napolik

Yes, often you need to provide some magnitude of an acquisition for services. One common way is for the government to provide their estimate of the level of effort and mix of personnel needed (number of hours/days per each labor category). Another less common way is providing a monetary estimate or budget. This is sometimes done when a Statement of Objectives approach is used describing the governments need. Offeror responding to a SOO need to know whether the government wants a $1 million proposed approach or a $10 million one.

During the 90s - the era of Acquisition reform, the term / policy Cost as An Independent Variable (CAIV) appeared. The purpose is to assure that systems acquired via contract fall within budget limits set for the system. The CAIV approach has been used successfully in service contracts as well. There is no reason why you cannot announce in a solicitation the maximum cost or price you are willing to pay for a product or service. You invite the competitors to provide proposals within the maximum cost or price while providing them the latitude to propose changes to your SOW or terms and conditions, if necessary to stay within the dollar limit you announce.

This approach should not be used routinely, but there are times when your budget circumstance demands its use.

I have a question related to this original thread on "Basic Agreement in lieu of IDIQ".

My office has a practice of issuing single award multiple year BPAs after a competition for the BPA, for commercial items. There are always multiple vendors who can provide for the item, and there are multiple vendors who offer on the BPAs. We solicit for and include prices in the BPA.

I don't find anything to expressly prohibit this, or any GAO cases that speak to this specifically, but it seems we are circumventing the intent of the FAR, by narrowing to one BPA award. The call orders are usually placed without negotiation. It makes placing call orders easy, but it feels like we are circumventing real competition. Since a BPA is not binding and either party can end it without cause, doesn't that eliminate the effect of a competitive environment?

I'd appreciate feedback on whether anyone knows of regulations or GAO rulings make this acceptable or unacceptable.

If you did the BPAs under FAR Part 13, take a look at paragraphs ( c ) and (d) of FAR 13.303-5.

Quote

13.303-5 -- Purchases Under BPAs.

(a) Use a BPA only for purchases that are otherwise authorized by law or regulation.

( Individual purchases shall not exceed the simplified acquisition threshold. However, agency regulations may establish a higher threshold consistent with the following:

(1) The simplified acquisition threshold and the $6.5 million limitation for individual purchases ($12 million for purchases entered into under the authority of 12.102(f)(1)) do not apply to BPAs established in accordance with 13.303-2( c )(3).

(2) The limitation for individual purchases for commercial item acquisitions conducted under Subpart 13.5 is $6.5 million ($12 million for acquisitions as described in 13.500(e)).

( c ) The existence of a BPA does not justify purchasing from only one source or avoiding small business set-asides. The requirements of 13.003( and subpart 19.5 also apply to each order.

(d) If, for a particular purchase greater than the micro-purchase threshold, there is an insufficient number of BPAs to ensure maximum practicable competition, the contracting officer shall --

(1) Solicit quotations from other sources (see 13.105) and make the purchase as appropriate; and

Unquote

If you did them under FAR Part 8, you are OK unless your agency FAR supplement dictates otherwise (e.g. DFARS 208.405-70 Additional ordering procedures).

Does anyone have information in regards to obtaining an approved purchasing system. I have gone to the DCMA website and downloaded all the materials available. I have been trying to locate a manual to use as a guide.

See this: https://acc.dau.mil/CommunityBrowser.aspx?id=24875.

Jacques - Yes to your question and just for the record I have assumed nothing about the example, Cajun stated there were several IDIQ contracts and I simply stated same.

I am not depending on FAR Pat 10 I am depending on the fact that any IDIQ is not mandatory after the minimum is met. Seems my answers throughout this thread would pinpoint this contention but there are some that want to section out issues just to defend their own position. Understood.

At the risk at taking this thread completely off track I believe I have from memory and my limited ability to do research (no Westlaw etc.) come up with a better analogy that has not been mentioned as of yet. No doubt I will continue to bear the brunt of brow beating and less than complimentary comments but I am simply interested in the debate.

