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DeniseH

Need definition/clarification

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I've been in contracting quite a few years. (disclaimer).  I have a cost breakdown from an 8(a) contractor with additional lines I've not encountered before and am not familiar with.  Hoping you all can help.

This is a FFP negotiated construction proposal with an 8(a) firm.  Ctr has a column on the worksheet that says, "Distributed Bid"  and another column with "Distributed Direct".   These two are along with the usual quantity, unit price, total price, G&A, and Profit columns that you normally see.

I do not know what "Distributed Bid" or "Distributed Direct" mean.    Why would they be included?

Thanks!  I appreciate any and all responses!!

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While I have some ideas, you should ask the contractor what those costs are, why they are included and require it to justify the amounts for each. Some construction companies direct charge some home office expenses, like a dedicated project manager or direct support to the jobsite that isnt on the jobsite. I doubt that an 8 ( a )  construction firm would have branch offices but they could have some off-site dedicated or partially dedicated staff or admin type support like schedulers and estimators.  

If this is the type of costs that they are distributing, you should make sure that such staff are removed from the overhead pools so that costs arent being double charged as direct and indirect.  You didnt explain if  those costs are charged across the proposal or only for certain activities.

I usually ask for information on the overhead and/or G&A overhead pools and the direct cost base used in the overhead calculations, especially if the contractor is direct charging non-jobsite costs out of other offices.

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11 minutes ago, joel hoffman said:

While I have some ideas, you should ask the contractor what those costs are, why they are included and require it to justify the amounts for each. Some construction companies direct charge some home office expenses, like a dedicated project manager or direct support to the jobsite that isnt on the jobsite. I doubt that an 8 ( a )  construction firm would have branch offices but they could have some off-site dedicated or partially dedicated staff or admin type support like schedulers and estimators.  

If this is the type of costs that they are distributing, you should make sure that such staff are removed from the overhead pools so that costs arent being double charged as direct and indirect.  You didnt explain if  those costs are charged across the proposal or only for certain activities.

I usually ask for information on the overhead and/or G&A overhead pools and the direct cost base used in the overhead calculations, especially if the contractor is direct charging non-jobsite costs out of other offices.

Thanks, Joel.  I do plan to talk with the Ctr, but I was hoping to get some kind of preliminary info about the concept before opening the conversation.  Like I said, I've not run into this before.

Thank you for your reply!

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If "Distributed Bid" reflects recovery of expenses to develop the proposal and/or negotiate the contract, then I would question them as "direct" costs (as they appear to be shown), especially if the G&A includes Bid and Proposal costs and/or other designation for costs for those who prepare proposals, and to estimate and negotiate contracts. 

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