jtolli

Under the principles of Federal Appropriations Law is it permissible for Other Direct Cost (ODC) funds on a severable services contract to ?cross? fiscal years? For example; you have a Firm Fixed Price contract with fixed price labor CLINs and a cost type ODC CLIN that is used to fund for travel. The period of performance is 1 July 2010 through 30 June 2011. The contract is funded with FY10 O&M funds (1 year money). Can the FY10 funds on the ODC CLIN be used for travel that occurs after 1 Oct 2010 (FY11)? Under the bona fide needs rule, is the travel a bona fide need of FY10 or FY11? I have read the portion of the GAO Red Book in Chapter 5 that discusses services rendered beyond the fiscal year and states in part, ?Most federal agencies have authority to enter into a 1-year severable service contract, beginning at any time during the fiscal year and extending into the next fiscal year, and to obligate the total amount of the contract to the appropriation current at the time the agency entered into the contract.? But does that apply to all of the funding on the contract, or just the actual ?services? (labor) portion of the contract? In the portion of Chapter 5 that discusses materials, it says in part, ?An agency may not obligate funds when it is apparent from the outset that there will be no requirement until the following fiscal year?. So is that the portion of the bona fide needs rule that would apply to the ODC portion of the contract? If you know that part of the travel will occur in FY11, should that portion be funded with FY11 funds?

I have always been curious about FAR 16.301-1 (for cost reimbursement contracts) which reads in part, "These contracts establish an estimate of total cost for the purpose of obligating funds and establishing a ceiling that the contractor may not exceed (except at its own risk) without the approval of the contracting officer." How should this be interpreted? Taken at face value it seems to indicate that the contractor may exceed the contract ceiling, but may not get reimbursed if they do. If that is what it means, does that mean it's OK for the contractor to work at risk as long as the Government doesn't know they are doing it?

Sounds like those (QBI, QAY, etc.) could be references to columns on a spreadhseet.

Very informative and educational post Vern. Thank you very much!

I have always been under the belief that option years must be exercised as written in the contract, and no changes can be made. FAR 17.207(f) states in part that the contracting officer shall make a written determination that "exercise is in accordance with the terms of the option." However, it seems that it is common practice to make changes to options at the time they are exercised. I recently attended CON 120 and this issue was briefly discussed in regards to one of the class room scenarios. The primary instructor indicated that you could make changes with the option when exercising it. A couple of us questioned this, and the instructor in essence said that as long as no one (implying another contractor) found out, then it was OK. When we questioned the second instructor on the side about this, she did say that options had to be exercised as written. We now have a situation at hand where the government wants to exercise an option on a services contract, but reduce the work required which would require the contractor to provide less people to do the work. Could this be done without entering into sole source negotiations with the contractor? Could this be considered a partial termination for the convenience of the government? Could it be considered a de-scope? Would partially terminating or de-scoping the contract upon exercising the option put the government in a sole source environment? I would be interested to know of any case law regarding this. While I was attending CON 120 I was able to find some case law, but it was rather old and wasn't exactly relevant to the scenario presented in the class or the situation now at hand. By the way, the contracting officer for this contract says that you can make changes to the requirement when exercising the option year, but I am skeptical based on what I have been told in the past and would like to have some case law to support my position if my position is correct.

I've seen this happen where the government provides a name and resume to the contractor of a recommended candidate that they want the contractor to hire. The contractor, wanting to keep their government customer happy, hires the candidate, the candidate doesn't work out (can't meet performance objectives) and the government then tells the contractor to fire the person. The contractor essentially then says, "this was the person you told us to hire, so don't hold this against our performance rating on the contract." It certainly puts the government in a sticky situation, so I don't allow my customers to do this. Although I'm sure it still happens on occasion without my knowledge.

Steve, It would also be a good idea to define CHESS. Are you talking about the Army Computer Hardware, Enterprise Software and Solutions program?

The rule with regard to end of FY contract awards in all agencies where I have ever worked is actual performance has to start in the current fiscal year. The way it was always explained to me is the contractor had to incur some expense in the current fiscal year. So this could be one billable hour of work, making (and paying for) travel arrangments, etc. It wasn't enough to simply have the period of performance start, but an expense also had to be incurred. I have never heard the term "substantial performance" mentioned in regards to this matter.

I don't think FAR 22.18 places any restrictions on hiring non-US citizens. It will require contractors to verify employment eligibility of their workers, but legal immigrants (non-US citizens) are typically authorized to work in the U.S. All E-Verify will do is help ensure illegal immigrants aren't hired. It would seem to me there are no across the board restrictions on contractors hiring non-US citizens as long as they are authorized to work in the U.S., and they don't require a security clearance. I have dealt with contracts in the past however that only allowed U.S. citizens to be employed on the contract, and any exception had to be approved by the Contracting Officer. But that was language specifically placed in those contracts.

