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2 hours ago, C Culham said:

What has not been stated throughout this whole thread is for what reason or purpose the contract could not be a commercial item contract.  Not one reason why the contract as  a commercial item contract is a strategy that would not be in  the best interests of the Government and is addressed in the FAR,  law (statute or case law), Executive order or other regulation, that the strategy, is not a permissible exercise of authority.

Emphasis added. Note that the phase "commercial item" is no longer in official use. We're talking about commercial product or commercial service.

@C CulhamOkay, I'll take a shot, even though I know that once you have made up your mind and committed yourself to a position, as you have in this case, you will never change it. I am really writing this for others. 

The reason the acquisition cannot be for a commercial service contract is because the work, as described by the OP, fits the FAR definition of construction. Here is the definition of construction from FAR 2.101, which applies throughout the FAR (see FAR 1.108(a) and FAR 2.000):

Quote

 

Construction means construction, alteration, or repair (including dredging, excavating, and painting) of buildings, structures, or other real property. For purposes of this definition, the terms "buildings, structures, or other real property" include, but are not limited to, improvements of all types, such as bridges, dams, plants, highways, parkways, streets, subways, tunnels, sewers, mains, power lines, cemeteries, pumping stations, railways, airport facilities, terminals, docks, piers, wharves, ways, lighthouses, buoys, jetties, breakwaters, levees, canals, and channels. Construction does not include the manufacture, production, furnishing, construction, alteration, repair, processing, or assembling of vessels, aircraft, or other kinds of personal property (except that for use in subpart 22.5, see the definition at 22.502).

 

A $500,000 project to replace weathered doors at a military installation (remove old doors and install new ones) would clearly require alteration and/or repair of real property. So it meets the FAR definition of construction

Is construction a commercial service? See the definition in FAR 2.101.

FAR Part 12 does not mention construction as a commercial service. FAR Part 36 says nothing about construction being a commercial service.

FAR does not define service, but it does define service contract at FAR 37.101, and that definition includes "Maintenance, overhaul, repair, servicing, rehabilitation, salvage, modernization, or modification of supplies, systems, or equipment," [emphasis added] but not of real property.

Is the agency buying commercial doors, and is the project the installation of a commercial product and thus a commercial service? I don't know. The OP did not describe the doors in detail. I don't know if the project involves doors of a single type and description or various kinds of doors. I don't know if they are special-order of commercial off-the-shelf. Given that the doors are for a military installation, I presume that they are heavy-duty doors, not the kind that go into ordinary houses. I don't know if the contractor will have to alter any door frames in order to install the new doors. I don't know what kinds of equipment the contractor will require.

However, FAR 2.101 defines a commercial product in part as follows:

Quote

 

(1) A product, other than real property, that is of a type customarily used by the general public or by nongovernmental entities for purposes other than governmental purposes, and–

                (i) Has been sold, leased, or licensed to the general public; or

                (ii) Has been offered for sale, lease, or license to the general public...

 

I wonder if the doors in question are customarily used by the general public.

How much tailoring of FAR 52.212-4 would be necessary in order to protect the government's interests. At what point would the CO have to do so much tailoring in order to protect the government's interests that the advantages of using FAR Part 12 would be lost?

Would the CO need to add coverage for bonds and liquidated damages, or should the CO forego such protections? What kinds of laborers would be needed? Would the Service Contract Act or the Davis-Bacon Act apply? What would your friends at the Department of Labor say? FAR 52.212-5 makes provision for including the SCA in contracts for commercial services, but not Davis-Bacon. What does that tell you? Would SCA wage determinations be appropriate for a $500,000 construction job. See Voith Hydro, Inc., B-401771, November 13, 2009, in which the protester complained that an acquisition being conducted under FAR Part 15 as construction should have been acquired under FAR Part 12:

Quote

 