So here I go..............

Consider Federal Supply Schedules that function much like an IDIQ. In June of 2004 the language of the FAR was changed, without statutory support, to allow agencies using the FSS to forgo small business restriction or set-aside (ref: FAC-2001-24). By my limited read the FAR Council simply believed it was the best thing to do even though there were comments to the contrary. I offer this example as by my recollection, prior to FAC 2001-24, small business participation was implied as necessary and the FAC changed this implication.

Followed three years later by GAO Protest B-309911. In this protest the protester was found not to be an interested party and the details of the protest were never addressed. It seems they appealed but I cannot find the follow-on results. The protest was against the failure of the agency to set aside the FSS procurement for small business. Again the protest was dismissed as the protester was not an interested party but what I found interesting in the read of the protest was the following comment by GAO -

"During the course of this protest, we sought the views of both the GSA, which administers the FSS program, and the Small Business Administration, as well as the Army. The submissions made clear that these agencies do not agree about how the set-aside requirements of the Small Business Act, 15 U.S.C. sect. 644(j) (2000), apply to orders placed against the FSS."

I find the comparison to the arguments in this thread to be interestingly similar - no agreement.

Again in my very rural abilities to search regarding appeals etc. I could find nothing. Maybe there is more and will watch intently for what folks might post.

Otherwise, I an satisfied with my participation in this thread and I am resigned to just waiting to watch for a GAO decision exactly on point, undoubtedly inclusive of any input from SB

The applicability of FAR 19 to FAR 8 is clearly a different issue from those that have been volleyed about in this thread. While I am reluctant to discuss yet another one in this thread, I am compelled to point out that GAO has stated clearly that FAR 19 does not require contracting officers to apply the rule of two to procurements conducted under FAR Part 8.

Quote

Nothing in the Small Business Act suggests or requires that the Rule of Two--which is set forth in the regulations that implement that Act (but is not found in the Act itself), see Delex Sys., Inc., B-400403, Oct. 8, 2008, 2008 CPD para. 181 at 6-7--takes precedence over the FSS program. To the contrary, and as noted above, the implementing regulations for the small business set-aside program and the FSS program expressly provide that set-aside requirements for the program do not apply to FSS buys. See FAR sections 8.404(a), 19.502-1(, 38.101(e). Accordingly, we conclude that the Small Business Act and its implementing regulations do not impose a requirement on agencies to first evaluate whether a solicitation should be set-aside for small businesses before purchasing the goods or services through the FSS program.

Unquote

See Edmond Computer Company; Edmond Scientific Company, B-402863; B-402864, August 25, 2010.

I am hoping there is a SPS/PD2 super user out there that can help me with the following conundrum:

SPS/PD2 does not let you change or update a line of accounting (LoA) after award.

I have a few situations now where the line of accounting is incorrect--numbers transposed, etc...

Payment cannot be paid until LoA error is corrected on contract/order.

I have created subCLINs with the description funding information only, and put the funding information on this CLIN (after making the main CLIN informational and subtracting funding). This seems to be an okay work around. I have to clean up and reword the summary of changes a bit, as not to confuse the vendor and DFAS, but it seems to do the job.

However, I now have a few situations now where I have to change LoA on subCLINs. For example, I have subCLINs 0001AA, 0001AB, 0001AC with incorrect LoAs. Since I cannot create a subCLIN of a subCLIN, is my best/only course of action to create new subCLINs 0001AD, 0001AE, 0001AF and label them as funding information only? From what I can tell, I must create a priced subCLIN in order for the correct funding/LoA information to appear.

Please help!

Thanks!

I understand your frustration as I know many 1102s in your circumstance. I am unable to answer this question. I can suggest that your office hire an 1106 who is responsible for dealing with issues like this. One of the disturbing side effects of an "automated procurement system" - which is actually an annex to a financial management system - is the diversion of "procurement professional" time and effort from learning and applying procurement principles to chasing bits and bites through computer systems. 1102s need to spend less time perfecting keystrokes and mouse moves and more time reading the FAR or thinking about good business deals.

