Vern Edwards

@shikakenin The Hunter S. Thompson of acquisition writing!

Well, you can't go wrong with a thought like that.

Has anyone compared the two versions of the clause, determined the differences, and analyzed the impact? If not, why talk on? To do so is just to speculate. erock, get a legal opinion.

I think a price reduction might well be in order. But if there is a protest that the change is outside the scope of the competition, a price reduction would not be a defense.

Roger.

@Neil RobertsDid you read the blogpost I provided from the Deming website link? In any case, keep in mind that my position is thte competitive bidding works best for simple and commodified requirements, but that it does not not necessarily best for complex requirements. I think there is ample published evidence in support of that proposition. I think that's why relational contracting is increasingly popular. Competition can induce bidders to engage in undesirable behaviors, like overpromising and buying-in. The construction industry is a classic case. It is highly competitive and it is highly litigious. Competitive bidding is the norm. Maybe we'll just have to disagree.

You may want to get a legal opinion. If the contract was awarded competitively, there may be an issue about relaxing the limitations on subcontracting after award.

Read some of the literature about "buying-in" and the making of extravagant promises in technical competitions. See Caril et al, Competition and Contract Performance: Evidence for US Defense Procurement (2020): Competition is great for simple stuff. But it often creates problems when buying complex supplies and services. It prompts companies to make unrealistic technical promises and propose unrealistically low estimated costs and prices. I'm not saying anything that hasn't been said many times before by many others.

It depends. There are many reasons why a manufacturer would prefer establishing a long-term relationship with a qualified supplier rather than to engage in competitive "sourcing" (competitive bidding, competitive tendering) for anything other than commodities and commodified items. Among those reasons are: quality, delivery, and price. See, for example: "Seven Reasons Competitive Tendering Fails (And What You Can Do About It)" https://www.processexcellencenetwork.com/innovation/columns/seven-reasons-competitive-tendering-fails-and-what There are countless articles about the disadvantages of competitive bidding. Competition does not necessarily make for better outcomes. It often does quite the opposite.

You must have a government contract. The government might initiate a Contractor Purchasing System Review (CPSR) when a contract involves a significant amount of subcontracting. A company cannot apply for a CPSR. See FAR Subpart 44.3. Contractors' Purchasing System Reviews. See also "What You Need to Know About the Contractor Purchasing System Review," at: https://unanet.com/blog/what-you-need-to-know-about-the-contractor-purchasing-system-review Finally, see "Contracting Purchasing System Reviews: What are They and What’s New?" https://www.dhg.com/portals/0/ResourceMedia/publications/Contracting-Purchasing-System-Reviews-What-are-They-and-Whats-New.pdf

Are you saying that neither company has been awarded the SIN?

Carl is a master of understatement. This should be a heads up to all those who say they "come here to learn." Unless I missed it, there has not been not a single reference to FAR 13.303. I'm getting old, so maybe I missed it.

Have we responded adequately? If so, then I have a thought in the form of a question: Why does the OP want a five-year contract with a five-year extension option for "general support services"? Why such an extended contract? Is that strategy based on the nature of the prospective requirement(s), or is it because the agency wants to put off having to conduct a new source selection for as long as possible? If the former, what is it about the requirement that suggests 5+5 makes sense? Ten years is a very, very long time in today's world. A lot can change in ten years. A lot is going to change. To give you an idea: I just went through the first 42 clauses and provisions in FAR Subpart 52.2, from 52.202-1 through 52.204-26. Guess how many are dated before 2011. The answer is nine. Thirty-three of those clauses are dated 2011 or later. Eleven are dated 2017 or later. Some of those provisions and clauses are new and address important congressional or presidential policies. I'm not sure how the others have changed or whether the changes are significant. Does the OP's strategy include updating the contract to incorporate new policies and procedures, especially those mandated by statute or executive order, such as 52.203-18, 52.203-19, 52.204-23, 52.204-24, and 52.204-25. Is the OP going to include a clause allowing the CO to impose a new FAR contract clause in return for a price adjustment? What are the policy implications of a contract with a prospective life of ten years? Might such contracts hamper the implementation of new national policies? Why establish and commit to such a lengthy relationship? What's the reason? What are the implications? What are the pros and cons? Is a five-year contract with a five-year extension option a wise acquisition strategy? Is it in the best interests of the government? If so, why? If not, why not? I think we have responded to the OP. If so, can we use this thread to teach people about strategic acquisition thinking? Or should we just wait for the next minor-league question?