That's true if the contractor employee(s) requires a security clearance. The National Industrial Security Program Operating Manual (NISPOM) requires that an individual be a US citizen in order to be granted a security clearance. But govt2310 didn't mention that the contractor employees require a security clearance.

Thanks for all the good input. I like learning new things. So, let's assume that I have a FFP LOE contract. I notice FAR 16.207-3 (d) states one of the limitations for use of this type of contract is, "The contract price is $100,000 or less, unless approved by the chief of the contracting office." My contract is valued at nearly $4.5 million, so if it is a FFP LOE contract, then it would had to have been approved by the chief of contracting office, and it may have been but I don't have that information.

No, I looked for that too.

Formerfed, The contracting office considers it a FFP order. It was done through PD2. I am trying to understand how it can be a FFP contract based on how the CLIN is set up, and how the contractor bills. I have never seen a FFP contract with CLINs set up like that. Don, Thanks, yes I read paragraph (i) of 52.212-4, but didn't want to make my original post too long. I was mainly referring to the fact that it doesn't have the T&M payment clause in the contract, but wanted to point out it is obviously considered a commercial service since 52.212-4 is incorporated. In reading paragraph (i) it says, "Items accepted. Payment shall be made for items accepted by the Government that have been delivered to the delivery destinations set forth in this contract." So if this is a FFP contract, and hours are not worked, then I would say the items (hours) aren't delivered/accepted, and shouldn't be paid for. So, then it wouldn't seem to be a FFP contract. I am also aware that contracts for commercial services normally should be FFP. So I am wondering if maybe that's why the Contracting Office wants it considered a FFP contract. Finally, there is no end deliverable to provide. The scope of the contract requires the contractor employee to come to work and provide support on a day-to-day basis. Since the contractor invoices us based on the number of hours worked, then my thinking is once they reach 1920 hours, they can't come to work any more unless a mod is done adding hours and funds to the contract. But the view of those who I am debating with say hours don't matter. If the contractor works more than 1920, then we don't care because it is fixed price. I haven't brought this up with them, but what if the contractor has billed us for all 1920 hours, I guess by their thinking the contractor would have to stop invoicing us as there would be no funds remaining to pay their invoice. The others in my office say if the contractor works less than 1920 hours, then they can submit an invoice at the end of the period of performance for all remaining funds, whether the hours are worked or not. That just seems so wrong to me. Again going back to 52.212-4(i), if we haven't received the items (hours), then why should we pay for them?

I am having a debate with someone in my office regarding the type of contract I am working with. Here are the pertinent details. 1. The contract is for network engineering services. 2. The contract does not include any payment clauses (e.g. FAR 52.232-7). 3. The contract does incorporate by reference FAR 52.212-4 (Contract Terms and Conditions?Commercial Items.) 4. The contract was awarded as an 8(a) set aside. 5. The contract has a labor CLIN that reads as follows: NETWORK ENGINEER, FFP. The quantity is 1920 Hours with a Unit Price in Dollars. 6. The contractor submits monthly invoices based on the actual number of hours worked for the month, multiplied by the unit price. I say this is a T&M contract (it also has a CLIN for travel that is labeled as ?COST?). My office mate says it is a Firm Fixed Price contract because the labor CLIN says ?FFP?. My argument is that if it?s a FFP contract, then the CLIN would not be awarded with a quantity of hours and a unit price per hour. I believe when the contracting office awarded it the FFP refers to the fixed hourly rate. Can you have FFP contracts that are awarded with a quantity of hours and an hourly price? Wouldn?t a FFP contract typically be awarded with a fixed lump sum for labor, or perhaps a fixed monthly price for labor?

This doesn't seem odd to me at all. In my experience with service contracts it is a common occurrence. The problem as I see it is that customers develop relationships with contractor employees, much as they do with their fellow civil service employees. They know about their families, their hobbies, etc. So when it comes time that their "fellow" employee is going to lose his or her job, then the customer obviously feels bad for that employee. Of course I am assuming that when you say the customer is disappointed with the new contractor the case is really the customer is actually disappointed with the new contractor's employee. I had a recent experience where a new contract was being awarded, and it looked like the new contractor was going to be bringing in a new employee. The customer had already determined before the new contract was even awarded that there was no way the new contractor (actually the new employee) was going to be able to do the job, and was asking how long after award they had to wait before requesting the contract be terminated. I have another contract ending this week where a new contractor will be taking over, and as of now it appears that they will be bringing in all new employees. So the customer is asking how we can keep the current employees because "they are good people". In my experiences this has always been resolved by the new contractor hiring on the incumbent employees, even though it happened at the last minute. I would think this is common throughout government contracting with service contracts, which is probably the reason why the President signed the Executive Order giving incumbent employees right of first refusal. Is your situation where one where the customer is truly biased against the new contractor as a company, or is it the new contractor brought in a new employee, and is that the real reason the customer is dissatisfied? If it is a case where the customer really is dissatisfied with the new contractor (company), with no obvious valid reason, then I certainly would question that customer?s relationship with that company.

