joel hoffman

I agree with Vern here.

I regularly used these type of "options" years ago in municipal and private contracting. They are common in the construction industry for such work as dewatering, rock excavation or other work that is impossible or difficult to fully define or quantify without further exploration during construction. I have also used them and seen them similarly used on construction contracts with the USACE. Sometimes there are alternative options, using mutually exclusive approaches or solutions), depending upon what conditions are actually encountered. The unit prices you described are for defined tasks or quantities of work not for labor hours plus materials. Apparently, you have defined enough quantities to be able to make price comparisons during the competition stage or negotiations, if sole source methods are being used. How does that equate to time and materials? I don't see any problem with this. They are usually referred to as "extras", if found to be necessary during execution of the contract or called something similar. Note: I assume that the proposer(s) is filling in the price, not the government? Am I correct?

If "Capabilities" is a separate and distinct topic in the SOW, it would seem to be improper to evaluate a proposal beyond that stated evaluation criteria, based upon the little bit of information you provided. However, it also depends upon the entire context of the situation. For example, one would have to know what proposal information was required to be submitted for evaluation.

deleted. Wrong button...

Don, your scenario appears to be an oxymoron. If the contractor seeks, as a matter of right, an adjustment of the contract price exceeding $100,000, then payment - as a matter of right - would naturally follow the entitlement that is asserted or demanded. In order to "seek payment", I don't think that a contractor is required to even mention the word "payment" in the written demand or assertion for an adjustment in the contract price. To me, it is a 'given' that one is seeking payment at some point for a price increase that they are demanding or asserting the right to. Only a fool would not try to be paid for the price increase it has successfully "tried to acquire or gain".

Don, please define the word "seeking" as you used it in the phrase "written demand by the contractor seeking, as a matter of right, an adjustment of the contract price exceeding $100,000 (but not seeking payment)". Thanks.

Applying the literal definitiion of a claim and a literal reading of the question without considering the rule : my answer to the question would be yes, it is a claim. Applying the literal definition of a claim and literally considering the rule to only apply to a written demand or written assertion by the contractor "seeking the payment of money exceeding $100,000", yes it is a claim. Inferentially thinking - still within the context of the box: The Contractor is "seeking, as a matter of right, an adjustment of the contract price exceeding $100,000"; but doesn't specifically "seek payment" in its demand or assertion. My answer is then - Yes, that matter which the Contractor seeks is a "claim". But, No - it is not a "claim under the Contract Disputes Act of 1978", until it is properly certified. My first assumption is that the Contractor is seeking an INCREASE in the contract price, not a decrease. If the Contractor is successful in its pursuit, under the terms of the contract, it will, "as a matter of right", ultimately be paid at least $100k more than it would have without the request or assertion. Therefore, WHY is it it is "seeking, as a matter of right", an increase in the contract price, exceeding $100,000? So that it will be paid at least $100,000 more, as a result of its specific demand for an increase in the contract price. It doesn't necessarily have to specifically demand or assert the right to the payment in its claim, because the contract will, "as a matter of right", provide the means for it to be paid. Therefore, it is seeking payment, without specifically demanding or asserting to be paid.. In addition to defining "which claims" must be certified, the Contract Disputes Act has certain requirements concerning the wording and signatory of a proper claim certification. I thik that there is a difference between the 2 scenarios. I hope that I can remember it when Don allows further explanation.

How one evaluates "offer acceptability" and "price" depends upon the context of the acquisition and your objectives. What are you planning to purchase? Is it services, supplies, management or consulting expertise, construction, design-build construction, etc. Since you are considering evaluating cost realism, is this going to be cost reimbursable type contract? If to be fixed price, why would you feel it necessary to evaluate cost realism? What you will evaluate depends upon what you are buying as well as your objectives for the acquisition. Would you evaluate acceptability of a product or service or are there variations of what can be provided that may warranted paying more for additional value? With regard to your questions on cost realism, what is the purpose of the analysis? In my opinion, without knowing the purpose and type of acquisition, any answers to your specific questions might or might not be be relevant to your situation. An out of context answer to your broad questions, may cause more harm than good.