I don't think GAO's interpretation of the rule of two in Delex will fly anymore based on the language of Sec. 1331 (see formerfed's post), because it would render Sec. 1331 meaningless.

Two years ago,I heard DoD VIPS say that Delex must be overturned. Recently, I heard a DoD Procurement VIP say that he supports the idea of applying the rule of two to IDQ contracts. I am no longer sure that Delex is going to be history - at least in DoD.

Vern:

I understand your opinion however a lot of new ideas come from a combination of what others are doing. We are all one Federal government. I have no intention of cutting and pasting anyones programs.

I have researched quite a bit as well as have participated in the FAC C training. I do not think this training is of a lot of benefit to GS1105s who never purchase over the 150k limit. I believe the main focus for this series should be classes such as the FAR Boot Camp, Simplified Acquisition, classes on the set asides as well as classes on GSA. Classes that actual emphasis the tools to do the job expected. I also feel that cramming these classes to obtain a certification defeats the learning as the new learned tools are not given time to reap the benefits.

Thank you for your comments!!!!!!

Pursuit of new ideas must be preceded by pursuit of basic knowledge of the FAR and of its day-to-day application. This cannot happen without an OJT program. Formal training, whether in the class or on the web, cannot be a substitute for reading the FAR and asking questions of knowledgeable journeymen 1102s.

This is for a construction contract so would fall under FAR Part 15. I told the KO that I would establish a competitve range. However she feels that competive rangs is only for best value source selections and not appropriate for LPTA. I have never heard that competitive ranges were only for best value/trade off. In regards to the translation, the propsals are in english. The Tech Board feels the error occured when the contractor internally translated the solicitation and then drafted their proposal in english.

It is important that you base decisions based upon your knowledge of the FAR, not upon "feelings" sensed around the office, even if the feelings are felt by someone with a warrant..

Please read FAR 15.3 and tell us if the concept of the competitive range applies only to "best value" source selections.

I recently sent a modification package to exercise an option to our contract attorney. When I received my legal review of the package our lawyer noted that findings were not needed on my D&F. That 17.207? states that ?the contracting officer may exercise options only after determining? anf that the "findings" are not required. I have never seen this done, and as our lawyer has been our lawyer for the past 10 years and never mentioned this in his previous reviews, I found it somewhat confusing. Any thoughts?

FAR Subpart 1.7 addresses Determinations and Findings (D&F). I don't see anything prohibiting the use of a D&F when making a determination to exercise an option.

Im going to start out by saying im in a contingency environment. Tech evaluations just occured and the source selection is LPTA. All offerors are technically unacceptable except 2 (well, they are the "most" acceptable). However the 2 technically acceptable proposals have statements within their proposals that are confusing that may be a result of the solicitation being translated. 15.101-2((4) states exchanges may occur. Can the Government ask the 2 most acceptable proposals to clarify their proposals without going to the other unacceptable offerors?

If you need additional information to determine the acceptability of the proposals, the exchanges with the offerors would constitute discussions. See this extract from Nu-Way, Inc., B-296435.5; B-296435.10, Sept. 28, 2005:

Quote

When an offeror is given the opportunity to remove an ambiguity from its proposal, especially where the information to be provided by the offeror is essential for determining the proposal?s acceptability, such an exchange constitutes discussions.

Unquote

If you are following FAR Part 15, perhaps the circumstances justify a competitive range of two. If you are using FAR Part 13, why not speak only with the "most acceptable" contractor offering the lowest price?

If the proposal statements are included in another language, can you not eliminate the confusion by obtaining a better translation of the statements by someone other than the contractors?

The authority to award new work under a contract vehicle created under the repealed demonstration program would seem to be directly contrary to the expressed will of Congress. (No more steel from Timbucktoo.)

