kevlar51

If it's sole source, then their justification for adjusting your hours to put you on equal footing with other bidders makes little sense. Agreed with Joel--you're in a much better position in a sole source environment to negotiate and reach a clear meeting of the minds. Discuss your concerns with the Government, and figure out their concerns. Then resolve them in the contract document.

You still need to pay it. The IFF is incorporated into your schedule pricing. It's not something to be added after the fact.

This bears repeating. More often than you think, Government program management won't be expecting an invoice for higher than the laptop's sticker price. Be prepared to fight them on this, because procuring material has additional costs associated with it, and if you only bill the laptop sticker price, then you're losing money. And I don't know if your contract type allows profit on materials. This whole deal can be a slippery slope. You might buy the laptop now, and then the program team decides it's a lot easier and quicker to have you buy their equipment rather than their contracts office. That's not a good position to find yourself in, and it's made significantly worse if you're losing money on every purchase. I suppose an extra benefit to billing actual costs is the Gov't might be less inclined to come back for more due to sticker shock (not always the case).

I had a Government customer years ago that would consistently insist that they did not want, and would not pay for a warranty. OK, fine with us. But once something happened with the equipment, they (rightly or wrongly) claimed it was a latent defect.

All fair points. And with that, I'm now more confused at what the OP is concerned with "losing." Though the chances of an overzealous COR are high, at which point it's hard to apply the rules when the "rules" are all in one person's head.

I suppose that's a question for the OP. Was the subcontract price included included in the overall estimated cost? Was the estimated cost tied exclusively to an LOE?

It depends on whether you're a shareholder or an employee. Shareholders (and mid/upper management) will want to see maximum profit and will be quite pleased with your example. Employees (and lower management assigning them to tasks) will want to maintain as many hours as possible for their own staff to keep them working on Government funds. In OP's case, I'm not sure where the extra funding is coming from for the FFP subcontract if he doesn't want to tie it to the LOE (assuming the estimated cost is tied to the LOE).

Thanks very much for the cite, Vern. This has been informative--I've printed out the full article for some light reading later on.

How much should Whynot be concerned with the covenant against contingent fees? I'm not well-versed on the exceptions but flags go up when I read about arrangements like this.

Sounds like the logical solution would be to get the Prime to pay the sub in accordance with the subcontract terms.

What does the solicitation text say regarding changes in Key Personnel? Here's another recent GAO protest (YWCA of Greater Los Angeles), dealing more with agency action after notification, but I feel to be relevant: https://www.gao.gov/assets/690/686617.pdf

Ha, I don't think that argument applies to my current scenario. But I'm absolutely guilty of making it when the need arises (and with equal success on my end).

Please don't use facts and citations to prevent my decent into disgruntled oldmanhood.

Purely anecdotal, but it's been years since I saw a true UCA. Large contractors I've worked with tend to shy away from them and have established rather strict internal approval requirements. I imagine it's tough for a CO to put one in place for similar reasons. Both sides of the table seem to think that a UCA is a huge advantage for the other party--Gov't sees it as a license for the contractor to run costs up and contractors see it as a license for the Gov't to kill their profit on the backend. Since these stricter internal requirements have been put in place, I don't see UCAs. I instead see lots of ATPs, NTPs, Letter Contracts, At-risk-orders, etc. Basically come up with anything you want. Just don't call it a "UCA" because that has to get signed off up top.

You won't be able to compel the Government to make award. It's curious that they went through negotiations with you (did you agree to a price?) and then decided against it. But it's far from unheard of, especially in the last two weeks of September.

To add to this, Contract Specialists I'd work with were constantly in multi-week training seminars. Yet I'd absolutely never see any changes in outcomes, because training all gets forgotten when they get back to whatever procurement culture their agency has fostered over the decades.

Do you have a disclosure statement that identifies these costs as G&A?

I haven't personally seen an IDIQ contract terminated for convenience. From a contractor's perspective, I've seen plenty of dead IDIQ contracts that probably should have been (and two that I really wished would have been). But the folks on the Government side I've worked with always seemed to go with the "we might be able to use this in the future" approach, figuring at worst they'd just stop ordering from it and it'd go away. On one occasion, an agency had an IDIQ with Company X for a specific solution. Then the agency combined Company X's solution with our own and placed it under a new IDIQ with Company X as sub to us. The agency left Company X's IDIQ open and stagnant, which created a toxic environment in the program because Company X (a necessary sub) held the very vocal belief that once we inevitably failed, the agency would pull the program from our IDIQ and place it back under theirs. I had a very good working relationship with the CO, and brought that issue up. Perhaps a bit presumptuously on my part, I asked if he'd terminate the sub's IDIQ--it wasn't utilized and its existence was having a negative effect on the program the agency was paying for. The CO was understanding, but didn't want to lose the IDIQ, because if some unforeseen event came up and they needed it, it'd be there for them.

GeoSystems (B-413016, 2016) made the argument that 15 pages was insufficient for their tech volume. But it was a post-award protest--they'd shoved lots of their solution in other areas of the proposal and protested when the evaluation team didn't count the information. The Comp. Gen. denied the protest. Sort of on topic (but the protest makes me laugh)--DKW Communications (B-412652.3, 2016), where the awardee fit their tech volume into the 10-page limit by significantly reducing the line spacing. It might have actually gone unnoticed if they hadn't used normal spacing in the rest of their proposal. The Comp. Gen. counted 66 lines/page in the tech volume and 44 lines/page in the rest.

A joint venture is a separate legal entity from its individual members, so it would need its own contract. An alternative is a contractor team arrangement, but both members would need to have something to offer from their respective schedules to meet a specific solicitation's requirements.

You post describes incredibly well an issue that recently fell into my lap (at least up to item 6), in my case the COR is rejecting invoices for "incorrect labor rates"--a discrepancy that has arisen due to rate differences between the schedule, BPA, and orders. The BPA and orders are unambiguous--services are to be performed on a firm fixed price basis, with no mention of LOE. But it's being administered as a T&M contract, and I'm told "that's just how it's always been done." Multiple CORs, COs, and Contractor PMs have been involved in this and I can't determine who initiated the process. I'm hoping I can sit everyone down and explain how much easier, less time consuming, and contractually correct managing a FFP contract like a FFP contract will be. But the Government recently sent the contractor a bilateral mod for a completed order to decrease the price by the unbilled value (the contractor has not signed it), so I'm not confident the discussion will go well.

For a FFP contract, the output should be your primary concern (I can't comment on whether your contract allows for others). If you are satisfied with the end result, even when the contractor put forth measurably less effort, then consider that fact for any follow-on solicitations.

If their workshare is based on a percentage of revenue (agreed with above that this was a bad idea), then they’ll figure out what the contract value is once they get their subcontract. And if you still won’t tell them your contract value, then they’ll assume you’re lying to them. I realize proposal values are not necessarily the same as final contract value, but if you’re going to need to ultimately disclose the contract value then hiding the proposal value won’t accomplish much.