The record reflects that the agency also contacted a representative of the U.S. Department Labor (DOL) to obtain DOL's views as to whether the provisions of the Service Contract Act, 41 U.S.C. sections 351–358 (2006), which generally covers services or maintenance work, or the Davis Bacon Act, 40 U.S.C. sections 276a–276a–7 (2006), which generally covers construction work, including alteration and repair work, were applicable to the solicitation. AR (B–401244.2) at 9; see Dismantlement and Envtl. Mgmt. Co., B–257632, Oct. 24, 1994, 94–2 CPD para. 151 at 3 n.3. The DOL representative found that RFP –0017 “did contain construction work and that the laborers involved would be covered under the Davis–Bacon Act, not the Service Contract Act.” AR (B–401244.2) at 9. The agency points out that it estimates that “in excess of [DELETED] labor hours” of “onsite” work will be required to complete the work required under RFP –0017, and that although certain service work will be required, “these services were not the majority of the work and were not severable from the work because the contractor that designs the systems must provide training on that system.” Id.

The agency also points out that the FAR sect. 2.101 defines “construction” in relevant part as “[c]onstruction, alteration, or repair (including dredging, excavating, and painting) of buildings, structures, or other real property,” and that “[f]or purposes of this definition, the terms ‘buildings, structures, or other real property’ include, but are not limited to, improvements of all types, such as ... dams [and] plants.” FAR sect. 2.101. The agency argues that in its view the dam, its power plant, and equipment installed therein, such as the generators and excitation system, fall within this definition of real property, and that such a view is consistent with the “Department of the Interior Real Property Financial Management Policy Guide,” which provides that “[r]eal property is defined as any interest in land, together with improvements, structures and fixtures, appurtenances, and improvements of any kind located thereon,” and specifically includes electrical utility systems and hydroelectric power generation within this definition. AR (B–401244.2) at 5; Tab G, Department of the Interior Real Property Financial Management Policy Guide, at 5.

 

FASA and FAR Part 12 were not written with construction in mind. Construction is defined in FAR and does not constitute a commercial service. Using Part 12 to buy construction would create more issues and problems than it would solve, except for very minor jobs, such as I mentioned in my last post.

I could go on, but I think I have made my point. Readers can take it or leave it. But, Carl, we all know that you will stand fast and to the death. So I'm not really writing for you.

In any case, after more than 28 years the policy makers have not seen fit to clear things up, and agencies will do as they like.

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26 minutes ago, Vern Edwards said:

In any case, after more than 20 years the policy makers have not seen fit to clear things up, and agencies will do as they like.

I'm watching to see what will become of the Open DFARS Case 2019-D034, Preference for Commercial Construction Services, which has not had a status update since April 2021.

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10 minutes ago, FAR-flung 1102 said:

I'm watching to see what will become of the Open DFARS Case 2019-D034, Preference for Commercial Construction Services, which has not had a status update since April 2021.

It was part of the FY2017 NDAA.

FY 2017!!!

It's clearly not a priority. They're probably having trouble defining "commercial construction service."

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2 hours ago, Vern Edwards said:

The reason the acquisition cannot be for a commercial service contract is because…

As a rule of thumb, I have in the past relied on the following reasoning.

Working on real property?  Then it’s construction, and it cannot be commercial because Wage Rate Requirements (Construction) - formerly known as the Davis-Bacon Act - applies at a $2,000 threshold.  The Act required terms and conditions that are noncommercial: most notably, the buyer must attach Wage Determinations to the contract and then enforce them.  The three definitions of commercial service in FAR are rendered inapplicable by these terms and conditions and non-catalog/market pricing.

Anyone not part of a union who has ever worked for a commercial construction company knows the term “prevailing wage job”, since it pays more than the commercial customers usually. 

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4 hours ago, C Culham said:

 

RS Means has as it basis market prices.

I will leave you with this as you bow out - 10 USC 3453

Those aren’t market prices. The unit price line items require considerable adjustments and much more information is needed besides any applicable line items to establish a proposal price. 

