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aordway

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  1. @Don MansfieldI will have to inquire as to if the contractor meets the definition of nontraditional defense contractor or not, but I had not considered that as a method of making certified cost or pricing data exempt. Thanks for that suggestion. If we assume they are not a nontraditional defense contractor (for argument's sake), then to sum up where we stand thus far, a non-commercial purchase in which a fair and reasonable determination can be made without the need for cost or pricing data (because cost or pricing data by definition is information that includes or supports cost elements, and the data in hand is that which supports the total price proposed), would therefor NOT fall under the 15.404-1(a)(3) requirement to do cost analysis when certified cost or pricing data is required, therefore a cost analysis would not be required to be performed because we have no cost or pricing data as it was not necessary for this procurement's fair and reasonable determination. However, because we are claiming certified cost or pricing data is not needed, and this is a negotiated procurement over $2M, then we would require a waiver of the submission of certified cost or pricing data in accordance with 15.403-1(c)(4), which is reserved for "exceptional cases" and requires HCA approval, both of which may deter us from requesting the waiver out of prudency. And if we decide not to submit for that waiver, then we would be required to request "unnecessary" certified cost or pricing data and do a cost analysis to reach the fair and reasonable determination to comply with the Part 15 rules. Is that the correct summation of everything I have learned on this post?
  2. Hmm I thought we were on the same page there. This makes it seem like certified cost or pricing data is required prior to award of a negotiated contract above the threshold (it does not make the need of that info by the contracting officer to make a fair and reasonable determination as a condition for its requirement). As a result, I understood the word "required" in FAR 15.404-1(a)(3) to reference only these two factors; above the threshold, and a negotiated contract. However it seems you view the word "required" in FAR 15.404-1(a)(3) to mean "needed by the contracting officer to make a fair and reasonable determination" no matter the dollar value, which completely changes the discussion I have been having on this entire post. My initial example in my very first post was trying to get at this specific question. I had said: My example tried to illustrate a situation where it appears cost or pricing data was not required to make the fair and reasonable determination, yet the acquisition met the two stated requirements for certified cost or pricing data: above $2M and a negotiated procurement. I understood your response to say that cost analysis is required in my example, despite the fact that i did not need certified cost or pricing data to make a fair and reasonable determination. Now, it appears you are saying that even if I have a negotiated procurement above $2M (which meets the only two requirements for being required to have certified cost or pricing data), if i don't actually have any cost or pricing data or cost elements to evaluate, then i did not "require" cost or pricing data in accordance with what 15.404-1(a)(3) says, and therefore I need not conduct cost analysis. Am I understanding your thinking correctly?
  3. That is not what the FAR says, IMO, and that is not what Don said, IMO. @ji20874 what Don just now said in item #1 of his post (When certified cost or pricing data are required, cost analysis is required and price analysis should also be conducted) and what you say you agree with seems identical to me to the statement I made in your first post, in which I said "when cost or pricing data is required (i.e. when the contract is over $2M), fair and reasonable price determination must be made through the cost analysis method" and you said you do NOT agree. Help me understand how you agree with one and not the other, since they seem like they are saying the exact same thing. Are we all in agreement that "certified cost or pricing data" could be comprised entirely of information that aids only a price analysis and not a cost analysis? Are we in agreement that when the FAR says "when certified cost or pricing data is required", it is talking about the dollar threshold, and not "when certified cost or pricing data is necessary to come to a fair and reasonable price"?
  4. @Don Mansfield Thanks. If that is the case, can you expand upon what your initial post was trying to convey? I feel like I am getting mixed messages. My initial question was "Is 15.404-1(a)(3) trying to say that (a) WHEN individual cost elements have been proposed (or when a Contracting Officer has requested they be submitted/proposed), they must be evaluated using cost analysis, OR is it trying to say that (b) cost analysis must always occur when certified cost or pricing data is required? Stated another way, could we do only a price analysis when certified cost or pricing data is required?" [I added (a) and (b) for clarity's sake] You had initial said that (b) is the one that is correct; "cost analysis must always occur when certified cost or pricing data is required". As a result, that would mean that the requirement to perform cost analysis is not based on if you have had cost elements broken out/proposed/provided, but rather is based on the certified cost or pricing data threshold of $2M. Said another way: you must do cost analysis when the purchase is over $2M, regardless of if you have/need/want cost elements to review. ji20874's post says that if you have cost elements, you use cost analysis, and if you have just price proposed, you do price analysis. That would correlate to (a) I think. Are you now saying (a) is the correct interpretation? Or still saying (b) is correct?
  5. @ji20874 That's what logic would tell me makes sense, however that appears to be the opposite of what Don stated. I'm curious what you take Don's initial response to mean. Or perhaps @Don Mansfield can let us know if he agrees with your post or not. I would also note that it says cost analysis SHALL be used, and price analysis SHOULD be used. It does not use "shall" in both instances. Also, it does not require cost analysis when cost elements are submitted, but rather when certified cost or pricing data is required, which is at $2M. Although what I think you stated is how i thought it should work, I can't help but think the FAR would have worded those two sentences a lot differently if that's what they intended it to mean. @joel hoffman My scenario would indeed be for a sole source situation, since we cannot rely on price competition to make a fair and reasonable determination (or could be for a competitive acquisition where only one offer was received, since DOD cannot rely on the "expectation of competition" fair and reasonable determination strategy any longer. A non-commercial purchase is likely unique, which would make price analysis difficult or impossible in most circumstances, but I would not say that is always the case. I'm curious about the situation where a price analysis is possible for a non-commercial purchase, and am just trying to determine if the FAR allows only a price analysis to occur.
