is.  Can you rephrase your questions?

Voyager, what is your point?  Are you arguing that profit is a cost of a contractor?

43 minutes ago, Atlas STS said:

However, learning that TINA also mandates the weighted guidelines method and limits profit to 10-15% at the end of this process was not a fun surprise!

That is not a true statement.  The Truthful Cost or Pricing Data statute (10 U.S.C. 3701 et seq. for DoD) only requires contracting officers to obtain current, complete and accurate cost or pricing data from contractors.  It says nothing of weighted guidelines or limits on profit. 

15 hours ago, Birdsong said:

Am I correct, that the funding will need to be good until the last delivery is made?

What do you mean by "good" in this statement?  If you are using appropriated funds, they must be obligated within their period of availability for obligation.  Once obligated, they remain available for expenditure until five years after the period of availability for obligation expires.  

15 hours ago, Birdsong said:

My concern is the order crosses 2 fiscal years. 

Why are you concerned if the order is for supplies?  

What is the TO for (supplies, services, etc.) and what is the period of availability for obligation of the funds used for the TO?

28 minutes ago, Don Mansfield said:

The Weighted Guidelines method is required in some instances for the Government to arrive at a prenegotiation objective, but it does not limit what a prospective contractor can propose.

Nor does it limit the government in what it can agree to.  As Don pointed out, the weighted guidelines are supposed to be used to establish a negotiation position, not a limit on profit.

2 hours ago, Deathdealer said:

I have a question...

"unallowable base costs are to be included in the base for calculation of indirect cost rates."-This is so the receive their share of the pool costs, correct?

Incorrect.  Unallowable base costs are to be allocated to cost objectives (contracts) although they may not be recoverable on those contracts.  Despite what FAR 31.203(d) states, indirect costs are allocated to contracts, not base costs, based on the amount of base costs allocated to those contracts.  See, Rice v. Martin Marietta, 13 F.3d 1563 (Fed. Cir. 1993) for a discussion of how 31.203(d) works.

3 hours ago, Deathdealer said:

"if overhead is a part of the G&A base"-This would be the case in a TCI base, correct?

Yes, but that is not the only G&A base where that would be true.

3 hours ago, Deathdealer said:

"However, unallowable overhead costs are to be excluded from the overhead pool for calculation of the overhead rate."-This is so direct projects do not receive a portion of the unallowable costs.

I don't know what you mean by "direct projects."  Despite being unallowable, unallowable costs are allocated to contracts.  See FAR 32.202-1, 201-6 and CAS 405.  The reason for excluding unallowable pool costs from an indirect cost pool is to ensure that unallowable costs are not billed to the government on contracts subject to the cost principles and/or CAS 405.  

2 hours ago, Deathdealer said:

"unallowable overhead costs are to be included in the overhead pool for calculation of the G&A rate"-This has me confused. 

This may be poorly worded.  Perhaps a better statement would be that unallowable overhead costs are to be included in the G&A base for calculation of the G&A rate.

On 4/15/2024 at 4:39 PM, EGovCon said:

We have recently graduated from a small business to a large business and a modification was completed to our GSA schedule to include a small business subcontracting plan. 

I don't understand your situation.  You state that you "graduated" to a large business.  Were you an 8(a) participant that graduated from that program?  Is FAR 52.219-28 in your contract?  If it is, were you required by the terms of that clause to recertify your size status?  If you were, what was the basis of the recertification?  Was the requirement to submit a subcontracting plan accomplished by including FAR 52.219-9 in your contract?  Was the effective date of the modification requiring a plan the effective date of your contract or some later date?

29 minutes ago, Vern Edwards said:

Remember when some people insisted that a T&M contract was a kind of cost-reimbursement contract.

You mean like Eleanor Spector in her guidance on prompt payment?

1 hour ago, Vern Edwards said:

Maybe DCAA has a different definition of "allowable".

Having worked for DCAA for 15 years I can tell you that it is a very inward looking agency.  Unless things have changed drastically, it refuses to allow its auditors to receive procurement training from anyone outside DCAA.  Thus, DCAA perpetuates its own views of procurement policy, including interpretations of the FAR.  In this regard, 52.232-16 never uses the term allowable, neither does the SF 1442 nor the instructions for that form.  Instead, the 1442 and its instructions use the term "eligible."

15 hours ago, Vern Edwards said:

Presumably, the contractor will want some kind of revenue flow during performance unless its is willing to provide its own financing. So it seeks progress payments based on costs, which will be anchored to the Government's maximum liability. See 52.232-16.

Thanks for the response.  This is what I was thinking would be the situation.  It was the use of the word "allowable" that had me spun up since to me, allowable denotes application of the cost principles in FAR Part 31 while 52.232-16 does not incorporate the cost principles.

20 hours ago, Vern Edwards said:

The contractor works pending price agreement and will be entitled to compensation for allowable costs incurrred until the parties reach final price agreement. 

Vern, I'm confused by this statement.  Can you clarify it for me.  Are you saying that as work progresses on the UCA, that the contractor can bill the government for its incurred allowable costs?  I see that if FAR 52.216-26 is in the UCA, however, if the definitized contract is anticipated to be FFP, 52.216-26 should not be in the UCA.

On 3/30/2024 at 1:38 PM, formerfed said:

Except many government payment systems won’t allow invoice payments exceeding the CLIN amount.

Why have we allowed ancillary systems to be designed so they cause more work for contracting officers that may not be necessary or consistent with contract terms?