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general_correspondence

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Everything posted by general_correspondence

  1. There is a difference between a subsidiary and a wholly owned subsidiary. What is the status of company A after the purchase? If they are a wholly owned subsidiary of Company B they may be able to remain the ELB.
  2. Neil I think you're right. That is a sound approach, I have seen it done before too. thank you
  3. I seem to remember if a Prime contractor uses (issues a purchase order) to a government facility to perform some qualification testing for example, that procurement is considered a competitive procurement. Is this true ? If so, where is reference for this for a file write up? The Prime has a CPFF contract and FAR 52.244-5 is included in Primes' contract.
  4. I thought as much, we do have to include option pricing but I agree option pricing should not go towards the small biz goals
  5. We are the prime, and the government RFP requires the planned percentage of total proposed contract value awarded 28% to small business. Is contract value the proposed cost? or is contract value the proposed price?
  6. The analyst words should be assertive regardless if the analyst organization has final word on the subject. It should always say....and therefore the price has been determined to be fair and reasonable. The contracting officers in this branch of the Air Force we get our RFP from, state unequivocally that the subcontracts price/cost reasonableness responsibility is on the Prime. In other words, just as someone else already said, the government is using the prime (who may eventually win the award) to do the analysis. They want to see a write up that leads them to same conclusion so not much questioning or investigating is needed. All the large Primes outsource ~40% in subcontracts/procurement every year, just to clarify I know this thread is not about subcontracts, nonetheless subcontracts can be a significant amount of the Primed Bid.
  7. Should contractors include a price/cost proposal for this portion of a government RFP with their initial proposal response?
  8. Neil said: I do not agree. Per FAR 15.406-2, the Certificate is required from a subcontractor as close as practicable to the date when your company reached price agreement with the subcontractor, I don't disagree with this either. We haven't reached an agreement on price until the assist audit is completed, in which case if not completed by time of award if we should be that fortunate - a reopener clause has already been communicated to the subcontractor.
  9. Neil and All thanks for your comments, very helpful. I think Neil nailed in the last post, "or is required to be certified" per the Definition. My subcontractors, nor we as the prime, are signing a cert and sending it in with our proposal. Albeit required, the government's request is when the prime signs a cert. That is when our subcontractors will send the prime a signed cert, before we the prime sign our cert. if omission, errors, or changes have occurred since the initial proposal was submitted, it's resolved before we send our signed cert in. That seems to make sense Agree?
  10. We are a prime contractor pursuing a government RFP and our subcontractor has proprietary information they will not allow or provide us to see - and the subject line scenario happens frequently. Do the subcontractors certify, and sign certificates of current cost and pricing data with the Prime contractor, or do the subs certify their cost directly with government customer?
  11. H2H had sound advice. How should we interpret " I have formed my subcontracting team"? Does this mean you have other companies poised, for something you all have agreed is in your wheelhouse,? Or does the "your team" consist of a smaller scale of consultants or internal personnel? I assume you are a small business yourself? Either way there are 2 things you must do: a) Subscribe to a M&A, competitor intelligence, customer intelligence, and opportunity intelligence that will steer you into target rich environments for what you do b) search out the B&D and procurement and subcontract manager points of contacts at the large primes. The how about getting started sounds like a cold call, so if it is a cold call, you need the stars aligned, timing, well crafted communication, and impressive expertise.
  12. ji Ramesses was a Pharaoh - and Ramesses said it. 💰👑🗡️
  13. I agree Joel. The Sub had the option fee at X%, when they were required to submit option pricing a year ago. But then we had "ideas" that would upgrade their 'system" and the customer likes our idea. Due to our suggestions that the customer accepted and agreed to fund, the Sub is asking for 35% more Fee than they originally proposed. I like what Neil was writing about, Neil mentioned it a couple times, "there is not government order" that really kicks this action into gear. From the government perspective and what the historical record will show is that the government increased funding on the contract, with no RFP, ECP, or change in SOW. When the Option is exercised here in a couple weeks, the government will simply increase the funding from what was originally proposed. But to answer your questions: 1. sub now wants a higher % fee for ALL of its work or just the additional and any revised duties? Answer: Our suggested changes in the upcoming Option period is the original work, but the work now consists of new software, tools, systems, than originally asked for. it can be argued the complexity has increased as a result. 2. Please clarify WHAT Is 35% higher: Answer: overall, they simply want 35% more in the option period from what they originally proposed. You interject a good argument we wouldn't increase fee for work originally required, I will have to look at that. the Sub will be asked, and they will need to go point by point justifying the risk and complexity factors to merit the requested fee.
