Jump to content

Expressing Level of Effort inclusive of materials


Recommended Posts

I know LOE has been discussed in these board forums numerous times in the past, but I am hoping I can get some comments here on my specific situation. The FAR offers little to no guidance as to what LOE actually means. It is mentioned (actually mandated) as a requirement for LOE type contracts in FAR16.306 and 16.207 but is not defined in either clause, nor is it defined in FAR 2.101, nor anywhere else that I am aware of. I have scoured GAO and ASBCA decisions for authority relative to establishing any basis for what LOE must "look like" in a government LOE type contract  but I have come up with nothing definitive in anything that I have found.

My problem is this. We are an incumbent contractor that responded to a sole source solicitation for a large, CPFF follow on effort to procure a sustainment type contract for repair and return of GFE. A different government agency will be administering this contract than the preceding iterations for the same effort. Contract scope will include labor, material and ODC. The USG did not specify term or completion in the solicitation, but it has been treated as a term type contract historically and that is how we bid the effort. FAR 16.306 requirements notwithstanding, LOE has never been specified or  defined in previous contract iterations. The solicitation for the current effort did not specify the LOE required and we submitted a proposal without offering to define or otherwise offer to deliver any minimum LOE.We have been in negotiations for quite some time  and are just days away from the present contract expiring. The PCO surprised us a couple of days ago and stated that LOE must be specified in the resultant contract. I concur with her assessment the FAR mandates LOE must be specified but disagree with her proposed resolution as to how to meet the requirement.

The PCO is proposing that LOE must be stated in terms of some quantity of hours. However, the contract scope (which is really unknown at the outset as to what quantity or repair type is necessary) includes labor, material ,and ODC. She also wants to equate the LOE with target costs for each CLIN. So in other words, if we aren't able to spend all of the money they allocate towards any given CLIN, it would mean we also did not meet the full LOE for that CLIN and the USG could de-obligate the fee portion along with the unexpended obligated target costs for that CLIN. Obviously, we are not happy with this. The LOE must be fixed for the entire PoP and this arrangement is looking like a Cost+% of Cost situation as our fee won't really be fixed but instead will just be a rate tied to how much of target costs are spent. As the contract is quite complicated, I have tried to give as much detail as necessary to answer my specific question. This CPFF type arrangement has always benefitted the USG as the scope at the outset is almost completely unknown. They don't want to manage the materials and all the vendors necessary to facilitate the repairs. 

Is there any reason the FAR 16.306 LOE requirement can't be satisfied with a simple statement in the schedule? Something like: The LOE required includes the following elements: secure and operate facilities capable of depot level repairs, provide all personnel necessary to test and evaluate items as received, and provide all personnel necessary to effectuate required repairs. I have simplified this for this forum, but I could also expound upon this "LOE statement" from requirements in the PWS (yes it is a PWS despite this being a term effort).  Must LOE be stated in terms of hours or is my approach acceptable? I am truly sorry this post is so long. Thank you!

 

Link to comment
Share on other sites

Guest
This topic is now closed to further replies.
×
×
  • Create New...