  6. @Retreadfed I'm just talking about fair and reasonable price determination. FAR 15.404-1(a)(3) says "Cost analysis shall be used to evaluate the reasonableness of individual cost elements when certified cost or pricing data are required." That appears to say, and with Don's guidance, that when cost or pricing data is required (i.e. when the contract is over $2M), fair and reasonable price determination must be made through the cost analysis method. It does not say "when certified cost or pricing data is submitted" or "when certified cost or pricing data is requested", but says "when required", whether actually submitted/needed for the fair and reasonable determination or not. It seems then that the need to do cost analysis is tied to a dollar threshold rather than submission of actual certified cost or pricing data. Submission in the Table 15-2 is optional in accordance with FAR 15.403-5(b)(1). If we requested info in the Table 15-2 format, then yes we would receive a breakdown of cost elements, and it would be obvious that a cost analysis would be the best way to evaluate those submitted elements to determine a fair and reasonable price. If the initial citation said "a cost analysis is required when individual cost elements have been submitted as certified cost or pricing data", there would be no confusion. But since the citation says "when certified cost or pricing data is required", and the requirement occurs for anything over $2M, that citation then applies to purchases where we did not request cost element breakdowns at all (whether in the 15-2 format or another format) because we have sufficient pricing data to determine the overall price proposed fair and reasonable. The citation referenced requires (apparently) that we perform a cost analysis in that situation nonetheless.
  7. Thanks @Don Mansfield. This would be for DOD, so the FAR 15.403-1(c)(1)(ii)(B) allowance could not apply. How does that jive with DFARS PGI 215.404-1(c)(i) where it says "When the contracting officer cannot obtain sufficient data to perform a price analysis in accordance with the pricing steps in FAR 15.404-1(b), a cost analysis is required." In my example, we do have enough pricing data to perform a price analysis. The DFARS seems to say try and do a price analysis first and foremost. I guess 15.404-1(b) is missing something that says "unless you are over the cost or pricing data threshold, in which case you must expend time and resources to evaluate using cost analysis despite the sufficient pricing data already in hand"? I don't quite understand the logic behind the mandate to evaluate using cost analysis, but perhaps I should not be looking for logic within the FAR... Thanks again.
  8. Can someone help me understand FAR 15.404-1(a)(3)? It says: "Cost analysis shall be used to evaluate the reasonableness of individual cost elements when certified cost or pricing data are required. Price analysis should be used to verify that the overall price offered is fair and reasonable." Is 15.404-1(a)(3) trying to say that WHEN individual cost elements have been proposed (or when a Contracting Officer has requested they be submitted/proposed), they must be evaluated using cost analysis, OR is it trying to say that cost analysis must always occur when certified cost or pricing data is required? Stated another way, could we do only a price analysis when certified cost or pricing data is required? For example, lets say I have a non-commercial purchase for a supply item that will cost $2.5M. The Contractor is able to provide numerous previous invoices proving they have sold the item in question to other Government agencies at the same price. As a result, we feel we are able to justify a fair and reasonable price based on price analysis alone. However, because the purchase is above $2M, certified cost or pricing data is required per 15.403-4(a)(1). And also as a result, 15.404-1(a)(3) says that cost analysis SHALL BE USED. If we were to award our contract using only price analysis, did we comply with 15.404-1(a)(3) because no cost element breakdown was submitted or requested to be submitted? Or did we fail to comply with 15.404-1(a)(3) because cost analysis was not used at all in the evaluation, and it says cost analysis "shall be used"? It seems like the current wording in 15.404-1(a)(3) does not account for the possibility that certified cost or pricing data could be required without a cost breakdown of individual cost elements being submitted.
  9. On the SF30 form used for contract modifications, Block 1 ways "CONTRACT ID CODE", and the instructions for filling out the SF30 on page 2 says "Insert the contract type identification code that appears in the title block of the contract being modified." What is the SF30 form looking for us to insert in this block? I could not locate a field called "contract type identification code" or anything similar on common award documents (SF26 and SF1449). My logical assumption is that it just wants the 9th digit in the Procurement Instrument Identifier(PIID) [e.g. C for contracts or P for Purchase Orders], however we use PD2 as our contract writing system, and the dropdown choices we have for completing Block 1 are A, J, K, L, R, S, T, U, V, Y, or Z. C and P are not answer choices, which makes me think that it is asking for a different code than the 9th digit in the PIID. Anyone know what this question is asking?
  10. Thanks @Don Mansfield, I think "constructive waiver of right to be paid" is a great way to look at it, rather than viewing it as a supplemental agreement to the contract as I had been. I can definitely get on board with that. @Ibn Battuta It comes from the Assistant Secretary of the Army (Acquisition, Logistics and Technology) via PARC Policy Alert #18-46 (written in 2018), which states you should not issue a contract mod in any circumstance, and that guidance rescinds and updates PARC Policy Alert #13-39 (written in 2013) which previously stated you should not do a mod unless the KO feels it is prudent and necessary.
  11. Thank you. The Red Book and FAR 43 references seem to say that IF you are doing a mod, they must be done in accordance with those regulations, but they do not address the need for a mod in the first place. 31 USC 1501 seems to say that you only record an obligation when you have a valid contract (meeting the definition of "contract"); I'm not entirely convinced it answers the question of needing to adjust an obligation downward (but if you did choose to adjust an obligation downward, it would need t be a binding agreemnt in writing before you did so).
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