To do otherwise would not pass the red-face test. Imagine being called to testify in front of a congressional committee and being asked to explain why you awarded new work under a repealed program. All the finely nuanced arguments in the world would not sound reasonable, mainly because they aren't, imho.

Why can you not use contracts awarded prior to the repeal? What has directed the non-use of existing contracts?

See FAR 1.108(d):

Quote

(d) Application of FAR changes to solicitations and contracts. Unless otherwise specified ?

(1) FAR changes apply to solicitations issued on or after the effective date of the change;

(2) Contracting officers may, at their discretion, include the FAR changes in solicitations issued before the effective date, provided award of the resulting contract(s) occurs on or after the effective date; and

(3) Contracting officers may, at their discretion, include the changes in any existing contract with appropriate consideration.

Unquote

What has specified non-use of existing contracts?

The agency is DoD. I would prefer a reply from active COs.

Posts 2 and 3 have all the information you need. You will not find a common response from contracting offficers.

In my career within and outside DoD, when faced with a CR, there have been times when I funded fully 12 month periods of performances. In other cases, the funding covered only the period covered by the CR. My decisions have been governed by the wording of the CR and the allocation of funds by the agency comptroller.

Does anyone have experience with telephone service/utility contracts and "Letters of Agency"?

My agency has a contract for IT services from a KTR. In order to perform the IT services they are contractually obligated to provide, the KTR needs to have cooperation from our local telephone provider. The telephone provider refuses to work with the KTR until the KTR provides a "Letter of Agency" signed by my agency.

The DRAFT LOA states: "[the KTR] is authorized to act on behalf of [the agency] for the acquisition of supplies/services . . . leasing/rental of equipment . . . In addition . . . [KTR] has the authority for the issuance of tax exempt status for these supplies/services . . . ."

We looked at FAR 51 and are not sure if this constitutes a "Letter of Authorization" as detailed in FAR 51. Also, the KTR is not being authorized to purchase off of another government contract, which is what FAR 51 is about. And we are wary of the "tax exempt status" language.

Can anyone shed light on this for us? My agency does not usually encounter telephone service/utility contract matters. Should we sign the LOA? If we should modify the LOA, how so?

While I would be willing to provide information or documents pertinent to a tax exemption for the contractor supporting my agency, I would be leery of signing any LOA. Take a look at FAR Part 29 for direction. Specifically see FAR 29.303 and FAR 29.305. The former FAR section says the following at paragraphs (a) and (:

Quote

29.303 -- Application of State and Local Taxes to Government Contractors and Subcontractors.

(a) Prime contractors and subcontractors shall not normally be designated as agents of the Government for the purpose of claiming immunity from State or local sales or use taxes. Before any activity contends that a contractor is an agent of the Government, the matter shall be referred to the agency head for review. The referral shall include all pertinent data on which the contention is based, together with a thorough analysis of all relevant legal precedents.

( When purchases are not made by the Government itself, but by a prime contractor or by a subcontractor under a prime contract, the right to an exemption of the transaction from a sales or use tax may not rest on the Government's immunity from direct taxation by States and localities. It may rest instead on provisions of the particular State or local law involved, or, in some cases, the transaction may not in fact be expressly exempt from the tax. The Government's interest shall be protected by using the procedures in 29.101.

Unquote

The latter FAR section addresses evidence needed to establish an exemption from State or local taxes.

I read the memo as applying to the solicitation of offers, not quotes. The memo does not mention quotes at all. So, unless you are soliciting offers under FAR Part 13, the memo would not apply.

I want to agree with you, but I cannot - as yet. I am familiar the kinds of FPDS data analyzed and discussed prior to the issuance of the memo. The DPAPers looked at all actions coded as competitive for which a single offer or quote was received. These actions included ones under FAR 8, 13, 15 and 16.

