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Price Proposals for A-E IDIQ Contracts


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Carl, the government is supposed to identify and rank at least three firms that are initially determined to be the most qualified for the task order. The government conducts technical discussions with those firms as described in. FAR 36.6.

Then, beginning with the top ranked firm, seek to negotiate a fair and reasonable price and award the order to the firm.  If the parties are unable to negotiate a fair and reasonable price, you move on to the next most highly qualified firm. If that doesnt work out (a sign that the government’s pricing  or basis of pricing might not be realistic), move on to the third. 

The order should be priced when awarded. 

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48 minutes ago, Rookie1102 said:

I believe my words are now being taken out of context.

Sorry that you feel that way, but you did ask this -

 

On ‎3‎/‎5‎/‎2018 at 2:30 PM, Rookie1102 said:

Is this task order process non-compliant with the Brooks Act?

And now state this -

48 minutes ago, Rookie1102 said:

We are in compliant with the Brooks Act on how we solicit and award A-E IDIQ contracts and subsequent task orders. 

I guess your latest statement is based on the discussion in this thread.

Thanks

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Joel - I agree with your most recent post as it is my understanding too.  So as I posed before - So why not ask for proposal/quotes from A-E offerors at the get go (when they submit 330's or revised 330's) for ALL A-E needs whether a standalone contract or for an IDIQ task order if you think the process that Rookie is using is both compliant with the Act and the FAR? 

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2 hours ago, C Culham said:

Joel - I agree with your most recent post as it is my understanding too.  So as I posed before - So why not ask for proposal/quotes from A-E offerors at the get go (when they submit 330's or revised 330's) for ALL A-E needs whether a standalone contract or for an IDIQ task order if you think the process that Rookie is using is both compliant with the Act and the FAR? 

You normally ask for a price proposal after conducting discussions with the selected firm to gain a mutual understanding of the design approach and scope, sometimes conceptual approach. The government should identify the construction cost information and the parties discuss fee limitations and what design work is subject  to the limits, etc. also what other work will be required, if any, such as soil and foundation studies, surveys, topos, etc. 

We aren’t talking about a proposal for labor and technology unit rates here.  We are talking about negotiating a FFP task order to design a specific project.  

The approach used here is apparently an attempt to save the step of asking for a proposal after tying down the scope and methodologies, etc. so that the A-E can prepare a detailed, meaningful proposal.

The problem to me is that it appears that they are skipping the critical step of mutually agreeing on the details of the specific plan for design approach, project scope , etc. by asking for a FFP proposal during the qualifications based selection process.  

Its one thing to contract by looking for contracting instructions. “What does the FAR say literally?” A clerk can do that. To properly negotiate a design contract requires that both parties understand what and how the design is going to be performed and what has to be done to produce it.  

If I were to guess, from the information given, here the government prepares an independent estimate, the firms prepare a proposal based upon the limited information known from the RFTOP, the government compares its estimate to the selected firms proposal, then either accepts it or negotiates if it is too high (or maybe too low). 

Successfully negotiating A-E and construction contracts require mutual understanding of the scope of work, not only of the amounts, labor rates and types of efforts, but of the specific scope of work  to be designed and the design approaches, etc.

 A government estimate is just an estimate and an early proposal may simply be similar to a rough order of magnitude estimate, padded for unknowns. 

Those are my opinions.  

EDIT: note that the base ID/IQ might or might not include established unit prices for various labor categories and technology, OH, etc.  

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17 hours ago, joel hoffman said:

The problem to me is that it appears that they are skipping the critical step of mutually agreeing on the details of the specific plan for design approach, project scope , etc. by asking for a FFP proposal during the qualifications based selection process.  

Joel - Agreed.  Noting this here is my view.

FAR 1.102-4(e) states ".........absence of direction should be interpreted as permitting the Team to innovate and use sound business judgment that is otherwise consistent with law and within the limits of their authority. Contracting officers should take the lead in encouraging business process innovations and ensuring that business decisions are sound.”

FAR 36.602 provides direction for the steps for selection of an A-E firm and provides no direction with regard to securing price information from contractors during the selection process.   A full read of either selection process (board or short) provides that seeking of price information begins after selection of the “most preferred”  ( not necessarily the highest qualified) firm.

FAR 36.606 provides that to start the negotiation process one is to follow FAR Part 15 processes which provides that an RFP would be issued at this point.  Again the “selection process” has no direction to seek price information pursuant to FAR Part 15 the negotiation process does.    

Summarized A-E selection is a step process by direction, select first then seek pricing second.   As there is no absence of direction in FAR subpart FAR 36.6 one can not spin their own to develop a new process.   Further this  step process as provided in FAR subpart 16.5 is to be followed in placing orders under multiple or multi-agency IDIQ contracts.

In a different view in the OP’s process I even see a hiccup where it is stated that  All other price proposals remain confidential to include omission from the contract file.”   This mere fact raises concern in that if they are in fact omitted from the contract file and successful negotiations fail with the most preferred firm how does one retrieve the next in line – its not a part of the contract file?  Semantics maybe but does raise more question.  

All in all the OP’s agency process for selecting A-E’s for task orders may be seen as innovative but it carries several instances where it does not follow the direction of the FAR.  At the very least I would have a deviation in the contract file to support the process being used at the most I would follow the step process,  evaluate capabilities then seek pricing information through the FAR Part 15 process.

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My impression here is that the instant process apparently would have the government evaluating a preliminary proposal and “negotiating, as necessary”, as though they were purchasing a commodity.

Aside from that, the industry has made it abundantly clear to our agency and in various professional associations (e.g., DBIA and AIA, SAME) that A-E firms don’t have deep pockets for routinely preparing detailed design price proposals unless they are reasonably assured of being hired to perform a design for a client. Most (small business) A-E firms dont have the same B&P or Business Development resources that construction companies have for chasing work.

The instant process involves preparing a price proposal  for every qualifications based task order selection competition. 

Yet, apparently the firms here have agreed to the task order competition process. Perhaps they are padding their proposals enough to recoup some of their costs on the task orders they don’t win. 

Perhaps the ID/IQ’s are used for small projects with uncomplicated designs.  We don’t know.  

Is it “prohibited’? Perhaps not specifically.

Is it a sound practice for contracting for professional design services?  Not, in my opinion, for anything other than small, non-complex designs. That’s from my perspective of having been the government client and having been a professional engineer in a consulting firm.

Can it be wasteful? Possibly.

Can it lead to risks and misunderstandings between the parties after award? Probably.   

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