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DOECPA

DSSR Allowances and DBA Insurance

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I'm developing a pricing model for contractor to use for a CPFF solicitation and would appreciate input from the discussion board about the treatment of Department of State (DSSR) Standardized Regulations (DSSR) Allowances and also Defense Base Act (DBA) Insurance.

Currently, I have offerors collect all estimated taxable salary related recruitment and retention incentives and combine them with base salary to form an OCONUS Effective Labor Rate.  Offerors then add their OCONUS Indirect Expenses and Fee to the OCONUS Effective Labor Rate.  I provide an Other Direct Cost (ODC) Plug Number that includes DSSR Cost of Living, Quarters, and Other Allowances that are not taxable salary related expenses.

I get pushback from contractors because they want the DSSR taxable salary related recruitment and retention incentives (Post Hardship and Danger) included in the ODC Plug Number.  Is there accounting guidance anywhere for the treatment of these DSSR Incentives?  Many Offerors do not choose to use the DSSR Allowances and instead use a Multiplier Factor on base salary to estimate enough compensation in order to recruit and retain.

Relative to contractor and subcontractor acquired DBA Insurance, I have offerors use the pricing model labor buildup tab to demonstrate how the DBA expense is calculated.  Would I be better off just including an ODC CLIN for DBA Insurance?  I assume subcontractors have their DBA in their loaded labor rate to the Prime., Thanks

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DOECPA seems to be trying to force-fit the cost accounting practices of individual contractors into a one-size-fits-all template. Typically, that approach doesn't work very well.

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20 hours ago, bob7947 said:

Is anyone able to respond to this?

I can't. If a DOE certified public accountant can't figure it out, I sure as heck can't. Reading the OP's first sentence made my head hurt. What's an ODC "plug number"? I can't find that term in my accounting dictionary.

If he wants to know how much the offerors will spend on DBA insurance, why not just ask them?

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Let me add that I know for a fact that some contractors treat the "recruitment and retention incentives" as labor costs while others treat those expenses as ODCs.

Related question to DOECPA -- If you are using a DSSR model, how will the offerors treat overtime?

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Actually, what the OP shows is the insanity of competitive pricing of cost-reimbursement contracts. You can read many bid protests in which agencies got wrapped around the axle trying to perform cost analyses of multiple proposals during the liar's (or fool's) contest we call source selection. For a classic and terrifying example see DZSP-21 LLC v. U.S., COFC No. 18-86 C, 2018 WL 1530654, March 29, 2018, in which the parties have been going at each other in the GAO and the Court of Federal Claims over the evaluation of labor cost since 2014, and it still isn't over. Much of the trouble has been due to a needlessly complex cost evaluation process and to agency incompetence.

All contracting professionals should be urging, even demanding, that Congress amend the Competition in Contracting Act to provide that estimated cost shall not be an evaluation factor in source selections for cost-reimbursement contracts. The government should select a prospective cost-reimbursement contractor on the basis of its qualifications and its proposed fixed or incentive fee, then work with the selectee to develop a mutually acceptable estimate of the cost of performance and final fee agreement, and then sign a contract. If the parties cannot reach agreement on estimated cost, the government should resort to the second-ranked offeror.

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On 4/19/2018 at 6:59 AM, DOECPA said:

Would I be better off just including an ODC CLIN for DBA Insurance?

Yes.  My experience from working on a CPFF science-support contract was that the cost of DBA insurance was impossible to predict, because it  depended on things like the season; in my case, the 'winter-over' crew and the 'summer' crew had very different rates.

Now; if someone would care to explain why it's called "Defense Base Act" when it applies to ALL contracts outside the US, I'd be much obliged.

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On 4/20/2018 at 10:19 AM, here_2_help said:

If you are using a DSSR model, how will the offerors treat overtime?

 

I use an OCONUS Effective Labor Rate based on all productive hours and whether backfilled or not.  We evaluate Total Taxable Compensation and also look at Total Comp.  I totally concur with what Vern is proposing and am thankful that others continue to improve the system.  In the meantime I will make it work in support of our Warriors here and OCONUS.  Thanks for the insight.

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