joel hoffman

How were the tasks priced, i.e., what was the basis of the costs which were marked up? (Forward priced?)

LeighHar, you mentioned FAR clause 52.244-4. Is this an A/E contract? Just curious. I have no disagreement with the previous responses.

Biden has surpassed Obama’s preference for unionized construction projects. Trump left Obama’s EO alone. Before then, Clinton and Bush went back and forth on the issue.

Clarification - “…promoting union labor initiatives.”

Ok, I overlooked the category of the original post under “Schedules, GWACs, MACs and ID/IQs”. I didn’t realize that this would be set-aside task order for an 8(a) firm under an ID/IQ or a new ID/IQ. Are there existing schedules that provide for both A/E design services and construction by the same firm that isn’t design-build? I still believe that the initial purpose of the task will be for an A/E effort, since construction might or might not be awarded. I believe that both A/E design and Construction would have to be within the scope of the ID/IQ. Can you please elaborate on what type of task order contract you are planning to use?

If you are somehow allowed to award a sole source or competitive set-aside A/E contract, the selected firm cannot subcontract more than 50 percent of the amount paid by the Government for A/E contract performance to subcontractors that are not similarly situated entities (FAR 52.219-14 Limitations on Subcontracting). Any design work that a similarly situated subcontractor entity further subcontracts will count towards the prime contractor's 50 percent subcontract amount that cannot be exceeded. For the separately awarded construction option, I think that the A/E prime contractor would have to comply with the 75% or 85% limitation on subcontracting to similarly situated firms. Since the Limitations on Subcontracting clause has been bastardized to allow almost any method to achieve self-Performance, I suppose that you might be able to award a prime A/E contract to a 8(a) Joint Venture of a design firm and a construction firm. There might be 8(a) construction companies with their own qualified A/E design staffs or 8(a) A/E firms that perform D-B construction. I don’t know. The main challenge is that the primary purpose of the contract is to design the project. Construction of the project, as an option, might never be awarded. For such a small project, subcontracting and/or joint venturing and layering of subs would seem to eat up the budget. And would a consortium of firms be interested in small shares of a small project? Small A/E firms might be unable to obtain performance and payment bonds on their own. Bonding companies require some capitalization or other security, since it isn’t insurance. A surety will generally go back to the bonded contractor to cover any losses.

If you are awarding a contract to design a project with an option to construct it, it isn’t a “design-build contract” . It is an A/E contract. A design build contract is an integrated contract upon award with the firm intent to construct a project. There isn’t any legislative authority to award a design-build contract to design a project with an option to construct it. You must follow the Brooks Act procedures to select the A/E to design the project.

Not sure of the reason you are asking here rather than ask the KO. If the answer is yes do the report, you will be reimbursed, right?

dsmith, I no longer teach the class. The class uses the CSI Format. Our Army Chem-Demil Systems Contracts, using the UCF were under a Service Contract Umbrella. The PCO was in Rock Island, IL. Their organizational name changed so much, I don’t remember what they were called. Some systems contracts were a combination of FFP construction and CPFF services. Others were CPFF for both. Others were single award ID/IQ task order contracts with CPFF design tasks and CPAF construction and operations, etc. tasks. Mixed bag, based upon the maturity and type of De-Mil Process designs and the types of Chemical Weapons and the chemical weapons agents being destroyed. Mustard, Sarin, and VX. Whoever designed those weapons never designed them to be de-militarized. MAD scientists!!!!

True, true (first statement) Regarding second statement, the title of this thread is Distinction Between Sections C and H in UCF. The original poster made reference to construction contracts. My initial reply explained some differences between Sections C and H for construction or design-build. But it could be applied to services, too. Then someone mentioned that he thought that construction, design-build construction and A/E contracts would rarely use the UCF. The USACE uses the UCF for its A/E contracts. Other than for DOT/State Highway department work, USACE probably awards more government A/E contracts than most other agencies. As for construction, numerous agencies use the UCF. Many of my non-DoD students in my D-B class over a period of 20 years confirmed that. In fact, my last program before retiring involved six huge Systems Contracts to build (1/2 of them were design-build) , systemize, pilot test and operate, full operations and de-construct Chemical Weapons Demilitarization Plants around the US. The contracts were in the UCF format. Construction alone was many hundreds of millions of dollars. I personally don’t like the UCF for construction and especially for D-B, which involves non-traditional roles and responsibilities for both government and design-builder. The FAR clause for Order of Precedence doesn’t make sense for design-build contracts in either CSI or UCF. I think the UCF fits services and supply contracts better than construction or D-B. But the fact is that it is also being used for construction and D-B.