The most usable part of an R.S. Means line item unit price is the productivity. And that’s only directly applicable if it matches crew composition and assumed equipment.

P.S. 10 USC 3453 concerns market research for commercial products and services. This isn’t a commercial service.

I have no doubt that the materials and supplies for door and hardware replacement are commercial products. The labor and equipment aren’t commercial services. It’s a construction project by definition, as Vern said.

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On 9/17/2022 at 8:07 AM, Vern Edwards said:

Note that the phase "commercial item" is no longer in official use.

Agreed but why does that impact the discussion?

 

On 9/17/2022 at 8:07 AM, Vern Edwards said:

Okay, I'll take a shot,

 

On 9/17/2022 at 8:07 AM, Vern Edwards said:

fits the FAR definition of construction

Miss!  True but where in the FAR does it say you cannot use FAR Part 12 to procure construction.

 

On 9/17/2022 at 8:07 AM, Vern Edwards said:

Is construction a commercial service?

Emphasis added and by the way one source - RS Means.

"Services of a type offered and sold competitively in substantial quantities in the commercial marketplace based on established catalog or market prices for specific tasks performed or specific outcomes to be achieved and under standard commercial terms and conditions. For purposes of these services–

                (i) Catalog price means a price included in a catalog, price list, schedule, or other form that is regularly maintained by the manufacturer or vendor, is either published or otherwise available for inspection by customers, and states prices at which sales are currently, or were last, made to a significant number of buyers constituting the general public; and

                (ii) Market prices means current prices that are established in the course of ordinary trade between buyers and sellers free to bargain and that can be substantiated through competition or from sources independent of the offerors; or

On 9/17/2022 at 8:07 AM, Vern Edwards said:

How much tailoring of FAR 52.212-4 would be necessary in order to protect the government's interests. At what point would the CO have to do so much tailoring in order to protect the government's interests that the advantages of using FAR Part 12 would be lost?

All of it could be except that which is statutorily required.   Here I would say that a full view of Forum discussions on use of FAR Part 12 there are several examples where folks have said that they would wholesale change 52.212-4.   My read of the FAR at part 12 is that there is clear intent to do so if market research provides that 52.212-4 should be change to meet commercial practices.

 

On 9/17/2022 at 8:07 AM, Vern Edwards said:

Would the CO need to add coverage for bonds and liquidated damages, or should the CO forego such protections? What kinds of laborers would be needed? Would the Service Contract Act or the Davis-Bacon Act apply?

Red herring.   Commercial practice, here I will reference the AIA General Conditions for Contract for Construction, provides a clear example regarding bonds and insurance.  With regard to both Davis Bacon and Service Contract that they are "prevailing" wage requirements.   Nothing I have found prevents the use of Davis Bacon in a FAR part 12 contract.   It applies when USDOL rules says it does but it is not indicative of having a contract defined as construction as you attempt to do.  In fact I would suggest that a service contract by definition could in fact have Davis Bacon requirements in the contract as well.  Reference FAR 36.1010(c). 

On 9/17/2022 at 8:07 AM, Vern Edwards said:

But, Carl, we all know that you will stand fast and to the death

As will you.

 

On 9/17/2022 at 8:07 AM, Vern Edwards said:

and agencies will do as they like.

Exactly and in the end I have found none that were taken to task (protest) for doing so.  Have you?

 

On 9/17/2022 at 8:53 AM, Vern Edwards said:

It was part of the FY2017 NDAA.

And reemphasized 2019 by my read.

 

On 9/17/2022 at 10:27 AM, Voyager said:

Anyone not part of a union who has ever worked for a commercial construction company knows the term “prevailing wage job”, since it pays more than the commercial customers usually. 

What?  Are you saying that union rates only apply to Federal government contracts?    Union rates are part of  everyday ordinary trade.

