Don Mansfield

formerfed,

If the Data Item Description cited on the CDRL required reporting of subcontract costs, then I don't think there would be a problem with the Paperwork Reduction Act. However, I think that a policy requiring the submission of such reports whenever awarding contracts under the 8(a) program would be a FAR deviation and subject to the public notice and comment process pursuant to 41 U.S.C. 1707.

formerfed,

Which monthly status reports are you referring to? Those required by a FAR clause? A CDRL? Something else?

How many of you think that contracting officers are responsible for imposing a subcontract reporting requirement on 8(a) contractors so that COs can monitor compliance with the limitations on subcontracting clause (FAR 52.219-14)? The reason I ask is because the GAO recently faulted COs for not imposing such a requirement in 8(a) contracts awarded pursuant to agency partnership agreements (PA) with the SBA. The most recent PA that I could find between DoD and the SBA contained the following DoD "responsibility":

shall include monitoring and oversight provisions for all contract awards, modifications, options, and purchase orders to ensure that all contracts comply with the performance requirements (Limitations on Subcontracting) of FAR 52.219-14 and 13 CFR 124.510 and 125.6;

I assume that similar language appears in PAs between the SBA and other agencies.

Note that FAR 52.219-14 does not require subcontract reporting. Nothing in the FAR or DFARS requires COs to obtain the information or the contractor to report it. OMB has not approved an information collection under the Paperwork Reduction Act for reporting subcontract information other than the reporting required for contractors with subcontracting plans.

Some questions that come to mind:

1. If a contracting officer were to impose the subcontract reporting requirement that the GAO thinks they should be imposing, would that be a deviation from the FAR?

2. Do contracting officers have the authority to impose the subcontract reporting requirement that the GAO thinks they should be imposing without the requirement going through the rulemaking process? (41 U.S.C. 1707 requires that procurement rules be published for comment in the Federal Register when they have "a significant effect beyond the internal operating procedures of the agency or have a significant cost or administrative impact on contractors or offerors.”)

3. If contracting officers started requiring the subcontract reporting that the GAO thinks they should be requiring, would that be an authorized "collection of information" under the Paperwork Reduction Act?

In my opinion, the COs have not done anything wrong. I think that it's up to the DAR Council to put the requirement through the rulemaking process. They have either neglected to do so or made a conscious decision not to do so.

What's your opinion?

This is the most recent survey that is free.

Dan,

You may want to check if your contracts contain DFARS 252.244-7001, Contractor Purchasing System Administration. One of the system criteria is that the contractor's purchasing system shall:

(10) Perform timely and adequate cost or price analysis and technical evaluation for each subcontractor and supplier proposal or quote to ensure fair and reasonable subcontract prices;...

If you're not doing your price analysis on the $42K widgets, you are risking payment withholding.

Did you look in 41 CFR parts 60-1 and 60-2?

LFO?

Are you referring to offeror responses to FAR 52.222-22 and -25?

That's a good question. We'll have to wait until the proposed SBA rule is issued to see what it says. If it's silent, somebody needs to ask that question.

I could not find anything saying that imposing a Q&A deadline is prohibited, nor could I find anything that requires the Government to extend the deadline for receipt of proposals because it receives a last minute question.

Instead of imposing a deadline, you could advise offerors that it may take you up to X days to respond to a given question. Thus, if they want their question answered before the solicitation closing date, they should have it in by [insert date]. Questions received after [insert date] may not be answered prior to the solicitation closing date.

This doesn't impose a deadline for questions and it would communicate to offerors that the timing of their questions will have no effect on the solicitation closing date.

GeoJeff,

What can I say? You were the type that was more responsive to negative reinforcement.

ron,

We agree on 1, 2, 3, and everything you wrote after that.

As far as the prescription for DFARS 252.225-7021 being carelessly written or written exactly as intended, I believe it's the former. The prescription for the clause used to read:

Use the clause at 252.225-7021, Trade Agreements, instead of the clause at FAR 52.225-5, Trade Agreements, if the Trade Agreements Act applies.

I pointed out that "Trade Agreements Act" needed to be changed to "WTO GPA" and they changed it. I'm not buying that the omission of a reference to the list at DFARS 225.401-70 was the product of thoughtful deliberation.

Don,

I work for a civilian agency for which the BOPP does not apply and for which the agency FAR supplement provides no further guidance. My questions were more in line with what is discussed in Westlaw Journal, Government Contract, Volume 24, Issue 6 by Jeffrey Belkin and Donald Brown.

If the BAA does not apply (IT exception, foreign use, etc.) why apply the TAA?