I should have more info on this in the next few days.

I have a firm fixed price indefinite quantity contract that I would like to solicit as a commercial item. There are a few time and materials components as well. Am I required to do the D&F under FAR 12.207((ii), even though the majority of the contract line items would not require this, or does the mere presence of any time and materials line items mandate it?

In reviewing the policy and procedures set forth in FAR 12.207 governing the preparation of a D&F, I conclude that you must do one even though a majority of contract line items are firm-fixed-price.

FAR 12.207((1)(ii)(A) establishes a requirement to prepare a D&F:

Quote

12.207 -- Contract Type.

(a) Except as provided in paragraph ( of this section, agencies shall use firm-fixed-price contracts or fixed-price contracts with economic price adjustment for the acquisition of commercial items.

( (1) A time-and-materials contract or labor-hour contract (see Subpart 16.6) may be used for the acquisition of commercial services when?

(i) The service is acquired under a contract awarded using?

(A) Competitive procedures (e.g., the procedures in 6.102, the set-aside procedures in Subpart 19.5, or competition conducted in accordance with Part 13);

( The procedures for other than full and open competition in 6.3 provided the agency receives offers that satisfy the Government?s expressed requirement from two or more responsible offerors; or

( C ) The fair opportunity procedures in 16.505, if placing an order under a multiple award delivery-order contract; and

(ii) The contracting officer?

(A) Executes a determination and finding (D&F) for the contract, in accordance with paragraph ((2) of this section (but see paragraph ( c ) of this section for indefinite-delivery contracts), that no other contract type authorized by this subpart is suitable;

Unquote

While they do not address your question directly, other paragraphs in FAR 12.207 do imply that you must prepare one. Take a look at FAR 12.207((2)(iii):

Quote

(iii) Establish that the requirement has been structured to maximize the use of firm-fixed-price or fixed-price with economic price adjustment contracts (e.g., by limiting the value or length of the time-and-material/labor-hour contract or order; establishing fixed prices for portions of the requirement) on future acquisitions for the same or similar requirements; ??.

Unquote

In my mind, this indicates a recognition that a single contract can contain both firm-fixed-price (FFP) and time-and-material (T&M) or labor-hour (LH) coverages.

See also FAR 12.207( c )(2) and (3):

Quote

(2) When an indefinite-delivery contract is awarded with services priced on a time-and-materials or labor-hour basis, contracting officers shall, to the maximum extent practicable, also structure the contract to allow issuance of orders on a firm-fixed-price or fixed-price with economic price adjustment basis. For such contracts, the contracting officer shall execute the D&F required by paragraph ((2) of this section, for each order placed on a time-and-materials or labor-hour basis. Placement of orders shall be in accordance with Subpart 8.4 or 16.5, as applicable.

(3) If an indefinite-delivery contract only allows for the issuance of orders on a time-and-materials or labor-hour basis, the D&F required by paragraph ((2) of this section shall be executed to support the basic contract and shall also explain why providing for an alternative firm-fixed-price or fixed-price with economic price adjustment pricing structure is not practicable. The D&F for this contract shall be approved one level above the contracting officer. Placement of orders shall be in accordance with Subpart 16.5.

Unquote

These subparagraphs also anticipate contracts containing a mixture of FFP, T&M and LH coverages.

Since the scope of requirement to prepare a D&F set forth in FAR 12.207((1)(ii)(A) is not limited to a contract wholly T&M or LH and since FAR 12.207((2)(iii) and FAR 12.207( c )(2) and (3) anticipate the issuance of contracts with a mixture of FFP, T&M and LH coverages, I believe you must prepare the D&F.