  14. Sorry, one and the same, it increased by 35%, not quite doubled
  15. not accepted yet, but in case you haven't figured this out yet, it's my management that coached the subcontractor to change their fee. This is why I want to protect the subcontractor as well as our company during any audit. read the first paragraph of the document I put in the link . If the subcontractor is increasing fee erratically, not in conformance to its accounting principles, the definition and description of defective pricing is an issue.
  16. Here 2 Help their are 2 issues, agreed, but they are related in that defective pricing is a concern to the prime due to what can be described as erratic Fee proposed. read the last bullet on page 21 of 28 https://www.acq.osd.mil/dpap/cpf/docs/contract_pricing_finance_guide/vol4_ch5.pdf
  17. Neil both clauses 52.215-12, and 52.215-13, are in the Prime, and in the Subcontract. The government is not going to change the SOW. The government is apparently going to accept our recommendations into the SOW, but will not ask nor will they send RFP. The contract action is going to be the option period the government will exercise in next couple weeks, that carries our "recommendations" and cost/price for another XX months. The government intends to give us the money for the option period, but no scope change, and no RFP. The original option period had funding of ~100K. Our recommendation increased this. All this aside, I want correct myself on my original post, the subcontractor as not a sole source, it was competitive under the old rules of receiving only one Bid, 5 potential Offerors were solicited, only one returned an offer. certified cost and pricing data from our subcontractor, is probably not required, do you agree? the 35% jump in Fee is going up against a lot scrutiny. I already put together an incentive for the fee they want, very reasonable, but defective pricing creeps in when radical changes to what the firm typically offers, so it will help to know if certifying their costs are required. thanks
  18. "Be limited to such Modifications" My DoD customer and prime contract has a 2M TINA threshold, so If I understand correctly, then based on the award and MOD amounts I provided a moment ago, CCCP IS NOT Required did I pass the test yet?
  19. I am reading FAR 52.215-10, and if the subcontractor increases their Fee by 35% - with no explanation as of yet, they may be putting themselves and us in a bad situation? thoughts? I intend to fact find and negotiate, I have adequate time before I begin negotiations
  20. I apologize because I know this question has been answered before, but I looked all over WIFCON and cannot find the thread. We are the Prime, we were awarded a task order on our IDIQ, the award was over 20M, the award was competitive, certified cost and pricing data was not required, our award was based on adequate price competition. In our award winning proposal, was a subcontract valued under the TINA threshold. When the subcontract is Modified to a dollar threshold exceeding TINA, will certified cost and pricing data be required from the subcontractor? The subcontract award is sole source, and all the FAR 52.215 clauses are in the prime and subcontract agreements.
  21. Retread, what is it you need me to clarify about my question "does the Fee remains fixed?" It's understood rates, escalation, and other factors effect costs on option years proposed, but if the subcontractor proposed fee the same in base and throughout, that's my question? I've never seen it, and it would have to be rare, to see the Fee on a subcontractors proposal change in the Option years, keep in mind, this is engineering services CPFF, not a construction contract.
  22. In a CPFF with options, will the Fee remain fixed in Option periods ? We are the prime on a DoD contract that has a subcontractor who submitted a base year proposal, and an option year proposal approximately 12 months ago. The contract and subcontract are CPFF. There were some Scope changes from the customer that will require additional labor from our subcontractor, so an ECP came from the customer, and I sent an RFP to the subcontractor with the changes to incorporate into the option period. The subcontractor doubled the Fee in this proposal, with no explanation in the proposal. Just to be clear, the proposal submitted from this subcontractor 12 months ago had the Fixed Fee the same for both base year and Option period. I don't see how adding 2.5 FTE in the Option period would merit enough risk to double the Fee. The current value of the subcontract is 1.6M, and the option period was originally only 200K. With the ECP, the Option Period proposal price from the subcontractor went from ~200K, to 950K. The Labor hours appear appropriate, the rates are fair, but since Fee is always arbitrary to an extent, and in a CPFF if under 15%, it's fair game, has anyone else experienced or prepared or a negotiation when something like this happens?
  23. 49.202 Settlement Profit. So the guidelines I was told to follow is a mixed bag of 49.2, and 49.3 language, but I understand - everything I would do must fall within 49.3. To cut to the chase, can the subcontractor ask for Fee? Seems they would be asking for something unallowable, consequential . No? But it's my experience if you don't ask, you don't get, and in federally funded TfC's an adjusted and reasonable settlement can be agreed - doesn't matter what you call it. But the customer in this case will review the subcontractors settlement proposal - I don't believe they will delegate that to the prime entirely, so is Fee an allowed "thing" if it is negotiated?. Fee on cost, after termination is not what I am talking about. Fee on costs after termination is unallowable or hardly ever allowed unless I think it went through arbitration, I am talking about an ask for a sum of money and a method on how you came to ask for that sum of money.
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