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Navy_Contracting_4

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Everything posted by Navy_Contracting_4

  1. In a CPFF contract, the contractor doesn't get fee "on" any individual element of cost. The contractor gets a fee that is fixed. I expect that in your situation, the offeror has proposed a fixed fee, and someone (the offeror? you? both of you?) has characterized the fee as some percent of something, such as, for example, "XX percent of cost, not including cost of money." Mathematically, that may be an accurate statement, but it isn't what you're going to negotiate. You're going to negotiate a fixed amount that you agree to pay, as fee, for the work. The offeror may use any number of tactics to get you to agree to the fixed amount he wants. In my opinion, any tactic short of lying/deception/fraud is a reasonable tactic. You should focus your efforts on determining how much money you believe is a reasonable amount to pay as a fixed fee, and proceed to negotiate on that basis. Ultimately, someone will do the division and may refer to the fixed fee amount as a percent of something, but at that point, what difference does it make? Consider the following: Direct Labor cost.........$400,000 Indirect (Overhead).......$320,000 ODCs..........................$ 20,000 G&A............................$ 70,000 Cost of money (FCCM)...$ 5,000 Fixed Fee....................$ 64,800 Total...........................$879,800 The fixed fee amount of $64,800 may be characterized as: 8.2% of cost, not including ODCs or cost of money, 8.0% of cost, not including cost of money, 7.95% of cost, including cost of money, 7.36% of sales, or even 16.2% of direct labor cost All of those statements would be accurate, but the significant fact, contractually, is that the fixed fee is $64,800 no matter how you may choose to characterize it.
  2. 232.501-1 is the DFARS section listing the customary progress payment rates for use with FAR 52.232-16. If this clause applies, then the government is offering progress payments based on costs, however, as napolik points out, your description of what you're contemplating sounds like you're not talking about "progress payments."
  3. formerfed- I think the part about "...appropriations available for new obligations..." refers to the period of time before appropriations expire for obligation purposes. This varies among different types of appropriations. In DoD, for example, O&M funds are available for new obligations for one year (the fiscal year for which they were appropriated.) RDT&E funds are available for new obligations for 2 years; procurement funds are available for new obligations for 3 years. At the end of these times, the funds "expire" and may not be used for new obligations, however, all of these types of funds may be obligated after they have expired under certain specified circumstances, such as to pay for a change order, or a claim. After expiration, the funds are available for payment (or for obligation against changes/claims) for 5 years, at which time they are "canceled," and they aren't available at all, even for payment against valid unliquidated obligations.
  4. Not all progress payments are based on cost. Is this a proposal in response to an RFP? If so, read the RFP to see what it says about payments. Does it include FAR 52.232-16, Progress Payments? If not, it may include FAR 52.232-30, Installment Payments for Commercial Items, or FAR 52.232-32, Performance Based Payments. If any of these clauses are included, it's usually best to review them carefully and structure your proposal accordingly. If your proposal is not in response to an RFP, then you may propose any kind of contract financing you shoose, however, you should be aware that the contracting officer will review and consider that aspect of your proposal against the policies in FAR Part 32, and particularly FAR 32.106 and 32.113. Read them carefully, and if your proposed financing method is not in accordance with those policies, then you should be prepared to change your proposal or support the need for an alternative method with a convincing business case.
  5. I just searched an old version of the ASPR, and couldn't find a clause by that title. The closest thing I could find was "Certificate of Independent Price Determination," which still exists today. I believe the version I searched was the version in existence immediately preceding the FAR, so could it have been deleted before 1984? What was the essence of the clause?
  6. Are you suggesting pro-rating the annual cost among several contracts based on usage?
  7. I can't speak to policy at other agencies, but incremental funding of RDT&E is fundamental DoD fiscal policy. Your situation doesn't fit the bill for a multi-year contract. You can't describe next year's (or the third year's, etc) "requirement" separately from this year's.
  8. Doesn't First Article Testing require some kind of written terms and conditions, and aren't written terms and conditions prohibited for purchases with a Government Purchase Card? What are you buying that is under the micropurchase threshold that needs First Article Testing?
  9. If you truly have a non-severable requirement, then you don't really have 5 years worth of requirements, you just have one requirement. And it's a requirement of this year. I expect you actually need the work done now, but the nature of the work won't allow for it all to be accomplished in this year. I'm not sure the 5-year limitation you refer to applies to your situation.
  10. Linda- Yes, I did. Thank you for the correction.
  11. Does the prime contract include FAR 52.244-2? Does the prime contractor have an approved purchasing system?
  12. It depends on which agency you work for. In DoD, the thresholds are $10 million (total costs for all contracts) for development, and $25 million (total costs for all contracts) for production or services. [DFARS 207.103(d)(i)]
  13. BPA = Blanket Purchase Agreement How do you have an "agreement" if there's only one party to it?
  14. I agree with your answer ("No"), but I'm not sure I agree with the quoted sentence. Of course, who can tell what the Gov't intends without seeing what else they say about their intentions in the RFP. It sounds to me more like they intend to make a single award, pursuant to either FAR 16.504( c)(1)(ii)(D)(1)(i) or FAR 16.504( c)(2)(i)(A). I wonder if the RFP included either FAR 52.216-27 or -28, or if the Gov't's intentions were otherwise discussed..