 

On 9/17/2022 at 12:12 PM, joel hoffman said:

P.S. 10 USC 3453

"Pub. L. 114–328, div. A, title VIII, §876, Dec. 23, 2016, 130 Stat. 2311 , as amended by Pub. L. 116–92, div. A, title IX, §902(59), Dec. 20, 2019, 133 Stat. 1550 , provided that: "Not later than 90 days after the date of the enactment of this Act [Dec. 23, 2016], the Secretary of Defense shall revise the guidance issued pursuant to section 855 of the National Defense Authorization Act for Fiscal Year 2016 (Public Law 114–92; 10 U.S.C. 2377 note) to provide that-

"(1) the head of an agency may not enter into a contract in excess of $10,000,000 for facilities-related services, knowledge-based services (except engineering services), construction services, medical services, or transportation services that are not commercial services unless the service acquisition executive of the military department concerned, the head of the Defense Agency concerned, the commander of the combatant command concerned, or the Under Secretary of Defense for Acquisition and Sustainment (as applicable) determines in writing that no commercial services are suitable to meet the agency's needs as provided in section 2377(c)(2) of title 10, United States Code [now 10 U.S.C. 3453(c)(2)]; and

"(2) the head of an agency may not enter into a contract in an amount above the simplified acquisition threshold and below $10,000,000 for facilities-related services, knowledge-based services (except engineering services), construction services, medical services, or transportation services that are not commercial services unless the contracting officer determines in writing that no commercial services are suitable to meet the agency's needs as provided in section 2377(c)(2) of such title [now 10 U.S.C. 3453(c)(2)]."

Have a great week everyone!

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On 9/15/2022 at 10:45 AM, joel hoffman said:

So buying hundreds of thousands of dollars of new exterior doors and hardware (and probably frames and trim) to make repairs to a DoD building or buildings can be a “commercial service”? 

Yes. It's only doors not frames and trim.  The doors go on modular office building listed as equipment rather than real property.  Replacing doors that have become deemed unserviceable due to age and weather is an act of sustainment.  Army DA Pam 420-11 that provides work classifications between maintenance, repair and construction. Similarly Navy reg OPNAVINST 11010.20H, chapter 4(1)(c), dated 16 May 2014, provides that “sustainment” or “ST” is defined as, “the maintenance and repair activities necessary to keep a typical inventory of facilities in good working order.  ST includes regularly scheduled maintenance as well as cyclical repairs or replacement of components that occur periodically over the expected service life of the facilities (e.g., roof or HVAC replacement).”  The DA PAM 420-11 is attached with highlighted passages showing this is a service.  Door replacements are done by private households, local, state, and private business as well as federal government...its commercial service action performed by door installers.

DA PAM 420-11.pdf

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6 minutes ago, CaptJax said:

Yes. It's only doors not frames and trim.  The doors go on modular office building listed as equipment rather than real property.  Replacing doors that have become deemed unserviceable due to age and weather is an act of sustainment.  Army DA Pam 420-11 that provides work classifications between maintenance, repair and construction. Similarly Navy reg OPNAVINST 11010.20H, chapter 4(1)(c), dated 16 May 2014, provides that “sustainment” or “ST” is defined as, “the maintenance and repair activities necessary to keep a typical inventory of facilities in good working order.  ST includes regularly scheduled maintenance as well as cyclical repairs or replacement of components that occur periodically over the expected service life of the facilities (e.g., roof or HVAC replacement).”  The DA PAM 420-11 is attached with highlighted passages showing this is a service.  Door replacements are done by private households, local, state, and private business as well as federal government...its commercial service action performed by door installers.

DA PAM 420-11.pdf 471.94 kB · 0 downloads

Thanks for the clarification, CaptJax! I concur. 

