Jump to content
The Wifcon Forums and Blogs

Don Mansfield

Members
  • Content Count

    2,781
  • Joined

  • Last visited

Posts posted by Don Mansfield

  1. 29 minutes ago, MAY-D-FAR-B-WIT-U said:

    We considered this but there is a concern that this may create too may apples to oranges comparison on proposed prices.

    There is a way to make it apples to apples. But one would have to understand cumulative distribution functions, expected value, and calculus. You're probably not going to cover that in an introductory probability and statistics course, so most DoD contracting folks and cost/price analysts wouldn't understand it without some training. Some cost estimators may have such knowledge. I understand conceptually, but wouldn't attempt the number crunching without some help. 

    The key is to not think of an offeror proposing a price--rather, they are proposing a range of possible prices and each of those prices has a corresponding probability. If you think of it that way, then it becomes an expected value problem.

  2. 18 hours ago, MAY-D-FAR-B-WIT-U said:

    The more I structure my FPIF the more I feel like there is always a hole to be exploited in a FPIF contract.

    What if instead of the Government structuring the FPIF, offerors were allowed to propose the parameters (target cost, target profit, ceiling price, and share ratios)? Let the invisible hand of competition do its thing?

  3. 16 minutes ago, MAY-D-FAR-B-WIT-U said:

    Don,

    To be honest, PTA hasn't even come up at all in our incentive geometry discussions. I understand for the purpose of contract administration and risk identification it will be beneficial for the Govt to understand when the contractor is approaching PTA, but for the purpose of a source selection I am not sure what the benefit is to the Government. Offerors obviously want to identify the PTA but not sure when or where to use it from the Gov't perspective.

    The PTA for Offerors A, B, and C in the scenario I put up is $121.43, $108.57, AND $102.30 respectively. The more input I get from this forum, the more I think the answer to my concern is Cost realism on fixed price type contracts aka price realism. My current thinking is the high profit is less of a problem, the problem is using the high profit to cover for understated or hidden target costs related to buy-in.

    The reason I asked is because if you considered the difference in PTA between offerors proposing different amounts for target profit, you may not be as concerned about an offeror proposing an "excessive" profit. Think it through.

  4. 15 hours ago, MAY-D-FAR-B-WIT-U said:

    We are evaluating at the ceiling price to avoid hidden target cost and offerors gaming the FPIF geometry, this is best practice within DoD at least in the last 5 years or so.

    This approach is fundamentally flawed, but it seems like that ship has sailed and you're not asking for a better approach.

    From what I understand, the problem you're trying to avoid is that two offerors can have the same TEP even though one can propose a higher target profit. 

    If that were the case, which offeror's point of total assumption would be lower--the offeror who proposed the higher target profit or the lower target profit?

  5. 3 minutes ago, MAY-D-FAR-B-WIT-U said:

    Don, yes it does. The share ratios, ceiling prices as a percentage of target cost are all dictated in the RFP. The ceiling price for some of the CLINs are as high as 130% leaving plenty of room for as much as 29% profit while still allowing offerors to propose below the ceiling.

    What is the overrun share ratio?

  6. 1 hour ago, MAY-D-FAR-B-WIT-U said:

    A FPI(F) contract where no cost realism will be performed and total evaluated price (TEP) is based on ceiling prices not target price. The concern is that an offeror could possibly propose profit as high as 25% and still come under the ceiling and this will not affect the offeror's TEP since ceiling is a % of target cost and the profit never comes into play.

    Does the RFP dictate any of the parameters of the FPIF arrangement (e.g., share ratios, ceiling price as a percentage of target cost, etc.)?

  7. 53 minutes ago, govt2310 said:

    What if contractor A's ceiling is maxed out, so it is ineligible to get award of any future task orders.

    Contractor A isn't "ineligible". Rather, they are no longer contractually required to comply with the Government's task orders. They could waive that limitation. The question would then be whether the work to be ordered was within the scope of the original competition for the MAC.

    Just wondering what was the value of the original acquisition? What was the maximum in each contractor's contract?

  8. 8 minutes ago, Freyr said:

    I had a feeling these would be the responses (I don't disagree)! It's curious to me though that such a large/visible program like OASIS would take this approach, if it's a poor/non-compliant approach then why would they write it like that? Did they just try to be too clever to make it user friendly?

    Who knows? But, you should probably lower your expectations.

  9. 45 minutes ago, Vern Edwards said:

    (1) Do you think such a contract is among the types already described in FAR Part 16?

    No

    45 minutes ago, Vern Edwards said:

    (3) If the answer to the first question is no, do you think the CO must seek an approved FAR deviation in order to enter into a contract of that type?

