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Proposal submittal


AAC

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I have submitted a proposal to the U.S. Government for a follow-on one year extension to an existing contract that will expire at the end of the year. The proposal is being evaluated and is priced above the TINA Threshold. I know I will have to certify my cost or pricing data, but the contracting officer is stating that I should have certified my prices when I submitted my proposal. I think what the CO meant is that I needed to submit a proposal adeqacy checklist which was not a requirement that was stated in the RFP. The resultant contract will be fixed price for operations, support and sustainment effort. The CO also stated that operatios, support and sustainment effort is actually a services contract. Most of the operations, support and sustanment operations is performed overseas in support of an allied nation and some of the effort is perfomred here in the U.S. My questio is- Do I need to provide any type of Cost or pricing certification with my proposal submittal and does anyone think that my Operatiosn, support, and sustainemnt effort should be a services contract?

Thanks

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Guest Vern Edwards

I presume that you are talking about a sole source contract extension.

The CO should not ask for a certificate of current cost or pricing data with submission of a proposal. The certificate is supposed to be submitted after agreement on price. See FAR 15.406-2(a), which says that the contractor should sign "as close as practicable to the date when price negotiations were concluded and the contract price was agreed to." Also, you said that the CO wants you to certify your "prices." Did he or she say that literally? "Prices"? Contractors don't certify prices under TINA. They certify cost or pricing data, which are not the same thing. Did you misstate what the CO said?

As for a contract for "operatios, support and sustainment effort" being a service contract -- of course it's a service contract. What the heck else do you think it would be? A supply contract? A construction contract?

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AAC,

To add to what Vern said, I would expect your proposal to conform to the format and requirements of Table 15-2, found in FAR 15.408. The Table is entitled "Instructions for Submitting Cost/Price Proposals when Cost or Pricing Data are Required". If your proposal reasonably conforms to the requirements of the Table (and to any other proposal instructions you received) then you and your CO should be ready to negotiate a price, upon which you would execute a CCPD.

As a nit, I think Vern mistyped the FAR citation because I cannot find the quoted language at 15.406-2(a). However, at 15.403-4(B) I found the following:

B) When cost or pricing data are required, the contracting officer shall require the contractor or prospective contractor to submit to the contracting officer (and to have any subcontractor or prospective subcontractor submit to the prime contractor or appropriate subcontractor tier) the following in support of any proposal:

(1) The cost or pricing data.

(2) A certificate of current cost or pricing data, in the format specified in 15.406-2, certifying that to the best of its knowledge and belief, the cost or pricing data were accurate, complete, and current as of the date of agreement on price or, if applicable, an earlier date agreed upon between the parties that is as close as practicable to the date of agreement on price.

Hope this helps.

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Guest Vern Edwards
As a nit, I think Vern mistyped the FAR citation because I cannot find the quoted language at 15.406-2(a).

Look at the three-asterisk note for "Date of execution" at the end of the certificate language.

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AAC,

As a nit, I think Vern mistyped the FAR citation because I cannot find the quoted language at 15.406-2(a). However, at 15.403-4(B) I found the following:

Hope this helps.

If you read more carefully, you'll find Vern's cited language in the third ("***") footnote of the actual Certificate that is set forth in full text in FAR 15.406-2(a), just as Vern said.

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Since we are waiting for clarification on the certifying prices terminology, I would also like to get clarification on whether we are talking about an extension of a current contract that is about to expire, an exercise of an option under a current contract period that is about to expire (priced or unpriced), or a separate stand alone follow-on contract to the original contract. I think if we are talking about an extension of an original contract it may not be necessary to certify at all.

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Guest Vern Edwards
Since we are waiting for clarification on the certifying prices terminology, I would also like to get clarification on whether we are talking about an extension of a current contract that is about to expire, an exercise of an option under a current contract period that is about to expire (priced or unpriced), or a separate stand alone follow-on contract to the original contract. I think if we are talking about an extension of an original contract it may not be necessary to certify at all.

The poster described it as follows: "follow-on one year extension to an existing contract that will expire at the end of the year."

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FAR 52.217-8 is an option clause. Note the use of "(not an option)" in my question.

You referred to three possible scenarios:

1. an extension of a current contract that is about to expire,

2. an exercise of an option under a current contract period that is about to expire (priced or unpriced),

3. a separate stand alone follow-on contract to the original contract.

When applying TINA, what's the difference between scenarios 1 and 3?

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Ok, now you are confusing me. You wrote:

I would also like to get clarification on whether we are talking about [1] an extension of a current contract that is about to expire, [2] an exercise of an option under a current contract period that is about to expire (priced or unpriced), or [3] a separate stand alone follow-on contract to the original contract.

What is the difference between [1] and [2]? Does [1] refer to the exercise of an option pursuant to FAR 52.217-8 and [2] refer to the exercise of an option pursuant to another option clause? Please clarify.

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For purposes of TINA under a Fixed priced contract - scenario 1 and 2 are the same. That was my point.

You, got me thinking, is there a way to extend a contract by not using an Option clause? I don't think so. But maybe you have a way. If so your way may indeed require C&P data. Please show us the way.

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That works.

But if it is an extension through a supplemental agreement then the rules are whatever the parties choose to agree upon, and C&P data may or may not be agreed to. And probably not agreed to if the extension period rates are the same as the current expiring year rates.

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But if it is an extension through a supplemental agreement then the rules are whatever the parties choose to agree upon, and C&P data may or may not be agreed to.

Huh? Are you trying to say that a contractor may not agree to submit cost or pricing data when negotiating such a modification?

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Yes.

If a vendor were so inclined (preferred not to give C&P data) what would compel them to agree to provide it? What is the CO going to do - not award the extension?

With a little effort the CO may figure out that they have enough information to determine prices are fair and reasonable without C&P data.

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If a vendor were so inclined (preferred not to give C&P data) what would compel them to agree to provide it?

The possibility of the Government deciding not to extend the contract.

What is the CO going to do - not award the extension?

That would be an option.

With a little effort the CO may figure out that they have enough information to determine prices are fair and reasonable without C&P data.

So what if they do? What exception to cost or pricing data requirements would apply?

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Any applicable exception will do - the first one looks good. Not too hard to compare prices to other prices on other contracts that were properly competed. Or the CO can go get a waiver and explain why through their poor planning that they have to get a rush sole source extension rather than having done a proper follow-on acqusition and through their even worse execution why their contract does not have the proper extension option clauses.

My point is that standard and routine extensions (options) are likely not to require C&P data. We do not know from the original poster whether this is an extension or a follow-on contract.

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