That's good to know information Joel, but just for clarification do you mean subchapter 451? I can't find subchapter 415, but SC451.15.2.2. states, "Persons or organizations having a commercial or profitmaking relationship with the Department of Defense or with a DoD Component shall not be granted recognition, unless the contribution is substantially beyond that specified or implied within the terms of the contract establishing the relationship, or the recognition is clearly in the public interest." Thanks!

I know a major focus of this is to convert in-place contractor employees to GS employees, and there are probably a lot of those people who do not want to convert. But there are also a lot of people in the commercial sector who would like to get into DoD contracting but have been blocked from doing so as many of the DoD contracting positions have been advertised as either "internal" or only open to candidates with "status". I never really understood why DoD did that, as they are typically stealing people from one agency (DoD or non-DoD) to fill vacancies in another and restricting bringing in "new blood". In my last job (non-DoD) I was a term civil service employee which didn't give me the necessary status to apply for a lot of DoD vacancies. Fortunately I eventually got my foot in the DoD door because I was a retired vet. I know some other people who previously spent time in DoD as term employees, took a job in the commercial sector because it seemed to offer longer term security over a term appointment, and are now having a hard time getting back into DoD because they don't have "status". Hopefully DoD will open up the doors a little wider with this new influx of civil service employees.

Here's a question and answer from the Ask-A-Professor site that would lead one to believe the DoD memo applies to 8(a) also. Can I use GPC for a service buy under $25k if it is off a GSA contract schedule holder? Posted to Government-wide Purchasing Card on 4/1/2009 12:00:00 AM The Scenario? I have a requirement to have some furniture moved to another building. The price exceeds the micro-purchase limit but is not over $25k. The Question? Can I use a GSA schedule holder if I get 3 quotes? If not, may i issue a P.O. directly to an 8(a) contractor -------------------------------------------------------------------------------- I recommend you read FAR 13.301 which addresses utilization of the Government Purchase Card in greater dollar amounts. To answer your question on going directly to an 8a Firm, I recommend you read Memorandum for Secretaries of the Military Departments, Under Secretary of Defense, 10 Mar 2009, at https://acc.dau.mil/CommunityBrowser.aspx?id=275888.

For what it's worth, I have a Government Contracts Dictionary that was provided to me many years ago when I went to my first contracts training class. I use it quite often. It doesn't always give the source for its definitions, but in the forward it says it has been compiled from scattered elements of Federal, State and local government contracting regulations and literature. Here are the definitions it contains for Contractor and Vendor: Contractor: (1) A supplier, vendor or manufacturer having a contract (commitment) to provide supplies or services to the Government. (2) Any individual or other legal entity that (a) directly or indirectly (e.g., through an affiliate), submits offers for or is awarded, or reasonably may be expected to submit offers for or be awarded, a Government contract, including a contract for carriage under Government or commercial bills of lading, or a subcontract under a Government contract or ( conducts business, or reasonably may be expected to conduct business, with the Government as an agent or representative of another contractor. Vendor: (1) Seller. Means a supplier of goods or one who operates in real estate; a supplier of a house, etc. (2) An individual, partnership, corporation or other activity which sells property to the military establishment. A vendor may supply a Government contractor. See Contractor.

Vern, point(s) taken. Actually I am a very helpful type of procurement person, even if I do say so myself I usually end up working with them to develop cost estimates, and am putting together some training materials now that everyone will hopefully benefit from. The problem at the moment is by the time I get involved they (the technical people) have already gone to a vendor and got a quote. While they won't admit that they provided the vendor a copy of the PWS, it looks suspicious when the vendor's quote has the same labor category that the customer used in the PWS, which isn't a standard labor caegory. I actually called one vendor and the vendor told me they wrote the PWS and gave it to the government. The real issue I have is the technical person giving me a package with one quote from a vendor, and when I ask them for an Independent Government Cost Estimate (IGCE), they say the quote is their IGCE. So, I have to explain to them the purpose of the IGCE. I certainly don't throw it back in their face and tell them to get something else. I am aware of industry days, draft solicitations, pre-solicitation conferences, etc. Those may be good if we had time to do something like that. Unfortunately, by the time the customer comes to me with their requirement they are expecting to have their service in place within a month. Also, most of these requirements are under $500K, so may not be worth doing some of the other things. Lazy was a bad word to use, the problem is the technical people just need educated and trained.

