Navy_Contracting_4

In order to answer your question definitively, one would need to read the modifications adding funds to determine with certainty whether thay had any impact on the contract prices, but generally, incremental funding actions do not affect contract prices.

I think FAR 28.101-1(a) is clear and unequivocal - "A contracting officer shall not require a bid guarantee unless a performance bond or a performance and payment bond is also required." Any policy that runs counter to that prohibition would require a FAR deviation, wouldn't it? Has your regional acquisition officer obtained a deviation?

What are the rules governing the timeline a Contracting Office has to respond to questions submitted by Offerors pertaining to an RFP prior to the proposal submission due date? Is there a specific FAR clause that specifies a duration?

Scenario:

Proposal due date: 10 December 2013

Questions were due: 18 November 2013

I presume you are asking from the offeror's perspective, thinking "It's been 2 1/2 weeks since questions were due, no answers have been provided and proposals are due in 3 business days - what's going on?"

If that's your situation, I would guess that the goverment received more questions than expected, or received a very complex or difficult question. Either of these situations, coupled with the timing of being around Thanksgiving, may have led to a longer time to get answers out. I would expect answers to be provided by tomorrow, before the weekend, and the proposal due date will likely be extended, possibly until the first week of January.

Have you asked the contracting office POC what's going on?

There were no FAR changes issued in March 2013. FAC 2005-65 was issued January 29, with rules effective January 29 and February 28. FAC 2005-66 was issued February 28, with rules effective February 28 and April 1. FAC 2005-67 wasn't issued until June 21. Based on my cursory review of the topics covered in these 3 FACs, none appeared to include the change you described.

There is no where in the previous contract that requires proposal for a follow on. And you are correct in assuming this is not a long-lead.

...

I should probably also clarify that this is an IDIQ. The first task order has already been issued and we have paid excessive proposal costs associated with the base on the first TO. I was not part of those negotiations. But I do not want to continue paying proposal costs on the following task orders for a contractor that does not respond to Government requests in a timely manner. I know they're going to try to charge us on the following task orders but my FAR definition of a contract includes task/delivery orders and as long as those task order contracts do not exist yet, I see no reason for us to pay proposal costs.

Yes, you should have mentioned that you're talking about task orders under an IDIQ contract, because the terms of the IDIQ contract apply to task orders. What does the contract say about pricing of orders?

Do not give up, but ask the person who told you that the existing contract "requires proposals for the next phase" to show you where in the current contract it says that the contractor is "required" to submit a proposal for the next phase. if they can show you, that's good, because now you'll know the proper place to charge those costs, i.e. to the existing contract. If there is no such requirement, then you should feel comfortable enforcing compliance with the contractor's disclosure statement. The Assad memo addresses this situation directly and explicitly.

The mere fact that the contract you're negotiating is a "follow-on" has no bearing on whether proposal prep should be charged direct or indirect. This determination is made by reading the contract(s).

NOTE: The above comments presume that the follow-on contract is not a "long-lead" contract, i.e. an undefinitized contract action (UCA) issued on a NTE basis, which authorizes the company to purchase long-lead material and requires it to submit a proposal to definitize the complete contract for which the long-lead material is intended.

I haven't experienced that problem this week,

Caramel92,

Just out of curiosity, how was this situation discovered, i.e. how did it come to light that there was some allegedly out-of-scope work performed? Were some costs disallowed on an invoice? In a CR contract for R&D,with an approved accounting system, and with the scope broadly defined, how were the out-of-scope costs identified? Is there an argument to be made that the work was in-scope?

So, then under that logic a contractor could potentially execute a fixed-price subcontract for $155,000, and then modify that subcontract 5 times adding $100,000 each time, and never have to notify the USG. That seems like it's not what the clause is intended to do.

If the contractor was going to split purchases to avoid getting consent, he would have issued the original award for $150,000 and avoided the issue completely, so I'm going to assume the additional 5 purchases are righteous individual, unrelated buys. If they are, then I think the result is precisely what the clause intended.

From DCMA Instruction 143:

"CHAPTER 2

RESPONSIBILITIES

. . .

2.2. PRIME CONTRACTOR. The Prime Contractor:

2.2.1. Notifies the ACO in advance of awarding any subcontract or making a modification to a subcontract, for which consent is required."

I interpret this to mean notification is required in advance of awarding any subcontract for which consent is required or making a modification for which consent is required. In essence, if an action will require consent, then advance notice of that action is required. If a modification does not otherwise require consent, then advance notice of it is not required.

Joel,

Yes, I didn't realize that it was a correction until after I had responded to you. Sorry for the confusion.

I agree with you totally that the sub and the prime need to talk to each other and make sure both understand the situation. I think the questions you pose are excellent, and need to be addressed openly and explicitly.

