rafieldjr

Well, "for now" has expired, Vern. Industry has made a motion to AT&L to reconsider -- Contractors complain about Pentagon limits on labor rates http://cdn.govexec.c...t/092012cc1.pdf Just a bunch of whiners, 350 of them, I guess . . .

. . . Aaand Vern furnishes the image to go next to "pseudo-intellectual joker" in the dictionary. Laugh if you want Vern, but Infoseeker's depiction of the emperor with no clothes is pretty dead-on. Maybe some time out of the classroom and in the trenches for a reality check is in order. When I came here as a new participant, it was with the honest belief that I would find seasoned, thoughtful analysts of the acquisition art with whom I could converse on a patently defective piece of legislation and companion regulation. The idea was to put heads together on damage control, as well as perhaps generate a head of steam of rational thought that might result in a correction of the big goof. Instead, I found cheerleaders for a broken system, defensive bureaucrats, and self-satisfied masters of the gratuitous slur . . . and a few honest souls. I was actually taken aback by the haughty and sneery reception. Took a few iterations to get acculturated. Got there, 'though. Guess I'll put the question to Facebook next time. The results couldn't be any worse.

Well, then, that is a different discussion, isn't it? --It certainly has nothing to do with getting "same or similar services' at two-year-old prices. You're talking "workarounds" necessary to exercise damage control for poor policy. Look - all of these arguments in defense of/apology for this garbled law/policy are wholly reliant on a combination of irrelevancies, assumptions about intentions of drafters, belief that regulatory language does not have to say what it really means - sprinkled with occasional ad hominem attacks. Since when did we decide we had to settle for such slop?

I'm glad that is established - perhaps there is hope after all! So, Rooney's memo really doesn't have much significance to the point of the discussion - the 2010 bogey. Will not . . . or can not? I project the latter.

Yes, I did, and alluded to the same in post #48. The history is not mysterious, only the logic.

I do not see anything in Rooney's remarks that pledges allegiance to 2010 price levels. In fact, this appears to want to deflect that notion by merely signing up to the obvious: don't exceed 2012 enacted levels and the 2013 budget, no contracting for inherently governmental work, reduce support services contracting, motherhood and apple pie. We already knew all that and what's more - it's within the realm of the possible! In fact, the silence in Rooney's remarks on the 2010 pricing bogey is deafening! This makes the whole DoD treatment of Section 808 even curiouser. --Sorry, far from "case closed".

Yes, they can, Vern - straight talk or bureaucratic balderdash.

So is this the new, acceptable norm? When ambiguous, confusing direction comes out of Washington, contracting officers should revel in the opportunity to leverage the uncertainty by using their best business judgment? Is this the Mad Hatter's tea party? --and, in anticipation of the claim that it is our responsibility to interpret language rife with multiple interpretations, as that is a basic responsibility of practicioners of contract law - no, I'm sorry, it has NOT always been this way. This is a new era of blatant ambiguity and impracticality that I have not seen before. Here's what SHOULD happen: DPAP should go to the Hill with a well stated petition to have the law changed to something that makes sense - something that doesn't merely rely on testimony that services represents a low hanging fruit ripe for the cost-saving picking (see the Wifcon marginal notes for Section 808). They should then implement the rational law in the normal fashion, such as not to engender the kind of general confusion that we now see. What a concept. Sorry, Vern and Napolik, the emperor has no clothes.

Thanks for posting that, Vern. Infoseeker and I eagerly await the more careful re-reading of the "deviation", to be following by the gesture of the hand clasped over the agape mouth, and the muffled utterance, "What were we thinking?!..." Perhaps it will be found that the "misunderstanding" of those whiney COs reading plain English will be best "clarified" by rewriting the law and its implementing memo. By the way, I have been at this for 39 years (contracts, program, and operations management, government and industry). I have done plenty of negotiating - on narrow to broad charters. I get it. This subject has nothing to do with that - it has to do with a nonsensical piece of guidance that represents a growing tendency out of Base Camp Beltway to those of us on on the LZs and FSBs (I'm also a Vietnam vet).

Very revealing. I don't need to hear any more than that. "DPAP -- We have a problem."

I guess my original point was that the NDAA and the resulting DPAP memo are attempting to "hold the line", or even "move back the line", on services contracting cost by placing cost control responsibility on the hapless contracting officer in a way that flies in the face of marketplace economic realities. The CO is obliged to set negotiation objectives at cost levels that are two years old and/or actually negotiate net, bottom line prices at two-year-old expectation levels. This is notwithstanding any actual history that may have seen costs move upward by reason of any number of factors, including Federal regulation. It is obvious that Federal price controls cannot be mandated on industry. Thus, the contracting officer is potentially put in a position of impossibility of performance - with arbitrary, roll-back price objectives in lieu of a "fair and reasonable price" that reflects reality. Yes, I believe heads of agency will be getting quite a few requests for waiver.

This presumes the scope of the services has not changed in two years and enjoys apples to apples pricing. I do not see that kind of stability in my programs. Even if it were to be apples to apples, there is a second presumption (if one is anticipating success in using the tactic) that the government market is a must-have for the services provider. Not the case in my programs. . . . or as you say, "the question is whether the big player can make it stick". Hardly a game of chance I would want to play - given the choice. Well, so much for exchanging economic theories. I am more interested in what other practicioners may be encountering, or concluding, as they deal with this new requirement. Anyone else in the high-dollar services arena?

I realize what the two paragraphs may have intended to address - they just haven't done it in a way that makes the direction clear, or even feasible. For instance, "price" is inclusive of labor, OH, and all other cost elements in its make-up. Any natural market pressure upwards in the latter will most certainly create an increase in the former. This is what happens wnen the attempt to lower government contracted services cost is addressed through an attempt to unnaturally reverse the natural cost progression of a free market enconomy . . . instead of, for instance, reforming program requirements. As to checking with those in charge of implementation . . . you're talking to one of them! That's why I'm trying to sort this out!

I do not agree that the paragraphs do not conflict. Granted, the law and the waiver are rife with ambiguity, but the second paragraph in a plain English reading has the effect of nullifying the ostensible limitations of the first paragraph - and it is not clear that the conditions of the first paragraph apply to the second paragraph. In any event, I agree with the statement, "Expect the waivers to be used frequently." Barring greater clarification of the law, I am sure this will be the pragmatic approach.

For those performing DoD services acquisition, what is the general feeling about DPAP Memo USA001973-12-DPAP, June 6, 2012 on this subject? Frankly, I am surprised at the lack of reaction in the trade press and the DoD community in general. Briefly, it seems to require mandatory pricing at the FY 2010 levels (whatever and however those are determined to be) for service contracts over $10 million, unless the head of agency waives the requirement. Furthermore, it's two key paragraphs (from the Act) seem contradictory -- (1) Unless rates are otherwise established by law, negotiation objectives for labor rates and overhead rates not as yet formalized by the date of this deviation, for other than the acquisition of commercial items or competitively awarded contracts or task or delivery orders awarded to a contractor in fiscal year 2012 or 2013, shall not exceed labor rates and overhead rates paid to the contractor for the same or similar contract services petformed under contract with procuring DoD component in fiscal year 2010; and (2) Any contract or task or delivery order awarded to a contractor in fiscal year 2012 or 2013 that provides for continuing services at an annual price that exceeds the annual price paid by the DoD component concerned for the same or similar services in fiscal year 2010 shall be approved in writing by the Secretary of the Military Department or Head of the Defense Agency prior to contract award or order issuance. Any thoughts out there? Thanks.