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BAA - question


The1102

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My team awards cost-plus-fixed-fee (CPFF) contracts under a Broad Agency Announcement (BAA). A co-worker of mine raised a good concern recently, and I'm questioning whether we're applying the BAA correctly.

FAR 35.016(a) states "this paragraph prescribes procedures for the use of the BAA...for the acquisition of basic and applied research and that part of research not related to the development of a specific system or hardware procurement. BAA's may be used by agencies to fulfill their requirements for scientific study and experimentation directed towards advancing the state-of-the-art or increasing knowledge or understanding rather than focusing on a specific system or hardware solution."

My question is: what is meant exactly by "development of a specific system or hardware procurement" and what constitutes "focusing on a specific system or hardware solution"? How would you draw that line?

Some of our BAA topic areas seem to flirt with this, like basic research relating to a special antenna (including a prototype deliverable) to be used on a specific sea-going probe-like device. Another example is research (including a prototype deliverable) that could potentially shrink the size of an existing system.

My first thought was to check the definition of "system" in the FAR/DFAR, but it is not defined (only "major system" is defined).

Does anyone have experience with this? If you wanted to keep awarding contracts for similar requirements under the BAA, what would you do?

Thanks.

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I just realized that I could be interpreting this citation incorrectly. Maybe "BAA's may be used...rather than..." is simply a suggestion for another application of the BAA, not a prohibition against using BAAs for the development of a specific system or hardware solution.

Thoughts?

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If you're in DoD, the DoD Financial Management Regulation (DoD 7000.14-R), Volume 2B, Chapter 5, provides descriptions of the different types of RDT&E budget activities (see DFARS 235.001). In my opinion, advanced technology development (Budget Activity 3) is appropriate for a BAA--the description states "The results of this type of effort are proof of technological feasibility and assessment of subsystem and component operability and producibility rather than the development of hardware for service use." Contrast this with Advanced Component Development and Prototypes (Budget Activity 4), which states "Efforts necessary to evaluate integrated technologies, representative modes or prototype systems in a high fidelity and realistic operating environment are funded in this budget activity. The ACD&P phase includes system specific efforts that help expedite technology transition from the laboratory to operational use." I think that the "that part of research not related to the development of a specific system or hardware procurement" excludes ACD&P.

I have experience with BAAs and when I was unsure what type of effort something was (basic research, applied research, development) I would look to the type of funding that was being used to fund the effort. If it came from budget activities 1, 2, or 3, it was generally appropriate for a BAA.

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Guest Vern Edwards

Basic research is defined in FAR 2.101 and applied research and development are defined in 35.001.

So what does "not related to the development of a specific system or hardware procurement" mean? The key word is "specific." If you want proposals for the development of a warp drive engine for general testing and experimental purposes, then you're good to go with a BAA. If you want the development of a warp drive engine to be used in the new Starship Enterprise, then you can't use a BAA.

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Thank you both.

I take from your replies that you feel my original (not subsequent) interpretation of the rule was correct, that 35.016(a) prohibits a BAA from "focusing on a specific system or hardware solution." Is that correct? If so, the way the rule is written doesn't communicate that directly. Do you see what I mean by the "BAA's may be used...rather than..." part appearing informational in nature? "May" is permissive, right?

I have experience with BAAs and when I was unsure what type of effort something was (basic research, applied research, development) I would look to the type of funding that was being used to fund the effort. If it came from budget activities 1, 2, or 3, it was generally appropriate for a BAA.

I agree, and that is our policy here. However, we also have a process for when a customer intends to use budget activity 4. We require that they justify in a memo to our comptroller how the guidelines in FAR 35.016(a) overlap with the description of BA 4. If the comptroller agrees with the customer's rationale (and approves the memo), we are comfortable proceeding.

Although the "ACD&P phase includes system specific efforts that help expedite technology transition from the laboratory to operational use," this phase can also include efforts that are not system specific, right? What about "efforts necessary to evaluate integrated technologies...in a high fidelity and realistic operating environment." That type of effort could technically be unrelated to a specific system, couldn't it?