fomerfed, that's my line of thinking too. I just need to change the mindset of some of our technical people. They tend to go out to vendors and ask for pricing in order to develop cost estimates. Their reasoning being the vendor has the capability to determine what skill sets are required, and therfore what labor categories and rates are appropriate to meet the requirement. I think they are just being lazy, and don't want to put much work and thought into developing cost estimates. I have some reservations with the Ask-A-Professor answer that "...any information be provided to one potential competitor that may result in a competitive advantage then that information should be included in the resultant solicitation." If we follow that line of thinking, then we could share the PWS with one vendor weeks before the solicitation is issued, and then say we are OK since the PWS will be shared with all interested vendors when the solicitation is actually issued. Obviously the vendor who saw the PWS initially will have a significant haedstart on developing a response to it. I am new at my present job, and don't know how long this has been going on, or if the Contracting Officer's are aware that it is happening, but will find out shortly what their take on this is.

I read a question and answer on the DAU Ask-A-Professor web site as listed below. I was curious as how some of the experts here feel about this answer? I have a similar situation where I work now. A particular vendor saw, or probably saw, the Performance Work Statement (PWS) for a requirement. If the PWS was revealed, it was done by the technical people as part of their market research to develop an Independent Government Cost Estimate (IGCE). So my question is; is sharing the PWS with a particular vendor (or vendors) as part of market research an acceptable practice, as long as the PWS is included in the reusltant solicitation, which it will be? It seems to me that other vendors could complain that one vendor had advance knowledge of the requirement, and therefore more time to develop a proposal. Here is what was posted at the Ask-A-Professor site: Quotes & Proposals Posted to Pre-Award Procurement and Contracting on 3/11/2009 12:00:00 AM The Scenario? My Division CHief says it is OK for techical people in our organizatioon to accept quotes and proposals from vendors as long as we let them know they are non binding. The Question? When, if ever, is it ok to receive quotes or proposals from a prospective vendor if you are not a contracting officer? -------------------------------------------------------------------------------- Request for Proposals (RFP), Request for Quotes (RFQ), and Invitation for Bids (IFB) have specific meanings in federal acquisition. Therefore responses to them should be the domain of the contracting officer. Government personnel conducting market research may request technical as well as pricing information. Care must be taken during market research to ensure that industry understands the informality of market research. Also, care must be taken not to share one competitor's information with another. Additionally should any information be provided to one potential competitor that may result in a competitive advantage then that information Should be included in the resultant solicitation.

I would say yes, award can be made without evaluating the technical portion of the other offerors. The reason I say that is, what would be achieved by evaluating the remaining proposals? Under LPTA you are awarding to the offeror with the lowest price on a go/no-go basis for technical factors. So it doesn't matter how "good" the offerors technical solution is, as long as they pass the acceptable threshold, then it comes down to price. So common sense would tell me that you would do the price evaluation first, rank the offers by price, and then not need to go any farther once you found a technically acceptable offer.

Each Agency has their own web site dedicated to the Recovery Act. Listed below is what DoD says their portion of the funds will be used for. Looks like a lot of construction contracts mostly. $4.2 billion in Operation and Maintenance accounts to upgrade DoD facilities, including energy-related improvements $1.3 billion in military construction for hospitals $240 million in military construction for child development centers $100 million in military construction for warrior transition complexes $600 million for other military constructions projects such as housing for the troops and their families $300 million to develop energy-efficient technologies $120 million for the Energy Conservation Investment Program (ECIP) $555 million for a temporary expansion of the Homeowner?s Assistance Program (HAP) benefits for private home sale losses of both DoD military and civilian personnel $15 million for DoD Inspector General oversight and audit of Recovery Act execution

What if the Government isn't totally happy with some of the incumbent employees on the contract? In the past I worked for a contractor submitting a proposal on a contract being re-competed. The incumbent contractor had earned a reputation of being somwhat sloppy in their workmanship, with some of their employees being lazy. Granted a lot of those types of problems can be fixed by strong management, but we (the outside company) wanted to bring in a largely fresh set of people so there would not be an impression, if we won, that it was status quo with the contractor employees merely putting on a different color company shirt when they came back to work on Monday working for a new company.