here_2_help

When I apply for a new position, I emphasize my business degree (Economics). But I obtained that degree from a liberal arts college.

Pepe, Heinlein was a product of his times, and those times were (at a minimum) three full generations ago. I grant you that. My quote was more to get folks thinking (as you did!) rather than to imply I agree with Heinlein or that I was espousing his fairly unique views of competency. That said, I like the idea of an acquisition "professional" who can deploy where needed, as needed. And I also like specialized training focused on the skills and knowledge necessary for today's position, as well as to help prepare for tomorrow's position. I'm not even going to claim those two "likes" are consistent. *Shrug* I contain multitudes.

Many contractors divide the profession into three fields -- prime contract management, subcontract management, and purchasing. Most contractor employees specialize into one of those three categories. My old boss, Bill, used to tell us he didn't want specialization. He wanted professionals who could negotiate a prime contract, manage a subcontract, or order parts out of a catalog. He wanted to move his staff where necessary to follow the workload. I haven't seen his approach used in very many places. “A human being should be able to change a diaper, plan an invasion, butcher a hog, conn a ship, design a building, write a sonnet, balance accounts, build a wall, set a bone, comfort the dying, take orders, give orders, cooperate, act alone, solve equations, analyze a new problem, pitch manure, program a computer, cook a tasty meal, fight efficiently, die gallantly. Specialization is for insects.” ― Robert A. Heinlein

Joel you may well be correct. But to your comment, remember that a cost-type CLIN requires that an invoice be supported by allowable, actual, costs. If somebody is going to make a billing adjustment, there must be an associated adjustment to the cost records. Material is often easier than labor, but not always.

Sure. This is especially true if one CLIN is FFP and the other is Cost-Type. But think this through. Who pays for the labor involved in processing that credit/debit transaction? Obviously it's the contractor but either the contractor is going to charge the program for the effort as a direct cost, or else the contractor is going to charge the cost transfer activity to its overhead. And if you make the contractor do enough of these inter-contract transfers, it will have to hire additional personnel. And then its overhead rate will go up. If you ever wonder why a contractor's rates are so high, here's a great example of what drives them up.

Joel I was reading between the lines. The OP said there were ECPs and some of those ECPs led to additional CLINs. I assumed the linkage was a proposal from the contractor that identified contract cost/price impacts in the form of an REA. But yes, you are correct, there was no express mention of REAs.

I understand ACRNs and color of money and, indeed, already covered that in my first post on this thread. Absent ACRNs and color of money concerns (which are valid), are there any other reasons a contractor should care -- from a contract compliance standpoint -- with governmental bookkeeping issues? What contract clause would drive those concerns?

Vern, 1. "Aren't you talking about change order accounting?" Not exactly. Change order accounting is important when forming the basis of a claim or REA, as it provides evidence of the cost of contract changes. In this case -- at least as I understand the situation -- the government has accepted the contractor's REA and modified the contract. The contract was modified by addition of a new CLIN. So this is really "change order funding" if you will let me use that phrase. Addition of a new CLIN after costs have been incurred is interesting from a charging perspective, since presumably costs were charged elsewhere, or at least other than where the funding is now. But I was interested in the situation where a change order is accepted and costs are ongoing, but now there are two CLINs from which to choose. Why create that choice when modifying the changed CLIN would avoid it? And even if we want to talk about change order accounting, from my experience it is very difficult (often impossible) to segregate the costs of the changed work from the original work. Reality doesn't often break across those clean lines. 2. "I don't understand what you were saying there." I was saying that a hybrid contract with multiple CLINs, each of which is of a different type (e.g. CLIN #001 is FFP, CLIN #002 is T&M, CLIN #003 is cost-type) presents more compliance challenges than a contract where every CLIN is of the same type. In the former case, a cost transfer from one CLIN to another would be risky, but in the latter case I wouldn't care. In my example, assume I'm overrunning CLIN #001 and want to get well by transferring some costs to CLIN #003, which would then be billable since CLIN #003 was cost-type. That's a compliance concern. However, if both CLINs were of the same type, then my concerns would be greatly reduced.

