Matthew Fleharty

37 minutes ago, ContractSpecialistTJohn said:

past performance is supposed to be evaluated in every procurement?

Can you provide a reference for this statement?

In light of Don's example, many more can be found in the DoD's "Encyclopedia of Ethical Failure" which can be viewed here:

http://www.dod.mil/dodgc/defense_ethics/dod_oge/eef_complete.pdf

I think you're focusing in the wrong area - rather than the subject of "conflict of interest" I'd focus on the ethics requirements pertaining to "gifts."  See 5 CFR §§ 2635.201-2635.205, specifically the definition of gifts (https://www.law.cornell.edu/cfr/text/5/2635.203)

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(b) Gift includes any gratuity, favor, discount, entertainment, hospitality, loan, forbearance, or other item having monetary value. It includes services as well as gifts of training, transportation, local travel, lodgings and meals, whether provided in-kind, by purchase of a ticket, payment in advance, or reimbursement after the expense has been incurred. It does not include:

(1) Modest items of food and refreshments, such as soft drinks, coffee and donuts, offered other than as part of a meal;

(2) Greeting cards and items with little intrinsic value, such as plaques, certificates, and trophies, which are intended solely for presentation;

(3) Loans from banks and other financial institutions on terms generally available to the public;

(4) Opportunities and benefits, including favorable rates and commercial discounts, available to the public or to a class consisting of all Government employees or all uniformed military personnel, whether or not restricted on the basis of geographic considerations;

(5) Rewards and prizes given to competitors in contests or events, including random drawings, open to the public unless the employee's entry into the contest or event is required as part of his official duties;

(6) Pension and other benefits resulting from continued participation in an employee welfare and benefits plan maintained by a former employer;

(7) Anything which is paid for by the Government or secured by the Government under Government contract;

(8) Any gift accepted by the Government under specific statutory authority, including:

(i) Travel, subsistence, and related expenses accepted by an agency under the authority of 31 U.S.C. 1353 in connection with an employee's attendance at a meeting or similar function relating to his official duties which takes place away from his duty station. The agency's acceptance must be in accordance with the implementing regulations at 41 CFR part 304-1; and

(ii) Other gifts provided in-kind which have been accepted by an agency under its agency gift acceptance statute; or

(9) Anything for which market value is paid by the employee.

From reading the brief scenario and the definition of gift, the discount does not seem to meet the exclusion in paragraph (4).  At that point, you should look to the general standards and exceptions (https://www.law.cornell.edu/cfr/text/5/part-2635/subpart-B).  

If you're a member of that office or know someone who is, I'd recommend contacting your agency's ethics official and initiating CYA procedures ASAP.

46 minutes ago, NinNinVT said:

Although the discussion went deeper than what I needed for the purposes of my original question, I do appreciate the deeper dive made available to me as long as the BLUF answer was stated.  The concepts as further discussed are understandable and relevant to the broader understanding of the topic.

Thanks!

Good job WIFCON team!  Thanks for the feedback NinNinVT.

4 hours ago, Vern Edwards said:

Yes, and FAR 52.215-1(c)(8).

So may a CO insert an instruction in a solicitation requiring a proposal to be irrevocable for a specified period?

Since the prescription for FAR 52.215-1 requires contracting officers to insert the provision "in all competitive solicitations..." and the requirement for the proposal to be "irrevocable for a specified period" is in conflict with the requirements of the provision, I'd look to FAR 1.4 "Deviations from the FAR."  The circumstances here would likely meet paragraphs ( c ) and/or (e) of the Deviations definition under FAR 1.401.  Therefore, unless a Deviation is obtained, my answer is no.  If a Deviation is approved, I say yes.

1 hour ago, Vern Edwards said:

Does that make the proposal irrevocable during that period?

If so, that would conflict with FAR 15.208(e), which states "Proposals may be withdrawn by written notice at any time before award."

Vern,

Since we're on the subject, I'm curious to hear your take on the "Elements of a Contract."  Depending on the author/source, I've seen them range anywhere from four to seven elements.  The list I keep and share has six:

• Offer
• Acceptance
• Consideration
• Legality of Purpose
• Competent Parties
• Mutuality (aka Clear Terms & Conditions)

You're not the first and certainly won't be the last to receive an improper write up based on outdated information.  Take the information provided by Vern and Jamaal to the reviewing official/organization and adjudicate the comments.

22 minutes ago, uraniumgal said:

For goodness sake already...I know what to do...

I don't believe anyone's intention here is to "pile on" - this is a public forum for the contracting profession and if another contractor or person with a similar situation comes here to find information on this subject, the users here are merely trying to document what could/should have been done to hopefully avoid future occurrences.