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Carl, I wasn’t debating the order of precedence. My initial post was in response the the OP’s question concerning what goes in Section H vs. Section C - or in essence, what is Section H for? By the way, there are over 200 pages in EP-1-7. What page were you referring to? For an A-E contract, there are numerous mandatory references applicable and there will be an attached specific Project Development Booklet or similar name, as well as the approved congressional authorized MCP (Air Force) or MCA (Army) scope and PA (I have forgotten the DD Form number). Also any site plans and geotechnical or other test reports, previously performed. .

Unfortunately, there are many organizations using the UCF for construction and D-B contracts. It definitely appears so to me as a member here over the years. From reading his past posts over the years, even Vern isn’t completely familiar with the CSI format for construction contracts. When using the UCF, the order of precedence clause at 52.215-8 is mandatory. “FAR 15.209 …(h) The contracting officer shall insert the clause at 52.215-8, Order of Precedence - Uniform Contract Format, in solicitations and contracts using the format at 15.204.” And USACE A/E contracts use the UCF.

In particular, since many or most contract clauses are included by many organizations by reference, I wonder if many people actually read or know them. Those who have to administer contracts after award usually aren’t the same personnel as the solicitation writers. Especially fun (NOT) to try to determine and find the specific dated version of a clause that was applicable at the time of the solicitation and award, if updated since, or even discern whether or not they are the same version… I believe that, if you don’t want to clutter up a solicitation, you should include the clauses as an attachment or at least have a link to a document containing the applicable edition of the clauses.

…and the section H requirements are meant to take precedence over the proposal or section C as Vern mentioned above.

Section I contains requirements that generally apply to contracts. Section H would or could contain requirements specific to an installation or agency for its contracts, as applicable for that type contract(e.g., construction contracts, work on an airfield, work in restricted or security areas, State or other environmental requirements). Normally expected adverse weather for each month also comes to mind, for a specific installation or location. Other similar requirements, specific to types of contracts, an organization or location come to mind. Another example would be some of the unique, non-traditional general roles and responsibilities of the parties for design-build contracts that were never incotrporated into the FAR. Why write or re-write general type of project or other location specific requirements in Section C each time??

From the Oxford Languages Dictionary: ful·crum /ˈfo͝olkrəm,ˈfəlkrəm/ noun the point on which a lever rests or is supported and on which it pivots. a thing that plays a central or essential role in an activity, event, or situation. "research is the fulcrum of the academic community"

The FAR 15 re-write did remove the restriction for having more than one round of discussions and revisions to offers. However, for us that didn’t result in technical leveling. The FAR re-write allowed us to eliminate all but the most highly rated and competitive offers before and during discussions. That is a huge contrast with the previous requirement to include all offers with a reasonable chance of award and “when in doubt include the offer”, that I spoke of in an earlier post. The re-write also provides an opportunity for the KO to further limit the competitive range for purposes of efficiency, in the event there are many highly rated offers. The re-write allows us to eliminate an offer after discussions if it is or becomes no longer competitive. I had such an experience before the re-write where a firm in the CR wasn’t really competitive in a large USAF DB project to rebuild Homestead AFB after Hurricane Andrew. The company president asked me during discussions if they had a good chance of award. He said we’d tied up their bonding capacity and they needed to pursue another big project rebuilding local schools if they weren’t in line for award. I replied that I wasn’t allowed to answer his question. But, I said, if it was me- I’d pursue the school work. He thanked me profusely. They withdrew the next day, thankfully without comment! I eventually confessed to my friend, who was the KO/SSA. He laughed! Whew! We found that there were a few instances where we were able to obtain acceptable non-price proposals but there were still problems with pricing within the budget or construction cost limitation. in those cases we needed to examine in further depth what was driving higher than anticipated costs. In an attempt not to get into long discourse here, I won’t expand on that right now. But we were able to discover and examine cost drivers and to make adjustments to or clarify the requirements to mitigate and reduce prices. For design-build projects, in particular for projects with extensive performance based design criteria*, we specified a design and construction cost limitation for award, which reduced or eliminated the need for more than one round of discussions and revised offers. The re-write also retained the ban on technical transfusion, meaning the disclosure of any offeror's technical ideas or approaches, which results in the improvement of a competing proposal. We did inform offerors that if they deviated from a solicitation requirement as a suggested betterment, it was a deficiency and that the only way it could be accepted would be to amend the solicitation to allow all offerors to include the aspect in their revised proposals. It’s on my do list. I have three or four specific examples of failing to discuss objectionable aspects of proposals even though they met the minimum performance design criteria . I have a couple examples where the KO didn’t have a clue how to discuss excess pricing or how to bargain for better performance where millions of dollars were left on the table.

