Fishpaw

I'm sorry, I didn't go a good job of explaining. This is not a sole source. This proposal (and several others) was selected by the technical evaluation team for the BAA, so I suppose it's "competitive". The issue I have is that the proposal does not have an approved indirect rate. This specific item was not otherwise addressed in the BAA. Maybe this question belongs in the beginners forum. Can you issue an award to a company without an approved indirect rate (and they're claiming indirect costs)?

I have a small business that has responded to a Broad Agency Announcement. They've performed some small work for the government under SBIR programs, but they've never established their indirect rates. The proposal came as FFP, but included "estimated" indirect costs of 10% and some separate costs for fringe. I suspect the owner/operator (a former professor) set it at 10% due to the allowance to do this under grants. Since this is a BAA, how could I proceed to issue an award? Send in an auditor to establish what the indirect rates should actually be? Can I accept an obviously low rate? The proposed costs (labor, materials) otherwise seem to be supported by my research.