16 minutes ago, Vern Edwards said:

I wonder if, as the deadline for exercising the option approached, uraniumgal called the CO and asked, "What are you going to do about the option?" or "When are you going to exercise the option?" or said, "Just checking in on the status of the option exercise."  That's what a prudent business person would have done, especially if failure to exercise the option would cause havoc in their personal and professional life.

...or even asking about the option when the preliminary written notice of the Government's intent was not provided in a timely manner.  By default, the time period is usually 60 days before the contract expires which should be more than enough time to avoid any surprises.

1 hour ago, uraniumgal said:

Finally, to Matthew F. above:  There isn't such a thing, except for the fact that the prices for the two options are codified in the Contract itself, so as I understand it, that occurs "when it has been determined prior to soliciting offers that the Government is likely to exercise the options"  (FAR 17.206).

The presence of an option in a contract does not impose an obligation on the contracting activity to consider exercising the option - if it did, that would seem antithetical to the concept of an option.

Moreover, there is ample case law stating that options must be exercised in a timely manner and in exact compliance with the option terms, Lockheed Martin IR Imaging Sys., Inc. v. West, 108 F.3d 319 (Fed. Cir. 1997) - and there is good reason for that strict compliance.  What you're essentially advocating is that in cases of contract mismanagement (which may or may not be the case), the Government should be able to ignore the strict compliance standard and retroactively exercise an option...that sounds more arbitrary and capricious (and lacking good faith) to me than the scenario you've detailed here.

Uraniumgal, if you can find somewhere in the FAR that states agencies have a positive obligation/responsibility to consider whether or not to exercise options maybe you could get some traction behind your position, but I don't think you'll be able to do so because, to my knowledge, such a requirement does not exist - as Vern pointed out in his first response "An option is, well, optional."

This wouldn't be the first time an agency has forgotten to exercise on option and it won't be the last - forgetting or failing to exercise an option does not entitle an agency (or customers relying on that agency, in this case uraniumgal) to a mulligan under some standard of "arbitrary and capricious" behavior or failing to act in good faith.  As you can see from the definitions posted by Vern (and others if you look up the definitions for those terms), each requires some action, exercise of discretion, or decision and in this case of not exercising an option, you have the absence of behavior/discretion/decision entirely.

Duke,

You're interpreting the FAR correctly (though the reference is actually FAR 17.203(g)).

Thanks for sharing, I hadn't come across that HBR article before.  I often use the term "linguistic precision" when stressing the importance of using the right word(s), particularly in our business.  I'll never forget the feedback (aka red ink) I received from my Commander the first time I drafted a Proposal Analysis Report and Source Selection Decision Document for a source selection.  I took, what I'll call, a "college writing approach" to the documents using synonyms for many of the words (e.g. cost, price, amount, etc.) to help the documents flow better and to avoid sounding repetitive only to find out that approach was improper because each of those words mean specifically what they're defined to and were therefore inappropriate as replacements for one another.  So I learned from my mistake and share the story as often as I can with new buyers so they can learn from it as well.  Glad to see a couple articles on a similar subject.

I echo Don's comments.  You may be interested in the following link on GSA's website, though as with most Government contracting content it is mostly focused on "what" rather than the "how" or "why."  http://www.gsa.gov/portal/content/200397

What is made clear in the previous link, under the third bullet, is that Contracting Officers can request price reductions multiple times (in the example they present, the reductions are requested in the RFP and post-evaluation) so, conceivably, you could request reductions more than once (if necessary).  Moreover, since FAR 8.405-4 is silent on specific procedures for requesting price reductions, I would follow the guidance of FAR 1.102(d) and exercise sound business judgment based on the particular circumstances to determine how best to proceed.

Troy,

The example you provide is possible without violating the ADA; however, you have not presented enough facts for us to determine whether or not that is the case.  Are you DoD and are you utilizing DFARS 252.232-7007 "Limitation of Government's Obligation"?  

I've seen many a complaint (and at one point been the complainer myself before I learned better) about incremental funding, but sometimes it is necessary for contracting to bear some additional workload if the circumstances warrant it.  If your customer and the budget office have "budget difficulties" it is contracting's job to provide them the various business solutions that may address their "difficulties" and then implement the most appropriate/feasible option.  In order to do that though (and for the members of the forum to advise you properly), you have to understand the issue beyond merely "budget difficulties."  Maybe you have already done so and you're dealing with an office that is just stuck in their ways, but I can't recall a situation where I didn't reach a mutually satisfactory result after I sat down with a customer, identified and understood the problem, then respectfully presented them options and reasons why it was more beneficial for everyone involved.  Try adapting your tactics from a rules based, "it's in violation of the ADA" approach (which isn't accurate as far as I can tell) to identifying their interests/concerns and providing solutions that address them.

