Vern Edwards

@Lionel Hutz The relevant text of the Trade Agreements Act is in 19 USC § 2511(f): Next FAR 25.401(a)(1) says: What does that mean? It must mean that under a set-aside the CO need not do the things required and need not refrain from doing the things prohibited. I cannot think of what else it could mean. So, what does the subpart require and prohibit? What are the shalls and shall nots that do not apply to set-asides. There are nine sections within Subpart 25.4—25.400 through 25.408. (1) 25.400 states the scope of the part. It neither requires nor prohibits anything. (2) 25.401 lists exceptions and services excluded from the WTO/GPA. (3) 25.402(a)(2) says that the CO must determine the origin of services by country in which the firm providing the services is established. (4A) 25.403(a) explains a couple of things but does not say that anyone shall or shall not do anything. (4B) 25.403(b) explains the application of dollar thresholds. (4C) 25.403(c) says to acquire only U.S.-made or designated country end products or services unless no offers are received or the offers are insufficient. (5) 25.404 says that for certain acquisitions construction materials and services must be treated as end products. (6) 25.405 says certain construction materials and services must be treated as end products. (7) 25.406 says that certain agencies must evaluate Israeli offers without regard to Buy American restrictions/ (8) 25.407 says that the Trade Representative has waived Buy America statute for civil aircraft. (9) 25.408(a) specifies certain procedures the CO must follow when the WPO/GPA applies: (1) and (2)synopsize, (3) not include technical requirements designed to preclude acquisition of eligible products, (4) state the offers must be in English and in U.S. dollars, (5) notify unsuccessful offerors as required by FAR. It refers readers to FAR Subpart 25.5 for evaluation procedures. So that's it. That's all that does not apply to small business set-asides. How about we move on from FAR 25.401(a)(1).

@MileHighAcqYour "solicitor" (are you British?) has developed a faulty opinion. The proper clause to use in acquisitions valued at more than the $7,032,000 trade agreements threshold is FAR 52.225-11, as prescribed by FAR 25.1102(c). I will explain. Everyone- There is no conflict between FAR 25.401(a)(1) and FAR 52.225-11, which implements the Buy American Act. The Buy American Act, which applies to supply and construction procurements, requires the use of domestic construction materials, but provides for exceptions. See 41 USC 8303(b). FAR 52.225-11 is the product of the 1999 "FAR Part 25 Rewrite," FAC 97-15, 64 FR 72416-01, Dec. 27, 1999. It implements the Buy American Act by requiring the use of domestic construction materials, but grants a blanket exception for construction materials from countries with trade agreements. The key language in the clause is this: Before the FAR Part 25 Rewrite, the construction clause was FAR 52.225-15, Buy American Act-Construction Materials Under Trade Agreements Act and North American Free Trade Agreement (JUN 1997). It imposed the Buy American Act on construction acquisitions. It also established an arduous procedure whereby an offeror or contractor could apply to the contracting officer for an exception allowing the use of materials from nations with U.S. trade agreements. Here is the procedure for contractors: A separate procedure for offerors is prescribed in the solicitation provision at FAR 52.225-10(b). Apparently, individual requests for exceptions in large construction procurements had become common. So rather than process numerous individual requests for Buy American exceptions, the FAR Part 25 Rewrite did away with all that by creating the FAR 52.225-11(b)(1) blanket exception that we now know and love. In short, what FAR 52.225-11(b)(1) does is allow companies to use construction materials obtained from countries with U.S. trade agreements ("designated" countries) in procurements valued at more than $7,032,000 without having to apply for an exception. FAR 52.225-11(c) prescribes a procedure for requesting an exception for materials from other foreign countries. So what about FAR 25.401(a)(1)? The Buy American Act and small business set-asides are considered discriminatory trade practices. In 1978-79, members of the World Trade Organization (WTO) negotiated the "Tokyo Round" Agreement on Government Procurement (AGP). The signatories to the WTO/AGP agreed not to apply discriminatory practices to foreign trade partners. The Trade Agreements Act approved the president's agreement to the WTO/AGP. The Trade Agreement Act is a set of exceptions to the Buy American Act, and is implemented by FAR Subpart 25.4 The U.S. appendix to the WTO/AGP provided that the agreement would not prohibit the use of small and minority business set-asides. That is the basis for FAR 25.401(a)(1). But FAR 25.401(a)(1) does not prevent the government from allowing exceptions to the Buy American Act and allowing purchases of materials from foreign trade partners when domestic products are unavailable or too costly, so there are exceptions. Thus, FAR 52.225-11(b)(1). The bottom line is: You cannot understand FAR 25.401(a)(1) without some background. FAR 52.225-11 must be used as prescribed by FAR 25.1102(c). (A fun fact: When FAR was published in 1984, 52.225-11 was named "Certain Communist Areas.") I traveled a tortuous, hours-long path of research to dig up and polish the above nugget. I had to condense a lot of information in order to fit it into a reasonably brief post. I don't like writing long stuff in this online forum, but I don't think I made any big mistakes. Hopefully, this post is clear enough to settle the debate. During the course of my research I downloaded well over one thousand pages of historical documents. I learned lot about the history of the Trade Agreements Act. Thank goodness for the internet. I don't sleep much, and it has worried me. But, sometimes, it has its rewards. I get in lots of reading. Please remember me fondly after Alzheimers sets in.