A contract contains several CDRLs that will now not be required and a para in the SOW that will not need performed. The contractor is beginning to incur costs associated with these tasks. Should the PCO issue a Stop Work Order for those tasks and associated CDRLs? The FAR part I'm finding confusing is 42.1303(: "Generally, a stop-work order will be issued only if it is advisable to suspend work pending a decision by the Government and a supplemental agreement providing for the suspension is not feasible..." This implies you either issue a stop work OR a supplemental agreement and the stop work would only be issued if a decision by the Govt is pending. In this case the decision is firm: the Govt does not want the Ktr to perform the work associated with the SOW para or to deliver several CDRLs.

This leads me to believe a SA is advisable, which I believe is often referred to as a 'descope' modification. From DAU 'Ask a Professor':

"A de-scope is a reduction in the contract requirements- specifically the statement of work. You should do the following:

Send the contractor a letter advising it that the government intends to de-scope the contract, and specifically identify what will be de-scoped and how much. Request that the contractor give you a de-scope proposal, showing how much money will be saved by the de-scope. The proposal should be like any other- showing reductions in material, personnel, labor hours, etc. The proposal will be lower than the Government estimate in most cases. Then you evaluate the proposal and negotiate the reduction (including a reduction in profit/fee, since there is less work to do). Once an agreement is reached on the amount of the reduction, you issue a bi-lateral contract modification with the reduced pricing in section B, the reduced scope in section C, and any other changes that result from the reduction (some clauses may drop out if the revised contract value is below the threshold for using the clauses)."

I think we want to follow the process outlined above but we need the Ktr to immediately stop incurring costs (i.e. don't want to wait for proposal, etc) associated with the SOW para and CDRLs we no longer require. Please respond with any thoughts or recommendations....thank you.

Here is a portion of the text of 42.1303:

Quote

42.1303 -- Stop-Work Orders.

(a) Stop-work orders may be used, when appropriate, in any negotiated fixed-price or cost-reimbursement supply, research and development, or service contract if work stoppage may be required for reasons such as advancement in the state-of-the-art, production or engineering breakthroughs, or realignment of programs.

( Generally, a stop-work order will be issued only if it is advisable to suspend work pending a decision by the Government and a supplemental agreement providing for the suspension is not feasible. Issuance of a stop-work order shall be approved at a level higher than the contracting officer. Stop-work orders shall not be used in place of a termination notice after a decision to terminate has been made.

Unquote

Note the final sentence of paragraph (.

I assume you have a FAR Part 49 Termination clause in your contract. It appears you have decided you no longer require the work covered by a portion of the SOW and by CDRLs. You should issue a partial termination of your contract covering the relevant portions of the SOW and the CDRLs.

Hmm, it looks "the plain reading of the FAR" may get one into trouble concerning the Disputes clause, now doesn't it?.

Approximately 2 years ago, I ate lunch with a member of the DAR Council during a DoD Conference. I pointed out the contradiction between the court decisions and the FAR coverage of interest on claims. She seemed very interested, and she requested that I send the details. I did.

Perhaps the next FAC will correct the FAR coverage.

Is there a written policy change? No, I haven't seen anything to modify my view.

The most significant implication of calling ship repair a supply is the avoidance of the Davis-Bacon Act. If the cost of compliance with the Davis-Bacon Act were not an issue, the Navy would not be calling ship repair a supply.

There may be other regulatory and statutory hurdles that the Navy is trying to avoid and, as illogical as it may be, it may make the best business sense to call ship repair a supply. The application of laws and regulations does not always yield a logical conclusion. It reminds me of a Supreme Court decision holding that a tomato is a vegetable.

The policy affects overseas Navy contracting offices doing ship repair where the DBA does not apply. I am trying to get a copy of the policy memo to determine the basis for the decision to move from service to supply.

Where does it say in the FAR that you must obligate your minimum order at the time of award of the contract?

It is not stated in the FAR. It is stated in the GAO Red Book. See post 16 of this thread for the reference.

They also rejected the argument, still used by NAVSEA, that a ship repair contract is a supply contract:

DON, within Navy, outside of NAVSEA, there has been a recent policy change that converted ship repair from a service contract to a supply contract. Have you seen anything modifying your view that ship repair is a service vice a supply?

