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nelsoji

DFARS 215.404-1 Update question

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Not sure if I am posting this in the right place.  The Federal Register posted on 31 Jan 18 has the final rule on a DFARS update which includes language aimed at providing "guidance to contracting officers for making price reasonableness determinations...."

In the update to 215-404-1 it describes a process for determining price reasonableness which includes language saying the "contracting officer shall consider information submitted by the offeror of recent purchase prices paid by the Government......."

Am I to read that to say that if there is an exemption to requiring certified cost or pricing data - the government could rely on prior prices paid by themselves for similar items to determine price reasonableness?  That portion of the clause goes on to talk about commercial items so I am trying to figure out if this is aimed more at items that the contractor is trying to deem a commercial item or if it could be for a non-commercial item that meets an exemption.  This could obviously make it much easier to establish price reasonableness on re-competes where a waiver exits but trying to see if I am reading it right.  Thoughts?

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On 2/2/2018 at 1:31 PM, nelsoji said:

Am I to read that to say that if there is an exemption to requiring certified cost or pricing data - the government could rely on prior prices paid by themselves for similar items to determine price reasonableness?

Sure. That's not new. See FAR 15.404-1(b)(2)(ii).

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On 2/2/2018 at 1:31 PM, nelsoji said:

Am I to read that to say that if there is an exemption to requiring certified cost or pricing data - the government could rely on prior prices paid by themselves for similar items to determine price reasonableness?  That portion of the clause goes on to talk about commercial items so I am trying to figure out if this is aimed more at items that the contractor is trying to deem a commercial item or if it could be for a non-commercial item that meets an exemption.  This could obviously make it much easier to establish price reasonableness on re-competes where a waiver exits but trying to see if I am reading it right.  Thoughts?

Hi Don

My reading of the post question (in bold) above leads me to ask about whether your reference to FAR 15.404-1(b)(2)(ii) technique applies to non-commercial items. Do you read it that way? Could you please clarify your thoughts? I am not sure whether the reference in subparagraph (ii) to commercial items was intended to alleviate doubts about whether it applies to commercial items or was intended to state that it only applies to commercial items.

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DFARS 215.404-1(b) appears to apply to both commercial and non-commercial items as indicated. (b)(i) appears to apply to both commercial and non-commercial items (obtain market research pricing) and if that fails, my view is that (b)(ii) instructs only what to do with respect to commercial items, including but not limited to those exempt from cost or pricing data.  

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