    Yes

  10. The Government Property clause (FAR 52.245-1) allows the contracting officer to unilaterally decrease the amount of government-furnished property provided to the contractor and allows for a corresponding equitable adjustment to the contract. It also provides for an equitable adjustment if GFP is delivered late or is unsuitable for use.

    If the contract contains the basic version of the clause, the Government generally assumes the risk of loss of Government property.

    If you use your own company's equipment, then your company assumes the risks of loss, unsuitability of equipment, and late delivery of the equipment to the users.

  11. 15 minutes ago, Vern Edwards said:

    @Don Mansfield Here's something to think about---a quote from the Armed Services Procurement Regulation (ASPR) of 1974, the year I entered the contracting world. Citation: 32 CFR 3.401(b):

    Haven't we made progress!

    Max Planck suggested that science progresses one funeral at a time. In other words, much faster than procurement policy.

    Quote

    A new scientific truth does not triumph by convincing its opponents and making them see the light, but rather because its opponents eventually die, and a new generation grows up that is familiar with it. -Max Planck

     

  12. 31 minutes ago, Vern Edwards said:

    @Don Mansfield Think about this, from FAR 16.102(b), which consists of two sentences:

    1. "Contracts negotiated under Part 15 may be of any type or combination of types that will promote the Government's interest, except as restricted in this part (see 10 USC 2306(a) and 41 USC 3901)."

    Then, in the very next sentence:

    2. "Contract types not described in this regulation shall not be used, except as a deviation under Subpart 1.4"

    Now, is a combination of contract types itself a contract type?

    If so, does the FAR describe every possible combination of contract types?

    If not, does that mean that a contracting officer may not use any combination of contract type that is not already described in the FAR without a deviation?

    If so, what combinations of contract types does the FAR describe?

    Are there any combinations of contract types that we can use without a deviation?

     

    Since the language isn't very clear, I would interpret it in a way that creates the least amount of work for the contracting officer. Old habit.

    So, I would not interpret a combination of contract types as a distinct contract type. I think "combination" in this context means that some line items are one permissible contract type and other line items are another permissible contract type. I also think that "contract type" in this context is referring to cost or pricing arrangement. 

  13. Good idea. In the interim, let's change the last sentence in FAR 16.102(b) to say:

    "Contract types not described in this regulation shall not be used, except as a deviation under subpart  1.4unless market research demonstrates a different contract type is consistent with customary commercial practice." 

  14. 55 minutes ago, DCDOD2020 said:

    This is through a IDIQ task order and as I had mentioned it’s being filled through a labor category that aligns with the requirement. We released a draft RFP and made revisions based on the feedback received. As I stated it’s not merely a call center position, as I used that descriptor to illustrate the sort of work that will be performed. Really, it doesn’t matter, as the question comes down to more of a philosophical question of how you want to interpret the FAR with respect to the unique circumstances of this requirement. The way I described it was “call center with lipstick.” There’s coordination responsibilities, some data work, etc. 

    Is it a Government call center staffed with contractor employees (or a mix of government/contractor employees)? Or is it a contractor call center?

  15. I think that it's an improvement in that DAU's 200- and 300- level courses will no longer be required for certification. The memo states that mandatory training hours went down from 650 to 200. To that I say "Great, now let's make it zero."

    I still like the way the Actuarial profession does it better:

     

  16. That's true. See FAR Case 2004-025, which removed references to facilities contracts. See also the comment & response under Item 37 in the final rule.

    Quote

     

    One respondent stated that they currently have a facilities type contract and having that type contract in place saves the Government both time and money. Property on this contract supports over 150 Government tasks, across multiple agencies. The elimination of the facilities use type of contracts will have a negative effect on how we currently manage Government property.

    Response: The Councils do not agree. A “facilities contract” is merely a form of service contract for property management. Agencies are not prohibited from issuing service contracts for this purpose.

     

     

  17. 30 minutes ago, Vern Edwards said:

    Can you use simplified acquisition procedures to award a cost-reimbursement contract?

    I think so. I don't know what would prohibit it. FAR 13.302-1(a) says:

    Quote

    Except as provided under the unpriced purchase order method (see 13.302-2), purchase orders generally are issued on a fixed-price basis. See 12.207 for acquisition of commercial items.

    That suggests that there could be exceptions.

  18. 2 hours ago, buonomma said:

    Step 1:  Issue an Oral Task Order (or other name) to the Contractor.  This will comprise of the Government notifying the Contractor of the number of assets for repair and shipping them to the Contractor's facility where they will perform the test and evaluation.  A draft task order can be provided to the Contractor, if necessary, which reflects 1 CLIN for test/evaluation and separate CLIN for repair costs.

    I think your agency has to record an obligation for the test and evaluation at this point. In DoD, I think the rule is the obligation needs to be recorded within 10 days of its creation. So how would you communicate the obligation to the accounting folks in the agency after issuing the oral order?

×
×
  • Create New...