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Guest108830

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  1. Spot painting is but one of the work areas. The vessel is being refit and updated to a large extent. 

    It's an awarded contract. There are no FAR Part 12 clauses present. 

    Am aware bottom paint is applied in commercial shipyards and on a regular basis. 

    Perhaps I should've just asked if anyone is aware of the Federal Reg that prohibits acquiring a portion of something versus an entire something. We seem to be hung up on the term system, which is my fault for interjecting it to begin with. 

    I'll figure it out. Thanks for the responses. 

  2. Nope, not a FAR Part 12 acquisition. It's FAR Part 15. I'm familiar with the Buy American (and America) Act about subassemblies and the like. Assemblies and subassemblies and the like is not at issue.

    Looking at it from a standpoint of applying new paint next to hull plating that still carries the older paint, something akin to installing a new pipe into a rusty pipe. I recall a prohibition against the Government in using this approach somewhere within the regulations.  I recall it being invoked (by the Government) on a medical gas replacement with US Army Corps of Engineers (Huntsville Div) contract. Can't replace a portion of the system, have to replace the entire system. I don't believe it (the regulation) was specific to the Army.

  3. joel - thank you for the prompt response. 

    Yes, areas painted are distinguishable from other areas.

    Yes, service contract.

    Warranty per the contract is below as well as FAR 52.246-4(e):

    • "Warranty Work: The Contractor shall complete all repairs, maintenance and modifications prior to Government inspection. All work and materials provided must be in accordance with American Bureau of Shipping (ABS) and United States Coast Guard (USCG) requirements. ... The contractor is responsible to ensure that all class requirements are met at the time the tasks are accomplished. The Government reserves the right to inspect the work during execution. The Contractor shall warranty all completed tasks for a minimum of sixty (60) calendar days or duration approved by the  CO."

    Do you know of the regulation call out pertaining to having to buy a complete system in order for a warranty to be valid? 

  4. I recall a federal regulation that stated words to the effect the Government is obligated to replace an entire system as opposed to a portion of a system so the Contractor can warrant the entire system being repaired / replaced. In other words, can't run a new pipe to an existing rusty pipe and expect the Contractor to warrant the entire system. 

    With that being said, Contractor is required to spot paint the hull of a vessel (which is 40 feet in length) because the Government doesn't have enough funds to paint the entire hull, whether above or below the water line. The parties agreed upon a fixed price based upon a set square footage and marked those areas on the hull with the Government representative participating and present, demarcating those areas that would receive blasting, primer and paint. This is under DoD, but the vessel is not classified as a US Navy Vessel, but rather, it's a Marine Vessel. There's also a number of construction related clauses strewn throughout the contract, including 52.246-4 inspection of Services-Fixed Price. 

    Question - how is it possible to warranty those portions the Contractor performed vs areas not touched by the Contractor (e.g., Gov't Inspector points to (presumably) rusty area above one of the patchworks and says to Contractor you're required to paint this too, and at no cost to the Government, along with 20 other areas I've marked.)

    Wouldn't the painting fall under a "complete system" whereby the Contractor would have to blast, prime and paint the entire hull in order for any warranty to apply? 

    Does anyone know of the regulation I'm referring to about the Government being required to purchase a complete system or similar language? 

  5. Found the following clause on the internet. It does not apply in my situation but it reinforces some thoughts. I'm working with a DoD contract and the following is from the EPA supplement.

    It clearly delineates the level of effort (hours) the Contractor must provide and also states can go 10% above the hours. But apart from that, such will not be compensated. Clear and concise.

    I believe I have my answer - the LOE is a hard ceiling absent a surge CLIN or other similar mechanism that allows more hours to be provided above the standard LOE / hours. Thank you.

    ====================================================

    1552.211-73 Level of effort - cost-reimbursement contract.

    As prescribed in 1511.011-73, the contracting officer shall insert the following contract clause in cost-reimbursement contracts including cost contracts without fee, cost-sharing contracts, cost-plus-fixed-fee (CPFF) contracts, cost-plus-incentive-fee contracts (CPIF), and cost-plus-award-fee contracts (CPAF).

    Level of Effort - Cost-Reimbursement Contract (MAY 2016)

    (a) The Contractor shall perform all work and provide all required reports within the level of effort specified below. The Contractor shall provide up to ________ direct labor hours for the base period. The Government's best estimate of the level of effort to fulfill these requirements is provided for advisory and estimating purposes. The Government is only obligated to pay for direct labor hours ordered and corresponding fixed fee for labor hours completed.