As a contractor, my primary concern would be that the contract types and colors of money be the same for the gaining and losing CLINs. From a compliance standpoint, I'm not worried about transfers within the same contract, unless it impacts billings (which it would if I'm moving the material from a cost-type to a FFP CLIN or vice-versa). If a customer has multiple active contracts, I would even accept direction to transfer material between contracts, so long as the direction was in writing by an authorized customer representative. For example we could build widgets on Contract #1 and then transfer residual material to Contract #2, if the customer directed us to do so. This is especially true on a CPAF contract, where willingness to work with the customer (within reason) might affect the AF determination. In a related note, on a contract with multiple CLINs -- some of which were added based on acceptance of ECPs -- I wonder how the contractor's personnel figure out which CLIN to charge labor to? Let's say CLIN #003 is for building widget A. During performance it becomes apparent that an Engineering Change needs to happen. The ECP is submitted and approved and the contract is modified by adding CLIN #099 for the changed work--which is changed work for building widget A. How does the contractor know which labor to charge to CLIN #003 and which labor to charge to CLIN #099? It's all labor associated with building widget A. Wouldn't it make more sense (in this example) to modify the contract and add funding to CLIN #003 rather than create a new CLIN? Are there any rules of the road with respect to when a new CLIN is created and when an existing CLIN is modified, with respect to ECPs? H2H

I'm not sure I agree with your definition of "learning objective." From another source I read that a learning objective consists of 1. A description of what the student will be able to do 2. The conditions under which the student will perform the task. 3. The criteria for evaluating student performance. That definition seems more practical and less theoretical than your definition. Given the (revised) definition, it seems that any learning that is "one size fits all" is not meeting the second part of the definition -- i.e., the learning needs to address the conditions under which the student will perform the task. Thus, it seems we need to tailor the training. I was also struck by your use of actuaries rather than accountants in your example. Once an accountant passes the CPA and other related tests they are good to go -- but need to document a certain amount of continuing professional education each year. (If memory serves it's 120 hours over 3 years with no more than 80 counting in any one year.) Again, though, we are talking about a rigorous examination that a certain amount of takers are expected to fail. But once over the hurdle, you are in the profession.

Have you read the DCAA Contract Audit Manual, Chapter 8? It has a very useful flowchart. 1. Per DCAA CAM, Chapter 8: "Any business unit (as defined in CAS 410.30(a)(2)) that is selected to receive a CAS-covered contract or subcontract of $50 million or more, including option amounts, shall submit a Disclosure Statement before award." 2. FAR 30.202-6: Responsibilities. (a) The contracting officer is responsible for determining when a proposed contract may require CAS coverage and for including the appropriate notice in the solicitation. The contracting officer must then ensure that the offeror has made the required solicitation certifications and that required Disclosure Statements are submitted. (Also see 48 CFR 9903.201-3 and 9903.202 (FAR Appendix).) (b) The contracting officer shall not award a CAS-covered contract until the cognizant Federal agency official (CFAO) has made a written determination that a required Disclosure Statement is adequate unless, in order to protect the Government's interest, the agency head, on a nondelegable basis, authorizes award without obtaining submission of the required Disclosure Statement (see 48 CFR 9903.202-2). In this event, the contractor shall submit the required Disclosure Statement and the CFAO shall make a determination of adequacy as soon as possible after the award. (c) The cognizant auditor is responsible for conducting reviews of Disclosure Statements for adequacy and compliance. (d) The CFAO is responsible for issuing determinations of adequacy and compliance of the Disclosure Statement

Anybody ever done a solicitation where the offeror needed to discuss how it would handle the inevitable changes that would occur post-award? Was that an evaluation factor/sub-factor? Seems important.