Either way, I agree that the budget activity is generally a useful acid-test for when you can use a BAA.

Basic research is defined in FAR 2.101 and applied research and development are defined in 35.001.

So what does "not related to the development of a specific system or hardware procurement" mean? The key word is "specific." If you want proposals for the development of a warp drive engine for general testing and experimental purposes, then you're good to go with a BAA. If you want the development of a warp drive engine to be used in the new Starship Enterprise, then you can't use a BAA.

Thanks for the feedback. In most of these efforts, the Government contemplates some specific application (e.g. the Starship Enterprise). After all, if there wasn't some specific system at least in our imagination, I doubt we would pursue the technology in the first place. There are plenty of uncertainties of course. The intended system may change (we might put it in the Millennium Falcon), or the technology's application may change (maybe the warp drive engine is better for powering cities). In your opinion, can this uncertainty be somehow woven into a justification for using a BAA?

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Guest Vern Edwards

Were we not clear? If we weren't, there are a number of agency handbooks, manuals, and guides that explain BAAs. One issued by Wright Patterson AFB says:

A BAA solicitation method to contract for research and development may be used when:

1. the Government desires new and creative solutions to problem statements.

2. using a conventional statement of work could result in unintentionally stifling ideas and concepts given many possible approaches.

3. fulfilling requirements for scientific study & experimentation directed toward advancing the state-of-the-art or increasing knowledge or understanding rather than focusing on a specific system or hardware solution.

4. the Government must be able to state its objectives in terms of areas of need or interest rather than specific solutions or outcomes.

5. meaningful proposals with varying technical/scientific approaches are reasonably anticipated.

6. evaluation will be based on a peer or scientific review

This is from the Army Corps of Engineers:

The provisions of the Competition in Contracting Act of 1984 (P.L. 98-369) as implemented in the Federal Acquisition Regulation (FAR 35.016) provide for the issuance of a Broad Agency Announcement (BAA) as a means of soliciting proposals for basic and applied research and that part of development not related to the development of a specific system or hardware procurement. To be eligible for consideration and possible contract award, the technology or methodology shall be either basic research, applied research, advanced technology development not for a specific system/hardware, or demonstration and validation. BAAs may be used by agencies to fulfill their requirements for scientific study and experimentation directed toward advancing the state-of-the-art or increasing knowledge or understanding rather than focusing on a specific system or hardware solution. The BAA shall only be used when meaningful proposals with varying technical/scientific approaches can be reasonably anticipated.

Department of Commerce:

A BAA may be used by an operating unit to fulfill its requirements for scientific study and experimentation directed toward advancing the state-of-the- art or increasing knowledge or understanding rather than focusing on a specific system or hardware solution.

This is from a 1994 GAO bid protest decisions, Golden Manufacturing Co., Inc., B-255347, 94-1 CPD ? 183:

A BAA is a contracting method by which government agencies can acquire basic and applied research. BAAs may be used by agencies to fulfill requirements for scientific study and experimentation directed toward advancing the state of the art or increasing knowledge or understanding rather than focusing on a specific system or hardware solution. Unlike sealed bidding and other negotiated procurement methods, a BAA does not contain a specific statement of work and no formal solicitation is issued. Under a BAA, the agency identifies a broad area of interest within which research may benefit the government, and organizations are then invited to submit their ideas within a specified period of time. The firms that submit proposals are not competing against each other but rather are attempting to demonstrate that their proposed research meets the agency's requirements. Avogadro Energy Sys., B?244106, Sept. 9, 1991, 91?2 CPD ? 229. The agency may decide to award contracts to those offerors who submit ideas which the agency finds suitable. See FAR ? 35.016.

You have enough information to know whether your agency's use is or is not proper. Don't make this more complicated than it really is or needs to be. Has your agency issued any guidance? Does anyone else in your organization seem concerned?

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Vern,

Maybe you're right - I might be making this more complicated than it needs to be. The reason I'm digging into this is because I'd like to keep using our BAA (but with a little more confidence).