    (b) Direct labor includes personnel such as engineers, scientists, draftsmen, technicians, statisticians, and programmers, and not support personnel such as company management or data entry/word processing/accounting personnel even though such support personnel are normally treated as direct labor by the Contractor. The level of effort specified in paragraph (a) of this section includes Contractor, subcontractor, and consultant non-support labor hours.

    (c) If the Contractor provides less than 90 percent of the level of effort specified for the base period or any optional period exercised, an equitable downward adjustment of the fixed fee, if any, for that period will be made. The downward adjustment will reduce the fixed fee by the percentage by which the total expended level of effort is less than 100% of that specified in paragraph (a). (For instance, if a hypothetical base-period LOE of 100,000 hours is being reduced to 70,000, the fixed fee shall also be reduced by the same 30%. Using a corresponding hypothetical base-period fixed fee pool of $300,000, the reduced fixed-fee amount is calculated as: $300,000 × (70,000 hours/100,000 hours) = $210,000.)

    (d) The Government may require the Contractor to provide additional effort up to 110 percent of the level of effort for any period until the estimated cost for that period has been reached. However, this additional effort shall not result in any increase in the fixed fee, if any.

    (e) If this is a cost-plus-incentive-fee (CPIF) contract, the term “fee” in paragraphs (c) and (d) of this section means “base fee and incentive fee.” If this is a cost-plus-award-fee (CPAF) contract, the term “fee” in paragraphs (c) and (d) means “base fee and award fee.”

    (f) If the level of effort specified to be ordered during a given base or option period is not ordered during that period, that level of effort may not be accumulated and ordered during a subsequent period.

    (g) These terms and conditions do not supersede the requirements of either the “Limitation of Cost” or “Limitation of Funds” clauses.

    (End of clause)

  6. Don - no. No new contract.

    Do you believe the overage on hours pushes those extra hours into an out of scope situation as it deviates from the contracted level of effort (hours) and specific time period that the parties originally bargained for? If so, that was my original thinking -- that overproviding hours runs afoul of what the contracting parties bargained for even though there's existing monies on contract.  

  7. RetreadFed - Contract is for on-going programming services with the Govt's existing software. There is no delivery of software itself (as a canned product). 

    Vern - there's been a plethora of information provided that coincides nicely with the monetary side of things. As I've said before, that's the easy side of things. There doesn't seem to be a great deal of information available as to the level of effort (hourly) portion. Looking to the contract for words that address performance of the level of effort is to no avail as previously indicated. Unfortunately stuck with what's been provided. 

    If you are saying, don't look to a regulation or a contractual clause as this situation is not addressed in either - instead, look to the contract words and how the Government contracted with the Contractor to perform its level of effort (hours) -- then OK, then that's the answer. In my situation, the contract is silent in that arena, apart from the denoted labor cats and hours per labor category as previously mentioned. So looking to a regulation or contract clause is for not. And if this is the case, then there's no prohibition against the Contractor overproviding a level of effort (hours) provided there's existing monies on contract. In which case, bring on the 11th person. 

  8. Don, understood. There are enough funds on contract to cover the added cost of bringing on the 11th person (for 960 hours). Aware of the notice requirements which deals with the dollars. Contractor won't exceed the estimated cost, but it will exceed the level of effort (hours).

    There's enough money on contract to absorb the increase of level of effort (hours) for the 11th person. It's the level of effort (hours) that are at issue.

  9. Vern - there's also 32.704(c). Assume for arguments sake there are enough funds on contract to cover the hourly overage. Otherwise, we'll get bogged down on tangents concerning the dollar side the CPFF (Term) brings. Focus is singularly on the level of effort (hours).

    Don - what contractual right to payment? I'm thinking the moment the updated software becomes used by the Government is the moment compensation to the Contractor attaches under cost reimbursement principles. Otherwise, Government must reject that work.

  10. No CLIN specific for the labor cats. Applicable Labor CLIN(s) specifies the unit of measure along with a dollar value. And yes, discussions have been had with the Contracting Officer and COR and no objections to bringing on the 11th person.

    Perhaps it might be easier to re-state the inquiry to its very basics. 

    • What happens when a Contractor provides more hours than contracted for under a CPFF (Term)? 

    I can find no regulation, rule or law that prohibits a Contractor from performing more than the contracted hours and if so, what result?

