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joel hoffman

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  1. joel hoffman

    U.S. Code Reference for Paying for Services

    Thanks for your research, Neil. The OP can google: "advance payment US federal law" or something similar. It's the Second hit on the page.
  2. Clear and concise for both government and industry.
  3. Agree. Vern, I forgot about the two-step sealed bid in method. In fact, my very first design build project was in 1971 with the Air Force at Castle Air Force Base California. The Air Force use the two-step sealed bid method for design and construction of a military family housing project. The first step allowed Air Force to evaluate the acceptability of the various proposed designs. I think that they did conduct some kind of discussions and allowed the firms to correct their design proposals. The contract was awarded to the lowest bidder in step two. All units were back to back duplexes with carports. The exterior architecture of the 250 homes reflected the low bid mentality of this acquisition method (T-111 plywood and batten siding, no eaves or roof overhangs). It was the only allowed way to acquire design build construction at that time. Still, it was ahead of its time and the interiors were at least as good quality as most of the military’s then latest design-bid-build housing stock. The Navy used two-step sealed bidding extensively for design-build construction up through at least the late 1990’s.
  4. Hey, Jamaal. I was wondering myself whether there may be a situation where not every individual factor or sub factor had to pass some acceptability minimum criteria for overall acceptable rating. For your hypothetical situation, perhaps one could use a trade-off with price as substantially more important than technical. They can state that they intend to award on the basis of initial offers without discussions but reserve the right conduct discussions if necessary. How all this relates to discussion of what fair and reasonable” , I don’t know. The point that I originally tried to make was that what a buyer is willing to pay depends upon their priorities. I said that , when using the LPTA method, price is more important than providing any more value than minimally required for acceptability, if it will cost more than just meeting the governments requirements. Thats the way the design and construction industry understands it. If there is sufficient interest in the project, product or service, then the competitors should be sharpening their pens. Hopefully, the buyer has some idea how much the requirements might be purchased for. If they don’t have any independent clue, they will probably rely on the prices received. Depending upon the technical complexity of the project, product or service and the number, dollar spread and distribution of offers, when the lowest priced offer is acceptable, it may be a good idea to at least read or review a higher priced offer to validate that you are comparing apples to apples. If the first technically acceptable offer isn’t the lowest priced, you will already have some comparables for cost and technical. You might be able to correlate what price effect the deficiencies had on the price of those offers for comparison with your ffirst technically acceptable offer. There would likely be no need to examine any higher priced technical proposal. Then, depending upon how much flexibility you allowed yourself in the stated evaluation criteria and basis of award and other factors such as time available and offered prices vs. your budget, you could decide whether it would be advantageous to develop a competitive range and conduct discussions. If you are satisfied with the price of your first technically acceptable offer, you would likely just award. But If some or all of the lower priced but deficient proposals might be susceptible to being corrected without significantly upward affecting their price, it might be worth conducting discussions. Of course, then you might well have to consider whether it is necessary and/or advantageous to include any higher priced offerors in the competitive range. For construction projects with LPTA, I hesitated to recommend opening discussions when it would involve including higher priced initial offers. Conducting discussions in an LPTA could signal to the industry that they might be able to not submit their best price initially in hopes of getting a second bite of the apple. Some firms expressed their surprise in feedback. Awarding without discussions let them know that the government was serious about sharpening their initial prices. The only times we conducted discussions in LPTA was when’re didn’t get affordable pricing or when it was deemed advantageous to allow lower priced offeror(s) to cure their deficiencies. Vern alluded to the IFB method for relying on competition to sssure substantiate or validate fair and reasonable pricing without any regard to technical evaluation. I would agree - with the caveat that in IFB, it isn’t deemed necessary to examine or assure the government that the lowest bidder will likely meet the solicitation’s technical or other requirements, other than a routine responsibility determination. Competitors are competing strictly on lowest price basis. If there isn’t any need to do that, then it should not be necessary or appropriate to use LPTA. Use IFB. My LPTA perspective is based primarily on construction contracting. The nature of buying supplies and materials and routine services based upon pricing is a different animal when it comes to pricing plus it is often possible to research the web for prices. I found that acquiring more complex services is just that - more complex .
  5. Jamaal,, if every non-price factor in an LPTA acquisition must be rated “acceptable” for a technically acceptable rating, then each technical factor is equally important. Yes, indeed - see Chenega Federal Systems LLC. They are not individually “weighted”. By weighted, I mean either numerically or percentage weighted or differentiated using statements of relative importance. Where does Far 15.101-2 discuss any comparison between factors.? Yes, I think that the LPTA acquisition method is an exception to the statutory rule that if not otherwise stated, the relative importance between cost and other than cost factors when combined are equal. That is under FAR 15.101-1 for trade-off competitions. FAR 15.101-2 says, instead, that “Solicitations shall specify that award will be made on the basis of the lowest evaluated price of proposals meeting or exceeding the acceptability standards for non-cost factors.” It is not possible for technical acceptability to be equally important as price in a competitive selection of the successful proposer with LPTA, when more than proposer is rated technically acceptable (or exceeding acceptable standards) . The discriminator for selection between technically acceptable offers is price . I don’t know how to make it any clearer than that. Lowest evaluated price wins. Industry knows it. Again, read Chenega, for example. Actually, I suppose they can only be equal if all technically acceptable propiosals are equally priced. Then, I don’t know what would be the final discriminator. Even when we provided a ceiling price in construction or design-build construction competitions when using LPTA, the competitors would usually propose some number that was lower or nominally lower than the ceiling price.
  6. Jamaal, just to clarify, the LPTA method is outlined in 10 USC 2305 (a)(4)(B). There is no relative importance of factors assigned in this method. It is described in FAR 15.101-2 The relative importance of factors including price and non-priced is required for the Trade-off process. See 15.101-1 for that specific requirement.