For acquisitions below $204,000, you wouldn't apply the TAA for commercial IT or foreign use. The prescription for the implementing clause, FAR 52.225-3, states (FAR 25.1101( b )(1)(i)):

If you're wondering why we don't have the same exceptions when the WTO GPA applies, I'm not sure. My guess is that the WTO GPA does not provide for such exceptions.

Don, I'm not sure I follow your post #4. Are you saying that you cannot incrementally fund a non-severable services contract using the same appropriation? The way I read the FMR all that is required is that such a contract be funded with the same appropriation. It doesn't say that the contract cannot be incrementally funded using the same appropriation.

Sherlock, what type of services are you obtaining using OPN funds?

Retreadfed,

The FMR can be read the way you are reading it. However, I don't think that's the correct interpretation. In Matter of: Financial Crimes Enforcement Network, B-317139, June 1, 2009, the GAO stated:

Yes, I think it does. The authority granted by 10 U.S.C. 2410a is not specific to a particular type of appropriation. Here's what the statute says:

Hi, Ron,

You wrote:

Now, going back to your post #5, the "not exactly" part: I believe I have a small correction. -7036 is the clause you would use (or one of the alternates) when you are below the full TAA threshold, but over the various Free Trade Agreement (FTA) thresholds. -7021 is the full TAA clause, used when you are above the WTO GPA threshold of $204k.

There are important differences between the two. For example, below the WTO GPA threshold, a domestic product is required, along with the appropriate FTA product. Above the threshold, a US-made product is acceptable. The difference, of course, is the 50% content requirement for domestic products. Another example is the purchase restriction of the TAA. It applies when you are over the WTO GPA threshold, but does not apply to the FTAs.

I agree with everything you wrote, but I don't understand how it corrects what I wrote. You then wrote:

Well, another minor correction: -7036 does not mention either eligible products or designated country products. -7021 allows designated country products, but does not mention eligible products. The word 'eligible' only shows up in the exception to the BOPP. This brings us back to the problem I mentioned above: the difference between eligible and designated.

DFARS 225.003 defines "eligible product" as follows:

"Eligible product" means, instead of the definition in FAR 25.003--

(i) A foreign end product that--

(A) Is in a category listed in 225.401-70; and

( Is not subject to discriminatory treatment, due to the applicability of a trade agreement to a particular acquisition;

(ii) A foreign construction material that is not subject to discriminatory treatment, due to the applicability of a trade agreement to a particular acquisition; or

(iii) A foreign service that is not subject to discriminatory treatment, due to the applicability of a trade agreement to a particular acquisition.

Instead of listing all of the "eligible products" in the clause (i.e., free trade agreement country end products, etc.), I just referred to them as "eligible products", the same way the term is used at DFARS 225.7501( b ). Also, I'm not confused by the difference between an "eligible product" and a "designated country end product." DFARS 252.225-7021 defines the term as follows:

“Designated country end product” means a WTO GPA country end product, a Free Trade Agreement country end product, a least developed country end product, or a Caribbean Basin country end product.

Given the definition of "eligible product" above, "designated country end products" includes the foreign end products described in ( i ) of the definition of "eligible product", least developed country end products, and Caribbean Basin country end products.

You also wrote:

Well, OK, another. When applying the BOPP, I don't think that both the TAA and the BOPP could apply. First, the TAA is a law that covers the applicability of the WTO GPA, the FTAs, and other agreements such as the treatment of Caribbean Basin countries and least-developed countries. The exception to the BOPP is only for when the WTO GPA applies, which is when you are over $204k. Second, the WTO GPA is an exception to the BOPP, so you can't have both. That's why the -7021 clause is just entitled "Trade Agreements," and -7001 and -7036 have BOPP in the title.

The TAA applies to the acquisition of end products as long as the value of the acquisition exceeds $25,000 (the lowest trade agreement threshold), the end product is in one of the FSGs listed at DFARS 225.401-70 and there are no exceptions. Period. The BOPP can also apply for acquisitions under $204K. Saying that the TAA applies to an acquisition does not imply that the WTO GPA applies--it may or may not.

Lastly, you wrote:

In the scenario under discussion in this thread, we are also looking at what it means to have "the trade agreements" apply. DoD only applies "the trade agreements" to the FSGs listed in DFARS 225.401-70. Does that mean collectively all agreements covered by the TAA, or just the FTAs? You could find arguments for both. For example, the prescription for -7036 (for FTAs), specifically says "for the items listed at 225.401-70," while the prescription for -7021, the full WTO GPA clause, does not. From this you would think that the restriction to the listed FSGs only applied to the FTAs. However, the text of the WTO GPA itself contains the exception to the listed FSGs for DoD.

Which is it? Who can possibly know? Unfortunately it makes a difference in whether a product needs to be domestic or can just be US-made. It also determines whether the purchase prohibition applies or not.