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If the Government bought a cage whose purpose was to keep people inside based on the stated purpose I would reason that the cage is not a commercial items because only certain authorized agencies within the Government has the authority to lock people up.  If the Government bought doors that required a specification to some intel standard of sound attenuation and signal shielding and I would also reason that a door requiring those specs are not commercial off the shelf items either. Both of these scenarios arose and caused fierce debate. The cage and doors are mass produced and the stated purpose didn't matter according to the proponents of commerciality. They argued you can buy cages and doors from Grainger and other commercial vendors. My view is that those cages are not intended to incarcerate or deprive someone of their freedom (lawfully), but are to keep mail and inventory safe...in away I see that in that it keeps people out rather than in.  Doors: if the doors must meet some governmental guidance or reg that is definitely not an off the shelf.  These doors that are at the center of this post did have such as spec, but was found to be a copy and paste mistake from a previous request and not necessary to this purchase.  The doors are off the shelf exterior doors.  There is customization to install the door hardware such as egress and panic bar and door closure hardware.

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1 hour ago, CaptJax said:

It's only doors not frames and trim.  The doors go on modular office building listed as equipment rather than real property. 

49 minutes ago, CaptJax said:

The doors are off the shelf exterior doors.

You might have introduced this information earlier in the conversation.

A problem clearly stated is a problem half solved.

 

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CaptJax - there is nothing in the definition of a commercial product that requires it to be used for the same purpose as it is used commercially. The definition focusses on the product, not the intended use. Even if they have to meet some government requirement, they might still qualify under the 'modified' or 'of a type' parts of the definition.

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4 hours ago, ji20874 said:

You might have introduced this information earlier in the conversation.

A problem clearly stated is a problem half solved.

 

This made ME think!

@CaptJaxHere are your questions yet everyone piled on the construction- commercial item subject including me.   Yep finding the questions buried in the scenario might have caused the confusion but the problem it seems in the form of some questions were very possibly clearly stated.  Let me back track and offer the following.

Q.   Is it dangerous to use terms of clarification, discussions, POM/PNM, negotiation from FAR 15 applied to an 8(a) sole source for commercial services?  

A.  Yes I believe so in an 8(a) sole source.   Too much formality.  FAR subpart 19.8 only calls in the entirety of FAR Part 15 when doing a competitive 8(a).  May sound too simple but stick to FAR 19.8.   I am not saying the POM/PNM is not required as your agency policy may dictate and it just makes common sense to me as well.   Clarification and discussions  do not fit in my view.   You are just sitting down with the sole source and negotiating. 

Q. The term "negotiation" in the world of the FAR is it wholly owned by FAR 15?   

A.  In the case of the OP procurement see 19.808.     

Q.  I had a contract where the service could only be done during whale season, which is somewhat of a moving target; how could this POP commencement rule be so stringent?   

A.  I think FAR subpart 11.403 might help you answer the question yourself.

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A key point is that the work is being performed on personal property, not real property. Ok, so commercial service or commercial product with installation. Since you are negotiating the price of a sole source contract, it would seem to me that part 15.4 negotiation procedures would be appropriate: 

“15.400 Scope of subpart.

This subpart prescribes the cost and price negotiation policies and procedures for pricing negotiated prime contracts (including subcontracts)…”

You can certainly ask for whatever level of price or cost breakdowns or backup information deemed necessary to determine whether the price is fair and reasonable. If you are going to negotiate the price, it makes perfect sense to develop pre-negotiation objectives (POM) and to document the negotiation (PNM). A POM is your outline plan for negotiations. I always developed pre-negotiation objectives, even if it was primarily a marked up proposal with notes.

Its really not that difficult.

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11 hours ago, C Culham said:

What?  Are you saying that union rates only apply to Federal government contracts?    Union rates are part of  everyday ordinary trade.

I'll defend the above if I have to - particularly in the realm of minor construction where union labor is perhaps not the norm -  but I'd rather stay on the offensive here and humor your argument.  Okay, so union rates are part of everyday trade.  Is the owner of a shopping mall developer (read: U.S. Government) hiring agents of the shopping mall (read: COs) to perform the following actions upon review of Turner Construction's certified payroll submittals?