You've made your position clear: if the development is for a specific system, I can't use a BAA. I was a little confused by FAR 35.016(a) earlier, but I found a FAR reference that better communicates this prohibition; I've come around. See FAR 6.102:

"The competitive procedures available for use in fulfilling the requirement for full and open competition are as follows:

...

(d) Other Competitive Procedures

...

(2) Competitive selection of basic and applied research and that part of development not related to the development of a specific system or hardware procurement is a competitive procedure if award results from --

(i) A broad agency announcement that is general in nature identifying areas of research interest, including criteria for selecting proposals, and soliciting the participation of all offerors capable of satisfying the Government's needs; and

(ii) A peer or scientific review."

Since development relating to a specific system is not covered here, using a BAA that focused on such a requirement would not be a competitive procedure available for fulfilling the requirement for full and open competition. This reference makes sense to me.

But I still have a bone to pick with the way FAR 35.016(a) is worded. As written, I don't feel it communicates a prohibition against using a BAA for development of a specific system. If I told you "a knife may be used for spreading rather than for cutting," would you take that as a prohibition against using a knife for cutting?

Regardless, because of FAR 6.102, I'll make sure my BAA procurements stay away from "specific systems."

To answer your questions...my co-worker was the first to raise this concern, but now there are a few more (including me). My agency has some guidance on BAAs, but it essentially re-states FAR 35.016(a).

Thank you for your help.

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Guest Vern Edwards

I don't understand why you think FAR 6.102 is clearer than 35.016, and I don't understand your analysis of it. But if you are clearer on the matter, then I'm glad.

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Maybe I was confusing, sorry. Here's the sentence in FAR 35.016(a):

"BAA?s may be used by agencies to fulfill their requirements for scientific study and experimentation directed toward advancing the state-of-the-art or increasing knowledge or understanding rather than focusing on a specific system or hardware solution."

I don't think this sentence prohibits anything.

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The 1102,

There's a principle of statutory construction called expressio unius est exclusio alterius, which means "when one or more things of a class are expressly mentioned others of the same class are excluded." So if the FAR says that a BAA may be used for X, Y, and Z, then it cannot be used for A, B, or C. The FAR does not need to expressly state that a BAA cannot be used for A, B, or C.

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The 1102,

There's a principle of statutory construction called expressio unius est exclusio alterius, which means "when one or more things of a class are expressly mentioned others of the same class are excluded." So if the FAR says that a BAA may be used for X, Y, and Z, then it cannot be used for A, B, or C. The FAR does not need to expressly state that a BAA cannot be used for A, B, or C.

Awesome, thanks for the thorough response. So if a regulation says, "you may use a knife for spreading rather than for cutting," I need to take this as a prohibition against using the knife for cutting, due to the principal of expressio unius est exclusio alterius. That guidance helps, thanks again.

So knowing that I can't wiggle out of the "specific system" language...if I make sure my BAA solicitation topics do not call out a specific system, I make sure that my SOW (based off the contractor's technical proposal) does not call out a specific system, and funding is BA 1, 2, or 3 (or 4 with a valid justification), I should be OK.

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I don't agree with "(or 4 with a valid justification)." When acquiring major systems in DoD, ACD&P funds are used in the Technology Development Phase, which is post-Milestone A (see DoDI 5000.02). If a program is past Milestone A, then an Analysis of Alternatives has been completed and a materiel solution has been approved. From DoDI 5000.02:

TECHNOLOGY DEVELOPMENT PHASE

a. Purpose. The purpose of this phase is to reduce technology risk, determine and mature the appropriate set of technologies to be integrated into a full system, and to demonstrate CTEs on prototypes. Technology Development is a continuous technology discovery and development process reflecting close collaboration between the S&T community, the user, and the system developer. It is an iterative process designed to assess the viability of technologies while simultaneously refining user requirements.

Pre-Milestone A (Materiel Solution Analysis Phase) DoD is looking for innovative ideas to address a broadly defined need. A BAA is helpful in soliciting such ideas. However, once the materiel solution has been selected, the focus is on maturing the technology for incorporation into a system. As such, I don't see how the use of a BAA would be appropriate, given the FAR specifically excludes use of the BAA for efforts "focusing on a specific system or hardware solution."

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