@Lionel HutzHere's 19 U.S.C. 2511(f): I don't think that says what you indicated it says.

There is no single correct answer. It depends on (1) the agency's mission and (2) the complexity and volume of the work. When I started out as a GS-05 trainee in August 1974 at the USAF Space and Missile Systems Organization (SAMSO), COs were GS-14s or GS-13s and journeymen contract specialists were GS-12s. The contract specialists had several years of experience as such. The average contract specialist was much, much more expert than the average CO today. COs did not conduct acquisitions. Contract specialists conducted acquisitions. COs supervised the contract specialists, gave direction, made decisions and recommendations, reviewed files, and signed contracts, modifications, and other documents that required CO signatures. CO appointments were hard to come by. After CO review, but prior to issuance of an RFP and prior to contract award in excess of a certain dollar value, a contract specialists contract files had to be reviewed by the Judge Advocate's office and then by "The Committee". The Committee was chaired by a GS-15 and was staffed by GS-14s. First there was an administrative review by a GS-12, then there was a substantive review by a GS-14. The GS-14s reviewed every file, page-by-page, and made written findings and directed or recommended changes. COs could challenge directions and recommendations to the Committee chair. Unresolved issues were decided by a colonel (O-6) or by his deputy, a GS-16 (now SES). Very large contracts that had to be approved by a command four-star or the Secretary of the Air Force had to be further reviewed by the Committee at the Air Force Systems Command headquarters. In the late '70s and early 80s I was a GS-13 contracting officer at SAMSO in the Space Defense program office, which was headed by a brigadier general. I supervised the work of two contract specialists. My boss, the director of contracts for Space Defense, was a lieutenant colonel. He managed two contracting officers. We had adequate, but not ample, clerical support. It is my opinion that the idea of contracting officers being, in effect, working-level contract specialists who sign their own work, has diminished the status of contracting officers, degraded the contracting career field, and resulted in generally poor quality work.

It would clearly be in violation of the clause prescriptions. But at this point I think we're all just trying to understand. For instance, what is the authority for the exception for set-asides, and what is the rationale?

How do you know that? There have been goofs in the FAR. You referenced training by the Trade Representative. Did you attend a class? Is the class available on line?

See clause paragraph (b)(1): "(b) Construction materials. (1) This clause implements 41 U.S.C.chapter 83, Buy American, by providing a preference for domestic construction material." FAR Part 25 and its provisions and clauses are a mess.