Quote

FAR 22.406 Administration and enforcement.

* * * *

22.406-4 Apprentices and trainees.

(a) The contracting officer shall review the contractor's employment and payment records of apprentices and trainees made available pursuant to the clause at 52.222-8, Payrolls and Basic Records, to ensure that the contractor has complied with the clause at 52.222-9, Apprentices and Trainees.

(b) If a contractor has classified employees as apprentices or trainees without complying with the requirements of the clause at 52.222-9, the contracting officer shall reject the classification and require the contractor to pay the affected employees at the rates applicable to the classification of the work actually performed.

* * * *

22.406-6 Payrolls and statements.

(a) Submission. In accordance with the clause at 52.222-8, Payrolls and Basic Records, the contractor must submit or cause to be submitted, within 7 calendar days after the regular payment date of the payroll week covered, for the contractor and each subcontractor,

(1) copies of weekly payrolls applicable to the contract, and

(2) weekly payroll statements of compliance. The contractor may use the Department of Labor Form WH-347, Payroll (For Contractor's Optional Use), or a similar form that provides the same data and identical representation.

(b) Withholding for nonsubmission. If the contractor fails to submit copies of its or its subcontractors' payrolls promptly, the contracting officer shall, from any payment due to the contractor, withhold approval of an amount that the contracting officer considers necessary to protect the interest of the Government and the employees of the contractor or any subcontractor.

* * * *

22.406-7 Compliance checking.

(a) General. The contracting officer shall make checks and investigations on all contracts covered by this subpart as may be necessary to ensure compliance with the labor standards requirement of the contract.

(b) Regular compliance checks. Regular compliance checking includes the following activities:

(1) Employee interviews to determine correctness of classifications, rates of pay, fringe benefits payments, and hours worked. (See Standard Form 1445.)

(2) On-site inspections to check type of work performed, number and classification of workers, and fulfillment of posting requirements.

(3) Payroll reviews to ensure that payrolls of prime contractors and subcontractors have been submitted on time and are complete and in compliance with contract requirements.

(4) Comparison of the information in this paragraph (b) with available data, including daily inspector's report and daily logs of construction, to ensure consistency.

* * * *

22.406-8 Investigations

* * * *

22.406-9 Withholding from or suspension of contract payments.

...

(b) Suspension of contract payments. If a contractor or subcontractor fails or refuses to comply with the labor standards clauses of the Construction Wage Rate Requirements statute and related statutes, the agency, upon its own action or upon the written request of the Department of Labor, must suspend any further payment, advance, or guarantee of funds until the violations cease or until the agency has withheld sufficient funds to compensate employees for back wages, and to cover any liquidated damages due.

If not, then even though there may be union labor (assuming this equates to Wage Determination-based catalog/market pricing per FAR 2.101 definition of commercial service), the terms and conditions beyond pricing are not commercial.  And in that case you cannot get past the bold emphasis I place in the definition below:

11 hours ago, C Culham said:

"Services of a type offered and sold competitively in substantial quantities in the commercial marketplace based on established catalog or market prices for specific tasks performed or specific outcomes to be achieved and under standard commercial terms and conditions. For purposes of these services–

(i) Catalog price means...

(ii) Market prices means...

 

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Thanks C Culham,

I'm dealing with a KO who spent his entire career in FAR 15 and has not much familiarity with services.  So when FAR 19.808 mentions "negotiate" that triggers the full FAR 15 process of technical evaluation by an engineer, a cost analysis by a cost engineer, preparation of a POM, clearing the POM through legal for clearance to negotiate, meeting minutes documenting negotiation, and a PNM finalizing the negotiations.  We are replacing 21 doors. 