Multiple Award Task Order Contract. A multiple award IDIQ contract for services, including construction. See the definition of Multiple Award Contract in FAR 2.101, entry (2). A SATOC is a Single Award Task Order Contract. For an example of usage see: Obsidian Solutions Group LLC, GAO B-417134, March 1, 2019. https://www.gao.gov/assets/b-417134%2Cb-417134.2.pdf See also: https://www.anamarinc.com/blog-frontpage/entry/idiq-explained https://apps.dtic.mil/sti/pdfs/ADA579715.pdf https://info.ksiadvantage.com/blog/an-introductory-guide-to-multiple-award-task-order-contracts-matocs

@joel hoffman I didn't want anyone to look it up and then regurgitate it to me. Four-step was adopted by DOD in the late 1970s following on NASA's lead. It was designed to eliminate concerns about "technical leveling" and "technical transfusion" during discussions in R&D acquisitions. Industry complained bitterly about those practices. FAR 15.610(d) defined technical leveling and technical transfusion as follows: Concern about those practices go hand-in-hand with the notion of "competitive negotiation." Originally, Four Step was mandatory for R&D. Later, it was made optional. Even later, its use was authorized for other kinds of acquisitions. Even though the prospect of one-on-one negotiations with the selectee before award was attractive to many COs and PMs, Four Step never caught on, because it still required discussions with offerors in a competitive range prior to the selection. There were too many steps, which made it more complicated and time-consuming than standard source selection procedures. Here is the description of the Four Step process from the 1997 DFARS 215.613: Now, if FAR 15.101, Best value continuum "clearly permits" such processes, and you like the idea of one-on-one negotiation with the selectee prior to award, why not redesign Four Step by cutting a couple of steps?

What you're talking about is not a "contract type" issue. It's a contracting strategy issue. PMs have a say in such matters.

I cited that article earlier today in a response to a post Joel made in another thread. Why he posted on this topic in that thread I cannot say. NASA began using Four Step in the early 1970s. DOD formally adopted it in 1979. It remained in the Defense Acquisition Regulation (DAR) until 1984, when the FAR took effect and the coverage was moved to DFARS 215.613. DOD removed the coverage from the DFARS in 1998, after the FAR Part 15 Rewrite, explaining as follows in the Federal Register, 53 Fed. Reg. 55040-01, Oct. 14, 1998: So many of you know little or nothing of the origins and development of the rules that govern your profession. How can you "innovate" your way out of such ignorance? It's like trying to plot a course when you don't know where you are or how you got here.

@jumpmanz5and @Kat Have you read FAR Part 44, Subcontracting Policies and Procedures, especially FAR Subpart 44.3 and the clause at FAR 52.244-5, Competition in Subcontracting? Have you read the DCMA Contractor Purchasing System Review Guidebook (February 26, 2019).

MATOC madness.

@joel hoffman Yes. And see Smith, "The New "Four Step" Source Selection Procedure: Is the Solution Worse than the Problem?" Public Contract Law Journal, June 1980. (No public link available.) See also, "To the Administrator, National Aeronautics and Space Administration," 51 Comp. Gen. 621, GAO B-173677, 1972 CPD ¶ 44 (March 31, 1972). https://www.gao.gov/products/b-173677-2 Almost all concerns and complaints about "Four Step" were about the limitations on discussions, the thought being that discussions improved the quality of competition and, thus, the contract outcome. I do not believe that there is any evidence that discussions with all offerors in a competitive range have improved performance outcomes. No one has ever produced any such evidence, and I do not believe that anecdotal reports constitute evidence on which policy should be based. According to Waks: Anyone who thinks there is "maximum communication"—free, frank, and full—between the government and all offerors in the competitive range during source selection discussions has not participated in very many such discussions. Besides, in most cases the weaknesses and deficiencies in "approaches" are not flaws in promises (offers), but in descriptive essays and technical presentations. Source selection decisions are not performance outcomes; they are the outcomes of sales pitch contests. And according to Waks: What has happened since 1962 and Pub.L. 87-653 is that the discussions statute, regulations, and bid protest case law have made agencies reluctant to conduct really substantive discussions, not even under the rules in FAR 15.306(d), which is too bad, because talk is important to achievement of a meeting of minds. When agencies do hold discussions, usually what gets discussed are "weaknesses" and "deficiencies" in what is little more than an essay test response. That's why discussions with offerors in a competitive range, which once were mandatory, are now optional. I think the simple fact is that negotiating non-price terms with multiple contestants is just too complicated and difficult. In fact, it's weird. Pick somebody, and then get on with it.