Don't worry folks. It'll might five years or longer for the FAR councils to develop a final rule based on the E.O. They'll almost certainly wait for OPM to issue its final rule. We are living in a utopia of rules. We are the most rule-crazy people on the planet. Way to go attracting all those innovative companies to government work.

Is it safe to conclude that you don't like the policy? BTW, it's not socialism in any meaningful sense. That's claptrap. It's clientelism (client politics). In any case, the government has dictated facets of employers' hiring procedure for decades. What's new about that? https://www.eeoc.gov/prohibited-employment-policiespractices#:~:text=The laws enforced by EEOC prohibit an employer or other,%2C and pregnancy)%2C or national See Francis Fukuyama on clientelism in Political Order and Political Decay.

Do you know how many GAO protest decisions there have been about the GSA FSS "logical follow-on" exception? Five, since 1998. Do you know how many have been sustained? None. Do you how many protests against the exception have been filed with the Court of Federal Claims? One. Do you know the result? The court ruled for the government. The standard for the GSA FSS logical follow-on exception is not much of a problem. You don't need a lawyer.

Here is what I think has happened: 1. You know that FAR Subpart 25.1 and 25.2, which address the Buy American Act, include no exemption for small business set-asides. 2. You also know that FAR 25.401(a)(1) exempts small business set-asides from the trade agreement policies in FAR Subpart 25.4. 3. Then you saw that FAR 25.1102(c) prescribes FAR 52.225-11, Buy American-Construction Materials under Trade Agreements (my emphasis), for use in contraction contracts, but prescribes no exemption for small business set-asides, and the FAR provides no explanation or information that solves what appears to be a paradox. Do I have it right? Well, the clause prescription does strike me as peculiar, so I have discussed the matter with others and sought an understanding. But I have found nothing anywhere that resolves the matter. I know very little about FAR Part 25. I have always found FAR Part 25 and its predecessors in the old Defense Acquisition Regulation (DAR) and Armed Services Procurement Regulation (ASPR) to be extremely complicated and difficult to understand. Those rules seriously challenge my attention span. And when conducting an acquisition we have to get on with things. We can't afford to get bogged down. I think ji20874's advice boils down to this: Just comply with the clause prescription and move on. In this case, I think that's reasonable advice. No one could justly criticize you for doing that. In the very last line of your opening post you said: Frankly, when we start thinking, talking about, and looking for the "spirit" of a law, we have stepped off the main road and are on the road to perdition. In this case I think you should get back on the main road, unless your name is Montesquieu. "Steal Captain Black's car. That's what I always do." Thanks for the puzzle. You were thinking, and I learned something.

See also 25.100(b). I found no such statement in FAR Subpart 25.2.

See FAR 25.101(b): "The Buy American statute applies to small business set-asides."

Oh, for Pete's sake: "in the interest of economy and efficiency" Translation: in order to save the time and money that would have to be spent bringing a new contractor up to speed. See Harmonia Holdings Group LLC, GAO B-417465, 2019 CPD ¶ 257, July 18, 2019: Now, how hard was that to answer?

See DOD DPC memo USA000182-21-DPC. https://www.acq.osd.mil/dpap/policy/policyvault/USA000182-21-DPC.pdf Emphasis added. The DAU curriculum will be tied to it.

@govt2310If you want to make two (or more) awards from one solicitation, one award for one "market segment" and one for another "market segment," and want to use different approaches for selecting the contractor(s) for each segment, begin by establishing one contract line item for the first market segment and one for the second. Then, in Section M of the RFP (supposing that you are using the Uniform Contract Format), describe the evaluation approach (tradeoff or LPTA) and factors for the first CLIN and do the same for the second CLIN. Essentially, you conduct two source selections under a single solicitation. It is clearly permissible. It is easy. And I just told you how to do it. ji20874 told you how to explain it in the solicitation. You joined Wifcon in 2009. You are not a newbie.