  11. Vern, you aren't missing anything except there are option periods. Option is set up to be exercised at the end of the base year PoP (Dec 31). I took early exercise of the option period off the table as that tends to cut against FAR 17.207(f)(e.g., Options exercised in strict accordance with the terms, considered out of scope). There is no surge CLIN holding unused hours or related.

    Remember, it's the Contractor that believes the addition of this 11th person would greatly benefit the effort due to his superior skillset with a piece of software. Contractor seeks to insert his skillset (in a fulltime capacity) within the existing scope and still keep all existing full time individuals. 

    Everyone knows if a Contractor fails to provide the contracted level of effort over a specified time period under CPFF (Term), Contractor could face contractual remedies, including, but not limited to breach. What happens when the Contractor provides more than the contracted level of effort? I can find no regulation or case law on point with this scenario. 

    The only way to get more hours, absent competition or sole source with J&A, would be to exercise the option earlier than originally planned. 

  12. Vern,  the 1920 hours will be achieved and contracted hours have been delivered and before the contemplated exercise of next option period. There is no other wording surrounding the 1920 hours per labor category. Just labor category and 1920 hours each labor category and for a period of performance.

    What happens when the hours have been fully delivered and short of the next option period? Contractor continues to provide same effort and Gov't accepts the work, thus making the Gov't liable?  Contractor demobilizes and remobilizes upon exercise of the option period? Contractor performs at-risk between end of current PoP and start of new option? 

    Is this the first time this has been brought up here at WIFCON? 

  13. Joel, yes. There's a number of options available as to the make up of the current personnel. For example, either move 1 person to another task order or remove him / her altogether. I was trying to see what options were available so as to keep the existing team in place and add the additional individual. There is no change in scope.

    H2H. In a CPFF (Term), the parties are contracting for hours, not dollars. The dollars may or may not surpass the estimate, even with the additional .5 FTE. The dollar situation is fairly straightforward.

    The focus is on the hours and the Contractor required to deliver a certain number of hours over a given timeframe. Contractor will only be able to provide the contracted hours up to a certain point. In any event, Contractor will not be able to reach the end of the current PoP as it will run out of hours.  (Cost) underruns and (cost) overruns are relevant as to the dollars, not hours. Once the hour situation is addressed, the money will follow suit as appropriate. 

    The focus I have is addressing the hours and the Contractor possibly overproviding on the contracted hours. Contractor is not going to perform at its own risk until the Option is timely exercised. And exercising the option early is questionable contracting practice.

    Everything seems to point to issuance of a mod to increase the hours (and dollars) (but not fee) in this instance. Else get rid of the 11th person or perform gratis until the exercise of option period. I can't find any authority as to possible options or remedies in this scenario. 

  14. Don, thanks for the reply.

    Yes. But the Contractor will surpass the contracted hours of 19,200 in total in Nov, for example. When end of PoP is Dec 31. Contractor still has another month of performance but technically, no hours left, unless Contractor decides to go over the contracted hours of 19,200. And should Contractor exceed the contracted hours, is the Gov't required to compensate the Contractor for those hours beyond 19,200? If so, why? If not, why not? Thanks.

  15. Under CPFF (Term / LOE), Contractor has 10 persons direct charging. Assume 1920 hours per calendar year = total 19,200 hours per year. Assume PoP is the same, Jan 1 - Dec 31.

    Contractor seeks to add an 11th person six months into the PoP and receives no objection from the Gov't (KO and COR) in doing so. And there is no additional scope being added, so no mod from the Gov't. And Contractor believes adding this 11th person would be beneficial to the program (e.g., superior computer programming skillset).  Assume DoD, Army, Base Year with 4 one year options. Contract is in Base Year. 

    If Contractor brings this 11th person on board, Contractor would be providing more hours to the Gov't than originally planned and the hours the Parties have contracted for (e.g., Contractor obligated to devote the specified level of effort for the stated time period per FAR 16.306(d)(2)).  

    Does Contractor:

    1. ask for a mod from the Gov't to increase the hours and if granted, bring the 11th person on board? And if not granted, don't bring the 11th person on board?

    2. what happens when the Contractor runs out of hours before reaching the end of its PoP - then what? [Shouldn't be able to exercise the next OY early and have overlap of Base and OY for a month as that would conceivably violate FAR 17.207(f) (e.g., Options exercised in strict accordance with the terms, considered out of scope).] 

    3. If the Gov't "accepts" the work of Contractor, including the 11th person (e.g., Gov't begins using the new / updated programming code), wouldn't the Gov't be required to compensate the Contractor for the accepted work irrespective of the hours?

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