I don't think use of the term "trade agreements" is ambiguous. If you look at the table in FAR 25.402( b ), the column with the heading "Trade Agreement" lists the WTO GPA and the FTAs. I don't think it would reasonable to interpret the term "trade agreements" as just the FTAs. I would not infer anything from the absence of a reference to DFARS 225.401-70 in the prescription for DFARS 252.225-7021.

As complicated as the BAA/TAA/BOPP scheme is, I think I get it. Not to say there was not a garbage can full of crumpled up notebook paper with half-written decision trees along the way. Let me know if I'm missing something.

That's better. Since you referred to 2410a, I assume you work for DoD. According to Volume 3, Chapter 8, of the DoD Financial Management Regulation, nonseverable services must be fully funded at the time of award. See 080303 ( C )(2):

Vern.

ji20874,

No, I didn't specify. This was what I wrote:

Would a mobile storage facility (think mobile home but bigger) owned by the Government be considered a public building or public work? Assume the item is accounted for as personal property as opposed to real property.

I know this will do nothing to convince Vern, but I asked someone on the FAR Team responsible for Labor Law if they thought a mobile storage unit (as described by the OP) was a public work for purposes of the Wage Rate Requirements (Construction) statute. This was the response I received:

In reviewing your question and without knowing the history, I would say the mobile storage facility is considered a public building/work.

I agree. The foreign acquisition regs are a maze. My nomination for most difficult to clause prescription is at DFARS 225.1101(2)(i) (I had to make a decision tree to understand it):

Use the clause at 252.225-7001, Buy American and Balance of Payments Program, instead of the clause at FAR 52.225-1, Buy American—Supplies, in solicitations and contracts, including solicitations and contracts using FAR part 12 procedures for the acquisition of commercial items, unless—

(A) All line items will be acquired from a particular source or sources under the authority of FAR 6.302-3;

( B ) All line items must be domestic or qualifying country end products in accordance with Subpart 225.70. (However, the clause may still be required if Subpart 225.70 requires manufacture of the end product in the United States or in the United States or Canada, without a corresponding requirement for use of domestic components);

( C ) An exception to the Buy American statute or Balance of Payments Program applies (see FAR 25.103, 225.103, and 225.7501);

(D) One or both of the following clauses will apply to all line items in the contract:

(1) 252.225-7021, Trade Agreements.

(2) 252.225-7036, Buy American—Free Trade Agreements—Balance of Payments Program; or

(E) All line items will be acquired using a procedure specified in 225.7703-1(a).

My comment that "everyone is doing it" was meant as an observation, not to suggest a course of action.

What you are describing is a combination FFP/Cost reimbursement contract. I don't think that such a contract is FFP or FP/EPA and would, thus, be prohibited by statute and regulation.

Having said that, everyone is doing it and nobody is getting in trouble.

joel,

I had to look up "Philadelphia Lawyer." This is what I found:

A colloquial term that was initially a compliment to the legal expertise and competence of an attorney due to the outstanding reputation of the Philadelphia bar during colonial times. More recently the term has become a disparaging label for an attorney who is skillful in the manipulation of the technicalities and intricacies of the law to the advantage of his or her client, although the spirit of the law might be violated.

Whichever way you meant it, I take it as a compliment. Thank you.

Fara Fasat,

You wrote:

So let me see if I have this straight. Subpart 225.75 (the BOPP) says to acquire domestic end products for use outside the US. One of the exceptions then says, UNLESS the acquisition is covered by the World Trade Organization Government Procurement Agreement (WTO GPA). The WTO GTA applies to procurements over $204k. However, DoD only applies it to the FSGs listed at 225.401-70 (which of course is not mentioned in 225.75).

Correct.

Since the products here are not in the listed FSGs, the WTO GPA will not apply, so DoD must acquire a domestic end product, unless a another exception applies. Under 225.7501(b )(iv), it looks like one exception allows the agency to apply the price evaluation factor of 50% like under the BAA.

Correct.

BTW, under 225.7501(b )(i) and (ii), it looks like the agency can also accept qualifying country end products and eligible country end products, if they are the low offer. Of course, eligible countries are trade agreement countries, and DoD only applies the trade agreements to the listed FSGs, but that's not mentioned here. I guess under the BOPP that's OK. It would not be the only example of convoluted logic in the BAA/TAA regime.

Not exactly. If the BOPP applies and the TAA does not apply, then you will use DFARS 252.225-7000 and -7001. These treat qualifying country end products the same as domestic end products. There's no special treatment of eligible products.

If both the BOPP and the TAA applied, then you would use DFARS 252.225-7035 and -7036. These would treat both qualifying country end products and eligible products the same as domestic end products.