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Working with a contract where we tell the contractor we need a set number of employees at a set location for a number of hours- Temporary help services. 

Customer requests that travel be reimbursed per the JTR. My question. How would you evaluate this when it came time to evaluate price? A contractor using local employees vs having to transport them seems to have an unfair advantage. The  performance work statement does specify how many nights and meals but leaves miles open.

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15 hours ago, nkd9 said:

A contractor using local employees vs having to transport them seems to have an unfair advantage

What is unfair about it?  Not every advantage is unfair.

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Did the offeror submit an offer in a competitive environment for the FFP work, and in addition proposed mileage reimbursement on top of the FFP?  Or are you still in the pre-solicitation, market research phase?

Unless there is something special, I'm with Retreadfed in not seeing anything unfair.  My office used to require short-term work in Alaska.  Of course, the Seattle and Portland companies had an advantage over the Oklahoma and Florida companies.  If all else is equal, the Seattle or Portland company will win fair and square, and the Government will benefit from that.  For the Government to pay extra to let the Oklahoma company win would be absurd -- if the Oklahoma company wants to win, it will need to sharpen its pencil and make a better offering (price and/or quality).  By the way, the Oklahoma company will have an advantage over the Seattle company for work in Texas.  It al works out.

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23 hours ago, nkd9 said:

Customer requests that travel be reimbursed per the JTR. My question. How would you evaluate this when it came time to evaluate price?

If the travel is going to be reimbursed per JTR, is the travel CLIN a reimbursement CLIN?

Remember, a firm-fixed-price contract provides for a price that is not subject to any adjustment on the basis of the contractor’s cost experience in performing the contract.

You may want to read FAR 31.102 and 31.205-46; and consider the thoughts in this previous post:

 

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Travel should not be reimbursable in the scenario contemplated in this thread.

The location is known.  The number of overnights is known.  The number of meals is known.  These are all part of the Government’s requirement.

Make the whole thing FFP, and let offerors bid their prices to meet the Government’s requirement.

The offeror’s location IS NOT part of the Government’s requirement.  We do not have to equalize that.  The far-away offerors will have to compete against the near offerors.  This IS NOT unfair, this is simply the reality of the market.

If location, number of overnights, and number of meals were not known, we might have to think further because of the uncertainty in the Government’s requirement.  But in the scenario here, there is NO UNCERTAINTY in the Government’s requirement — instead, there is a far-away crybaby prospective offeror who is hoodwinking federal employees with its sob-story.  But that offeror is fully capable of submitting a FFP proposal just like anyone else.  The playing field is perfectly level.

No uncertainty = FFP.

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On 5/3/2019 at 8:36 PM, nkd9 said:

Working with a contract where we tell the contractor we need a set number of employees at a set location for a number of hours- Temporary help services. 

Customer requests that travel be reimbursed per the JTR. My question. How would you evaluate this when it came time to evaluate price? A contractor using local employees vs having to transport them seems to have an unfair advantage. The  performance work statement does specify how many nights and meals but leaves miles open.

It appears that the requirement is known but customer wants to use cost reimbursement with JTR limit. 

Im  with the others - it should be FFP and competed. 

It would appear that the customer would be concerned about the cost of travel if they were no limits on it.

To evaluate reasonableness, you could look at the travel line item prices of those offers that are overall most competitive considering cost and non-cost. Then - knowing the location - develop your own estimate with the JTR rates for each location and compare to each offer, as applicable.

Sounds like a lot of work but the only variable would be airfare from the offeror’s location, right?  Otherwise, the local costs can be estimate - theoretically same for everyone. 

Then if the offered price or prices seem high, you could conduct discussions and tell them you think the travel cost CLIN is too high. If otherwise conducting discussions, you can include that as a discussion item. 

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12 hours ago, Jamaal Valentine said:

 

You may want to read FAR 31.102 and 31.205-46; and consider the thoughts in this previous post:

 

The distinction between this thread and the earlier thread cited above, is that the amount of travel is determinate in the current original post. 

If the OP wants to reassure the client that   the selected firm’s  travel costs fairly well conform to the JTR limits, the OP you can evaluate and compare with a government estimate for that firm’s location. 

 And if the reasonableness of travel cost is a concern to the Customer, state in the evaluation criteria that the government may (will?) evaluate the Reasonableness of the proposed Travel CLIN, in comparison with JTR rates, as applicable to that firm. Of course, you’d need to know where the employees would be traveling from. If that can’t be tied down, discussions could consider that. At least you’d understand the basis of the proposed price. Which might reveal that FFP isn’t necessarily the most economical  pricing method .   When you make the contractor responsible for covering all their costs in a bid item, they are going to cover their risks.

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4 hours ago, joel hoffman said:

And if the reasonableness of travel cost is a concern to the Customer, state in the evaluation criteria that the government may (will?) evaluate the Reasonableness of the proposed Travel CLIN, in comparison with JTR rates, as applicable to that firm.....  Which might reveal that FFP isn’t necessarily the most economical  pricing method.  When you make the contractor responsible for covering all their costs in a bid item, they are going to cover their risks.

Joel,

If the locations are known, and the number of nights is known, and the number of meals is known, then FFP is the best approach, hands down.  Compliance with the JTR is wholly irrelevant.  Competition with FFP is the best approach for the original poster.  No travel CLIN — just bury travel as part of the work CLIN.  The faraway crybaby offeror will need to sharpen its pencil — if it can’t win on price, it will have to win on technical merit.

