Jump to content
The Wifcon Forums and Blogs

Matthew Fleharty

Members
  • Content Count

    462
  • Joined

  • Last visited

Posts posted by Matthew Fleharty


  1. 13 minutes ago, Retreadfed said:

    This discussion has focused on techniques for determining if a price is fair and reasonable.  My question is if you cannot define what fair and reasonable is, how do you know that you have it regardless of the techniques you apply?  Is this something like Justice Stewart's explanation of pornography in that "I can't define it but I know it when I see it"?

    You can find a more pertinent example in the oral arguments for Kingdomware Technologies, Inc. v. United States, No. 14-916 (2016) where Chief Justice Roberts says:

    Quote

    These terms imply a lot of discretion: What's fair? What's reasonable? What's best value?  The idea that that's going to operate as a significant restraint on the requirement that the VA locate veteran businesses seems a real stretch to me.

     


  2. 12 hours ago, Jamaal Valentine said:

    What is unclear is what you mean by market based because you also seemed to rely on the other prices (with unknown merits of comparability) as evidence of an effective competition. 'By virtue of competing against the market'? That is overly simplistic and doesn't consider several basic considerations such as a mistakes and defective, vague, or ambiguous solicitations or otherwise ineffective competitions.

    Jamaal, apologies if what I wrote was unclear, but I thought my answer to your question:

    On 9/17/2018 at 5:35 PM, Jamaal Valentine said:

    What is your reasonable argument? Does it involve or rely on comparison of proposed prices?

    With:

    22 hours ago, Matthew Fleharty said:

    Not one bit...

    Was as clear as possible; however,  you're fixated on the concept of comparison of proposed prices while I was stating another way of analysis to determine the price fair and reasonable separate from relying on comparison of proposed prices (technically evaluated or not).  If you'd like to discuss it, you know how to get in touch with me, but an answer to your questions here would only result in repeating myself.


  3. 15 hours ago, Jamaal Valentine said:

    What is your reasonable argument? Does it involve or rely on comparison of proposed prices?

    Not one bit - it relies on an understanding of the competitive markets and the concept of fair and reasonable prices.  For one, the approach doesn't use technically unacceptable offers; that's important because you're presuming those offers are unacceptable...I believe, for these purposes, they're presumed "innocent until proven guilty."  After all, that's how the contractors approach the situation.  If they don't offer a solution that is technically acceptable and the lowest price they're going to lose business to someone who does.  If a determination of fair and reasonable pricing is concerned with too high of a price, I think, generally (because there are exceptions to every rule) it is perfectly reasonable and sound business judgment to consider the LPTA offeror of a competition as not too high (and, therefore, fair and reasonable) by virtue of having competed against the market for the contract.  The fact that you have X number of unevaluated proposals simply serves as evidence of the competitiveness of that market for the requirement.

     

    As for all this talk about "adequate price competition normally establishing a fair and reasonable price," whether it is misplaced or not, compare the second standard  to the situation at hand:

    • Adequate price competition (15.403-(c)(1)(ii): an expectation that two or more responsible offerors, competing independently, would submit priced offers even though only one offer is received...
    • This situation: numerous offers are received, though only one offer is evaluated IAW the solicitation's procedures because it is the LPTA

    If some are willing to hang their hat on "adequate price competition = a fair and reasonable price" why wouldn't they be equally okay doing so in a situation where one receives more than one offer, but only evaluates one?  I think the second situation is far more defensible than the first, regardless of how the FAR defines "adequate price competition" (frankly, it's too narrow...).


  4. 14 minutes ago, ji20874 said:

    FAR 15.404-1(b)(2)(i) says comparison of prices received in response to the solicitation is a valid method of price analysis.  It doesn't say comparison of "technically acceptable" prices received in response to the solicitation.  

    Moreover the list isn't exhaustive nor does the FAR contain a restriction to only use the listed techniques.

    What does FAR 1.102-4(e) say again about sound business judgment?


  5. Let's not forget that the FAR is not a "how to" guide and it isn't definitive or exhaustive on how one determines prices fair and reasonable (emphasis added):

    Quote

    (2) The Government may use various price analysis techniques and procedures to ensure a fair and reasonable price. Examples of such techniques include, but are not limited to the following:

    Is it possible to make a reasonable argument that a LPTA proposal's price is fair and reasonable without knowing whether the other proposals are technically acceptable?  I think so, despite what the FAR may or may not say.

    Next up in "how can we make more non-value added work for ourselves", someone is going to explain to all of us that to meet the standard of adequate price competition the Government must perform contractor responsibility determinations on the unsuccessful offerors in addition to the technical evaluations...