Just curious—do you remember the Four-Step source selection procedure? I'm not asking if you know about by Googling it, and I'm not asking for a description of it. I know what it was. If you remember it, did you ever use it? If you remember it, do you know what happened to it?

Is the work for a capital project or is it severable support?

@dsmith101abn In the science fiction film "Forbidden Planet" (1956), humans discover an alien world on which the extinct inhabitants, called the Krell, had developed an IT system that enabled them to create things merely by imagining them, "without instrumentalities," i.e., without tools. When they went to bed at the end of the day on which they turned the system on, their subconscious minds created monsters that killed them all in a single night—"monsters from the Id." To paraphrase a poet: we're not there yet, but we're headed that way.

Both of us know what the word "must" means, but I don't know what is GAO's intent in that regard. I know what I would do in the case of an urgent procurement, but I don't know if it would be right. And I don't like the idea of acting on the basis of unclear and unsettled precedents. I think GAO should sort things out. (I know better than to hope that the FAR councils would spend time on this.) To me, the key is not to speculate about GAO's intent, but to develop clear thoughts of my own as bases for a rationale in support of a course of action grounded in the regulations. GAO has specified some options, and there may be others. But the GAO has not been as clear as they ought to have been, and they may never be entirely clear. (They like to handle things ad hoc.) One thing I know is that we cannot count on the FAR councils to clear things up and provide guidance. We work in a howling wilderness of rules and protest litigation. If I were writing an IFB or an RFP, I would develop and include a statement about the SAM registration requirement explaining how I would handle bids or proposals submitted by an unregistered competitor. Prospective bidders would have until bid opening to protest. "He found him in a desert land, and in the waste howling wilderness; he led him about, he instructed him, he kept him as the apple of his eye." KJB, Deuteronomy 32:10.

@C Culham The problem is that GAO has issued confusing decisions. See this quote from Jade Excavation: Emphasis added. Note that GAO first mentions bidder responsibility, then refers to FAR 14.405, Minor informalities and irregularities in bids. So which is it when a company that has not registered in SAM as required by FAR 4.1102(a) and 52.204-7(b)(1)—a matter of responsibility or a minor informality or irregularity? If it's a matter of responsibility, and if the bidder is a small business, must the agency then refer the bidder to the SBA for consideration of a certificate of competency? That might delay award. ji20874 pointed out the COC referral exception at FAR 19.602-1(a)(2)(i) with respect to "unqualified and ineligible" bidders. (Note the "and.") Don Mansfield then pointed to the official definition of "ineligible" at FAR 2.101, which suggests that the "unqualified and ineligible" exception at FAR 19.602-1(a)(2)(i) would not apply, because failure to register in SAM would not make the bidder "ineligible" as that term is defined in FAR 2.101. If it's a matter of minor informality or irregularity, then FAR 14.405 says: "The contracting officer either shall give the bidder an opportunity to cure any deficiency resulting from a minor informality or irregularity in a bid or waive the deficiency, whichever is to the advantage of the Government. " In light of FAR 4.1102(a), would waiving the failure to be registered in SAM constitute an unauthorized FAR deviation? Maybe not. In C.L.R. Development Group, GAO B-409398, April 11, 2014, a negotiated procurement, which I believe to have been the first case about this matter, GAO said that the VA waived the requirement, and said: "We find no prejudicial error associated with the agency's waiver of the requirement for offerors to be registered in the SAM database at the time proposals were due." See also Jade Excavation and Master Pavement, both cited elsewhere in this thread. But what would waiving it mean? Waive it with respect to what? As a prerequisite to bid submission, but not not as a prerequisite to contract award? See the clause at FAR 52.204-13, paragraph (b). This matter seems to be a problem that occurs mainly in sealed bidding. In a negotiated procurement there should be no reason to reject an offer out of hand because the offeror was not registered in SAM when it submitted its proposal. If the agency is planning to award without discussions the CO could treat it as a minor or clerical mistake and clear it up in accordance with FAR 15.306(a)(2). And see FAR 52.204-13(b). In sealed bidding I would treat failure to register as a minor informality and give the bidder time to register or simply waive it. Confusing FAR coverage seems to be the ultimate source of the issues, but the FAR councils won't fix that problem. GAO has either not developed a clear stance or has failed to explain itself. It's time for GAO to sort things out.