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Basis for CICA analysis - modification

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Scenario: Contract is awarded for XY services. Government wanted to add Z, which was out of scope. Government prepared and issued adequate JOFOC. Current contract is now for XYZ services.

Question: Now Government is now attempting to add Q services to the contract. For the sake of argument, assume the following: Q services are within scope of XYZ contract, but they are out of scope of XY contract. When deciding whether a JOFOC is required to add Q to the contract, may the Government's analysis be based on the current iteration of the contract (i.e. XYZ contract, meaning that Q is in scope and a JOFOC isn't required)? Or must the Government's analysis be based on the original contract at award (i.e., XY contract, meaning that Q is out of scope and a JOFOC is required)? Regulations or cases supporting your position would be helpful. THANK YOU!

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In assessing whether there is a material difference, GAO will look to:

[T]he extent of any changes in the type of work, performance period, and costs between the modification and the original contract, as well as whether the original solicitation adequately advised offerors of the potential for the change or whether the change was the type that reasonably could have been anticipated, and whether the modification materially changed the field of competition for the requirement.”

http://smallgovcon.com/gaobidprotests/in-scope-vs-out-of-scope-modifications-gao-explains-the-difference/

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The general rule quoted above would not be applicable in this case.  Here, the contract has already been modified through a proper CICA compliant procedure.  In essence, what we have now is a single contract that satisfies two separate requirements that could have been satisfied through two separate contracts.  As stated above, the new requirement for Q is within the scope of the modified contract.  If that is the case, the modification is permissible under any of the standard FAR Changes clause that permit changes that are within the general scope of the contract and there is no cardinal change issue.  Remember, the contract includes all modifications that have been made to it, including any options that have been exercised.  See the definition of "contract" in FAR 2.101.  

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Talking about adding Q to XYZ cannot serve as the basis for a reliable answer.  I agree with Retreadfed to the degree that Q is a change within the general scope of the contract in one or more of the areas allowed by the contract's Changes clause. 

animalspirits, Are you talking about--

  • Adding new work to the contract?, or 
  • Making a change within the general scope of the contract in one or more of the areas allowed by your contract's Changes clause? 

I suppose I should also ask (because we might be talking about a commercial item contract), Does your contract have a Changes clause such as FAR 52.243-x?  If so, which one?

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41 minutes ago, Retreadfed said:

The general rule quoted above would not be applicable in this case.  Here, the contract has already been modified through a proper CICA compliant procedure.  In essence, what we have now is a single contract that satisfies two separate requirements that could have been satisfied through two separate contracts.  As stated above, the new requirement for Q is within the scope of the modified contract.  If that is the case, the modification is permissible under any of the standard FAR Changes clause that permit changes that are within the general scope of the contract and there is no cardinal change issue.  Remember, the contract includes all modifications that have been made to it, including any options that have been exercised.  See the definition of "contract" in FAR 2.101.  

One needs to look at the original solicitation to see if Q is within the scope of the original competition.

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17 hours ago, napolik said:

One needs to look at the original solicitation to see if Q is within the scope of the original competition.

The original competition, if there was any, is irrelevant to this issue.  Note that animal spirits has already stated that Q is not within the scope of the original contract XY.  However, the original contract has been superseded by the revised contract XYZ.  Q  is within the scope of the revised contract.  Because Q is within the scope of the revised contract, no J&A is needed for Q because it is not a new procurement (cardinal change).

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On 4/5/2019 at 2:57 PM, animalspirits said:

For the sake of argument, assume the following: Q services are within scope of XYZ contract, but they are out of scope of XY contract.

One infers that Q services are within scope of the Z services. But, suppose they weren't. Suppose the facts were these.

Let’s say that XY covered electrical system repair services for a US Navy ship located at sea. Let’s say that Z services cover ferry services to transport sailors and goods to and from the ship. Now, let’s say that Q covers motor repairs on the ship.

If a motor repair contractor protested the issuance of the mod for Q services, do you think the GAO would look at the solicitation leading to the award of the electrical repair contract to determine if the motor repairs are in the scope of the electrical repair solicitation? Or, would GAO decline to review the scope of the competition leading to the award of the contract for XY services because the X services mod was issued?

