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joel hoffman

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Everything posted by joel hoffman

  1. joel hoffman

    how to structure emergency service

    Carl, i just don’t think that there are many plumbers that would be foolish enough to bind themselves to a government contract (ESPECIALLY a government contract with all its bureaucracy) to guarantee that they drop whatever else they are doing to make a typical service call. Maybe in a big city... it would seem to me that responsiveness and availability would be more important than a $50 or $100 difference in price between plumbing firms for an emergency service call. I guess it would depend upon the nature and amount of time needed for the fix, of course. But $10-$20 per hour price savings isn’t important if they can’t respond...
  2. joel hoffman

    how to structure emergency service

    Why use a requirements contract with only one firm? What if they are not available to respond in time? Most plumbing firms are not big enough to always respond immediately to one client. The ordering officer should be able to call around from the BPA list for availability, as the first priority, like you would do if you needed a plumber for an emergency.
  3. joel hoffman

    Defective Pricing

    Yes, if it exceeds the threshold for C&P and is non-commercial service. Since your example is for geo surveys, it is likely a contract for A/E services. See definition in FAR Part 2. It would be negotiated after selection of the most qualified firm. I should have caught that earlier. If this is a unit-priced contract, it would depend upon how the prices were negotiated.
  4. joel hoffman

    Defective Pricing

    There is no “effect” on the initial contract price for the “competitively bid” contract in your example. Certified cost or pricing data are not applicable in that situation. If it was a competitive negotiation under FAR Part 15, the government is prohibited from requiring certified cost or pricing data for the initial contract pricing . Read FAR 15.403-1, for example.
  5. joel hoffman

    Charging with Coverage

    Inconsistently “charging” to a fixed-price contract is not relatively harmless as a (this) customer is concerned. Cost principles are usually applicable to pricing of modifications or claims settlements, so inconsistent allocation of costs between direct and indirect affect such pricing . For example, see FAR 31.202 (a) under Direct costs and 31.203 (b) under Indirect costs.
  6. Can a contractor obtain SCA wage rates when the places of performance are unknown? How do the parties contract for concession services at undetermined locations? There seems to be some missing info here on how the contractor could or did price the contract. I’ll admit that I’m not familiar with concession contracting details
  7. Pepe, is it a good idea to prohibit any construction, major renovation or replacement of a headquarters for various executive agencies within the official seat of the US Government? Is it a good idea to let any state or subsidivision of a state submit “bids” to establish executive agency headquarters outside of the Seat of the government? Does that improve efficiency of government, reduce costs and promote effective oversight of agencies by the President or executive and congressional oversight agencies? Ive dealt with organizational entities for years, that have Offices, Divisions and other major sub offices far from the “flag pole”. It doesn’t promote efficiency, consistency, effective oversight, evaluation of performance or compliance with policy, etc. I recently worked on development of a project for a new HQ for one of the exempted agencies. There was nothing efficient about it and much empire building involved. It would likely involve increased travel costs between the HQ and the Seat of Government. It would apply to any new construction or necessary major renovation of existing HQ for the affected agencies. Congress would have to specifically otherwise provide an exemption, by law. Obviously, this is a political move, so there will be differing opinions concerning the idea. The current policy is to have a Seat of Government for Federal Agencies to establish their HQs. Pepe, is draining the swamp by dissipating it a good idea? Does it reduce costs? Does it promote efficiency in government? Does it help citizens interact with their government?
  8. joel hoffman

    Updating SAM for Financial Results

    How’s that for an example of Doublethink?
  9. It appears to be ambiguous - “shall give priority to”. Does that make it the most important factor- unless the firm is a large business competing against a small business? Does it apply to construction contracts (“on-site” child care for employees of the entity”)? Does the entity include all (construction) subcontractors who come on-site, even if only present for short period(s)? It doesn’t say whether the contract cost would include the cost. It doesn’t distinguish between government paid (allowable cost) and employee paid child care. Just requires “priority” for an entity “providing on-site child care for employees”. Who provides the space for child care facilities? I’d like to see the CBO cost estimate for this legislation.
  10. joel hoffman

    Are Small Business Concerns "Nontraditional Defense Contractors?"