In your view what are the statutory or regulatory implications of using a supply versus a service contract to repair ships?

Specifically I need to know if it is required to disclose our actual estimated costs for components & manufacturing expense; and whether we need to thereby disclose our profit. It is a FFP contract with no specific price limitations, but we will come in under $2MM total. 15.403 & 15.408 are mentioned as governing provisions.

You may need to provide your actual estimated costs and profit. The answer depends upon your specific solicitation and its provisions, and the circumstances of the procurement. Chances are the solicitation contains the provision at FAR 52.215-20 -- Requirements for Certified Cost or Pricing Data and Data Other Than Certified Cost or Pricing Data. If so, read the provision to determine exactly what information the contracting officer is seeking from you.

If you must submit cost or pricing data because no exception applies, see FAR 15.408 at Table 15-2 -- Instructions for Submitting Cost/Price Proposals When Certified Cost or Pricing Data Are Required. Part I of the table -- General Instructions, requires you to provide your proposed cost; profit or fee. Part II of the Table 15-2 -- Cost Elements, requires a break down of your cost elements.

This may sound naive, but as I read the FAR and my current RFP (FFP for patented equipment with components which are all "commercial" items), I see nowhere that requires the Offeror to disclose in its Proposal actual estimated costs, and the profit that is expected from sales. But plastered everywhere I look is "Price/Cost Proposal."

This has me concerned since it appears to me to be counterintuitive with respect to the title. I realize that the Government can gain access to our records, quotes, etc to determine "Reasonableness" after a determination that we are "in the competitve range." It does mention that we need to describe our analysis, methods and "Results" thereof... But it refrains from coming out and asking for actual estimated costs & profit.

We have no subs except for Direct Material Suppliers, and none of them exceed the "simple acquisition threshold," so no certified price or costing data is required.

My question is: "Am I way off base, or have I interpreted the FAR/RFP correctly." I sure don't want to screw up now...

Many thanks to anyone who can help me out here.

Best,

bocajohn

boca,

What is your specific question? What is the estimated dollar value of the procurement, including options? What FAR provisions in the solicitation address price / cost information?

Question: Does an overseas office buying a service that will be performed in a U.S. outlying area have to comply with the rest of Part 19? It seems that there is an emerging consensus among the participants here that it is the location of performance that matters. If the answer is yes, does anyone know if overseas contracting offices read it that way?

I corresponded with representatives of an Army and a Navy contracting offce located in Europe. Neither office has a SB rep; neither awards contracts for work in the US. I am attempting to obtain copies of relevant documents setting out the reasons for these policies.

Does anyone know of any references or seminole cases related to business loss calculations for IDIQ contracts. Specifically, how damages are determined when the Government breaches an Umbrella/MAC IDIQ contract. I found cases involving Requirements contracts but I have not found anything on point dealing with IDIQs. I am still searching but would appreciate an assist.

Here is an extract from a 2001 decision of the United States Court of Appeals for the Federal Circuit.

http://ftp.resource.org/courts.gov/c/F3/23...26.00-1054.html

B. Entitlement and Damages

Both requirements contracts and IDIQ contracts provide the government purchasing flexibility for requirements that it cannot accurately anticipate. See Stratos Mobile Networks U.S.A. v. United States, 213 F.3d 1375, 1380 (Fed. Cir. 2000). A requirements contract requires the contracting government entity to fill all of its actual requirements for supplies or services that are specified in the contract, during the contract period, by purchases from the contract awardee. 48 C.F.R. ? 16.503(a) (2000). See also Medart, Inc. v. Austin, 967 F.2d 579, 581 (Fed. Cir. 1992). Conversely, while an IDIQ contract provides that the government will purchase an indefinite quantity of supplies or services from a contractor during a fixed period of time, it requires the government to order only a stated minimum quantity of supplies or services. 48 C.F.R.? 16.504(a) (2000). See also Dot Sys., Inc. v. United States, 231 Ct. Cl. 765 (1982). That is, under an IDIQ contract, the government is required to purchase the minimum quantity stated in the contract, but when the government makes that purchase its legal obligation under the contract is satisfied. See, e.g., Mason v. United States, 615 F.2d 1343, 1346 (Ct. Cl. 1980). Moreover, once the government has purchased the minimum quantity stated in an IDIQ contract from the contractor, it is free to purchase additional supplies or services from any other source it chooses. An IDIQ contract does not provide any exclusivity to the contractor. The government may, at its discretion and for its benefit, make its purchases for similar supplies and/or services from other sources.