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On 4/5/2019 at 1:57 PM, animalspirits said:

Scenario: Contract is awarded for XY services. Government wanted to add Z, which was out of scope. Government prepared and issued adequate JOFOC. Current contract is now for XYZ services.

Question: Now Government is now attempting to add Q services to the contract. For the sake of argument, assume the following: Q services are within scope of XYZ contract, but they are out of scope of XY contract. When deciding whether a JOFOC is required to add Q to the contract, may the Government's analysis be based on the current iteration of the contract (i.e. XYZ contract, meaning that Q is in scope and a JOFOC isn't required)? Or must the Government's analysis be based on the original contract at award (i.e., XY contract, meaning that Q is out of scope and a JOFOC is required)? Regulations or cases supporting your position would be helpful. THANK YOU!

If the change is within scope of the current contract requirements, it is authorized by the changes clause. 

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I'm waiting for animalspirits to answer the question whether or not the contract has a Changes clause, and if so, which one; as well as whether he or she is (1) adding new work or (2) making a change allowed by the contract's Changes clause.

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I failed to specifically address a commercial item/service contract.

If the government was required to compete the original  requirement, the government generally isn’t allowed to add “new work” outside the scope of a contract be it a commercial item/service or not , without an exception to CICA.

In a commercial contract, if the government is allowed to add it, the contractor would have to agree and the terms of the mod would have to be mutually agreed upon. That is applicable whether it is in or out of scope. 

The parties to a commercial type contract aren’t free to simply “mutually agree” to add anything they like,  because “I am a contracting officer and here is my warrant number" and because the contractor is willing to accept the work.

The real question here is whether the added work is within or outside of the current contract  scope. 

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3 hours ago, joel hoffman said:

If the change is within scope of the current contract requirements, it is authorized by the changes clause. 

 

2 hours ago, joel hoffman said:

The real question here is whether the added work is within or outside of the current contract  scope. 

How does one determine if it is authorized by the changes clause or within or outside the current contract  scope? 

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On 4/5/2019 at 4:53 PM, napolik said:

One needs to look at the original solicitation to see if Q is within the scope of the original competition.

One needs to look at the current contract to see if Q is within the scope of the current contract. 

The OP said to assume for the sake of argument that it is. 

Then, read the applicable changes clause. 

One must understand that the out of scope work was added to the instant contract for administrative convenience.

After obtaining an exception to full and open competition, it could have been issued to the contractor in a separate contract or added to an existing contract. It makes economic sense to piggy back the new work onto an existing contract - use existing management, supervisory and admin resources, avoid re-mobilizing, startup activities, etc.

After adding the work, the terms and conditions of the contract, as modified, apply to the added scope, too. 

 

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59 minutes ago, joel hoffman said:

 

One needs to look at the current contract to see if Q is within the scope of the current contract. 

The OP said to assume for the sake of argument that it is. 

Then, read the applicable changes clause. 

 

Before you ask, if Q is for ADDITIONAL supplies, it isn’t within the current scope...

Napolik, the GAO decision that you cited for your argument that one must examine the original scope of the competition did not involve a situation where work outside the scope of the original contract has already been added by supplemental agreement, as an exception to CICA.

In this case, considering these factors, GAO found that the modification did not substantially change the scope of the original contract, competitors for the initial solicitation could have reasonably anticipated the changes to the contract, and the changes to the contract would not have had a substantial impact on the field of competition for the original contract award.”

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So, the fact that ferry services were added to the contract for electrical repairs puts motor repairs within the scope?

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I should have stated in the scenario, the modification to add Q would be bilateral. So I'm not worried about the contractor objecting, I'm worried about a third party thinking that the modification runs afoul of CICA and that Q should have been competed (or supported by a JOFOC).

