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Estimated Delivery Order

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Can an estimated delivery order be used when ordering supplies off a single award IDIQ?

Our agency has single award IDIQ for commercial supplies with delegated authority for field support to place delivery orders.  The contract line items are estimated quantities with fixed pricing.  Because the customer we support has varying quantities of the line items during any ordering period, and does not have the ability to carry large stock levels, it is very difficult to issue a delivery order with firm quantities for any specific period.  This results in repeated small delivery orders being issued over and over throughout the course of the period. I would like to issue an estimated delivery order for a given period that would list estimated quantities and allow the customer to place a call against that funded delivery order as the supplies are needed.  At the end of the period, I interpret 52.212-4 (c) to provide the authority to do a bi-lateral modification to reduce the quantities for anything not used.  Our Legal states this would be akin to issuing an IDIQ delivery order against the IDIQ contract and that is not authorized.  I was just wanting to hear what others thought.  Thanks.

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I would agree with your legal and say no can do.

FAR 16.505(a)(2) states, "Individual orders shall clearly describe all services to be performed or supplies to be delivered so the full cost or price for the performance of the work can be established when the order is placed."

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12 minutes ago, Searching for Answers said:

At the end of the period, I interpret 52.212-4 (c) to provide the authority to do a bi-lateral modification to reduce the quantities for anything not used.

So you assume the contractor is going to just agree to reduce the value of the order? This firm must have very forgiving shareholders.

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Why not just set up options on your order with small quantities? Thinking out loud here... probably slightly less annoying than cutting a bunch of small delivery orders and you only fund what you need.

(Sorry for the multiple posts, I'm bored and have had way too much coffee.)

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16 hours ago, Searching for Answers said:

This results in repeated small delivery orders being issued over and over throughout the course of the period.

Is this bad, though?

 

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He needs 100 per year but can only store 10.   Why not award a delivery order for 100 widgets and on the delivery order state they are to be delivered ten at a time upon receipt of an email from the program office POC/COR.   The company invoices after  each shipment.  We have done that several times.  Why would this be an issue?       

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Let's not make this too hard.  I like Boof's idea.  If Searchings is hung up on 100, then issue the delivery order for 75.  Then, if needed, issue another delivery order if it looks like more than 75 will be needed.  Issuing a delivery order under a single-award IDIQ contract is simple and fast.

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I have thought about Boof's suggestion.  But the problem with that is that the need for an item is event driven.  I know that over the course of a period that I might require on average 15 of widget A and 20 of widget B, etc., but I don't know on any given day how many I will need and which ones. So I have been leaning towards what ji20874 just posted, issuing say maybe a quarterly DO for slightly less then what usage shows and letting the customer draw it down as needed.

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What's the dollar value of the individual orders?  If they are small enough, have them use a PCard.

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Issue a blanket delivery order. The BDO obligates funds but does not order or state quantities. The contracting officer signs it. It tells the contractor that the customer is authorized to place oral or written calls up to the value of the BDO. No pricing is involved. Put an expiration date on it so you do not violate the bona fide needs rule. Authorize someone in your customer's office in writing to act as an ordering officer, with authority expiring on the same date as the BDO. Provide a copy of the authorization to the contractor. Tell the ordering officer to place calls against the BDO as needed, like on a BPA, and to keep a log. This is a very old and legitimate technique. I'm surprised no one has mentioned it.

 

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Seeker, that is another possibility that I have been looking at, and the one that I prefer.  But my legal views that as being an IDIQ DO against an IDIQ, and states that is a no-no.  So that's why I am throwing this out there to see if somebody has any ideas I haven't been thinking of.

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13 minutes ago, Searching for Answers said:

Seeker, that is another possibility that I have been looking at, and the one that I prefer.  But my legal views that as being an IDIQ DO against an IDIQ, and states that is a no-no.  So that's why I am throwing this out there to see if somebody has any ideas I haven't been thinking of.

Searching, you understand that your legal counsel offered an opinion, correct? Did you ask for the factual basis of their opinion? Perhaps you would arrive at a different conclusion if you reviewed those facts. That's what someone who was searching for answers would do.

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What makes your legal think an IDIQ against an IDIQ is illegal? Ask him to show you where it says its a no-no. BDOs were discussed at Ask A Professor in 2007.

Quote

Use of a Blanket Delivery Order

Question: 

Is this legal?

Scenario - I would like to issue a blanket delivery order for $750K against a SABER requirements contract. Place or list Civil Engineering shop type of work against the BDO (i.e. plumbing,electrical, structures, etc) Contracting places call to contractor and then work is priced

Posted - 8/27/2007 12:00:00 AM

Subject Area - Contracting

Answer:

The blanket delivery order is commonly used to estimate work to be provided under an IDIQ contract.  Funds not to exceed a certain amount are obligated for a limited, specific period of time. The FAR 16.505 has limited coverage with regard to Ordering and FAR 16.506specify which provisions are to be used in the contract. 

You should refer to the contract, if it addresses the order process, usually in Section F, G or H in the Uniform Contract Format. If the contract uses the SF 1449, there may be a local clause which addresses ordering. The use of blanket delivery orders may also be in a local command directive.  

The only likely legal issue may be the potential violation of the Bona Fide Need rule.  Legal counsel should be consulted for this topic. DFARS 216.501-2 refers to DFARS 217.204 (e) for limitations on the period for task or delivery orders pursuant to 10 U.S.C. 2304a.

 

 

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Don, Seeker, attached is what my Legal is going by in providing their opinion.  I think the document is looking at a multiple award and not giving fair competition to all awardees, where my contract is a single award.  So I have different scenario than what this opinion is about. 

Yes, I understand that Legal offers an opinion, that is why, as part of my researching, I am asking for other opinions to formulate my own, rather then go on just one opinion.  Thanks.

GAO Orders under IDIQ and MATOC contracts must contain specific quantit....pdf

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Board decisions involving blanket delivery orders:

 

Quote

 

Variance between estimate, amount ordered enough to suggest changed requirements

Concorde, Inc. (2002) ASBCA, No. 53749, 03-1 BCA ¶32,113.

Board had jurisdiction over claim alleging avoidance of blanket delivery order

Carolina Steamatic Co. (1986) GSBCA No. 7858, 86-1 BCA ¶18,711.

 

Did the Boards think they were a no-no?

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Searching, 

You're thinking the right way.  The GAO's heartache was in a multiple-award IDIQ contract situation, where issuing an IDIQ-under-an-IDIQ subverted the notion that every multiple-award contract gets a fair opportunity to be considered for future requirements.  You're in a single-award IDIQ situation, to the GAO's heartache is not applicable to your case.  Maybe your attorney doesn't appreciate that you're in a single-award situation?

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3 minutes ago, Searching for Answers said:

Don, Seeker, attached is what my Legal is going by in providing their opinion.  I think the document is looking at a multiple award and not giving fair competition to all awardees, where my contract is a single award.  So I have different scenario than what this opinion is about. 

Yes, I understand that Legal offers an opinion, that is why, as part of my researching, I am asking for other opinions to formulate my own, rather then go on just one opinion.  Thanks.

GAO Orders under IDIQ and MATOC contracts must contain specific quantit....pdf

Searching,

Your thinking is correct--the case that your legal counsel is relying on is inapposite--you are not issuing an order under a multiple-award contract.

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