Travel Centre entered into a contract with GSA that explicitly stated, within its four corners, that it was an IDIQ contract and that Travel Centre was guaranteed no more than $100 of revenue. Travel Centre admitted, in response to an interrogatory question, that it understood prior to being awarded the contract that federal agencies identified in the solicitation were not required to use its services under the contract.

Further, the contract unambiguously stated that Travel Centre was "a preferred source" of travel agency services in Maine and New Hampshire. The language "a preferred source" is not equivalent to "the exclusive source" or even to "the preferred source." Rather, the language "a preferred source" indicates that governmental agencies could, but are not required to, use Travel Centre for its travel management services needs. That is, the federal agencies in the areas covered by the IDIQ contract were free to purchase travel management services from sources other than Travel Centre.

Regardless of the accuracy of the estimates delineated in the solicitation, based on the language of the solicitation for the IDIQ contract, Travel Centre could not have had a reasonable expectation that any of the government's needs beyond the minimum contract price would necessarily be satisfied under this contract.1

In sum, when an IDIQ contract between a contracting party and the government clearly indicates that the contracting party is guaranteed no more than a non-nominal minimum amount of sales, purchases exceeding that minimum amount satisfy the government's legal obligation under the contract. Accordingly, under the terms of the IDIQ contract at issue, GSA was only required to purchase the minimum quantity stated in the contract - sales that would lead to $100 in revenue. Prior to the termination of the contract, Travel Centre realized over $500,000 of gross sales under the contract. Sales of more than $500,000 netted Travel Centre over $100 of revenue.2 Therefore, GSA satisfied its obligation under the contract. Because GSA met the legal requirements of the contract at issue, its less than ideal contracting tactics fail to constitute a breach. Therefore, Travel Centre is not entitled to any legal relief, including damages.

http://ftp.resource.org/courts.gov/c/F3/23...26.00-1054.html

In Sterile Foods, the government argued that ASPR 1-700 meant that the provisions of the Part "are not to be applied to contracts which are awarded and are to be performed in foreign countries." (emphasis added). The GAO looked to the ASPR and to the SBA regs and found the argument a reasonable one. Under the facts in Sterile Foods, the government had no reason to argue for more.

Thanks.

In Sterile Foods, the government argued that ASPR 1-700 meant that the provisions of the Part "are not to be applied to contracts which are awarded and are to be performed in foreign countries."

When I arrived at my first overseas job in 1981, we were unable to award contracts anyplace but in a foreign country. There was little or no technology to allow us to award contracts outside the office in a foreign country. When I returned in the 90s, I began to carry a laptop with me. When I traveled, I would correspond with contractors located in foreign countries via e-mail. Sometimes, I was sitting in the US. Given the government?s argument in Sterlie, if I had awarded a contract while sitting in the US, FAR 19.5 would have applied. Fortunately, I think a reading of FAR.19.308 (a) (1) removes that possibility.

Reading the FAR is always a challenge and, frequently, frustrating. The same topic can be addressed in multiple parts, subparts, sections and subsections. Even when one locates all relevant passages, the vocabulary is poor, the text formatting misleading and the syntax confusing. It is not uncommon to infer meaning rather than to take it directly from the FAR text.