There were questions above about whether it was commercial and whether the contract included a Changes clause. Let's say that the Contracting Officer's argument for Q being in scope is the following: either the PWS explicitly forecasted the potentiality of additional changes of this type (thereby putting parties on notice that modifications of this type would be possible and in scope) or the totality of the circumstances is such that any reasonably informed party being familiar with this industry and the work set forth in the PWS could have reasonably foreseen and anticipated that changes of this type would be required over the course of the contract and that, had the contract been originally solicited as XYZQ instead of XYZ, it is unlikely that the field of competition would have changed or the apparent awardee would have changed (as compared to soliciting XYZ). If that is the case, does commerciality or the presence of a Changes clause matter to the analysis? I was not aware of CICA analysis changing depending on commerciality, and the Changes clause is not a required authority for the modification's issuance nor a basis for the Contracting Officer's underlying scope argument.

I appreciate all the responses. 

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31 minutes ago, animalspirits said:

the Changes clause is not a required authority for the modification's issuance nor a basis for the Contracting Officer's underlying scope argument.

You've lost me here.  From what you have written before, it appears that the PWS will be changed to add work.  The PWS is a description of the services to be provided.  The Changes clause for services allows changes in the description of the services to be provided.  Further, the changes in the description of the services must be within the general scope of the contract.  If the Changes clause is not the basis for the "Contracting Officer's underlying scope argument," what is?

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5 hours ago, napolik said:

So, the fact that ferry services were added a the contract for electrical repairs puts motor repairs within the scope?

Who said that? I was referring to the original poster’s statements.Your scenario involves out of scope additional work.

EDIT: perhaps you are referring to animalspirits seemingly using Z to rationalize that XYZ -but not XY or Z  sepately - should have led the competition to anticipate Q at the XY only stage.  Which of course, makes no sense. Right? 

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animalspirits,

If your competitive solicitation "explicitly forecasted the potentiality of additional changes of this type (thereby putting parties on notice that modifications of this type would be possible and in scope)," then you should proceed with the negotiation of the bilateral modification to make the changes.

You are taking pains to keep things vague and avoid providing direct answers.  Why?  Why say, "Let's say ___ or ___"?  Which one is it?  Just tell us the facts.

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2 hours ago, animalspirits said:

I should have stated in the scenario, the modification to add Q would be bilateral. So I'm not worried about the contractor objecting, I'm worried about a third party thinking that the modification runs afoul of CICA and that Q should have been competed (or supported by a JOFOC).

There were questions above about whether it was commercial and whether the contract included a Changes clause. Let's say that the Contracting Officer's argument for Q being in scope is the following: either the PWS explicitly forecasted the potentiality of additional changes of this type (thereby putting parties on notice that modifications of this type would be possible and in scope) or the totality of the circumstances is such that any reasonably informed party being familiar with this industry and the work set forth in the PWS could have reasonably foreseen and anticipated that changes of this type would be required over the course of the contract and that, had the contract been originally solicited as XYZQ instead of XYZ, it is unlikely that the field of competition would have changed or the apparent awardee would have changed (as compared to soliciting XYZ). If that is the case, does commerciality or the presence of a Changes clause matter to the analysis? I was not aware of CICA analysis changing depending on commerciality, and the Changes clause is not a required authority for the modification's issuance nor a basis for the Contracting Officer's underlying scope argument.

I appreciate all the responses. 

CICA analysis does not depend upon commerciality. 

 For non-commercial item service contract, if the  additional work is within the scope of the current contract then the changes clause authorizes the government to add it. As ji said, you can proceed to bilaterally add it but you could issue a change order to add it. 

 If this is a contract for commercial services or for non-commercial services, the government is not allowed to add out of scope work absent an exception to CICA, regardless of whether or not both parties agree to add the work. 

For commercial services contract, both parties have to agree to any changes in the terms and conditions - whether in-scope or out of scope. 

What is so difficult about this?

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1 hour ago, animalspirits said:

I should have stated in the scenario, the modification to add Q would be bilateral. So I'm not worried about the contractor objecting, I'm worried about a third party thinking that the modification runs afoul of CICA and that Q should have been competed (or supported by a JOFOC).