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4 hours ago, ji20874 said:

Joel,

If the locations are known, and the number of nights is known, and the number of meals is known, then FFP is the best approach, hands down.  Compliance with the JTR is wholly irrelevant.  Competition with FFP is the best approach for the original poster.  No travel CLIN — just bury travel as part of the work CLIN.  The faraway crybaby offeror will need to sharpen its pencil — if it can’t win on price, it will have to win on technical merit.

I don’t disagree that FFP is likely a good way to go when the scope and costs are reasonably determinant . 

But if they include an FFP travel CLIN, which might be useful for contract admin purposes, they could evaluate the reasonableness. That seems to be a concern of the customer and was the essence of the original question. 

As for a price advantage due to location, it wouldn’t matter whether travel is paid for as FFP or cost reimbursement.

 

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Why does the government care about meals, mileage, or travel costs at all? If the work will be competitively awarded as FFP and evaluated using price analysis what's the goal? The requirement seems defined well enough so that the field of competition can compete intelligently:

On 5/4/2019 at 10:36 AM, nkd9 said:

...we tell the contractor we need a set number of employees at a set location for a number of hours...

I wonder if this is going to be labeled as a PBSA; and if the contracting officer satisfied FAR 7.108.

 

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All, 

Thanks for the wealth of knowledge and advice. These replies have given me some good points to bring up with the customer. 

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If you want to save money and give an advantage (not an "unfair advantage") to local offerors who do not need to price in travel costs, then make it firm fixed price.

If you want to expand the pool of offerors nationwide, then make it cost reimbursable. 

This is a classic "trade-off" decision. Cheaper and local? Better and nationwide? Can you get the highest quality anyway, even if you keep it local? Maybe your local area is awash with potential offerors, anyway.

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On 5/3/2019 at 9:36 PM, nkd9 said:

How would you evaluate this when it came time to evaluate price?

Assuming that the goal of the  contract is not "travel", why are you evaluating it?   Just say travel will be treated as a reimbursable per the JTR and be done with it.  No one is favored or prejudiced.

Otherwise, level of performance might end up being determined by who can travel cheapest, not who has the best qualifications.

 

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On 5/5/2019 at 12:24 PM, ji20874 said:

Joel,

If the locations are known, and the number of nights is known, and the number of meals is known, then FFP is the best approach, hands down.  Compliance with the JTR is wholly irrelevant.  Competition with FFP is the best approach for the original poster.  No travel CLIN — just bury travel as part of the work CLIN.  The faraway crybaby offeror will need to sharpen its pencil — if it can’t win on price, it will have to win on technical merit.

But the city-pairs aren't known.....why would you even bother comparing Seattle-DC with Baltimore-DC?  Just say "closest LPTA wins".

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Please take care. Some who read only the discussion above might see the phrase "per the JTR" used in its given context, and mistakenly assume that the JTR applies to contractor travel...well, it  doesn't. Look at the introductory paragraphs of the JTR and you'll see for yourself...it's too plain to miss (and the exception noted there barely dilutes the general rule).

Knowing this about the JTR shouldn't stop us from doing what we aim to do, however. Notice that Joel Hoffman was discussing "JTR rates" and "JTR limits" with evident care to avoid the confusing phrase "per the JTR".  He's on to something...

See also the careful phrasing of the Cost Principle FAR 31.205-46 --Travel Costs. for a more lengthy example along the same lines.

 

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Yes, I agree that JTR per diem rate limits themselves don’t directly apply to contractors. 

Having said that, I’ve found that, when I travelled along with contractors, some companies had better hotel rates than the government rates. 

And, depending upon the timing and circumstances, contractors sometimes paid less airfare than the government’s all-season, fully refundable rates, when they used non-refundable fares. 

I chose the wrong term in the phrase  “firm’s  travel costs fairly well conform to the JTR limits”. I meant “compare reasonably well in comparison with the JTR limits. 

And yes, one could use the criteria in 31.205-46, Travel Costs as a guideline for an estimate of reasonableness in the evaluation criteria. But keep in mind that, for an FFP competitive proposal,  “allowable cost” limitations aren’t directly applicable. It’s more a yardstick for evaluation purposes, subject to application of judgement.

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On ‎5‎/‎6‎/‎2019 at 3:07 PM, REA'n Maker said:

Just say travel will be treated as a reimbursable per the JTR and be done with it.  No one is favored or prejudiced.

Otherwise, level of performance might end up being determined by who can travel cheapest, not who has the best qualifications.

That's what tradeoff analysis is for.

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On 5/14/2019 at 8:15 AM, jwomack said:

That's what tradeoff analysis is for.

Are you saying that you trade off "travel" with "qualifications"?

As Joel summarizes above, the best you could evaluate travel is a yardstick/JTR approach to ensure consistency, so why use it as a criteria?

One guy proposes bus travel and the other guy proposes air travel.  Do you really want to get into a trade off analysis of those two approaches?  To what end?

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I'm saying I would consider total cost to the Government when determining what's in the government's best interest.

Some contractors offer lower than FTR/JTR rates, e.g., as a percentage like 10% below FTR/JTR.

Some contractors won't need to travel if they have a large footprint.

If the Government says "we'll pay JTR" then there's no incentive for contractors to do anything to reduce or even eliminate some travel costs.

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