Vern, I believe that vecchia's reference to a "good system" was regarding the methods they used to negotiate sole source task orders/contracts or modifications to task orders on their MATOC contracts. He began his 2nd paragraph thusly (emphasis added): "In cases where a major modification to an existing contract was needed, or a sole source award was approved, NAVFAC used their database of existing labor rates, the hours needed to build structures of a given number of stories, square feet, etc., and also bounced that information off of commercial databases that reported on economic factors such as the costs of construction materials, labor shortages in local and regional areas, and other information. NAVFAC also encouraged its PMs and contracting folks to learn and conduct serious cost analysis, much more so than in any other office I have worked in. It was a good system..."

Thanks for the update, vecchia. I believe that MATOC 's for such work can be good alternatives to JOC/SABER. In addition to the price risk exacerbated by the intense competition to win a JOC contract, MATOC pool contractors aren't required to provide full time, on-site presence in the anticipation of an unknown workload. If anyone here has worked with JOC or SABER contracts, what is your experience with them? Thanks in advance.

Thanks, folks. Then, the Changes clauses for MSRA's and for cost type repair contracts would provide for time adjustments if warranted.

napolik, thanks for the info on ship repairs. What type of contract is used for ship repairs? Are you using job orders against master agreements under DFARS? Thanks.

vecchia, let me clarify that a Job Order Contract is only one of many types of contracts being used by the Army for Installation Support contracts. A JOC contract is a single award task order ID/IQ contract ("SATOC"). Since there is no competition for individual tasks in a SATOC, there must be a method to establish/negotiate prices for each task. The Air Force has also used a contract type with some similarities to JOC, called "Simplified Acquisition of a Base Engineering Requirements" ("SABER"). You said " simpler methods (than JOC) are available to accomplish the same task." What did you mean a- what are some of these simpler methods? The NAVFAC procedures you described relate to developing estimates and paying for work performed under some unstated type of contract. What you described isnt anything unique or unusual. What you didn't discuss is what "simpler methods" you did use or would use to procure the type of construction services that a JOC contract is used for. If using a SATOC, for instance, how do you negotiate or otherwise establish the price for task orders? Or do you compete each task or project? If so, what contract type did you use or are you using? Thanks.

Vern, I was actually referring to identifying the scope of neccessary work to be performed, which eventually becomes a statement of work in one of many, various formats. Thanks for the clarification, however.

What do you recommend? Utilizing task orders on MATOC's? Someone still has to develop scopes of work and put them into some type of format to procure a vehicle to execute.

I admit that I don't know what Changes clause is used in ship repair contracts. DFARS 217.7104 prescribes a Changes clause at 252.217-7003 for use on Master Agreements to be used for ship repair job orders. That clause does specifically allow for changes in the time of completion of the work (see paragraph (a) (4) below) or any other requirement of the job order (see (a)(5) below). In this case there appears to be a combination of excusable or unexcusable delays by the contractor plus some late discovered additional, changed work. The changed work appears to require additional time to perform than the original, incomplete work. In that event, it seems that the equitable adjustment for the change should extend the period of performance at least the number of days required to perform the change. For that, paragraph (b ) of the Changes clause would seem to apply here, based upon the information provided. I believe that most of the Changes clauses contain similar wording to the effect that if a change causes an increase or decrease in the cost of, or time required for performance of the work, whether or not changed by the order, the Contracting Officer shall make an equitable adjustment in the price or date of completion, or both. It doesn't matter whether or not the clause specifically authiorizes the KO to change the time of performance under paragraph (a) if the change itself requires an increase in the time of performance. Here are excerpts from 252.217-7003 for Master Agreements for ship repairs. "(a) The Contracting Officer may, at any time and without notice to the sureties, by written change order, make changes within the general scope of any job order issued under the Master Agreement in— (1) Drawings, designs, plans, and specifications; (2) Work itemized; (3) Place of performance of the work; (4) Time of commencement or completion of the work; and (5) Any other requirement of the job order. (b ) If a change causes an increase or decrease in the cost of, or time required for, performance of the job order, whether or not changed by the order, the Contracting Officer shall make an equitable adjustment in the price or date of completion, or both, and shall modify the job order in writing." How much additional time extension is granted may depend upon the specific circumstances. In construction contracts, a time extension for a late change might represent only the excusable portion of the overall delay after the required period of performance, not the whole period after the required completion date. I admit that I don't know how ship repair contracts are administered. I do know that the sophisticated contract scheduling systems were initially developed for the Navy's ship building program, before they were used for construction contracts.