There were questions above about whether it was commercial and whether the contract included a Changes clause. Let's say that the Contracting Officer's argument for Q being in scope is the following: either the PWS explicitly forecasted the potentiality of additional changes of this type (thereby putting parties on notice that modifications of this type would be possible and in scope) or the totality of the circumstances is such that any reasonably informed party being familiar with this industry and the work set forth in the PWS could have reasonably foreseen and anticipated that changes of this type would be required over the course of the contract and that, had the contract been originally solicited as XYZQ instead of XYZ, it is unlikely that the field of competition would have changed or the apparent awardee would have changed (as compared to soliciting XYZ). If that is the case, does commerciality or the presence of a Changes clause matter to the analysis? I was not aware of CICA analysis changing depending on commerciality, and the Changes clause is not a required authority for the modification's issuance nor a basis for the Contracting Officer's underlying scope argument.

I appreciate all the responses. 

CICA analysis does not depend upon commerciality. 

 For non-commercial item service contract, if the Additional work is within the scope of the contract then the changes clause authorizes the government to add it. 

 If this is a contract for commercial services, the government is not allowed to add out of scope work absent an exception to CICA, regardless of whether or not both parties agree to add the work. 

For commercial services contract, both parties have to agree to any changes in the terms and conditions.

What is so difficult about this?

EDIT:  To clarify, animal spirits indicated that the  additional work was not within the original XY scope of the contract but was within the current scope of the contract after adding Z as an out of scope supplemental agreement. What you currently have is two distinctly separate scopes of work together in one contract for administrative convenience. 

 Thus, whether or not the original scope of work contemplated adding Q has nothing to do with it,  from the information originally supplied. 

 

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So, I don’t understand if animal spirits is now indicating that the additional work is not within the scope of “X and Y” or “Z”, separately, but only when read as a whole “XYZ”.

If so, that doesn’t make any sense to me. XY is distinct from Z but being done concurrently or separately within one contract vehicle. Z has no relevance to the initial competition. 

You cant add Z to XY to rationalize that, when XYZ is looked at together, then Q will be considered within scope because it should have been anticipated by the competitors for XY.

Z wasn’t part of the original competition. 

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I apologize profusely if it seemed like I was saying earlier that, when XYZ are read together, Q could be considered within scope. 

Q would have to be within the scope of either XY or Z to be within scope of the “current contract”.

If it wasn’t within the scope of XY,  then it must be within the scope of  Z

I should have said that initially. 

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22 hours ago, animalspirits said:

either the PWS explicitly forecasted the potentiality of additional changes of this type (thereby putting parties on notice that modifications of this type would be possible and in scope) or the totality of the circumstances is such that any reasonably informed party being familiar with this industry and the work set forth in the PWS could have reasonably foreseen and anticipated that changes of this type would be required over the course of the contract and that, had the contract been originally solicited as XYZQ instead of XYZ, it is unlikely that the field of competition would have changed or the apparent awardee would have changed (as compared to soliciting XYZ).

You've changed a lot of things here.  From this, it seems you are saying the original solicitation was for XYZ instead of XY.  This seems to negate the assertion that Q would be within scope of the modified contract XYZ but not the original contract XY.  I agree with ji, you need to get your facts straight and figure out what your real question is.

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Scope analysis is highly fact-specific and case-by-case. The inquiry uses several factors and examines both the contract itself and the solicitation (scope of the contract versus scope of the competition, respectively).

Your scenario has no specifics.

This is a waste of time. Navel-gazing. 

The speculation in this comment thread will have no bearing on the actual scope analysis of any real-world situation this is based upon.

The "Government's analysis" is the wrong way to frame this issue. Who cares what the government says? If there is a protest, it will be the GAO's or Court of Federal Claim's scope analysis, not the government's.

The separation of XY and XYZ and the "assume this" nonsense is nonsense. The scope analysis can and will examine everything relevant. Nothing will be excluded because the protester or the government thinks that it should be excluded from examination.

This thread would be more interesting if it asked other trivializing questions like

Can God microwave a burrito so hot that He Himself cannot eat it? Was there ever nothing? Did something come from nothing? How many angels can fit on the head of a pin?

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42 minutes ago, PepeTheFrog said:

Can God microwave a burrito so hot that He Himself cannot eat it?

Hat Tip to George Carlin, right?

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