Thanks, but I'm too busy. Have fun.

@acq20wlWhat do you mean by "fees"? What "fees"? You said your contract is firm-fixed-price. "Fee" is not ordinarily a term we use with respect to FFP contracts. What "fees" have increased?

I have changed my mind. I'm not going to comment. I watched the video that Carl posted, and I think it would be pointless to do so. The standard appears to be the product of a big committee.

Are the rates used for estimating purposes or as contractual ceilings ("caps")?

I am happy for Bob to publish articles that I have written, but I will not discuss them here other than to say that I have written what I have written and it's been peer reviewed. When I have anything to add or alter I do it in the same publication, also subject to peer review.

I knew that they had developed a standard, but I had not read it. Now that I have, I'm horrified. From page 5: And, on the same page: Italics in original. 🧐 😞 The quality of writing (and thinking) is the same throughout. I would be embarrassed to show it to anyone as a consensus standard for the work that contract managers do. I will send comments, but I do not expect to see any improvement, given the short deadline for submittal. I suspect that they are eager to move on and are just following protocol.

@govt2310 You have posted twice in this thread. and Unless I have missed a post, the only question you have asked is in the first sentence of the first post, in bold above. Is that still the question? "Has anybody ever seen..."? Do you have another question?

The risk you run with that approach is that the information provided to offerors as the bases for firm-fixed line item pricing—statements of work or some other descriptions—do not accurately or completely reflect what will really be demanded of the contractor during performance. That would be a recipe for dissatisfaction and litigation.

@here_2_help The first sentence in the Assad memo says: The definition of B&P in FAR 31.205-18: So Assad's first sentence makes sense to me. But we have been talking about proposal preparation and negotiation costs that are required by contract. Those are ordinarily allocated as direct costs of the contract which required the proposal and negotiation support. However, FAR 31.202 says: Much earlier in this thread you agreed with me that charging proposal and negotiation costs required by contract does not turn them into B&P costs. (I should have challenged you on that business about "in practice nobody really ever makes that distinction," because it is demonstrably false. But I let it go, because I know that people in our business can be careless about terminology.) But then you said: The phrase "as being B&P costs" in that comment threw me for two reasons. First, because it seems to erase the important distinction between (1) proposal and negotiation costs that ARE required by contract and (2) B&P costs, which are such costs that are NOT required by contract. Second, it threw me because Assad's memo says no such thing! Not even close! Yesterday, you said: My emphasis. Again, your words seem to erase the distinction between proposal and negotiation costs required by contract and B&P costs by saying that costs required by contract may or may not be "part of B&P expenses"! I think we agree, but you have not been precise in the way you have expressed yourself in some of your posts in this thread. You know me. Imprecision can hurt businesses. That's why they have to resort to lawyers. Words and sentences matter in the contracting world. That's why I try to "mimic" lawyers, because the best of them know that, and they have taught me. Unschooled and inexperienced people are easily confused and misled by careless language about complicated, even esoteric, business matters. We must not mislead unschooled and inexperienced readers who come to this site "to learn," as they like to say. I shall now say what I think you mean: Proposal and negotiation costs that are required by a contract are to be allocated as direct costs of that contract, but may in some cases—for sake of "practicality,"—be allocated as indirect costs in the same way as B&P costs. However, the two categories of cost remain distinct, even when both are allocated as indirect costs. Thus, requirements that expressly apply to B&P costs, such as 10 USC 3763, DFARS 242.771-1, and many others, do not apply to proposal and negotiation costs that are required by contract, not even when they are allocated as indirect costs. Does that work for you? If it does, then we can close the book on this topic. And while we're at it, "selling costs," which are mentioned in the title of this thread, are not the same as B&P costs. I have the highest respect for you as a professional and a practitioner. Website chat sites are not the best place to discuss legally complex matters. Best, Vern