  7. Des, I wasn’t saying that all proposals are technically acceptable. If there are more than one, then lowest price is the discriminator for award.. Let me put it another way by asking you a couple of questions. Am I correct in assuming that you don’t want to pay a dime more for a better product, better service, better reputation, better approach, shorter completion, etc., as applicable to your LTPA method? If yes, then, would it be fair to guess that you are likely looking to award to a firm that will give you the best available price, not an average price? You are probably hoping that there will be some reasonable number of interested firms who will robustly compete price-wise, knowing full well that they don’t intend to provide any more than what you are asking for. , Someone may have some approach that allows them a competitive advantage that might also benefit you but that’s not what you are looking for . Your standard for “fair and reasonable” is probably different than it would be if you were willing to pay more for some added value. I don’t think that it is that complicated. I do think that good business practice should involve some idea or sense of what someone would or “should” expect to pay under the market conditions and solicitation provisions, if possible. For DoD, I think that is one aspect of their “Better Buying Power initiatives. After all, old Shay Assad was in a huge Defense Industry firm.
  8. Des, in a source selection, it is necessary that the proposal be technically acceptable. Your method is not different in that respect. The (lowest fair and reasonable) Price is the discriminator between acceptable proposals for award in an LTPA. Thus - guess what? Price is the most important factor. Industry will tell you this. In fact, industry tells us (and it is true) that price is THE most important individual factor when we say “price is approximately equal to all factors other than price when combined”. You will see this stated often in GAO decisions: “ It is a fundamental principle in a negotiated procurement that a proposal that fails to conform to a material solicitation requirement is technically unacceptable and cannot form the basis for award.” (http://www.wifcon.com/pd15_305.htm) (Sorry, I can’t edit the text size on my iPhone). We don’t need to quibble over this.
  9. How would price be equal to the non-priced factors in practice? If two or more technically acceptable offers from responsible offerors are found, the lowest fair and reasonably priced offer wins. You can’t pay a penny more to get a better technical offer. And there are “likely” more than one other-than-price factors. If there are more than one non-price factors and if price is “equal” to all of them when considered together as “technical” , then price would have to be the most important factor. One doesn’t usually describe a weighted comparison between price and non-priced factors when using the LPTA method. But the reality is that you are looking for the lowest, fair and reasonably priced offer that meets your minimally acceptable criteria from a responsible offeror. Its a step beyond best value trade off with price as the most important factor.
  10. Well, what you are willing to pay also depends upon how important price is in the selection process. If you’re going to use the lowest price technically acceptable method, then I suspect that price is extremely important and probably the most important factor. So the customer might be looking for the lowest amount of money to spend for the effort. Or the project may be under funded. Who knows? We didn’t have any context For this scenario.
  11. We don’t really know the reason for or the specific meaning of the original question. From a protest standpoint , it probably is defendable, as cited herein. The higher priced offers weren’t in line for award, so they aren’t interested parties in an award protest. If the question is “Can we do it? “ , it’s now too late for the pool members to protest the terms of the award decision. The task order competition said that this is how award would be made. If the question concerned the business sense of simply saying that the price is fair and reasonable because it is the lowest priced offer, then it might depend upon the fuller context of the situation, as was discussed herein.
  12. Actually, yes. I was just curious about the specific circumstances, which I suppose I should have inquired about at the beginning. I didn’t want to reopen the endless debate I will ask Brent privately.
  13. For DoD, the first situation is not applicable per DFARs and PGI implementation of “Better Buying Power “policy.
  14. Matthew, if you don’t mind my interjection, I don’t think that they would propose different prices. Either way, the basis of award is LPTA, with a fair and reasonable price. The price(s) that you are comparing the lowest LPTA to should be comparable as proposed or otherwise be able to be compared.
  15. Yes. Please note that my observations were not from a protest perspective. Higher priced offers would not be prejudiced by accepting a lower priced, technically acceptable offer. My observations are limited to determining if the price of the otherwise apparent successful proposal is fair and reasonable.
  16. I agree that the important aspect is that the price comparisons should be valid or that one could account for differences to make valid comparisons.
  17. I agree. I should have said that long ago here.
  18. No. I should not have stated or conveyed that impression. Strict technical acceptability of another proposal might not be necessary as long as one can make a relevant price comparison. Being able to make a relative price comparison would depend upon the context and complexity of the competition and what you are buying. Of course, If you have any other price information, you may well not need to examine another proposal to see if it reflects what you are trying to acquire. Edit: For that matter, your method doesn’t prevent you from looking at (e.g., reading or scanning, etc.) a higher priced proposal to see if it’s associated price proposal is meaningfully comparable to the lower priced one.
  19. All I was doing was answering the original question, as I rephrased it to what I thought he meant. Nobody here knows the context from the details not provided. “Can the lowest price be considered fair and reasonable when you do not know if the other offers are technically acceptable?” Can it be “considered fair and reasonable ?” Maybe legally yes, according to the stated solicitation procedure, although one might not really know one way or the other, . Not enough context known. It would certainly help if the government had an independent clue. It doesn’t take an acquisition professional to make such a declaration using that method. Does it make “common sense” as a generic answer to the stated question? No. It depends upon the facts and circumstances. I’ve had LPTAs where none of the prices were affordable or fair and reasonable. Found out what it took to resolve and did it. You probably would too if you were spending your own money.
  20. Restating the question : Can the lowest price be considered fair and reasonable if you don’t know whether the price of any other offer reflects a price or cost to meet the contract requirements? We don’t know how straightforwardl or technically complex the solicitation technical requirements are, how much effort is required to evaluate an offer, whether the lowest priced offer is technically acceptable (i.e., did you evaluate one or more lower priced offers before you found the one you intend to award to) the range of pricing (e.g., a wide variation, closely priced, etc.) or how many offers were submitted (the extent of interest and competition involved). To me, it would depend upon an assessment of how confident you are that the competition reflects pricing to meet the contract requirements. Thus, it would seem obvious to me that some judgement is necessary for such a determination. Blind comparisons may not be meaningful, depending upon the nature and circumstances involved. You might realize, for instance, that you need to evaluate the next one or two lowest priced offers and, if technically o.k., you can assure yourself that you have reasonable price competition for comparison purposes. I think that a contracting professional is expected to use and provide good business judgement. Simply seeking the simplest cookbook recipes, for “one answer to fit all circumstances” doesn’t cut the mustard for me.
  21. joel hoffman