Yes, I think they want to know the number of labor hours expended to actually perform the services, including construction, for the sake of consistency. I’d include their direct supervision.

edit: I’m not responding this in response to Vern’s last post above. I didn’t read it until after I posted. Wanted to verify that construction contracts are also included in the reporting. Labor hour reporting in FAR Part 4 - Administrative and Information Matters 4.000 Scope of part. This part prescribes policies and procedures relating to the administrative aspects of contract execution, contractor-submitted paper documents, distribution, reporting, retention, and files. Subpart 4.17 - Service Contracts Inventory 4.1702 Applicability. (a) This subpart applies to– (1) All FAIR Act agencies, except DoD as specified in 4.1705; (2) Solicitations, contracts, and orders for services (including construction*) that meet or exceed the thresholds at 4.1703; and (3) Contractors and first-tier subcontractors. 4.1705 Contract clauses. (a) The contracting officer shall insert the clause at 52.204-14, Service Contract Reporting Requirements, in solicitations and contracts for services (including construction*) that meet or exceed the thresholds at 4.1703, except for indefinite-delivery contracts. This clause is not required for actions entirely funded by DoD, contracts awarded with a generic entity identifier, or in classified solicitations, contracts, or orders. [The FAR Matrix for FP and CR Construction contracts indicates that the Clause 52.204-14 is applicable to construction contracts.] 52.204-14 Service Contract Reporting Requirements. (a) Definition. First-tier subcontract means a subcontract awarded directly by the Contractor for the purpose of acquiring supplies or services (including construction*) for performance of a prime contract. It does not include the Contractor’s supplier agreements with vendors, such as long-term arrangements for materials or supplies that benefit multiple contracts and/or the costs of which are normally applied to a Contractor’s general and administrative expenses or indirect costs. …b) The Contractor shall report, in accordance with paragraphs (c) and (d) of this clause, annually by October 31, for services performed under this contract during the preceding Government fiscal year (October 1-September 30). …(c) The Contractor shall report the following information: (3) The number of Contractor direct labor hours expended on the services performed during the previous Government fiscal year. (4) Data reported by subcontractors under paragraph (f) of this clause. (f) (1) The Contractor shall require each first-tier subcontractor providing services under this contract, with subcontract(s) each valued at or above the thresholds set forth in 4.1703(a)(2), to provide the following detailed information to the Contractor in sufficient time to submit the report: …(ii) The number of first-tier subcontractor direct-labor hours expended on the services performed during the previous Government fiscal year.

