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rafieldjr

DoD Implementation of NDAA 2012 (PL 112-81 ), Sec 808, Para ( c )(1) and ( c )(2)

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To our younger contracting practitioners:

When behind enemy lines, lost, alone, and in the dark, head toward the sounds of battle. Don't just sit there waiting for someone to find you and tell you what to do.

Here is some straight talk: Sec. 808 of the NDAA for FY 2012 and the DPAP guidance that followed are nothing. TINA and CICA were much worse. What does "cost or pricing data" mean? (We're still litigating that issue.) What is adequate price competition? What constitutes discussions in source selection? What does "full and open competition" mean? When FASA was enacted, there were the people who sat around complaining that the definition of commercial item was unclear. We're still arguing about what is a claim more than 30 years after passage of the Contract Disputes Act of 1978. You are in the wrong business if you need perfect clarify from above before you can act.

In every case, there are complainers and there are people who think, make a decision and a plan, and move out. You can be one or the other. Choose.

In time there will be clarifications, adjustments, changes in direction, and reversals. Deal with them when they happen. Until then: Improvise. Adapt. Overcome.

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I pulled the final rule from the Federal Register on 29 Jun 12 and furnished it to my supervisory contracting officers asking if we should implement it by adding the provisions IAW the prescriptions. I was told emphatically that until our HQ told us what to do, that we were not to take any action prescribed in the final rule. I find this amazing. The final rule is a final rule - the DFARS has been updated. We are a DoD agency. Now we have to wait until our HQ tells us to do what the DFAR update already tells us to do and until then, we are operating without the directions prescribed by the new provisions.

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The Federal Register announcement at the end of Napolik's link does not relate to NDAA 2012, Sec 808. It pertains to the "only one offer" policy.

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Guest Infoseeker

To our younger contracting practitioners,

Refiledjr is correct. Learn how to differentiate between balderdash and straight talk.

Sure there are always ambiguities in life, but when crap like this comes out that is outlining a clear path to nonsense (using 2010 rates, COME ON!!), make some noise and try to affect change.

This will be retracted soon, as I stated.

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You mean repealed, not retracted. It's law. Congress does not retract a law, it repeals it. Retracting the DPAP memo won't accomplish much, because it is just mandatory implementation of the statute.

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Just obtained a copy of a letter dated May 11 from the Under Secretary of Defense for Personnel and Readiness, Jo Ann Rooney (Acting) to Representative Maurice Hinchey of the House of Representatives in response to a letter signed by Hinchey and 130 other representatives on March 26. Here is what the Under Secretary said about Section 808:

Cap spending on service contracts -- The Department is committed to complying with and implementing Congressional direction, in section 808 of the FY2012 NDAA, to limit aggregate spending on service contracts. Guidance - developed jointly by my office and the offices of the Under Secretary of Defense. Comptroller (USDC ) and the Under Secretary of Defense for Acquisition, Technology, & Logistics (USD(AT&L) - has been prepared for signature by the Deputy Secretary of Defense to comply with section 808. This guidance will limit total obligations for contracted services, directing that they do not exceed FY2012 enacted levels and for FY2013, the budget request. Additionally, guidance issued by the Deputy will direct that any instance of inherently governmental work found to be performed under contract be immediately in-sourced to government perfonnance or divested, and that Components reduce obligations for staff augmentation contracts and contracts for the performance of functions closely associated with inherently governmental functions by 10 percent in FY2012 and FY2013.

Doesn't sound like DOD is planning on asking for repeal of Section 808. Judging from the letter from Congress, with is attached to the Under Secretary's letter, Section 808 is part of a movement to cut the use of contract services and going back to using civilian employees.

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I do not see anything in Rooney's remarks that pledges allegiance to 2010 price levels. In fact, this appears to want to deflect that notion by merely signing up to the obvious: don't exceed 2012 enacted levels and the 2013 budget, no contracting for inherently governmental work, reduce support services contracting, motherhood and apple pie. We already knew all that and what's more - it's within the realm of the possible!

In fact, the silence in Rooney's remarks on the 2010 pricing bogey is deafening!

This makes the whole DoD treatment of Section 808 even curiouser. --Sorry, far from "case closed".

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rafieldjr,

Did you review the conference reports on Section 808, found in the WIFCON analysis? I think it explains what Congress was thinking and how DOD leadership's remarks led to the statutory direction. (Thanks Bob, for continuing to provide such a useful service.)

From the contractor's point of view, it's a pain to work with the CO's to help them show compliance. But then again, many things these days are a pain, such as trying to negotiate prices without an FPRA to rely on. Somehow, we all manage to get the job done regardless of the obstacles Congress and USD (AT&L) put in our way.

H2H

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In fact, the silence in Rooney's remarks on the 2010 pricing bogey is deafening! This makes the whole DoD treatment of Section 808 even curiouser. --Sorry, far from "case closed".

The case is never closed.