    In either scenario, assuming that there is (adequate) competition, no certified cost or pricing data is required anyway. Set asides (1st scenario) use competitive procedures...
  11. joel hoffman

    how to structure emergency service

    “Like” The local Corps of Engineers District in my city established a suite of BPA’s for various geographical areas within the District, including military installations, to perform minor construction and repair orders not exceeding $25,000. It reportedly worked very well.
  12. joel hoffman

    Problem of the Day

    Agreed. I think that question has already been answered (no), plus agencies are issuing class deviations pending s FAR update to the level in the definitions for SAT.
  13. joel hoffman

    Problem of the Day

    Not sure what you are asking because the action is below the threshold at 15.403-4 for requiring the KO to obtain cost or pricing data.
  14. joel hoffman

    Problem of the Day

    In that case, the claim for CDA interest was denied. The contractor was in no financial position to pay back pay required because the government used an incorrect SCA wage decision. The Court ruled that the government should pay the back pay into an escrow account that the contractor could use to pay its employees the back pay. The Court wrote: “The award of back wages did not compensate Richlin for any past, present or future out-of-pocket expense. Indeed, Richlin conceded at oral argument that it "was never out any money." The back wages and associated taxes were paid not by Richlin but by the government through the escrow mechanism. Richlin acted merely as a conduit, and serving as a conduit did not entitle Richlin to receive [any] interest.”
  15. joel hoffman

    Problem of the Day

    Yes. A good example of that is 437 F.3d 1296 RICHLIN SECURITY SERVICE COMPANY, Appellant, v. Michael CHERTOFF, Secretary of Homeland Security, Appellee. No. 05-1085. United States Court of Appeals, Federal Circuit. January 31, 2006. https://m.openjurist.org/437/f3d/1296/richlin-security-service-company-v-chertoff
  16. joel hoffman

    Problem of the Day

    The costs were “prospective costs” at the time that the claims were settled and the contract was modified. EDIT: The Statute requires the United States to pay interest on prospective costs, too. See the Excerpt above from "Louis Caldera, Secretary of the Army, Appellant, v. J.s. Alberici Construction Co., Inc., and Martin K. Eby Construction Co., Inc. (joint Venture), Appellees, 153 F.3d 1381 (Fed. Cir. 1998) US Court of Appeals for the Federal Circuit - 153 F.3d 1381 (Fed. Cir. 1998)
  17. joel hoffman

    Problem of the Day

    Vern, my examples involve claims that the contract has been changed, the contractors cited sums certain in their claims. The claims were settled or adjudicated before some or all the costs were incurred. I don’t see any legal distinction between that and the case law in my last post.
  18. joel hoffman

    Problem of the Day

    Vern, I am confused by your two posts above. Are you saying that if the claim is settled or resolved through litigation for a specific amount before the costs (or all of the costs) are incurred, then there is a distinction between that scenario and the case law below? Vern Edwards Posted February 14, 2011 under the Topic Does USC Take Precedence over the FAR: Below is an Excerpt from "Louis Caldera, Secretary of the Army, Appellant, v. J.s. Alberici Construction Co., Inc., and Martin K. Eby Construction Co., Inc. (joint Venture), Appellees, 153 F.3d 1381 (Fed. Cir. 1998) US Court of Appeals for the Federal Circuit - 153 F.3d 1381 (Fed. Cir. 1998) Sept. 3, 1998. Rehearing Denied; Suggestion for Rehearing In Banc DeclinedDec. 1, 1998 I highlighted certain text fpr emphasis: The below is an excerpt from: 931 F.2d 860 37 Cont.Cas.Fed. (CCH) 76,082 SERVIDONE CONSTRUCTION CORPORATION, Plaintiff/Cross-Appellant, v. The UNITED STATES, Defendant-Appellant. Nos. 90-5115, 90-5121. United States Court of Appeals, Federal Circuit. April 24, 1991.
  19. joel hoffman