Vern and Matthew, I'll accept you are the professionals and not me. I tend to think of competitive acquisitions of commercial items as sealed bidding. I know it's not, but I bias that way. Thus, I reacted to the OP as if somebody had conducted a sealed bid and then tried to negotiate a lower price. That was wrong of me. My previous posts were based on my bias talking. This is me walking my comments back. H2H

Matthew your analogy is inapt. If I get a quote from a dealer on a new Ferrari and it's outside my price range, I'm not going to expect the Ferrari dealer to meet my budget. Instead, I'm not going to buy a new Ferrari because the price is outside of my budget. Let me offer my analogy: Next time I go to my auto mechanic and he tells me it will cost $500 for the repairs, I will either accept his quote or go find another auto repairman. I will not attempt to negotiate him down. The commercial price is the price. And if I get 4 quotes from 4 auto mechanics for the same repair and they are all in the same range, I will either accept the lowest quote or not get my repairs done. I will not go back to the lowest price mechanic and tell him he can have my business if he can shave off 10%. In summary: There is no purpose in getting commercial item competition if you're going to ignore the pricing information provided by the commercial marketplace. If you're going to ignore that information, why not just go sole-source and negotiate a price? Why pretend the competition is a valid means of determining price reasonableness?

Open competition in the commercial marketplace has determined the price. The available budget is insufficient. Either cancel the requirement or get more money. In my view the entire purpose of going to the marketplace to acquire commercial services is to provide assurance that the price is fair and reasonable. In this case there is no question about that. Trying to "negotiate" undercuts the entire philosophy of commercial item acquisitions. I'm just saying.

Vern, I appreciate your responses. Let me offer one of my own. 1. There was a contract. There was a written agreement executed by both parties that meets the definition of contract at 2.101. It was called a "purchase order" and, based on the purchase order, the contractor provided services and (presumably) received payment. The contract had terms, including a period of performance. 2. The contractor continued to provide services after the period of performance. 3. The contractor wishes to be paid for the services it provided, and for which the government received benefit. 4. The government acknowledges benefit received but believes the contractor is not entitled to payment because it should have stopped providing services at the end of the contractually specified period of performance. To be clear: performance WAS rendered but the issue is that performance continued after the contract's specified PoP had ended. 5. The contractor's argument will be that it was willing to end performance but the government failed to cancel the service, which was of a nature that it would be continually provided until cancelled. If the government didn't want the service to continue, it should have switched to another provider. That it failed to do so indicated it wanted performance to continue even past the contractual PoP. The government's argument is that the contractor had a duty to cease providing the service upon completion of the contractual PoP. Who's right? To be decided. My only point in all this is that the contractor has a valid claim that must be heard. The claim is not based on an implied contract, but on the actual contract that the parties executed. The contractor is arguing that the contract continued beyond the agreed-to PoP because of the government's inaction. Essentially it would be saying that the government waived the PoP by continuing to accept and use the services. Reasonable people can and will disagree with that argument. If the CO denies the claim, that's fine and the contractor can appeal the denial. I do agree that a valid claim must be related to one of the parties' discharge of its obligations under the contract. However, the term "related to" is to be read broadly (Todd Construction L.P., Federal Circuit, 2010 [s. p. 10]). In this case, the contractor would be arguing that its claim is related to the P.O. -- and I think that argument would be sufficient to get it a hearing on the merits.

The interesting thing (to me) about the ABB Enterprise Software appeal is that the Navy essentially told the contractor just what Vern's hypothetical dialog did: "We're done talking. If you think you have a CDA claim, go ahead and file one." When the contractor did indeed file its claim, the CO denied it on the grounds that the CDA did not apply to the contractor's claim. Imagine how confused the contractor felt ... on one hand they have written correspondence telling them to file a CDA claim, but on the other hand they have a COFD saying they were not entitled to file a claim under the CDA. Fortunately Judge Prouty at the ASBCA saw things differently than the CO did, and will let the contractor's claim be heard. The contractor may or may not win on the merits, but its claim will be heard.