Would you consider the following a "negotiation":

1. Contractor rolled up pricing in a lump sum line item for base security, labor, etc:  I asked for a price breakout to understand the price and determine if its necessary and reasonable. I don't consider this a "negotiation"

2. Contractor found some efficiencies in reviewing its proposal for a breakout and returned a revised proposal with the breakout. I don't consider this a "negotiation"

3. Contractor shows a breakout from a subcontractor, and some assumptions of cost  the subcontractor made were not required for the subs work. When this was pointed out the contractor's sub removed the unnecessary costs.  The overall proposal went down as a result. I don't consider that a "negotiation" especially in this case.

I define a negotiation as when the Government's justification of terms and conditions such as quantities and prices don't align with the contractor's proposal and there is a wiggle room where an agreement can be reached.  It's not really that 

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I think I can guess where this work is being done, and it is an 8(a) sole source. So perhaps some reasons why it will cost almost $24,000 per door. ($500,000/21 ) . But it would seem that such a magnitude requires some level of detailed evaluation and price negotiations.  

A request for a breakdown of a lump sum line item isn’t considered negotiations. The contractor can certainly revise the pricing of the line item. If you discussed and agreed on the revised line item price, that is a price negotiation.

If you pointed out the unnecessary assumptions and cost in the subs’ proposal, that’s an element of both technical evaluation and negotiations.

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10 hours ago, CaptJax said:

I'm dealing with a KO who spent his entire career in FAR 15 and has not much familiarity with services.  So when FAR 19.808 mentions "negotiate" that triggers the full FAR 15 process of technical evaluation by an engineer, a cost analysis by a cost engineer, preparation of a POM, clearing the POM through legal for clearance to negotiate, meeting minutes documenting negotiation, and a PNM finalizing the negotiations. 

Would you consider the following a "negotiation":

1. Contractor rolled up pricing in a lump sum line item for base security, labor, etc:  I asked for a price breakout to understand the price and determine if its necessary and reasonable. I don't consider this a "negotiation"

2. Contractor found some efficiencies in reviewing its proposal for a breakout and returned a revised proposal with the breakout. I don't consider this a "negotiation"

3. Contractor shows a breakout from a subcontractor, and some assumptions of cost  the subcontractor made were not required for the subs work. When this was pointed out the contractor's sub removed the unnecessary costs.  The overall proposal went down as a result. I don't consider that a "negotiation" especially in this case.

I define a negotiation as when the Government's justification of terms and conditions such as quantities and prices don't align with the contractor's proposal and there is a wiggle room where an agreement can be reached.  It's not really that[.] 

@CaptJaxAccording to FAR 15.000, a negotiated contract is any that is awarded using other than sealed bidding, and Part 15 prescribes policies and procedures for both competitive and noncompetitive negotiated acquisitions. Thus, according to FAR 15.400, the policies and procedures in FAR Subpart 15.4 apply to your 8(a) negotiation, even if it's for a commercial service. See FAR 12.203(a):

Quote

Contracting officers shall use the policies unique to the acquisition of commercial products and commercial services prescribed in this part in conjunction with the policies and procedures for solicitation, evaluation and award prescribed in part 13, Simplified Acquisition Procedures; part 14, Sealed Bidding; or part 15, Contracting by Negotiation, as appropriate for the particular acquisition.

Emphasis added.

The KO is the one who must sign the contract. See FAR 1.602-1(b). And see FAR 15.405(a): "Taking into consideration the advisory recommendations, reports of contributing specialists, and the current status of the contractor’s purchasing system, the contracting officer is responsible for exercising the requisite judgment needed to reach a negotiated settlement with the offeror and is solely responsible for the final price agreement."

Since the CO, not you, must put his name on the contract, and since he has decided what is appropriate, why not just do as you're told and stop your anonymous whining here.

When you work for someone, work for them.

