Whynot

I think the question deals with the delta between bid/proposed rates and actual/bill rates. The basis for proposed rates and actual rates should be identical. I think you need to find out what is driving the large delta between the two. It may be that the skill/experience mix of the labor from initially proposed to current actual is very different. If so, what caused the skill/experience to change, is it driven by the prime requirements or is the subcontractor allowed to use whatever labor they choose. You should get a proposal from the subcontractor for each task order proposal. The proposal and actual should not vary so much for no reason at all.

I agree with you on the HUBZones and 8(a) prescriptions. There is no prescription for small business concerns - what I am more concerned about..

Look at it's prescription 19.508(e) and 19.811-3(e). These are mandatory for set aside orders/contracts.

I apologize for the delay in responding to your question, I was away from electronics for a while. Perhaps my use of the word “becomes” is incorrect. I was thinking along the lines of a HUBZone Sole Source (FAR 19.1306(a)) A contracting officer shall consider a contract award to a HUBZone small business concern on a sole source basis (see 6.302-5( b )( 5 )) before considering a small business set-aside or similarly FAR19.1406(a). Here it is clear that you can have either a sole source as described above or a set aside. The clause assumes that you consider the sole source approach first. Perhaps in reality the CO incorrectly uses the same RFP/Contract form for either of the two approaches (sole source and set aside) or they happen concurrently. It seems from the forum’s responses to your original question under this thread that COs are using RFPs for making sole source awards. I find it very likely they are using competitive set aside RFP/Contract form when they do so. I think I was trying to confirm that you have an “either/or” and not a “both/and” situation. I was also trying to get traction with the view that a set aside needs to be competitive. See 41 U.S.C. § 3303( b ) ( b ) EXCLUSION OF OTHER THAN SMALL BUSINESS CONCERNS.—An executive agency may provide for the procurement of property or services covered by section 3301 of this title using competitive procedures, but excluding other than small business concerns in furtherance of sections 9 and 15 of the Small Business Act (15 U.S.C. 638,644).

Do the set aside clauses that are in the solicitation/contract self delete if the solicitation/contract becomes a sole source, such as the limitation on subcontracting (which is mandatory under a set aside only)?

Joel, Thanks for jumping in. The FPDS uses that designation (HUBZone Sole Source and SDVOSB Sole Source) for set aside types. I don't care what you call it that is what it is. If you go to FBO and do a routine search in last 90 days (search partial and total small business set asides, search award notices, search on all the J&A authorities) - what do you get? https://www.fpds.gov/help/Type_of_Set_Aside.htm

There seems to be only two sole source set aside types - HUBZone (19.1306) and SDVOSB (19.14.06). Technically not a set aside but a sole source before making a set aside. This also seems to follow the tracking and reporting in FPDS of set asides - there is no sole source set aside. How come then do you see so many sole source set asides in FBO that do not fall into these two categories?

In case anyone is interested. The citation is: 41 U.S.C. § 3303( b ) (B ) EXCLUSION OF OTHER THAN SMALL BUSINESS CONCERNS.—An executive agency may provide for the procurement of property or services covered by section 3301 of this title using competitive procedures, but excluding other than small business concerns in furtherance of sections 9 and 15 of the Small Business Act (15 U.S.C. 638,644).

It seems that 41 U.S.C. § 3303(B ) requires agencies conducting set-asides to use competitive procedures. As such, it seems as though you can either have an unrestricted sole source procurement or a competitive set aside procurement.

Do you think that under the “similarly situated” framework that any similarly situated second tier subcontractors (subcontractor’s subcontractors) could also be considered in the prime self performance calculation? It would seem to maintain the same spirit and intent of the clause.

Is there such a thing as a sole source set aside? It seems to me that a sole source and a set aside are mutually exclusive. If you have a sole source justification there would be no reason to set aside. The sole source justification does not seem to based whatsoever on size of the contractor. Just wondering.

Yes, I was looking for the interest rate. I have a simple over charge on my last billing.

Where do I find the interest to apply to returning an over payment that I received. Thanks.

It is nice to get a little feedback. I got paid. "Further, the subcontractor has charged similar fees to other government contractors under other contracts and presumably has been paid. We had the subcontractor provide this information directly to the government in support of our invoice." This avenue worked, actually as it turned out, the same CO paid another prime for these same services in the past under another contract but had not realized it. When we pointed it out to them they retracted their position and paid us.

I was originally looking at this as being similar to a conflict of interest in the source selection for a competitive procurement. If a contractor were involved in their selection under a competition then this would clearly be a conflict of interest. However, in a sole source procurement there is no source selection, but there is a sole source justification. Could this sole source justification essentially be considered equivalent to a source selection? Both result in the award of a contract to a particular contractor. If they function essentially the same and the results are the same, does the prohibition on conflict of interest apply to both?

Thank you. You hit on something else that I am curious about. I am not sure that by simply disclosing something makes that something proper. If I wanted to commit a crime would I be exempt from prosecution if I disclose my intentions ahead of time or admit and publish it after the fact? I come across that advice “just disclose what you are doing” frequently with the understanding that I am somehow thus covered legally and contractually. I guess by disclosing, that if someone has a problem with it, they will challenge it. If no one challenges the disclosure then there is no issue. I kind of think that some things maybe incorrect or wrong on their own account, regardless if they are disclosed. With all due respect…

Is it acceptable for a prospective contractor for a prospective sole source contract to provide direct assistance to the program office in the preparation of the sole source justification, or would this assistance rise to the level of a conflict of interest for the prospective contractor and should be avoided or minimized?

Thanks.

Is there a definition of what is meant by new equipment or what is not new equipment? I was thinking that new equipment meant equipment that hasn't been used or that hasn't been refurbished. But I am thinking that it could mean equipment that is not old in terms of its age or hasn't been designated as surplus.

It appears that the first month of the TO started in the middle of the month (partial month). Even though the individual is assigned full time to the TO you need to prorate the first month charge to the customer to reflect actual hours worked on the TO even though the individual is paid by your company for the full month or is working full time. The time before the TO started should not be charged to the customer directly or indirectly. The first partial month charge will be less than the second full month charge. They should not be the same by adjusting the labor rate.

I might be mistaken, but it looks like another one-person debate show blog between original poster and commenter(s)? It is very skillfully done and a pleasure to read. It is a great learning technique. However, forensic linguistics could probably track the written text back to its author through the identification of quirks in our original poster/commenter’s style. But why unmask the Pseudonym(s)?

The government has prior experience with the service and has seen a very similar service performed by other vendors at half the cost.

Yes. I believe that this process has been followed albeit not with official written notification. I am not looking to drive the CO to a final decision. That’s not my problem. I am looking for a way beyond what I have already tried to convince the CO that my cost is reasonable. Something that I missed.

The invoice is being held and not paid. I am not sure if that constitutes rejection.

Under a cost reimbursement contract a cost is being challenged by the government as unreasonable. It is for a fixed priced service by a subcontractor. The government has prior experience with the service and has seen a very similar service performed by other vendors at half the cost. The service was not itemized in the original contract proposal, nor was it competitively procured – it is below the small purchase threshold of $150,000. However, following the prime’s procurement procedures, costs were determined to be reasonable by the prime - this analysis was provided to the government along with a sole source justification. Further, the subcontractor has charged similar fees to other government contractors under other contracts and presumably has been paid. We had the subcontractor provide this information directly to the government in support of our invoice. I would like to hear of possible solutions to this impasse without resorting to disputes or filing a claim.