    Quote

    (1) Adequate price competition. A price is based on adequate price competition if --

    • (i) Two or more responsible offerors, competing independently, submit priced offers that satisfy the Government’s expressed requirement and if --

     


  6. 8 minutes ago, Jamaal Valentine said:

    Is there meaningful competition under CICA if an agency does not compare competing offerors' proposed prices in a certain meaningful way

    Jamaal,

    All other things being equal, do you think that offerors would propose different prices under the two LPTA frameworks?

    • Framework 1: Rank all offers by price; evaluate all proposals for technical acceptability; award to the LPTA
    • Framework 2: Rank all offers by price; starting with the lowest priced proposal, evaluate proposals from lowest to highest until one is technically acceptable; award to the LPTA

  7. 27 minutes ago, brent said:

    First, let me say I believe that you award to the LPTA because you have competitive pricing, someone disagreed.

    Matthew, I would award to them if I can reasonably conclude that the offer was submitted with the expectation of competition.

    Brent,

    Could you finish that line of thought?  Maybe the reason you're running into disagreement is because you're not adequately/fully explaining your position/argument...

    Food for thought: Is "competitive pricing" the only way to determine whether or not a price is fair and reasonable?


  8. 1 hour ago, brent said:

    Awarding a competitive task order.  RFP stated that TO would go to LPTA and that only the lowest priced offer would be evaluated for TA (continuing until there is a TA offer, then stop).

    Can the lowest price be considered fair and reasonable when you do not know if the other offers are technically acceptable?

    Brent,

    Let's think this through for a moment - imagine all your circumstances were identical except you only received on offer in response to you RFP...what would you do in that situation?  Would it be possible for you to determine whether or not that single offer has a fair and reasonable price? 

    Bob - this question should go in the Beginners Forum. 


  9. Vern,

    I think dak9204 is referring to FAR 12.301(d)(3) which reads:

    Quote

    Insert the clause at 52.204-21, Basic Safeguarding of Covered Contractor Information Systems, in solicitations and contracts (except for acquisition of COTS items), as prescribed in 4.1903.

    dak9204 should have provided that reference when he/she made the statement.


  10. Maybe you should ask that agency why they use that business practice.  Anything anyone tells you here is nothing more than a guess (unless someone from that office decides to respond here on WIFCON).

    1 hour ago, Hilarity_Follows said:

    Fee should be a completely independent point of negotiation - right

    No, not at all.  See FAR 16.103 for starters:

    Quote

    (a) Selecting the contract type is generally a matter for negotiation and requires the exercise of sound judgment. Negotiating the contract type and negotiating prices are closely related and should be considered together. The objective is to negotiate a contract type and price (or estimated cost and fee) that will result in reasonable contractor risk and provide the contractor with the greatest incentive for efficient and economical performance.

    Also see FAR 15.405:

    Quote

    (b) The contracting officer’s primary concern is the overall price the Government will actually pay. The contracting officer’s objective is to negotiate a contract of a type and with a price providing the contractor the greatest incentive for efficient and economical performance. The negotiation of a contract type and a price are related and should be considered together with the issues of risk and uncertainty to the contractor and the Government. Therefore, the contracting officer should not become preoccupied with any single element and should balance the contract type, cost, and profit or fee negotiated to achieve a total result -- a price that is fair and reasonable to both the Government and the contractor.

    (c) The Government’s cost objective and proposed pricing arrangement directly affect the profit or fee objective. Because profit or fee is only one of several interrelated variables, the contracting officer shall not agree on profit or fee without concurrent agreement on cost and type of contract.

     


  11. 24 minutes ago, Hilarity_Follows said:

    Hello, 

    Can someone direct me to the FAR provision that spells out the requirement for Contractors to provide consideration to the Govt. in exchange for granting  no cost extension requests? (Specifically, the requests I am primarily involved in are NOT due to any Govt. cause) 

    Since this is the beginner's forum I just wanted to point out how frequently the above highlighted text is misused (whether it is in this case or not, I cannot say for certain because I do not have enough facts about the situation, but based on my experiences I'd bet it is wrong).  I'm sure the phrase is used either to make extensions more palatable or out of a lack of understanding, but it's incorrect nevertheless.  Unless the contractor is no longer charging costs to the contract during the extension period, it is not a "no cost extension."  Absent some additional term, that extended work period will still cost the Government money.


  12. I agree with everything you just said Vern, that's why I used the words "which, I agree, is still movement in the right direction"  in my previous response.

    However, there seems to be another issue here with that no one has talked about.  Presumably, the Government does not want to exercise an option for production of whatever this is until they get the first article and test results (that makes sense) - but we all know delays happen.  So why not specify a period post-completion of Phase I (with better grammar than the 52.217-7 language) rather than hoping everything goes according to plan from the outset when establishing the option?  Or would you rather include a specific date and modify the contract's option if/when a delay occurs?

×