    Problem of the Day

    An example might be rejection of a technical submittal that required what the contractor considered to be a change in order to be approved. Government has one interpretation and contractor has another. Government remains firm and contractor submits a claim for additional costs that it will incur to comply either during installation or during procurement of an item. KO determines merit and settles the claim before contractor pays or incurs the additional cost.
  20. joel hoffman

    Problem of the Day

    Vern, I was referring to claims concerning disputes over contract requirements or government directives that would involve additional costs but the additional costs had yet to be incurred. The CDA says that interest is payable from the date the KO receives the claim until it is paid.
  21. joel hoffman

    Problem of the Day

    So, i have a question about payment of interest on a claim in a non-construction contract of a type without progress payments or other financing, such that payment can’t be made until after final performance or delivery. If a claim is settled prior to any performance of the disputed effort, does the government pay CDA interest on the amount of the settlement upon payment, which might necessarily have to occur much later? Or would the government perhaps separately pay the claim settlement earlier, which might be prior to performance, to avoid interest costs? That would seem awkward to me. Sorry to stray from the original poll question - but Don did beg the question if following the Disputes clause complies with the CDA and later said that “the topic hasn’t changed”.
  22. joel hoffman

    Problem of the Day

    In response to Vern’s concern about the language of sub paragraph (2) being strange and obscure, we were taught in the USACE (back in the 80’s and 90’s) that, if a claim was resolved prior to commencing performance of a disputed construction item or prior to procuring materials involved in the dispute, theortically the contractor would not yet have incurred additional expenses. The contractor could theoretically usually recover the extra costs in its normal construction progress payments, as though it had been in the contract all along. Thus, there would supposedly be no financial impact to the contractor between the contract as changed vs the contract had the extra work or materials been in the contract to begin with. We were taught that interest was payable for claims where additional expenses were incurred but not paid for until after the claim was settled. Otherwise, contractors would supposedly be encouraged to initiate claims long before the work was performed or extra costs were incurred to collect interest, even though the government couldn’t make progress payments for the work until it was being performed. I don’t have any problem with resolving claims early to avoid impacts but it doesn’t seem right to pay interest before the investment is even made. It’s something like the bank having to pay interest before you make a deposit or one having to pay interest before borrowing the principal amount of the loan. The “old rule” made perfect sense to me, except that it ran afoul of the language of the CDA of 1978. The ENGBCA put the Kabosh on that “old rule” thinking. As for Vern’s general argument that it generally isn’t the KO’s role or duty to comply with statutory changes on their own authority or initiative prior to the administrative rule making process necessary to implement the statute, where applicable - I agree. In contracts, the concept can apply to both the FAR and the technical requirements. I have seen recently where both the DoD and Civilian Councils and agencies have been issuing Class Deviations to implement changes prior to the FAR or Supplements (when specifically applicable) being updated through the formal rule making procedures. I seem to remember that the purpose of paying interest on claims was based upon the government’s widespread slow response to resolving claims, usually long after the additional expenses were incurred. The Disputes Clause required the contractor to continue performance while the matter was in dispute but the government would delay response/resolution until much later. So, I’ll bet that the sub paragraph (2) originated from the premise that interest was intended to provide some monetary relief for contractors who were financing the disputed extra costs. I can’t access HR 95-1556, which accompanied the CDA. Interesting to note that some of the historical context relates back to Admiral Hyman Rickover’s Nuclear Navy days and his epic fights with the shipbuilding industry (and the Navy hierarchy) in the 1950-1970’s. For you younger folks, one needs to know that we were deep into the Cold War with the USSR during the Nuclear Arms Race.
  23. joel hoffman

    Multiple Award Schedule

    Emphasis added...
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