  15. Why would you want a higher liquidation rate? I could understand a desire for a higher progress payment rate, because it would improve your cash flow, but wouldn't a higher liquidation rate have the opposite effect?
  16. You won't find anything saying their interpretation is right, because it isn't. And I doubt you will find a DoD or Army policy memo saying " 'task or delivery order contract' means contract, and not orders under a contract." An interpretation that this applies to orders makes no sense. How can you issue a mulltiple award order?
  17. Is there something in the clause, or in the FAR, that requires you to recompete, instead of exercising the option? I thought this requirement for re-certification was merely to avoid reporting dollars to FPDS-NG as being awarded to small business, when in fact, the work is being performed by what is now a large business. If a contractor won a contract as a small business, then grew to be large before the first five year period was over, wouldn't the re-certification just cause you to report the option exercise action as being awarded to a large business?
  18. I think here_2_help has jumped prematurely to a conclusion as to what COLA means. Without knowing what it means in the context of this deal, saying definitively that it "is an adjustment to an employee's salary or hourly wage rate based on moving from one duty station to another," may or may not be accurate, but definitely is not readily apparent from the facts presented. The implication in learningtheropes's initial post is that the contract is T&M (see reference to "the T&M bill rate"). I agree with Carl that one needs to read the contract to determine what it says the government will pay.
  19. Read FAR 52.249-8, paragraph ( c). Is that what you're looking for?
  20. Does anyone think the following notice may be sufficient? "(a) As stated in 10 USC 2409, an employee of a contractor may not be discharged, demoted, or otherwise discriminated against as a reprisal for disclosing to a Member of Congress, a representative of a committee of Congress, an Inspector General, the Government Accountability Office, a Department of Defense employee responsible for contract oversight or management, or an authorized official of an agency or the Department of Justice information that the employee reasonably believes is evidence of gross mismanagement of a Department of Defense contract or grant, a gross waste of Department of Defense funds, a substantial and specific danger to public health or safety, or a violation of law related to a Department of Defense contract (including the competition for or negotiation of a contract) or grant. "( A person who believes that the person has been subjected to a reprisal prohibited by paragraph (a) may submit a complaint to the Inspector General of the Department of Defense, and the complaint will be duly investigated as described in DFARS 203.903." You might add an address for the IG, too. There's one included at DFARS 203.1003 that could be edited easily.
  21. If you read more carefully, you'll find Vern's cited language in the third ("***") footnote of the actual Certificate that is set forth in full text in FAR 15.406-2(a), just as Vern said.
  22. I'm assuming you mean FAR 15.506, not 15.505. FAR 16.505((4) specifically invokes the procedures of 15.503((1) and 15.506 for orders exceeding $5 million, and agencies must provide an opportunity for a post-award debriefing for such orders, per FAR 16.505((1)(iii)(E). The procedures of FAR 15.505 don't make sense in the context of ordering under MATOCs. If the order is under $5 million, then the contracting officer is correct that a debriefing is not required.
  23. Does your contract include any clause or other language saying that issuance of a new wage determination entitles the contractor to an equitable price adjustment? I expect it doesn't. Does it include FAR 52.216-7 Allowable Cost and Payment? I expect it does. Unless there are some other limitations or restrictions elsewhere in the contract, the contractor will be paid for all his allowable costs (indirect as well as direct) without there being a need for a "price adjustment."
  24. The first problem I'm having with your question is you suggest there's a choice to be made between "T&M or IDIQ." You're comparing apples to oranges. IDIQ contracts can be priced on a fixed price basis, a cost-reimbursement basis or a T&M basis. The second problem I have is your statement that the "translation service charges per word / language and has a fixed hourly rate." How can you have a charge "per word" as well as per hour ("fixed hourly rate")? It seems to me that you can have one or the other, but not both, unless you mean that the ordering officer has a choice of ordering on a per word basis or a per hour basis. Finally, are you contemplating a multiple-award contract scenario, or a single award?
  25. VERN- I agree with your first and third paragraphs, but in your second paragraph, you opine incorrectly on FAR 13.101(. First, I think you have a typo in your citation, referring to 13.101((1). I think you mean 13.101((2). Secondly, 13.101((2) doesn't tell contracting officers to incorporate provisions and clauses by reference in contracts, it tells contracting officers to incorporate provisions and clauses by reference in solicitations. As you note, FAR Part 2 includes RFQs among "solicitations." FAR 13.101( does say "should," though, not "shall." Nevertheless, it makes no sense to use 52.212-1 in RFQs.
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