Joel,

"If the subk instead proposes at the target rate knowing that it would actually bill higher, actual costs or those position(s), then - in my opinion - it is, at a minimum, probably providing defective cost or pricing data." That's a nice way of calling it a lie, apparently intended to deceive someone who would read or rely on the statement or proposed lower rate.

If this were a cost-reimbursement contract, I would agree with you, but it's T&M. How can you bill at a higher rate than is in the contract?

The Source Selection Plan is an internal Government document that has no outcome on the competition. It's purpose is to set forth the roles and responsibilities of the source selection team.

If Sections L and M of the RFP have such an evaluation process, then sure. But the SSP doesn't dictate it.

I can't speak for other places, but every place I've worked has included the Instructions to Offerors and the evaluation factors as part of the SSP. See, for example, paragraph 2.2.5 of the Department of Defense Source Selection Procedures.

Thanks Navy! Can you point me to the specific clauses or language that I can use to support your second point?

My second point was merely a logic statement. If the law requires you to submit accurate, complete, and current cost or pricing data, and you do submit accurate, complete, and current cost or pricing data, you have complied with the law and can't be found to have submitted defective cost or pricing data. The issue of reaching agreement on the price, with both parties in possession of accurate, complete, and current cost or pricing data, is a separate matter. Besides, I'm thinking you must be worrying about something other than being penalized for submitting defective cost or pricing data, since you're subject to action in that regard only "f any price, including profit or fee, negotiated in connection with this contract, or any cost reimbursable under this contract, was increased by any significant amount." [FAR 52.215-10(a), emphasis added.]

Thank you for pointing out my mistake, Retreadfed. I had completely forgotten that. I think the oddity you highlight is something that could, and should, be fixed merely by moving a ")".

so "we are able to quote whatever price we want as long as we certify that we are willing to disclose any of the data/information that prudent buyers/sellers would reasonably expect to significantly impact final price negotiations. If the prime finds that the price we submitted varies from the data that supports our cost, then they have the right to negotiate us toward a price they think is reasonable based on our certified cost data, or they can elect to not award anything to us."

and this doesnt offend the requirement for certified cost and pricing data? The argument being that if our comp system points to a $50 an hour rate but we are bidding $40 per hour, then we are providing defective pricing.

1. The certification is more than just being "willing to disclose." The certification is that you "submitted, either actually or by specific identification in writing," accurate, complete, and current cost or pricing data. See FAR 15.406-2.

2. If you submit accurate, complete, and current cost or pricing data that you believe would support a $50/hr rate, but offer to perform for $40/hr, the data you submitted is not defective.

If there are no subocontracting possibilities, then 52.219-9 should not be included.. See FAR 19.708((1) -- "Insert the clause at 52.219-9 . . . in solicitations and contracts that offer subcontracting possibilities . . ."

If you have an option for production, and there are subcontracting possibilities, then you should include the clause, obtain a subcontracting plan, and negotiate and incorporate it into the contract, noting that it becomes effective if and only if the option is exercised.

What is the significance/relevance of the effort being NRE? There's no exception to the requirement for submitting and negotiating a subcontracting plan for NRE efforts, is there?

Is this deal being negotiated competitively, or on a sole source basis? If it's competitive, then TINA should not apply. If it's not competitive, and the amount is over the TINA threshold, then still TINA should not be a problem, because you can quote whatever you want, as long as you disclose "all facts that . . . prudent buyers and sellers would reasonably expect to affect price negotiations significantly." [FAR 2.101 definition of "cost or pricing data.]

I'm not famiiliar with the 9th circuit False Claims Act case mentioned by Retreadfed, but I believe TINA does not require you to quote any particular price; it merely requires you to disclose. You may quote a price that is higher or lower than your cost or pricing data might support, as long as you disclose all the facts.

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its a grant, but ultimatly the grant will be used to establish a contract.

What do you mean by this statement? Do you mean that if the grantee's work yields promising results, then you may issue a contract for further research, or something like that?

Deaner,

I don't know what agency you work for, but many agencies have their own regulations implementing and supplementing the OMB Circular. For example, in DoD, we have DoD 3210.6-R, "Department of Defense Grant and Agreement Regulations". You should definitely find out if your agency has any corresponding guidance.

If you want to change the specified work hours so that they're flexible enough to allow for alternate work schedules, I can think of nothing that would prevent you from doing that.

My question is, if the federal governmnet awards a grant to a doctor to perform a research study, does the FAR apply to that grant funding.

The answer to that question is clearly "No," for the reason I stated in my earlier post.

Grants are assistance vehicles not acquisition instruments, and thus, the FAR does not apply to them.

Can you be more specific as to what your question is?

Have you read FAR Subpart 17.2?

You may also want to review the discussion at http://www.wifcon.com/discussion/index.php?/topic/350-gaos-latest-mcs-decision/.