Rooney's memo predates DPAP's, which does invoke the 2010 pricing bogey. Moreover, Rooney invoked the 2012 "enacted levels." The enacted level is the 2010 budget request. If you are suggesting that DOD simply will not comply, I have no response. What can anyone say to that?

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Did you review the conference reports on Section 808, found in the WIFCON analysis? I think it explains what Congress was thinking and how DOD leadership's remarks led to the statutory direction.

Yes, I did, and alluded to the same in post #48. The history is not mysterious, only the logic.

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The case is never closed.

I'm glad that is established - perhaps there is hope after all!

Rooney's memo predates DPAP's, which does invoke the 2010 pricing bogey.

So, Rooney's memo really doesn't have much significance to the point of the discussion - the 2010 bogey.

If you are suggesting that DOD simply will not comply, I have no response. What can anyone say to that?

Will not . . . or can not? I project the latter.

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Will not . . . or can not? I project the latter.

And why do you project so? Have you had a discussion with your programs to see if it is feasible to tone down the requirement to become compliant with your 2010 spending levels on services? Have you assessed the requirements to see if all of them are truely necessary? Have you talked to the contractor to see if anything can be done to find savings?

I'm thinking not, because there is always a way to accomplish something. You have simply either not looked hard enough, or do not care enough to try. You'd rather complain about it than finding a way to accomplish it. Your contractors will be the first to tell you where you could save money on your requirement and what is costing you the most.

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When has any case in contracting ever been closed? Everything goes around and comes back again.

Rooney's memo expresses DOD's intention to comply at a level higher than DPAP, which I think is significant.

Will not: I think you just said that you do not believe DOD does not intend to comply.

Cannot: What's compliance? The precise amount of the bogey is not clear. We may not ever know whether DOD complied with precision. However, that does not mean that DOD will not follow through on the guidance that Congress enacted and that DPAP issued in compliance with statute. COs will still have to set certain pre-negotiation objectives and seek higher level approval for certain contract prices.

If you had merely said that the law is stupid, that full compliance will be difficult if not impossible, and that the law will be a minor nuisance to a few COs, I would have agreed with you. My reaction to you has been prompted by (1) your BS "free market" comments in Post # 5, (2) your seeming lack of understanding that the DPAP memo was required by statute and that there is not much DPAP can do about it, and (3) by your overall reaction to s statute/policy memo of very limited applicability, which strikes me as self-defeating. A better approach would be to quit complaining and to try to figure out how best to go on with the work. If you have been in this business for 39 years as you claim, then you have either seen much worse legislation and guidance or you haven't been paying attention. Why come out so strongly about this relatively mild nuisance?

Perhaps I'm just used to reading, analyzing, and writing about legislation, regulation, and policy. Maybe I'm under reacting, but I just don't find this temporary measure to be all that surprising what with all the concern about contract services that has been expressed for over a decade now. And I simply don't see the statute or the DPAP guidance as being all that big a deal when you read them closely. If you think this is bad, then you must have been buying pencils and toilet paper when DOD went through the spare parts pricing scandal of the mid-1980s and Operation Ill-Wind, not to mention the infamous 1983 DOD Directive 7640.2, "Policy for Followup on Contract Audit Reports," which had a big effect on DOD COs and generated a lot of trade press and even law review articles. And how about the cyclical contract type policies and GSA's most favored customer clause? And shall we discuss the Cost Accounting Standards? They had a much bigger effect than Sec. 808 will have.

In your first post you expressed surprise at the lack of reaction to Sec. 808 in the trade press. You're right, there hasn't been much of a reaction. Now, why do you think that is?

I think you and Infoseeker have gone off the deep end about this. Someone of your tenure and experience should be writing about how to deal with it, rather than spending so much time complaining about a done deal temporary budget measure. You should be smiling and shrugging. Instead, you are every leader's nightmare -- the morale eroder. I feel very sorry that after 39 years all you can teach our young apprentices is how to gripe. Really, I feel sorry for you. To me this is just another challenge, and not a particularly big one. I can think of many ways that a smart CO can deal with it.

Have you thought about what volunteer work you can do after you retire?

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Wow, what a bunch of double talk bullcrap. Thank goodness people like you are not in the field. Stay on point, that memo says use 2010 rates, if do not read that into it, you are an idiot. Read it, it is not that long.

Here is the point, (1) that memo is crap, written by people not in the trenches that know nothing about how things work. (2) Because this affects private industry and common sense, it will be withdrawn.

Its that simple. Keep your insults to yourself, you are one misguided fool that is for sure.

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And why do you project so? Have you had a discussion with your programs to see if it is feasible to tone down the requirement to become compliant with your 2010 spending levels on services? Have you assessed the requirements to see if all of them are truely necessary? Have you talked to the contractor to see if anything can be done to find savings?

Well, then, that is a different discussion, isn't it? --It certainly has nothing to do with getting "same or similar services' at two-year-old prices. You're talking "workarounds" necessary to exercise damage control for poor policy.