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For DoD, the PGI at 215.4 provides detailed procedures for evaluating and negotiating proposal's, including sole source commercial products and services. Plus there is a guidebook for pricing commercial purchases, including the requirement and general information on negotiating the acquisition. It’s pretty clear that evaluation, including price and technical/cost analyses where appropriate, preparing pre-negotiation objectives and documenting the negotiations are necessary.

https://www.acq.osd.mil/dpap/cpic/cp/docs/Guidebook_Part_B_Commercial_Item_Pricing_20180126.pdf

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9 hours ago, Voyager said:

I'll defend the above if I have to - particularly in the realm of minor construction where union labor is perhaps not the norm -  but I'd rather stay on the offensive here and humor your argument.  Okay, so union rates are part of everyday trade.  Is the owner of a shopping mall developer (read: U.S. Government) hiring agents of the shopping mall (read: COs) to perform the following actions upon review of Turner Construction's certified payroll submittals?

 Prevailing rate means that which is prevailing in a particular area.   Not all D-B rates are union.   By example if Turner Construction was building in Benton County Arkansas  based on your application of D-B being the basis for determining commercial services would the project be commercial?  If I think about it your premise does not make sense.   As to record keeping  requirements check out FLSA and let me know if it only applies to Federal contracts.  Overall the AIA standard that I noted before carries a term and condition that the contractor shall comply with applicable law, statute etc. in performing the work.   As a general rule of thumb your reasoning seems flawed to me. 

From a D-B wage determination emphasis added -  "A four letter classification abbreviation identifier enclosed in dotted lines beginning with characters other than ""SU"" or ""UAVG"" denotes that the union classification and rate were prevailing for that classification in the survey."

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10 hours ago, CaptJax said:

Would you consider the following a "negotiation":

You have received some other refined and general comments.   I will just add mine but as noted in other comments you are being driven to do something by a CO so I guess that is the rule.   But my view is this as dumb as it may sound.

I believe the negotiation of an 8(a) sole source begins at the very start where the agency begins dealing with SBA to identify an appropriate contractor to do the work and ends with a successfully agreed to contract.  On one hand dealing with SBA is sort of like ( a flimsy "like") clarification, and discussion to figure who is best for the work.  On the other hand, and I would agree not often used, is the fact that SBA is the prime supposedly, so when you start talking to them at the very beginning you are negotiating.

It has been a long while since I worked in the 8(a) arena but in the 15 years I did spend in it I always advocated for not making sole source complicated.   I do advocate for a well documented file however and if you have to hang an acronym on it then a POM and PNM it is. 

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One of Stephen R Covey’s “Seven Habits of Highly Effective People” is “Begin with the End in Mind”. All of Covey’s character based principles are great and can be applied to negotiated acquisition processes.

Be proactive

Begin with the end in mind

Put first things first

Think win/win

Seek to understand first, before making yourself understood

Learn to synergize

Sharpen the saw

But one needs a plan…🤠

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1 hour ago, C Culham said:

As to record keeping  requirements check out FLSA and let me know if it only applies to Federal contracts.  Overall the AIA standard that I noted before carries a term and condition that the contractor shall comply with applicable law, statute etc. in performing the work.

I checked out FLSA and found the DOL WHD says this about it in a fact-sheet: “If the employer performs work on a federally financed project or a project in which the Federal government has provided assistance in financing the project, a different and somewhat stricter set of labor standards applies. Typically this would require that employees performing on such contracts be paid a ‘prevailing wage rate’.”

Also, it’s time for a sanity check.  In our hypothetical commercial construction contract, who enforces the FLSA and applicable state laws: the mall cops (an inside party to the contract ;), or the DOL (an outside party)?

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22 minutes ago, Voyager said:

Also, it’s time for a sanity check.  

Oh I get it and I have had this argument thrown at me before.   Throw a dang term and condition in a contract that you as the owner (dare I say CO) feels that they have no enforcement power over.  If so why put in at all?   I guess when you build a house and your contract requires the contractor to comply with all state and local laws and codes and the contractor fails to do so you will just say "whatever" and move along!   Or, wait will you take contractor to task, even ask for a change in price if they don't.     Sanity check is correct and your suggestion is insanity.

 

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