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Situation:

Agency awarded a 5 year FFP contract for $240K (5 year total). Contract is currently in the first option year ($40K). Agency would now like to add some additional work to the contract. The nature of the additional work is very closely related to the work already being done under the contract (it would not result in a material change of the contract). Cost for the additional work has not yet been determined (agency is in the process of determining the cost parameters for a modification within scope). Furthermore, the RFP included this type of work in it - hence, offerors would reasonably have anticipated a modification of this nature at the time of award. Requirement was competed using SAP.

Question:

The nature of the work would itself not result in the modification being out of scope - but what are the cost limitations on ensuring the modification remains in scope? Would a modification for more than the micro-purchase threshold need to be either competed or justified with a sole source justification?

Some individuals utilize a 'rule of thumb' percentage for cost that can be added in a modification to keep it with in the scope of the contract, but I have found no actual references to back that up. Upon reading the following post, it seems as though the cost limit to ensure the modification remains in scope could be the micro-purchase threshold - but I'm not sure.

http://www.wifcon.com/discussion/index.php?/topic/1173-change-in-scope-qty-and-delivery-schedule-change/

However, part of the discussion in the post below indicates that as long as the nature of the additional work itself was included in the RFP, the modification for additional work would be with in the scope of the competition (even when adding the corresponding cost for that additional work, regardless of exceeding the micro-purchase threshold):

http://www.wifcon.com/discussion/index.php?showtopic=801

I'm aware of the regulation that FAR Part 6 does not apply when using simplified acquisition procedures, but from my understanding of FAR 13.501, a sole source acquisition for a SAP requirement (in this case, a modification for additional work) would still require a sole source justification to be drafted and posted, etc., and I'm having trouble reconciling the guidance from these 2 references.

Thanks in advance for any and all assistance.

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This has come up many times before. There is no rule of thumb percentage increase in cost or price that makes a mod out of scope. I would ask myself these questions:

1. Is the mod essential to the required outcome, or are you just adding more work to the job?

2. Could the added work be competed on its own?

If you're just adding work, and the work could be competed, then the textbook answer is that you're required to get competition. Not full and open competition at $40,000, but competition to the maximum extent practical pursuant to FAR 13.104.

FAR 13.501 does not apply, because $40,000 is within the simplified acquisition threshold and 13.501 applies only to acquisitions under the program for using simplified procedures to buy commercial items in excess of the threshold, but less than $7 million.

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Thanks. The mod is essential to the required outcome, and not simply adding more work. But yes, the added work could also be competed on its own.

Not full and open competition at $40,000, but competition to the maximum extent practical pursuant to FAR 13.104.

In regards to this - would 13.104 apply, given that FAR 13.000 states that the part applies to procurements "the aggregate amount of which does not exceed the simplified acquisition threshold" - and this contract's total value does exceed the SAT ($240K)?

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The amount that you're adding is $40,000, which is below the SAT. Thus, 13.104 would apply. But if the addition is an integral part of the work, it is likely to be within scope. I don't think I'd worry about it much. Not for $40K. Just mod the contract to add it as a within scope change.

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