I assume that your use of the term "BAFO" refers to a "Best and Final Offer". This term was deleted in the 1997 rewrite of FAR Part 15. The current term used in 15.307 is "final proposal revision(s)". Offeror's have no "duty to submit a BAFO" or to submit any revision to their proposals, per se. If the government doesn't conduct discussions, it means that there generally is no opportunity for a proposers or offerors ro submit revised proposals to correct errors or omissions.

See the Blog topic at http://www.wifcon.co.../#commentsStart vecchia capra posted a comment on 22 April to which I replied. vecchia then replied to my comment. I have been unable to copy the three comments and am niot going to retype them here, verbatim. I know that the Webmaster has stated that he desires running commentary on Blog posts to be directed to the Forum, not in the Blogs. The Blog article concerns the Court of Federal Claims Case No..09-865C, April 3, 2013, LAKESHORE ENGINEERING SERVICES, INC. vs. U.S. at http://www.uscfc.usc...SHORE040313.pdf Lakeshore was the winner (loser?) of a Lowest-Priced, Technically Acceptable (LPTA) Job Order ID/IQ contract at Ft. Rucker, AL.in 2006. In 2009, the Contractor submitted a claim for losses allegedly incurred during the base and first option year, using the JOC contract pricing scheme. The contract pricing methods and associated risks are described in detail in the Decision. Vecchia's last comment asked me what the benefit is of using such a scheme. I won't defend or condemn the pricing method or the details of the contract type. It was developed in the 1980's as a method to be able to quickly award a variety of task orders on a Single Award, Task Order Contract (SATOC) for minor construction, repairs, etc. Since there is no competition for task orders on a SATOC, it was necessary to streamline the individual task order negotiation process. I understand that JOC contract has been widely used for Army Installations. The Air Force has widely used the "SABER" type contracts, which had some similarities to the JOC contracts. Back in the mid 1990's I was assignerd to manage the source selection process for a couple of these type contracts. The price competition was extremely fierce with a bunch of proposers (perhaps 10 or more?). I was surprised to see that many of the proposed price coefficients to be applied to the bare unit prices in the estimating guides back then were less than 1.0 (something like .8 to .95 range). I don't know for sure but do think I remember that the Army Installations made some awards themselves. The Installations often, if not commionly, administered the JOC contracts themselves. It required a specialized, trained staff to develop, manage, negotiate and administer task orders. In the late 1990's, we were developing MATOC's as an alternative for some installations, due to complaints by industry and the Installations about problems with the JOC contracts, such as contractors' reluctance in performance of task orders due to high price risk, contractors having to maintain fixed staff, a wide variability in availability of funding to issue T.O's, etc.

vecchia, the Army has been using this pricing scheme for at least 25 years for Job Order Contracting ("JOC" contracts). And JOC contractors have been complaining about it for almost that long. There are some provisions for pricing non-covered work, which contractors have also tried to maximize the use of. In addition, I'm not positive but the contractors often but not always propose the quantities of unit priced work to be performed. You can do a search under "army job order contracting guide". At one site you can view a video that a friend of mine at USACE made back in 1987. It is mostly still applicable today. Someone told me last week that one of my old USACE organizations is using a similar method to contract for ID/IQ's for the Air Force, using the Means Estimating Guides instead of the Army's source estimating book. I think that the USAF also uses Means for their SABRE contracts. I didn't look it up this afternoon to verify. Busy...

Nope.

Delete - accidental duplication.

Regardless of method used or not used to adjust the target cost, I recommend that dkubis check to see if the Contractor had already considered wage escalation in its price for the option

Did you read the reference regarding evaluation of unit rates for an ID/IQ?

dkubis, I am assuming that you are referring to estimated cost of performance vs. actual cost of performance, not estimated vs. actual labor RATES. I would think that you want to establish the target prior to performance or as early as possible, so that other factors related to performance are not affecting or clouding the objective of adjusting the TARGET cost due to a change in labor rates..