    Small Business Participation Plans

    It’s important to distinguish between evaluating extent of small business participation in the proposal for small business and large business offerors for source selection purposes and, for large business primes, compliance after award with the subcontracting plan requirements of the contract. 52.219-8 Utilization of small business concerns applies to essentially all primes above the simplified acquisition limits, with certain exceptions. It’s the Apple Pie and Mom clause. 52.219-9 Small business subcontracting plan does not apply to small business primes and has a dollar threshold for applicability. 52.219-16 Liquidated damages - subcontracting plan applies to those contracts containing a subcontracting plan pursuant to 52.219 -9.
  22. joel hoffman

    Small Business Participation Plans

    Forgive me for using voice texting while being transported to an appointment . Carl, actually the small business participation evaluation extends beyond the small business subcontracting plan requirements for large business contractors. Thank you, Don for the link that you provided to army training concerning evaluation of small business participation. The presentation clearly pointed out that small business participation also would include involvement of the small business prime contractor or joint venture member of a joint venture etc. and performance of the contract. To me, this is actually an incentive for a small business proposer to self perform work and to get credit for it in the evaluation of this aspect of their proposal. I am editing my input to this thread to indicate that self performed work is also considered to be “small business participation”.
  23. joel hoffman

    Small Business Participation Plans

    Yes, there is a distinction. Factors are the high level, key discriminators which represent those specific characteristics that are tied to the significant RFP requirements. FAR 15.304(a) discusses factors and subfactors. The Army Source Selection Supplement to the DoD Source Selection Procedures provides guidance to "Identify key discriminators to be evaluated" and "define the discriminators as evaluation factors and subfactors and their relative order of importance." "Factors" should be limited in number for various reasons, such as reducing complexity, not diminishing the importance of any one KEY aspect of the evaluation, the fact that the relative importance of each factor in comparison to the others must determined and stated in the evaluation plan and RFP. Similarly, the relative importance of subfactors under a factor must also be determined and stated. I probably erred in calling the multiple aspects of small business participation that the DFARS described as "factors" as "evaluation criteria". They don't rise to the level of factors or even subfactors. If they were factors or subfactors, they would have to be somehow weighted or stated in terms of relative importance to other factors or subfactors under the factor level. For me, that would be overkill. In addition, the overall evaluation of the small business participation might well be designated no higher than as a subfactor under some related factor. The individual aspects could be classified as "elements", per the Army Source selection jargon (see below). They are simply various aspects of a factor or subfactor that the DoD wants to be evaluated. Evaluation criteria would be developed to describe what and how they are to be evaluated. Sorry for being "sloppy"! FAR 15.304 says in part: DoD Source Selection Procedures: Army Source Selection Supplement: GOTTA go - I have to be at church to oversee the fire suppression system testing and inspection.....