Look - all of these arguments in defense of/apology for this garbled law/policy are wholly reliant on a combination of irrelevancies, assumptions about intentions of drafters, belief that regulatory language does not have to say what it really means - sprinkled with occasional ad hominem attacks. Since when did we decide we had to settle for such slop?

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No one has to defend the policy -- we just have to implement it as best we can.

I see this as a challenge -- a challenge where we can excel, if we try -- our political masters are asking us to use 2010 rates as the starting point for our negotiation objectives -- an objective is something we TRY to achieve -- our agencies have to do something to lower our contract prices, and harder negotiations by contract specialists should be part of that solution.

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Look - all of these arguments in defense of/apology for this garbled law/policy are wholly reliant on a combination of irrelevancies, assumptions about intentions of drafters, belief that regulatory language does not have to say what it really means - sprinkled with occasional ad hominem attacks. Since when did we decide we had to settle for such slop?

rafieldjr:

No one has defended the statute. No one has said that the statute is clear or wise. The DPAP memo needs no defense, since the main part of its content was dictated by Sec. 808, paragraph ( c). DPAP's memo issued the required guidance and exempted some contracts from the pre-negotiation objective requirement. The law simply is the law and everyone's energies are best devoted to coping instead of complaining, although I must admit that you complain with aplomb.

As for your "since when" question, the answer is: Since March 4, 1789.

Infoseeker:

I'm a fool, no doubt about it, but not misguided. If people like me were in the field, tomorrow we'd have a Section 808 Friday the 13th Pre-negotiation Beer Party, with skits and door prizes, Including t-shirts and coffee mugs that say: I've gone Section 808! under a picture of Alfred E. Neuman and his motto: What, me worry?.

We'd give you the wrong address.

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Well, then, that is a different discussion, isn't it? --It certainly has nothing to do with getting "same or similar services' at two-year-old prices. You're talking "workarounds" necessary to exercise damage control for poor policy.

Look - all of these arguments in defense of/apology for this garbled law/policy are wholly reliant on a combination of irrelevancies, assumptions about intentions of drafters, belief that regulatory language does not have to say what it really means - sprinkled with occasional ad hominem attacks. Since when did we decide we had to settle for such slop?

They aren't work arounds, that is called adapting to changes and moving on. Just because you are so set in your ways that you can't possibly change how you operate doesn't mean the rest of the work force is.

Addressing the last portion of your reply, your entire argument is based on an asusmption you have made in interpretation of this memo, which omits things such as the obvious: this is mere policy guidance implementing a law. This isn't DPAP putting out guidance out of no where, they are merely doing what they were told to do by Congress, so this memo isn't going to be retracted, because it cannot be.

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No minds are going to be changed by anything anyone says in this thread. One stream is simply pissed off about the statute and the guidance and that's all there is to it. I understand where they're coming from. The other stream thinks the law and guidance are at worst a manageable short term nuisance and that we should just get on with it. We've gone back and forth at least a half dozen times. Interesting contrast in points of view.

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I have now encountered my first exposure to a misapplication of this deviation. A contracting activity has issued an RFP for an R&D contract (R&D contracts are exempt from the required guidance by Sec. 808). The award will be made competitively and is for a new requirement that was not in existence in FY 2010. Some of the effort required will be performed by individuals who are subject to the SCA. The contracting officer has asked all offerors to submit their 2010 labor rates for all employees and 2010 indirect cost rates (most of which probably have not been finalized yet because of the DCAA backlog).

This is some indication that the Deviation needs clarification.

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DOD does not need clarification to prevent that kind of misinterpretation. It needs intelligent and literate men and women for its contracting corps. No amount of clarification would be enough to prevent the kind of stupidity that you describe.

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Sure, DOD should go to Congress if it wants the law changed. In the meantime, the law is there, whether you or anybody else likes it or not.

Keep in mind that the heart of the statute does nothing more than limit aggregate obligations by DOD. It does not limit obligations of any particular DOD component (Army, Navy, Marines or Air Force), or of any contracting activity, or of any contracting office. DOD has to figure out how it will comply and extend instructions to its subordinates. Congress ordered DOD to issue guidance and said that the guidance must say particular things. Beyond that, it is up to DOD to decide how it will comply. Until then COs should read the guidance, decide what it means, and go forward as best they can until given other instructions. It will take time for DOD to sort things out and guidance will be evolutionary. Deal with it.

I hope you keep posting in the way that you have, because it gives me the opportunity to show our young people how a professional should respond in this situation, which is to think, plan, and act, not to complain, whine, and make cryptic predictions of imminent doom. They have two models to follow: you, on the one hand, and Napolik and me on the other. They can choose.

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I hope you keep posting in the way that you have, because it gives me the opportunity to show our young people how a professional should respond in this situation, which is to think, plan, and act, not to complain, whine, and make cryptic predictions of imminent doom. They have two models to follow: you, on the one hand, and Napolik and me on the other. They can choose.

I choose rafieldjr content and style.

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