Vern, you have assumed the contractor performed at its own initiative and not due to an act or omission by the government. Those assertions are for a trier of facts to decide. The trier of facts decides those things because the contractor files a claim and it gets heard. Now, back to your post that I already quoted: "In order to submit a Contract Disputes Act claim under FAR Subpart 33.2, there must be a contract. If the PO had expired, then I don't think that the contractor can submit a claim." That's wrong. My proof: FAR 2.101 defines a contract and expressly includes a purchase order in the list of mutually binding agreements that fall under the definition. Thus: A purchase order between government and contractor is a contract. FAR 33.206(a) states that "Contractor claims shall be submitted, in writing, to the contracting officer for a decision within 6 years after accrual of a claim..." The six-year period is not lessened by the expiration of a contract's period of performance. Thus, the expiration of the P.O. is irrelevant for purposes of determining whether or not the contractor can file a claim. It may be quite relevant for purposes of determining whether or not the contractor is entitled to the relief it may be seeking. But that's a different thing entirely. You have posted that an expiry of the PO eliminates the contractor's ability to file a claim. That's wrong. The contractor has six years from the date of claim accrual to file a claim. You should admit you were wrong and we can be done with this nonsense.

Vern, In my view you are conflating claim entitlement with claim accrual. The contractor may or may not be entitled to its claimed amount (assuming it files a claim). However, that has nothing to do with whether or not the contractor may file a claim, have that claim adjudicated by a contracting officer, and appeal that COFD if it desires. You said the expiration of the PO means the contractor cannot submit a claim that arises under or is related to that PO. That is wrong.

Vern, Surely you are not asserting that the CDA Statute of Limitations for filing a claim is zero, are you? The contractor has six years from the date of claim accrual to file. The expiration of the PO is irrelevant. Claims can "arise under" or be "related to" a contract, and those terms are interpreted broadly by the Boards and Courts. The ASBCA just went through the logic in the ABB Enterprise Software decision on the Government's motion to dismiss for lack of jurisdiction.

Here's where my head is at. I think I'm with ji20874 to a large extent. When you look at the original proposal, what do you see? Do you see a labor forecast and associated cost estimate that was reasonably achievable, or do you perhaps see a management "buy-in" situation, one where headcount was minimized and so were the associated labor costs? To me, that's where the rubber meets the road. Was the original proposal and contract price negotiated based on that proposal reasonable, or did management intend to "invest" in order to win the work? If you conclude that the original proposal was reasonable and the associated price was reasonably achievable, then you need to answer ji'20874's questions -- what changed over the past two years? Your statement "the employment situation has radically changed" is too general to let us give you any good advice. You may as well follow PepetheFrog's advice. If you conclude that management "bought in" to the original bid, then they need to suck it up. Perform and quit trying to get well from the original buy-in. ***** Some of my clients have been faced with a recent realization that their independent contractors are actually employees. That is causing lots of angst because the payroll withholdings are going way up. In addition to the FICA and other withholdings the company now has to make, there are suddenly additional benefits available to the employees, such as paid leave and healthcare. I wonder if this could be your situation? Having to incur all those unplanned-for costs would certainly impact any financial models used for FFP labor pricing. Just idle speculation.... ***** Hope this helps.

Apologies, Don. I was confused by your response.

1. Depends on the contractor's standard practices and who performs the work. If the work is performed by direct-charging personnel and the contractor consistently charges same or similar reporting labor as direct costs, then yes - direct labor. 2. No. The prohibition would only apply to direct labor. On the other hand, if the indirect labor amount was large enough to impact the contractor's indirect cost rates, then maybe somebody could make an argument the labor was unallowable. I would not make that argument (unless the personnel performing the reporting were 100% dedicated to the reporting), but somebody else might. That being said, if the contractor would normally charge the labor as direct labor and only charges it now as indirect labor to avoid the contract prohibition, then that would be a big no-no.

Don, This is not particularly my area of expertise, so I defer to you. On the other hand, the FAQ you cite as the basis for your answer contains the following language: "This page does not necessarily contain an exhaustive or current treatment of the DBA and should not, under any circumstances, substitute for a party's own research into the statutory, regulatory, and case law authorities on any given subject addressed by the following FAQs. The FAQs are an informational tool, not a final authority, and should not be cited or otherwise considered an authoritative statement of agency policy."

If a contractor employee, based in the United States, goes TDY to an overseas location during the course of performance of a DoD service contract, does the Defense Base Act (DBA) apply? If the clause is not in the contract the contractor did not procure DBA. If the contractor did not procure DBA then there is no coverage. I believe that the contractor's normal insurance would cover the employee.