I didn’t try to do anything to her. I didn’t advise or address her. But I did incorrectly mention the word “normally” in reference to G&A in my response to Neil. That is wrong. Yes - Labor charged to G&A is not a direct cost. As for the term “overhead”, what one is referring to depends upon one’s perspective. A direct cost objective can be at a contract level or at a task level depending upon one’s perspective. I was wondering if supervisory labor, on-site or off-site, higher level management labor and other similar non-production labor to perform the services, if directly charged to a service contract, would be included in the annual reporting requirement for a service contract. For construction contracts, on-site project supervision and management salaried labor costs are referred to as “field overhead” or “general conditions”, although it is a actually a direct cost to the contract in the contractor’s accounting system, rather than indirectly charged to a contract. Such costs are often, in practice, spread over all activities for unit pricing or lump sum pricing of individual activities. Yet, they are direct costs to the contract. Off-site management and support labor for some firms, like the Bechtels and Raytheon’s were direct charged to service and construction contracts wherever possible, in my experience with them. Other contractors often indirectly charge for such project support and management, admin, payroll, safety, training, etc. . Not all firms have “overhead” accounts, separate from G&A, particularly smaller firms. That, plus I didn’t understand what Kensenia was initially asking or what Neil said in his first reply to Kensenia are why I didn’t respond to Kensenia or describe what labor costs are direct for service contract reporting purposes. I don’t understand what Congress is really trying to track, either. The labor for management, supervision, and other support for those actually performing the services may be direct or indirect costs depending upon the scope and size of the service contract and the company organization and accounting structure. The report doesn’t include lower tier subcontractor labor hours either. This could be a significant share of service activities. The amounts invoiced during the reporting period might not directly correspond to the number of labor hours expended, either.

Thanks, Vern! When I get an opportunity to rewrite my examples concerning hesitation to or complete lack of taking the opportunity to discuss technical aspects or pricing in some design-build and construction source selections, I’ll try to partially address your question: “How does one negotiate in a competitive arena?”

Yep, I know. Jamaal used to be in USACE but that was fairly recently. He asked me a loaded question.

USACE Solicitations for construction and AE “used to be written” primarily by other than 1102’s (generally Engineering Division), in many Districts. Contracting and legal reviewed the drafts, advertised them, received bids or proposals, etc. The contract specialists in some Districts prepared and inserted the Division 01 sections, including proposal submission requirements and evaluation criteria and basis of awards, etc., DBA WD, etc. When our District began using source selections, my former boss, who was Chief of Contract Administration, took on the job of running the source selections because 1102’s had not yet been appointed as the PCO’s and didn’t want the duties. We retained that role afterward but “worked under the functional direction of the 1102 PCO’s and Chief of Contracting. I transferred to a higher level Working Division (Steve Feldman’s organization) as Chief of Contract Admin for a Level 1, Major Defense Acquisition Program for my last 10 years of Active Civil Service and was a member of the HQUSACE Program Management Team for the MILCON Transformation Program. The PCO’s weren’t 1102’s for USACE construction or A-E contracts until the very late 1980’s; the District Engineers or their (military) Deputies were the PCO’s for military and civil works contracts. In my case, I was an 0810, supervisory civil engineer in the Construction Division (at District level) and later in Construction Directorate (at a working Division). I was also certified Contracting Level III, DAWIA in the Acquisition Corps and an ACO. My Branch and Section oversaw all and performed some of the aspects Contract Admin aspects of all our District’s Construction contracts and later at the Division level. One of my subordinate personnel or I was on the acquisition team for each contract from acquisition planning through award and oversight or direct performance of all aspects of contract admin during execution. Part of our acquisition team contract formation duties entailed participating in “writing” the contract requirements, including writing or preparing the various DIV 01 sections for source selections. Some of my engineer (also supervised a GS12, 1102) subordinates or I negotiated all sole source contracts for our District. We led and/or was a member of all the District’s source selections, directly working for the two 1102 PCO’s (Chief and Assistant Chief of Contracting. They oversaw all my SS actions, writeups, correspondence and made the selections. In private Practice and as City Engineer, I was (and am) a registered Professional Engineer, planned and designed the projects, wrote and administered the contracts. Sorry that I already wrote too much, but you asked a leading question, if I was an 1102.

Hey there, Neil. Your post made me think about what a “direct labor hour” is. I looked for a FAR definition without much success. I also found a interesting definition on the Web. Does direct labor hour include all labor directly charged to a contract as a direct cost in a contractors accounting system to include supervision, safety, etc? G&A wouldn’t normally be a direct cost. “Overhead”? Depends on whether it’s charged to one contract or shared among other like business, perhaps?