1 hour ago, MCritzman said:

Of course if we were to anticipate receiving a significant amount of proposals on one vehicle we would not entertain competing among two vehicles. 

 

What's the danger/risk here with obtaining more competition?

37 minutes ago, bob7947 said:

 there is reason to fear the internet of things.

How is the cyber security for Wifcon?

1 hour ago, ContractSpecialistTJohn said:

The contract has expired and the option was not exercised.  Would a termination for convenience letter need to be created?

No. Reference FAR 13.303-7 - your BPA is considered "complete."

1 hour ago, ContractSpecialistTJohn said:

What procedures do you use to close out a MAS BPA where the options were not exercised.  

Are you talking about the BPA itself (which is an agreement, not a contract) or the orders issued under the BPA?  In any case, the answer to this question depends on your agency - reference FAR 4.804-1(a)(1).

Lastly, the subject for this thread is quite misleading.  You're asking questions relating to BPA Closeouts or Terminations not "Option to Extend Procedures"...

4 minutes ago, REA'n Maker said:

What's "wrong" with Government contracting is that it is not, nor has it ever been, about achieving the lowest price for an item or service.

If that were the case, drinking fountains would still read "whites only", job ads would still read "Irish need not apply", and women would still be fired from their jobs when they got pregnant.

Am I the only one who didn't sleep through that part of CON 101?

I don't follow...Are you stating that Government contracting should be about achieving the lowest price for an item or service?  Or is that what you think others on this forum are advocating for?

2 hours ago, Jamaal Valentine said:

I avoid Sep 31 actions … 

After all this time I'm just now finding out that we have an extra day in each fiscal year?!

The requirement for Brand Name Justifications is governed by the Competition in Contracting Act (CICA) and FAR Part 6, not FAR 11.105.  Since FAR Part 6 covers Brand Name Justifications under FAR 6.302-1( c ), refer to FAR 6.001 which states:

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This part applies to all acquisitions except --

(a) Contracts awarded using the simplified acquisitions procedures of Part 13 (but see 13.501 for requirements pertaining to sole source acquisitions of commercial items under Subpart 13.5).

Micro-purchases are a Simplified Acquisition Procedure under FAR Subpart 13.2, therefore they are exempt from FAR Part 6 requirements which include Brand Name Justifications.

Furthermore, the brand name documentation requirement anoncon is likely referring to is cited under FAR 13.106-1(b)(1)(i); however, that only applies when soliciting competition and FAR 13.203(a)(2) can exempt micro-purchases from solicitation procedures:

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Micro-purchases may be awarded without soliciting competitive quotations if the contracting officer or individual appointed in accordance with 1.603-3(b) considers the price to be reasonable.

Finally, FAR 11.105 deals with how agency requirements are written...if one is not writing a solicitation it would, therefore, not be applicable (though I'd further argue that the guidance to not preclude consideration of a product manufactured by another company unless "the particular brand name, product or feature is essential to the Government's requirements, and market research indicates other companies’ similar products, or products lacking the particular feature, do not meet, or cannot be modified to meet, the agency’s needs" is sound advice regardless of the method of procurement). 

H2H,

For an IDIQ I'm not sure either - the approach I've mentioned is used on contracts to establish options/mechanisms to contract for quick reaction tasks or studies.  Establishing rates and a labor hour cap is necessary to comply with FAR 17.207(f), otherwise those efforts may require a J&A.

Assuming the work is not commercial, rather than using FFP rates (via task order or additional CLIN depending on how the contract is structured) where one pays the full amount regardless, one could use a pre-established CPFF rate(s) on a per labor hour basis. With a CPFF structure, the contractor would only be able to charge for actual costs of performance (which may be lower or higher than the amount established) and the fixed fee at the amount specified.  In terms of execution, the parties negotiate the amount of labor hours then apply the pre-established contractual CPFF rate and fee amount to arrive at the total estimated hours, target cost, and fixed fee amount for the effort.  

One could conceivably use a pre-established CPIF structure instead in order to encourage cost control during performance, although I have not seen this approach used (yet).

Vern,

Just curious, does your position on pre-negotiated rates change (to any degree) if one uses CPFF rates rather than FFP rates?

If hightytighty is in the situation I think he/she is in, the contractor's concern regarding providing a Certificate of Current Cost or Pricing Data for orders stems from being required (contractually) to use predetermined rates to price out work that one, two...five years down the road will almost certainly be different than the rates they're realizing. The contractor is likely arguing that it is, therefore, impossible to execute the required certification that the contractually required rates are accurate because their actual rates are not the same as the rates used to price out the work.